[Congressional Record Volume 164, Number 177 (Tuesday, November 6, 2018)]
[Extensions of Remarks]
[Page E1500]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




       SUPPORTING FAIR PRIVATIZATION OF TITANIUM MINES IN UKRAINE

                                 ______
                                 

                             HON. KEN BUCK

                              of colorado

                    in the house of representatives

                       Tuesday, November 6, 2018

  Mr. BUCK. Mr. Speaker, I rise today with serious concerns about our 
national security. My home state of Colorado has a strong military 
tradition and military installations as well as a rich reserve of 
natural resources. I understand the importance of a well-equipped, 
well-supplied military force.
  That's why I'm concerned about the current state of titanium mines in 
Ukraine. This may not seem like a major issue until you realize how 
dependent American commercial and defense aerospace is on foreign 
titanium. We import 79 percent of our consumed titanium each year. And 
much of this titanium comes from Russia.
  In fact, key U.S. defense suppliers, like Boeing, GE, and Pratt and 
Whitney, rely heavily on Russian titanium.
  This reliance on Russian titanium for key defense capabilities is 
deeply problematic in our present geopolitical environment. As the 
United States has justifiably sanctioned Russia for their interference 
in our election process and their belligerent activities in Ukraine and 
the United Kingdom, the Russian government has discussed retaliatory 
sanctions that could impact titanium exports to the United States.
  In view of this precarious Russian relationship, we need to 
immediately identify alternative sources of titanium. China produces a 
lot of the metal, but they consume most of what they produce. And our 
national titanium stockpile was sold off over a decade ago.
  A key source of potential titanium comes from mines in Ukraine. 
Ukraine has pursued a free-market economic reform effort that includes 
privatizing state-owned companies.
  Unfortunately, in the midst of this reform effort, corruption, market 
distortion, and Russian influence has again reared its ugly head. 
Powerful oligarchs with ties to Russia and influence in the Ukrainian 
government are desperately trying to gain control of the titanium mines 
that are being privatized.
  One of Ukraine's primary titanium mine assets is already under the 
pull of Russian influence. The Zaporozhye Titanium and Magnesium 
Combine is 49 percent owned by Dmytro Firtash, a Ukrainian billionaire 
with Russian ties who is under house arrest in Vienna and wanted by the 
U.S. for extradition due to his efforts to bribe Indian officials.
  We cannot allow Russia to gain influence and control over a key 
source of titanium in Ukraine. Allowing them to monopolize the market 
for titanium would lead to serious geopolitical implications. Our 
ability to project power throughout the world, in a way that promotes 
global peace and stability, is dependent on military hardware that 
requires titanium for its construction.
  Beyond our national security interests are the interests of the 
Ukrainian people themselves. We should support a fair and equitable 
process of privatization for Ukraine. A corrupt process would only 
undermine the rule of law and the country's political system.
  Mr. Speaker, the United States and the international community must 
call on Ukraine to support a legitimate and fair process for the 
privatization and sale of titanium assets. We should push for an open 
and fair process that would allow global investors and U.S.-Ukrainian 
joint ventures to compete for these assets.
  Supporting a fair and open tender process will benefit not only the 
United States, but also the livelihood of the Ukrainian people as well 
as the security of the entire world.

                          ____________________