Mongolian Unionist’s Desperate Protest Over Failed Mines Policy

Drastic fall-off in foreign investment reflects distrust of indecisive government.17 November 2015

A drastic act by a Mongolian union leader angry and distraught over plans to sell coal mines to China is a dramatic reminder of the country’s deepening economic problems.

Tabloid media, including Britain’s Daily Mail, ran gruesome video footage showing the unnamed man’s self-immolation at a press conference on 13 November called to publicize the hardships Mongolian miners are facing.

“The government no longer supports our company, and families of the workers are forced to starve. This is why I will burn myself for the people of Mongolia and our children,” he said before dousing himself with flammable liquid and setting himself on fire.

Mongolia depends almost entirely on mining to earn foreign currency. Its economy went through an extended boom fueled by foreign investment and rising commodity prices until the worldwide financial crisis, and then slowing growth in China combined to knock the wind out of its sails.

The government has repeatedly failed to secure a lasting outside investment in Tavan Tolgoi, the coal mining company whose workers are in such desperate straits, according to the union leader.

A government negotiator said in September that a $4 billion deal with Chinese investors to develop Tavan Tolgoi was limping badly, partly because of slower growth in Mongolia’s most important trading partner, Reuters reported.

Two months earlier, Prime Minister Saikhanbileg Chimed had said that the impasse over Tavan Tolgoi would be resolved “in the very near future,” the Financial Times reported.

Earlier this year Reuters said the government was “desperate to kick-start a deal” for the mining company. Foreign investment fell 74 percent in 2014, “largely because of disputes between companies and the government,” Reuters said.

• The union leader was hospitalized in critical condition with serious burns, the Daily Mail said.

• Many foreign miners and investment banks took sniffs at Tavan Tolgoi, but “financial strains and interference from the government” put off most potential investors, Reuters says.

• A previous deal for the mining company was annulled after Japanese and Korean companies criticized the government’s award of the project to a consortium including Chinese, Russian, and Mongolian firms and the multinational coal conglomerate Peabody Energy.

Source:TOL.org