ADB President Commends Mongolian Efforts to Stabilize Economy

Asian Development Bank (ADB) President Takehiko Nakao on September 25 met with Mongolia’s Prime Minister Saikhanbileg Chimed to discuss ways ADB can support sustainable, inclusive growth in Mongolia, through job creation and diversification of the economy. He also met with Bolor Bayarbaatar, Minister of Finance and ADB Governor for Mongolia. 
Mr. Nakao commended the authorities’ efforts to stabilize the economy, manage inflation, and improve the investment climate. ADB projects this year’s growth at 2.3%, reflecting drought-affected crop yields and declining commodity prices, but it will recover to 3.0% in 2016. Inflation is forecast to be 7.6% this year, substantially lower than the double-digit inflation of previous years.
“Mongolia has huge development potential thanks to its strategic location and vast resources in mining and non-mining sectors,” Mr. Nakao told the country’s leaders. “As Mongolia continues to pursue appropriate macroeconomic and structural policies, ADB is fully committed to supporting Mongolia in realizing this potential through better regional integration and investments. It will bring real improvements in people’s lives across the country.” 
The ADB President acknowledged the rapid progress Mongolia has made in lowering its poverty rate—particularly in rural areas—to a national average of 21.6% in 2014 from 27.4% in 2012 through the contribution of the mining sector. Mongolia’s mining sector accounted for 17.1% of gross domestic product and 83% of exports in 2014, while providing fewer than 4% of jobs. Given the volatile nature of the mining sector, Mr. Nakao urged continued efforts to make the economy less prone to movements in the mining sector. He underscored the strong need to continue diversifying its economy.
There was also substantive progress in mobilizing private sector resources, including for the ADB-supported $1.3 billion Combined Heat and Power Number 5 Project. The concession agreement was signed in June 2014 with a consortium of global companies, under the country’s first major public-private partnership arrangement. The power purchase agreement was signed in July 2015, marking a major step forward in addressing the burgeoning needs of the world’s coldest capital for heat and power, according to ADB.
In 2015 ADB already approved a $50 million loan to support agribusinesses. Responding to the current difficult macroeconomic situation, ADB is preparing to provide assistance for continued delivery of social welfare programs for the most vulnerable through a $150 million loan scheduled for approval in late September. In addition, ADB plans a further $75 million loan financing for approval in 2015 to support small- and medium enterprises, and to support safer food and agricultural trade. 
Since ADB began its development assistance to Mongolia in 1991, it has provided $1.6 billion in total resources for transport; energy; water supply and other municipal infrastructure and services; education; and health; finance; and agriculture. 
Mr. Nakao was on a 2-day visit to Mongolia, and attended the 14th Central Asia Regional Economic Cooperation (CAREC) Ministerial Conference. This was his second visit to Mongolia, the first visit being in July 2013 shortly after he took office.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region. In 2014, ADB assistance totaled $22.9 billion, including cofinancing of $9.2 billion.


Reaching Students in Mongolia with the Gospel


College students from all over the world have been exposed to the gospel at a university in perhaps an unexpected location: Mongolia.
Mongolia International University is the only university in the country that teaches all of its classes in English. But even more importantly, the university was founded in 2002 with a missional purpose to reach students in Mongolia with the gospel.
“When I first came to Mongolia over 20 years ago, many missionaries focused on church planting,” shared MIU President Oh Moon Kwon at a vision night hosted at Oriental Mission Church in Los Angeles on Sunday evening. The vision night served as a way for MIU staff and recent graduates to share testimonies of how they witnessed God at work through their experiences in the university.
“They [missionaries] asked me to do something that church planters need, but can’t do. So I decided to invest in building schools, and that opened up ways to partner with churches,” Kwon explained.
 The school started with a little less than seventy students and five departments, and grew to become a ACBSP accredidation candidate (Accreditation Council for Business Schools & Programs) with undergraduate and graduate courses, 60 faculty members, and almost 700 students.
Many of these students come from various foreign countries, including Afghanistan, Uzbekistan, Nigeria, Germany, South Korea, Japan, Pakistan, and New Zealand, among others, due to the fact that all of the classes are offered in English.
MIU vision night OMC
(Photo : Christianity Daily)
About 80 people attended Mongolia International University's vision night at Oriental Mission Church on Sunday evening.
“This is a place where people from all parts of the world are coming to you -- it’s a wonderful opportunity to share the gospel,” said Reverend Jim-Bob Park, the senior pastor of Oriental Mission Church. Park has been the chairman of the board of trustees for MIU for several years.
“Some of the exchange students from South Korea have received Christ during their time at MIU,” said Joanne Lee, the director of the MIU language institution, who has been a part of MIU’s staff for over four years now.
Lee said her position as an English teacher and as faculty allowed her opportunities to talk to students about Jesus. She also had the chance to lead a team of MIU students on a mission trip to the Mongolian countryside where she said they “witnessed how God keeps his Word, and the fruits of church planting there.” Students lead their own campus worship services, and faculty and students join together in “Praise Him Daily (PHD) worship services” during lunch times.
“The faculty at MIU were really like extensions of Jesus, and they showed me how to live as a Christian,” shared Martha, one of the recent graduates of MIU.
Graduates go on to work as professionals in various fields, including education, technology, business, and government. Some pursue graduate level studies in Mongolia, and in other countries including South Korea, United States, and England. Many go abroad to other countries and serve in local churches in their respective places.
Though the staff and graduates shared much of the blessings that they’ve experienced through the university thus far, Kwon said there’s still much work left to be done to move forward.
Some of the aspects that he asked prayers for include starting more partnerships with mission agencies and local Mongolian churches; hiring more people to be a part of the faculty and staff; training professors for the English curriculum as Mongolia’s national language recently switched from Russian to English; and most importantly, Kwon said, for God’s wisdom in all of these aspects.
Kwon especially encouraged Korean Americans who are interested to consider taking on a short- or long-term position at the university.
“The network of Korean Americans, and their familiarity with diverse communities can really serve to help them to become great leaders for the university,” Kwon said.
 “Let’s plant the seeds of God’s dream together,” said Pastor Jim-Bob Park.
“We don’t want to do something on our own, but be a part of what He is already doing.”

Mongolia honors China conqueror Kublai Khan on 800th birthday

ULAN BATOR, MONGOLIA - Mongolia on Wednesday celebrated the 800th birthday of epic conqueror Kublai Khan, a source of intense pride in a country trying to highlight its own history after centuries of Russian and Chinese influence. 
A week of nationwide celebrations honoring the 13th-century ruler of the largest contiguous land empire in history culminated in Ulan Bator with costumed dancers and musicians performing beneath a giant statue of his grandfather Genghis.
The commemorations were meant to "honor and value the contribution of Kublai Khan to Mongolian and world history", government minister S. Bayartsogt said earlier.
"There was a time when we had to deny our history. However, the new path of democracy Mongolia chose has enabled Mongolian people to restore our history and understand it." 
The Mongol Empire reached its greatest extent after Kublai conquered China and established the Yuan dynasty in 1271.
Its armies were known for their strategy, tactics, speed -- and brutality in the face of resistance. The siege and destruction of Baghdad in 1258 was notable for the monumental scale of the carnage.
After spending most of the 20th century as a satellite of the Soviet Union, which rejected the public honoring of traditional leaders from the pre-Communist era, figures of the Mongol Empire are experiencing a rebirth in popularity. 
"Kublai Khan created the map of modern Asia and made China into a world power," author and Mongol history expert Jack Weatherford told AFP. 
"Today's world was shaped by Genghis Khan and his grandson Kublai Khan; they were the two most important men of the last thousand years." 
The National Museum of Mongolia has been displaying artifacts from the era of Kublai Khan and the Yuan dynasty, with ornate weapons, armour and clothing. 
"In Mongolia, Kublai is known as Kublai 'The Wise'," said museum researcher Egiimaa Tseveendorj. 
"Genghis Khan is known as a military leader, but Kublai was a king who organized an enormous kingdom, not only by conquering it, but with administration, politics, trade, diplomacy, science, religion and production," she added. 
"In the period of Kublai Khan, the Silk Road, which facilitated trade with the West, experienced a new era of prosperity."
My name is Kublai
China also claims Kublai Khan as its own, raising hackles in Mongolia, which is wary of being overshadowed by its giant southern neighbor and biggest trading partner.
The site of medieval Xanadu, which ultimately became the summer capital of the Yuan dynasty and is now in China's Inner Mongolia region, was added to the UNESCO World Heritage list in 2012 after an application by Beijing. 
"We want to correct history," S. Chuluun, director of Mongolia's  Institute of History and Archeology, told a local newspaper. 
"It's every Mongolian's duty to inform the world that Xanadu is actually a Mongolian creation." 
China is home to twice as many ethnic Mongols as in Mongolia, and some gathered early Wednesday to pay respects at a bronze statue near the Xanadu ruins, known as Shangdu in China.
But Kublai's legacy is more complicated in the country, where Beijing stresses ethnic unity, and there were no official celebrations.
Nowadays Mongolia's citizens are looking for a more personal connection to the once powerful khans. 
The latest trend is to name children after past rulers and members of Genghis Khan's royal bloodline. 
"In the past this was not popular, but for the last 10 years, many Mongolian children have been given the names of past khans or queens," Egiimaa said. 
"I think after this year's celebration, Kublai's name will become very popular for new babies."

By Eland Mann, Agence France-Presse

N Korea responds to Mongolia's proposal for talks with Japan

A response from North Korea to a letter sent this summer by Mongolian President Tsakhiagiin Elbegdorj contained a reference to the issue of Pyongyang’s past abductions of Japanese nationals, Mongolia’s top diplomat said Tuesday.
Mongolian Foreign Minister Lundeg Purevsuren told reporters that North Korea has replied to the letter, which included a proposal to use Mongolia’s capital Ulan Bator as the venue for official talks with Japan on the abduction issue.
Asked if the response contained any reference to the issue, Purevsuren said “yes.” But he refused to provide details, saying, “It is not appropriate to talk about it at this time.”
The foreign minister said the reply touched on a range of bilateral and regional affairs, and did not disclose whether it was written in the name of North Korean leader Kim Jong Un.
The proposal for talks in Mongolia was made in a personal letter from the president to Kim, which was delivered when his special envoy traveled to Pyongyang in July.
Japan has been counting on Mongolia’s good relations with North Korea to help obtain reliable information on the fates of Japanese nationals abducted by Pyongyang agents in the 1970s and 1980s.
In July last year, North Korea launched a fresh probe into all Japanese people residing in the country in return for the Japanese government lifting some of its unilateral sanctions.
But the negotiations have hit a snag and the two countries have not had a formal meeting since last October.
Japan officially lists 17 nationals as having been abducted by North Korea but suspects its agents were involved in many more disappearances. Five abductees were repatriated in 2002.
Of the 12 still missing, until the start of the new investigation North Korea had claimed that eight are dead and four others never entered its territory.
The most high-profile of the eight is Megumi Yokota, who was 13 when she disappeared from a Japanese coastal city in 1977 while on her way home from school.
The Mongolian capital of Ulan Bator was the place where the parents of Yokota were allowed by North Korea to secretly meet with her daughter Kim Eun Gyong in March 2014.
Senior officials of Japan and North Korea also held formal negotiations in the capital in November 2012.
The foreign minister said Mongolia has “good relations with all Northeast Asian countries and will continue to play an active role in the talks between Tokyo and Pyongyang.”

In search of nationality

“Mongolians, let’s grow together, come back to your country,” said the President of Mongolia, Ts.Elbegdorj, at the 100th anniversary of the Freedom Parade in 2011.
To this day, a video of this invitation is on Youtube, while no real work has been done since the 2013 Let’s Gather Mongolians Project for resolving the citizenship issues of ethnic groups, such as Buryats and Inner Mongolians. The project, rather than staying in focus, talked about demographic issues.
Head of Tsakhim Urtuu Kholboo NGO D.Sainbayar gave three Hazara Mongolians scholarships to study in Mongolia during the shooting of the “Mongolians Searching Mongolians” television show in Afghanistan. One of them was Meqdad Salehi.
Salehi gained little knowledge about Mongolia from his grandparents or from some old history books in Persian. When he landed at the Chinggis Khaan International Airport, he was astonished by the welcome he received from journalists, student unions, and Tsakhim Urtuu Kholboo NGO. It surpassed his expectations and left a deep impression on him.
When asked if he wanted to live in Mongolia in the future, Meqdad replied, “I could work here after I finish my masters, but it’s hard for foreigners to live here. We are treated as foreigners. Visa issues are troublesome due to the absence of a Mongolian embassy in Afghanistan. We have to send our materials to the Indian Embassy, and this takes up lots of time.
“Although the average salary is close to that of Afghanistan, the living cost is at least three to four percent more here.”
Many Hazara Mongolians are coming to study and travel in Mongolia nowadays. There are more than 20 Hazaras studying at Mongolian International University, for instance. Before the three Hazaras landed on Mongolian soil, Mongolians were unaware or had no knowledge about these people who secretly wished to become Mongolian citizens. Meqdad was grateful that the Mongolians he met always asked him if he would continue to live in Mongolia and asked him to stay. “Unfortunately, I have to make a rational decision,” Meqdad said.
The Hazaras haven’t heard any decisions in their favor after contacting the Mongolian government numerous times about citizenship issues and demonstrating with signs saying “I am Hazara” at Chinggis Square.
The co-organizer of the demonstration and human rights activist Ch.Munkhbayar said, “The law states that anyone who has lived in Mongolia for five years, and has adequate knowledge about Mongolia can become a Mongolian citizen. This sounds like a choice, but this ‘freedom’ is not being applied to the Mongolians of the world. The law doesn’t give enough information about gaining citizenship, so it’s easy for them to come up with a reason why you can’t become a citizen.”
The implementation of this law can be seen from a series of articles by N.Alkhaa, an Inner Mongolian citizen who has lived in Mongolia for 22 years, published in Gereg Magazine. D.Narangoo, a Chinese language teacher at Orchlon School, is an Upper Mongolian, or a Khukh Nuur (Blue Lake) Mongolian, who has lived in Mongolia since the 1990s, but became a citizen only two years ago. She spent almost 15 years of her life trying to get Mongolian citizenship.
When a person from her town also got Mongolian citizenship, she said, “When we heard the President’s words, we were head over heels, as if our Mongolia was calling us. But in reality, it was very hard. Even if you get a visa, getting permanent residency is another challenge. I wish Mongolians would help us to come live in Mongolia. This is an issue after you wed a Mongolian too. For me, life is relatively nice. I have a family and a job. The people left in Upper Mongolia ask a lot of questions. My relatives are even proud they have a family member in Mongolia.”
D.Narangoo’s aunt’s eldest son is named Ulaanbaatar. The name was given because of their desire to live in Mongolia. For “foreign” people of Mongolian ethnicity, the question is usually whether to come to Mongolia, where there is almost no chance of citizenship, or whether to live in a satellite state.
D.Khavar, an Inner Mongolian citizen in Ulaanbaatar pursuing a doctoral degree at the National University of Mongolia, is facing the same issue. After seeing the conditions which were far from expectation, he said, “Mongolians are better than Inner Mongolians in the sense that they have globalized. But globalization is not helping them. The average wage is low. Although it’s in the city, the wage is equal to that in a village. If you compare the average income to commodity prices, it’s probably an even lower amount.” D.Khavar said he faced issues when it came to visas. The names they get called because of their Chinese accent is also an issue, he claimed.
Buryats have a different attitude. Since the presidents of Mongolia and Russia signed agreements for travel without a visa, many Buryats have started traveling to Mongolia. “I am happy that I get to visit without a visa, at least for a while. My grandma calls Mongolia the ‘God country’. My friends love coming here and I feel truly Mongolian here,” said Buryat visitor Nadejda Siirenova.
After the Prime Minister married a Buryat woman in 1994, the first Altargana Festival was organized. To this day, the festival has evolved into a giant event where 20,000 Buryats from China, Russia and Mongolia gather. Dialect researcher and lecturer at the National University of Mongolia G.Gantogtokh said at the Altargana Festival’s academic meeting, “The Buryat youth today are proud to sing in Buryat on stage, but they feel ashamed to talk in Buryat in their daily lives. This is the result of shaming history and culture.”
A 2010 report on linguistics by UNESCO listed Buryat as a dying language. Youngsters aren’t participating in the festival, so the age range has become smaller. Things have become different in these two years, Nadejda said.
“We grew up in socialist times, when they called Chinggis a murderer and claimed that Mongolians are barbaric and evil people. But this identity is fading. Young people are coming here, making friends and finding that those stories were not the case. In addition, these projects – like Altargana and Khamag Mongol – are doing good deeds to unite people of Mongolian ethnicity.”
I discovered during my reporting, that the Tuvans of Russia have only a few patriotic people left, while the rest – mainly young people, believe they are not Mongolian. Tuvans who are currently in Mongolia said they don’t consider themselves Mongolian. Dan-Khaya, a Tuvan citizen in Mongolia, said he was worried his Mongolian language skills were poor. “My friends can’t even say a word in Mongolian,” he said.
Human rights activist Ch.Munkhbayar said, “In other countries, ethnic groups with the same origins as the majority group are encouraged to come. They prepare agreeable conditions for them. All of them have a repatriation policy. Even China, with a large population, has a well developed, limited policy about this issue.” Ch.Munkhbayar has proposed his Repatriation Policy for Mongolia since 2006 to the government, but still hasn’t received a response.

During his speech in 2012, the President mentioned that the ratio between Mongolians declining their citizenship to the people gaining Mongolian citizenship is 60 to one. “To change this, we need to modify the laws related to foreign residents’ rights or make special laws dedicated to people of Mongolian origins. The law stipulates that foreigners allowed into the country are to not exceed one percent of the state population. This article should be altered to fit the conditions of Mongolian ethnicity as well,” Ch.Munkhbayar argued.
Although the law allows them to become citizens, people with Mongolian heritage still can’t gain citizenship due to unspecified reasons. It is easy for authorities to shut them off when the law is “flexible”, because any reason can be given since the law is too broad. Some others have claimed that they were under much pressure because government officials abuse their power and oppress them.
We should help people of Mongolian ethnicity safely and peacefully reside in Mongolia. Many people support the Let’s Gather Mongolians Project and are urging the state and President to stay true to their words.
Source: Gereg Magazine

South Korean foundations set TB aid in Mongolia

SEOUL, Sept. 22 (Yonhap) — South Korea’s national tuberculosis association and two other foundations have begun a partnership program in Mongolia aimed at fighting and treating the pulmonary disease.
The Korean National Tuberculosis Association, the Chung Mong-Koo Foundation, and the Seegene Medical Foundation held a launch ceremony at the Mongolian University of Science and Technology in the country’s capitol Ulaanbaatar on Monday.
“STOP-TB Partnership Korea,” established in December 2012, is aimed at eliminating TB as a public health problem. Its partner organizations include the government, nongovernmental and governmental organizations, as well as patient groups.
The three organizations will provide a total of 1.35 billion won (US$1.14 million) annually for state-of-the-art X-rays to detect TB infections and to coordinate the provision of anti-TB medication to the community.
Also, local medical personnel will be sent to Mongolia to train medical doctors and researchers there for TB treatment and prevention.
Mongolia is one of seven countries with a high prevalence of TB in the Western Pacific region, with the mortality rate for TB at 7.2 people per 100,000.

Divided Mongolias find unity in common ancestor Kublai

Eight centuries after the ruler of the greatest land empire in human history was born, the mighty Mongol Kublai Khan’s descendants are a people divided between his homeland and the China he conquered, with both claiming him as their own.
With Kublai Khan’s 800th birthday coming up Wednesday, Mongolia will launch commemorations in Ulan Bator while China will mark the date near the site of one of his capitals after he founded the Yuan dynasty in 1271.
Under Kublai — a grandson of Genghis Khan, who first began the Mongols’ epic expansions — the realm reached its greatest extent, stretching from Eastern Europe to the Korean Peninsula, the largest contiguous land domain ever.
But the Yuan emperors ruled China for less than a century, and after they fell, the roles were reversed, with the Chinese later reigning over Mongolia.
Geopolitical earthquakes in the 20th century, such as the collapse of China’s Qing dynasty and the rise of the Soviet Union finally saw Mongolia break away as an independent country, only to quickly fall under the sway of Moscow.
“Kublai Khan, being a Mongol, would have had great difficulty establishing control over China, so he had to make himself a Chinese emperor and thus found the Yuan dynasty,” said John Man, an author and authority on Mongol history.
“It’s one of the world’s greatest historical ironies that modern China gets most of its borders, minus Mongolia, from a barbarian from the North, from Kublai Khan who was a Mongol, not a Chinese at all.”
Nonetheless China proclaims itself as the world’s oldest civilization and has a tendency to coopt successful invaders, declaring them Chinese.
Modern Mongolia has a population of just 3 million, the vast majority ethnic Mongols. But almost twice as many — nearly 6 million people— live in the People’s Republic of China, where they are one of dozens of minorities.
Some divided nations have re-unified, such as West and East Germany, but despite some Mongolian nationalists’ fantasies, the country’s geopolitical weakness and economic dependence on China make a single Mongol state impossible, says D. Shurkhuu of the Institute of International Affairs in Ulan Bator.
“This is a very sensitive issue in political terms, especially for politicians in Mongolia,” he said.
On both sides Mongols agree on the glory of their shared history.
“Genghis Khan is the ancestor of ethnic Mongols and Mongolians,” said Baigali, a guide who goes by one name at a complex in China’s Inner Mongolia region billed as the mausoleum of Kublai’s grandfather.
Foreign historians reject the claim, though the site of Genghis’ grave has never been identified and remains one of the world’s great unsolved historical mysteries.
Baigali said the two peoples are essentially the same, although those in China use traditional vertical Mongolian script, while Mongolians write in the horizontal Cyrillic alphabet inherited from the Soviet Union.
“And they think they are superior to us because they are pure Mongolian and we are Sinicized,” she added, hinting at underlying tensions.
Hada, an ethnic Mongol dissident who also goes by one name and who spent almost 20 years behind bars in China before being freed last December, says his people have been marginalized by communist authorities and “downgraded …to an ‘ethnic minority.’ ”
“It is an undeniable fact that they are the indigenous people of a great nation,” he wrote of China’s Mongols in an article published online this month by the U.S.-based monitoring group Southern Mongolian Human Rights Information Center.
“It serves a political agenda of the Chinese to belittle the Mongolian nation, diminish national self-confidence and cause them to abandon any aspirations of self-determination,” he continued.
Beijing denies accusations it oppresses minority groups and counters it has delivered economic development and raised living standards.
Mongol herders in China sporadically demonstrate against their resource-rich pastures being infringed upon by developers and coal miners — one named Tumur hanged himself in protest earlier this year — drawing attention and support from activists in Mongolia.
“There are many Tumur in Inner Mongolia and many herders are trying to keep their land away from the Chinese government,” campaigner Munkhbayar Chuluundorj said in Ulan Bator while holding a sign reading “Je Suis Tumur,” referring to the “Je Suis Charlie (I am Charlie)” movement that followed shootings by Islamic militants at French satirical magazine Charlie Hebdo.
The impossibility of political unification did not preclude cultural connection, Munkhbayar said, invoking Kublai’s grandfather.
“Genghis Khan is the only way because all Mongolians abroad believe they are proud of Genghis Khan,” he said. “They want to say they are descendants of Genghis Khan.”


Oyu Tolgoi is symbol on Mongolia's rise

Khanbogd, Mongolia
Ulaanbaatar city centre, in Mongolia
Ulaanbaatar city centre, in Mongolia Photo: Philip Wen
In the centre of Ulaanbaatar, the rough and pulsating capital of Mongolia, sleek new skyscrapers share the skyline with the concrete shells of stalled, half-built office towers.
The city, home to half of the country's three million people, has been transformed by an old-fashioned mining boom. The economy of Mongolia, a landlocked country wedged between Russia and China, has doubled in the space of a decade, with the young democracy's transition from a socialist command economy to a free market sparking a global rush to exploit its rich copper, coal and gold deposits beneath the earth's surface.
The biggest of Mongolia's mega-projects is the Rio Tinto-controlled Oyu Tolgoi copper-gold mine, deep in the south of the Gobi desert, 80 kilometres north of the Chinese border.
The above-ground open-pit copper mine at Oyu Tolgoi.
The above-ground open-pit copper mine at Oyu Tolgoi. Photo: Philip Wen
Oyu Tolgoi is already producing copper concentrate from an open-cut mine, but the true riches – 80 per cent of the mine's value – are nestled a kilometre underground.


key breakthrough in May saw Rio Tinto and the Mongolian government settle disputes over terms of the project that had seen Oyu Tolgoi's crucial underground expansion delayed for more than two years. When complete, the fully operating mine will account for as much as one-third of Mongolia's economic output.

The compound at the Oyu Tolgoi mine appears out of nowhere in the desert.
The compound at the Oyu Tolgoi mine appears out of nowhere in the desert. Photo: Philip Wen
"Without a doubt it is a huge impact and I think it does cause nervousness in [Mongolian] people in a sense," Munkhsukh Sukbaatar, Rio Tinto's country director in Mongolia, says of the project's size.
"But the other part of it is that what people recognise is that it's 30 per cent [of Mongolian GDP] that didn't exist before."
In the dry and dusty expanses of the southern Gobi, the bright blue buildings of Oyu Tolgoi's camp appear almost out of nowhere amid the desolation.
Inside one of Oyu Tolgoi's mine shafts which extend 1.3 kilometres underground. Some 80 per cent of the copper mine's value lies in the underground expansion.
Inside one of Oyu Tolgoi's mine shafts which extend 1.3 kilometres underground. Some 80 per cent of the copper mine's value lies in the underground expansion. Photo: Philip Wen
There is a renewed sense of anticipation after the lengthy delays. Rio Tinto expects to finalise $US4.2 billion ($5.8 billion) of project finance with its consortium of banks by November, and then obtain outstanding permits.
Rio Tinto has declared Oyu Tolgoi its single best project despite steep falls in the copper price.
The price of copper has fallen sharply.
The price of copper has fallen sharply.
A worker at Rio Tinto's Oyu Tolgoi mine, one of the world's richest copper deposits.
A worker at Rio Tinto's Oyu Tolgoi mine, one of the world's richest copper deposits. Photo: Supplied
The underground expansion will take between five and seven years to complete and require tremendous feats of engineering.
Reaching the underground ore body will require five mine shafts each approaching 1.3 kilometres in depth.
That will provide access for workers, service carriages and heavy machinery, as well as ventilation, to set up huge underground workshops and proceed to dig around 200 kilometres of tunnels – longer than the underground network of the London tube. Regulated air will be pumped through the tunnel to help insulate against the wild climate above ground – here, it reaches 40 degrees Celsius in the summer and minus-40 degrees in the winter.

Symbol of struggle

Oyu Tolgoi, though, has been symbolic of the Mongolian government's struggle to get to grips with a slumping economy heavily reliant on commodity prices and foreign investment.
Mongolia's government had promised to use its vast untapped mineral reserves to develop its tiny, landlocked economy, but flagship projects have been delayed and foreign investment deterred by political disputes and regulatory uncertainties.
Opposition parties have seized on public concerns that Mongolia will lose its identity and become overly dependent on mining. The shutdown of initial underground operations at Oyu Tolgoi had a devastating effect on Mongolia's economy.
In the first half of this year, Mongolia's gross domestic output expanded by 3 per cent, compared to 8 per cent in the same period last year; and a far cry from the 17.3 per cent growth in 2012.
"We had booming years of very high growth around 2010, 2011," says Batsaihan Jamichoi, director and co-founder of the Mongolia Opportunities Fund, a fund aimed at institutional investors.
"But starting in the second half of 2012 the economic growth has been slowing down very significantly. We are having some issues partly caused by the global commodities cycle, and partially it is home-made mistakes."

Political turmoil

Mongolia's parliament appointed Chimed Saikhanbileg​ as prime minister in November after ousting his predecessor in a no-confidence motion. While seen as a moderniser, the political turmoil has persisted, with Saikhanbileg replacing six members of his cabinet ahead of an expected election next year, a move the president said could further deter foreign investors worried about political stability.
The Toronto-listed Centerra Gold is awaiting a decision from parliament on the stake size the government will take in the Gatsuurt gold mine it hopes to put into production.
Parliament must also vote on a proposed investment agreement with a private consortium led by China's Shenhua Energy to develop and mine the huge Tavan Tolgoi coal mine.
Amarjargal Khenchbish, a Mongolian-born lawyer and executive now with the copper and coal group in Rio Tinto's London office, says it stemmed from the country's relative inexperience as an open-market economy, having only begun its transition from a socialist command economy with five-year plans in the 1990s.
"So initially there's a lot of misunderstanding and frustration," she says. "The public sentiment was different but now people especially in the past two or three years they understand how big the impact Oyu Tolgoi can be to Mongolia and also foreign direct investment into Mongolia."
"People say that Mongolians are fiercely independent and proud; I think that's probably an understatement. One pattern you'll see emerging again and again is pride, it's a huge thing," Sukbaatar says.
"People felt foreigners came in a bit too quickly and it affected their pride and it felt like their space was being marginalised."

Opportunities abroad

That pride has also seen waves of urbane, foreign-educated young Mongolians return home, excited about the economic opportunities and a desire to contribute to the country's fledgling development. Sukbaatar himself returned after more than a decade in the United States, eschewing the predictability of a lucrative career in financial services for the untapped potential back home.
"It's very common," he says. "You have Mongolians living abroad, you very frequently hear them wanting to come back here and do something more, come back to contribute after learning skill sets."
The confluence of a series of droughts and harsh winters and the growth of the country's mining industry has seen the population of Ulaanbaatar more than triple since 2000.
But most live on the fringes of the city in districts of gers, the circular canvas tents which nomadic herders have lived in since the time of Genghis Khan. With no running water or central heating, sanitation is poor and the burning of coal for heat sees the capital cloaked with thick smog during the winter.
Not unlike Australia, the challenge for the Mongolian government is to recalibrate its economy onto a sustainable footing after the heady heights of the global commodities supercycle, and to demonstrate the windfall from big mining can be evenly spread.


China correspondent for Fairfax Media

The reporter travelled to Oyu Tolgoi as a guest of Rio Tinto


As rivals blink, Rio Tinto plans to expand Mongolia copper mine

Rio Tinto said it is committed to expanding its Oyu Tolgoi copper mine in Mongolia based on a positive outlook for the metal and confidence that low production costs can buoy profits even as competitors cut output.
The miner wants to lock in up to $4.2 billion in project financing by November to build more than 200 km of tunnels to access higher-quality ores at the deposit over the next five to seven years, Craig Kinnell, Rio's chief development officer for copper and coal, said during a media tour of the mine this week.
The expansion should extend the mine's lifespan past 2100 and open up 80 percent of the resources available, making it the world's third-largest mine for copper and gold.
With new project approvals slowing elsewhere, Kinnell said he was confident demand would hold up, particularly in China.
"I can't see anything to reconsider given the quality of our resource," he said. "Our commitment is to bring this on as soon as possible".
Oyu Tolgoi is expected to produce 175,000 to 195,000 tonnes of copper in 2015 and has a key role in Rio Tinto's strategy to ease its dependence on iron ore, but there have been concerns that its expansion is coming at the wrong time.
"Rio Tinto has to develop the mine as it is a core copper asset to the company," said Yang Changhua, senior analyst at state-backed research firm Antaike in Beijing.
"But expected additional copper from the Oyu Tolgoi mine would pile pressure on the global copper market, which is not likely to improve strongly in the coming two years," he said.
However, Kinnell said that while the expansion of Oyu Tolgoi would raise ore production, there were no plans to expand concentrator capacity at the project.
He added that low production costs meant the project would be a "bedrock" for the firm, and that he remained bullish on the long-term fundamentals for copper.
While Rio plans to expand operations its four key copper assets - Oyu Tolgoi, Kennecott, Escondida and Grasberg - rival Glencore said it would cut supplies by 400,000 tonnes.
Rio is also looking for new supplies with plans to get online the Resolution project in the United States and La Granja in Peru, raising concerns that the industry will be hit by the sort of glut now affecting iron ore.
"The market is aware that supply cuts such as those by Glencore can only lay the basis for a tightening of the market," said Carsten Menke, commodities research analyst at Julius Baer.
"This is different to 2009, when for example copper demand collapsed because we had a global recession. This time the oversupply in the copper market is due to the expansion of mine production over the last few years." (Additional reporting by Polly Yam in HONG KONG and Pratima Desai in LONDON; Editing by Ed Davies)

World Bank urges welfare reform in Mongolia

The World Bank has urged Mongolia to reform its welfare system by consolidating different benefits and targeting assistance better in order to improve the efficiency of spending.
In the country, the top 40% of the population by income receive 28% of total welfare transfers, while the poorest 40% receive 56% of welfare, the bank’s Review of Program Design and Beneficiary Profiles of Social Welfare Programs in Mongolia said.
Costs also outstrip the average for other emerging and developing countries. In 2013, Mongolia spent 2.78% of gross domestic product on welfare compared with 1.6% in other emerging and developing countries.
“As an institution devoted to ending extreme poverty, the World Bank strives to understand the drivers of poverty reduction and the factors affecting how prosperity is shared among the population,” said James Anderson, World Bank country manager for Mongolia.
“We hope that this review provides the evidence needed for Mongolia’s leaders to create a more effective and efficient social welfare system, one that puts Mongolia’s poor and vulnerable first.”
The report notes that not all welfare entitlements were linked to need. It urged the Mongolian government to eliminate or reduce benefits for wealthier citizens through means testing.

Mongolia’s Rural Communities to Play Greater Role

The FINANCIAL -- Rural residents in Mongolia will benefit from a $34.1 million program funded by World Bank and Swiss Agency for Development and Cooperation (SDC) that aims to make the government funding process more transparent and more responsive to community needs.
The program, the third phase of the Sustainable Livelihoods Project, was officially launched on September 17 in Ulaanbaatar with a workshop organized by the Ministry of Finance and the World Bank. The three-year program aims to help Mongolia implement the 2011 budget law, which gives rural communities a greater role in the government funding process.
“The project will empower rural communities by providing a transparent mechanism for funding to be transferred to support local development initiatives,” said James Anderson, World Bank Country Manager for Mongolia.
The program will build on the success of the first two phases of the project, which have helped set up community development funds financing more than 6,000 projects, mostly investing in education and health. It will build local government’s capacity for financing investments in infrastructure and services. Based on the budget law, funding allocations are decided each year through robust community participation, according to the World Bank.
“The Sustainable Livelihood Project has played an important role in developing rural areas in Mongolia through community participation. The Government of Mongolia and World Bank have worked together since 2002 to implement the project and increase the flow of public and private investment to herders’ communities,” said Kh. Gantsogt, State Secretary of the Ministry of Finance.
The project will also support local economic development by promoting investments for private sector growth in the more than 300 soums – or local administrative districts – throughout the country.
It will focus on financing based on governance performance, which awards additional funding for local development investments to local government entities that adopt participatory processes to reflect local needs and priorities in their planning, budgeting, implementation, monitoring and evaluation processes.
“The new phase of the project will ensure that the budget available at local level, especially Local Development Funds, will be managed and used effectively and efficiently, responding to the needs of local people. Strengthening capacities of local governments in rural areas will be key to achieving this goal,” said Markus Waldvogel, Director of Cooperation of Swiss Agency for Development and Cooperation.
The program is funded with a $22.7 million credit from the International Development Association (IDA), the Bank’s fund for the low-income countries and a $11.4 million grant from the Swiss Agency for Development and Cooperation.

Mongolian President, Parliament Chairman open OSCE Parliamentary Assembly Autumn Meeting

ULAANBAATAR, Mongolia, September 17, 2015 – Mongolian President Elbegdorj Tsakhia and Parliament Chairman Enkhbold Zandaakhuu yesterday, September 16,  opened the OSCE Parliamentary Assembly’s 2015 Autumn Meeting, which has brought together nearly 200 parliamentarians from across the OSCE’s 57 participating States in Ulaanbaatar.

Hosted by the State Great Hural (Parliament) of Mongolia, the Meeting is focusing on continuing and emerging security concerns for the OSCE area and the role of parliamentarians in fostering co-operation to address those concerns. 

Topics to be addressed in presentations and parliamentary debate include the situation in and around Ukraine, refugee crises and human trafficking, counter-terrorism, food and water security, the development of democratic institutions and human rights issues.

In his opening address to parliamentarians, President Tsakhia said that despite acute challenges to Eurasian security, including the Ukrainian and refugee crises, there is cause for hope:

“Humankind still possesses the means and the opportunities to solve any emerging challenge… We [also] have the Organization for Security and Co-operation in Europe. Some of the challenges are spilling over the boundaries of one continent and this necessitates creating security and open co-operation mechanisms that cross [wide areas]. I am confident that the OSCE can serve as the best model for engagement and dialogue and cross-continental co-operation and shall be a leader in finding the solutions to the most pressing issues,” he said.

Parliament Chairman Zandaakhuu noted that the 2015 Autumn Meeting coincides with the 25th anniversary of Mongolia’s first democratic elections, which led to the establishment of a permanent parliamentary system in the country. The Parliament’s decision to host the Autumn Meeting is a testament to its belief in democratic dialogue, he said:

“Today countless complicated issues still exist in many corners of the world. This calls for improved coherence and communication among international organizations, the furthering of close co-operation and the necessity to comply with decisions and recommendations… Honorable parliamentarians, the representatives of your people, I have full confidence in you all to reach a common consensus through thorough discussions and multiple approaches to the given issues,” the Chairman said.

OSCE PA President Ilkka Kanerva also addressed the Assembly’s opening session, offering wide-ranging remarks on pressing security issues that parliamentarians will discuss in the coming days.

“Regarding the crisis in and around Ukraine, our dialogue must also be in support of the Minsk Agreements, which are the only viable solution. I welcome the fact that the ceasefire in eastern Ukraine has largely held in the past several weeks. I look forward to the day when local elections can be held throughout all of Ukraine. And I look forward to the restoration of Ukraine’s territorial integrity,” President Kanerva said.

“There is another crisis now raging in the OSCE area, and it is also one that urgently requires constructive dialogue: That is the migrant and refugee crisis…Europe can and simply must do more to respond, and do so with solidarity and compassion,” he said.

President Kanerva also congratulated Mongolia on its landmark anniversary and urged fellow OSCE participating States to learn from the country’s swift adoption of democratic standards.

Russian Duma Speaker Sergey Naryshkin, Ukrainian OSCE PA Delegation Head Artur Gerasymov and Deputy Speaker of the Afghan Parliament Mohammad Nazir Ahmadzai were among parliamentarians from more than a dozen countries to participate in an opening general debate.

Later on 16 September, President Kanerva and OSCE PA Secretary General Spencer Oliver met with Speaker Naryshkin and other members of the Russian Delegation to the OSCE PA. 

The President indicated that he remains supportive of EU sanctions in response to Russia’s actions in the context of the Ukraine crisis. He also informed Speaker Naryshkin of his efforts to ensure that sanctions against individuals do not inhibit parliamentary dialogue.

President Kanerva also hosted a separate meeting with members of the Russian and Ukrainian Delegations.

The sides held a constructive discussion regarding potential mechanisms for the parliamentary side to support implementation of the Minsk Agreements.

The 2015 Autumn Meeting will also consider trends and issues of particular relevance to countries in the eastern part of the OSCE area. A special roundtable on Central Asia featuring the Heads of OSCE field presences in Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan is also scheduled for today.

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