Witness: Ukraine can transition toward defense consumer model; committee hears options for finance and repayment

During questioning on Ukraine policy, General Jack Keane outlined ideas to reduce U.S. taxpayer exposure while sustaining Ukrainian defenses, describing two broad sources of finance: seized or frozen Russian assets and Ukrainian natural resources.

Keane suggested pressuring European partners to release frozen Russian assets and noted a Canadian geological assessment that identified large mineral and resource deposits in Ukraine. He said those assets could be used as collateral for loans or investment to help rebuild Ukraine’s defense industry and reduce reliance on U.S. budget appropriations.

Keane also described existing U.S. financial tools and precedents: foreign military financing and loan authorities used to support partners (he cited previous loans to Poland, Romania and Taiwan as examples). He said Ukraine has demonstrated the capacity to sustain and eventually repay loans tied to defense production.

Members asked about the practical steps the administration could take to accelerate Ukraine’s industrial recovery and whether such financing should be structured as loans, investment or a mix. Lawmakers and witnesses agreed that allied coordination and use of frozen assets merit further exploration, but the committee did not endorse a specific program in the hearing.

Keane and some members urged more aggressive allied pressure on sanction enforcement and coordinated financial steps to enable Ukraine to build its defense‑industrial base; members indicated the committee would follow up in future hearings.