The Mongolian Sandwich

By Elaine Xiang

Mongolia has two neighbours, China and Russia. Both of these countries are huge and have dominated Mongolia for several centuries, despite Mongolia being a sovereign republic. Mongolia is rich in natural resources such as copper, coal, gold and other minerals, which are providing new paths for success and prosperity. Its biggest market is China, while to the north, Russia forms an alternate route to other markets. However, many Mongolians believe that the possession of natural resources could lead to greater dependence rather than independence, as its commercial success may come to rely solely on either neighboring country’s economic stability.

Sandwiched Between Two Great Neighbours

Mongolian State Secretary Tsogtbaatar Damdin announced that his country has a good relationship with its giant neighbors. Sandwiched between China and Russia, Mongolia maintains peace like many other countries, though it now finds itself looking further outward. It might be said that this nation wishes to make further friendships with other parts of the world.

Mongolia’s Disenchantment with China

Mongolians are neither motivated nor ebullient about China or the Chinese. Even at a governmental level, Mongolia does not have basic human rights for Chinese workers in place. Some Chinese professionals pretend they are Koreans when doing business in Mongolia, as this is a more welcome ethnic group.

This seems to be a form of historical retribution. According to historical records, during the rule of ethnic-Manchu Qing dynasty, China ruled Mongolia rather inhumanly. One sixth of the population is Mongolian along the area of China bordering Mongolia, and there is continuous conflict there.

When the Dalai Lama visited Mongolia, China simply closed the border. This sort of behavior has led many Mongolians to fear for their future with China as a neighbor. Mongolia is a sparsely-populated vast and poor country, whereas the neighbouring countries are overly populated and economically booming. Eighty percent of the exports of Mongolia are bought by China and half of the imports are from China. To fulfill the demands of China, hundreds of small mines have been developed in Mongolia. Two big copper and gold mines have practically transformed this country.

The production of copper and gold in the mines at Oyu Tolgoi is expected to start in 2013 and at the same time, the coal production is expected to increase from 16 million tonnes a year to 240 million tonnes in 2014. Both these mines are in the province of South Gobi bordering China, which appears to be increasingly integrating into China. All necessary supplies have to pass across this border. To improve the marketing strategy and to have access to South Korea and Japan, plans are being laid out to build railways, not only to China but also into Russia and eastern Mongolia.

Mongolia’s relationship with Russia, on the other hand, has improved in the recent past. Russia has at least helped preserve Mongolian independence. Yet the relationship is not a perfect one. On a logistical note, Mongolia was importing diesel from Russia until the latter nation was unable to supply the required fuel amount. This led to a shortage of domestic supply in the summer.

For this and many other reasons, Mongolia needs to pursue a third neighbor policy and cannot afford to remain sandwiched between the two giants of China and Russia. Mongolia is a strong Western ally. It contributed troops to America during the war with Iraq and Afghanistan. Look for this nation to increasingly reach out to the world in the near future, perhaps starting with the West.

Source: http://www.biztechreport.com