Tuesday, June 19, 2012

[CPSI NewsWire: Prophecy to Acquire Chandgana Adjacent Licenses from Vale]

CPSI NewsWire brings you market updates on Mongolia, compiled by CPS International, a Mongolian marketing arm of CPS Securities, a Perth, Western Australia based stockbroking and corporate advisory firm, specialising in capital raising for mining and junior stocks.

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Prophecy Coal Consolidates Chandgana Coal Basin by Agreeing to Acquire Tugalgatai Licenses From Tethys Mining LLC.

VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 18, 2012) - Prophecy Coal Corp. ("Prophecy" or the "Company") (TSX:PCY) (OTCQX:PRPCF) (FRANKFURT:1P2) is pleased to announce that it has entered into a binding Sale and Purchase Agreement (the "Agreement") to acquire assets relating to certain Tugalgatai coal exploration licenses from Tethys Mining LLC ("Tethys") (Vale’s Mongolian subsidiary), and subject to approval from the Minerals Resource Authority of Mongolia, to have such exploration licenses transferred to it. The Tugalgatai licenses are contiguous to the Company's Chandgana licenses which host a measured resource of 650 million tonnes and an indicated resource of 540 million tonnes of thermal coal.

According to records reviewed by Prophecy, on March 15, 2011, Tethys applied to register a resource estimate of 2.33 billion tonnes of thermal coal for the Tugalgatai licenses with the Minerals Resource Council of Mongolia. The resources registered by Tethys are not NI 43-101 compliant. Prophecy expects to conduct work in due course with a view of preparing its own NI 43-101 estimate of the contained resource at Tugalgatai.

Since 2005, Tethys performed detailed exploration on the Tugalgatai licenses including drilling and geophysical methods, and conducted geotechnical, hydrogeological, environmental and topographic studies. Exploration results indicate a large and geologically simple coal occurrence within the Tugalgatai licenses that is similar to Prophecy's Chandgana licenses. The coal seam is continuous across the Nyalga Basin and outcrops to the northwest, with the main coal seam measuring up to 30m in thickness.

The terms of the Agreement include a US$10 million upfront payment and an 8.5% royalty on future coal sales from both the Chandgana and Tugalgatai licenses. The royalty can be extinguished by paying Tethys US$20 million before 2021 or US$25 million from 2021 onwards. Of the purchase price, $2 million will be immediately deposited in escrow. The total payment will be paid to Tethys upon the transfer of the licenses.

John Lee, Chairman and CEO of Prophecy, states: "By consolidating the Chandgana coal basin of approximately 300 squared kilometers, Prophecy is looking for greater economies of scale to potentially produce low-cost electricity at the Chandgana mine mouth power plant, and further develop coal to chemicals and coal gasification projects. It's also possible to further increase the resource through exploration in this highly prospective basin."

The transaction is expected to close in Q3, 2012, subject to regulatory approval from the Minerals Resource Authority of Mongolia. The technical contents of this news release have been reviewed and approved by Christopher M. Kravits, P.Geo, who is a Qualified Person as defined in NI 43-101. Mr. Kravits has 34 years of US and international relevant coal geology experience. He has been active in Mongolia since 2007.

Link to release


Nova Mining Corp Executes First Deal to Begin Securing Significant Lithium Reserves

SAN ANTONIO, June 18--(BUSINESS WIRE)--Nova Mining Corp. (OTCBB:NVMN) announced today that the Company has moved to secure valuable Lithium supplies by executing a Letter of Intent with Mongolian National Mining Consultants Limited (MNMC) for the exclusive right to purchase 100% of the Lithium produced from MNMC mining properties at a discount to market price. As part of the deal, Nova Mining will have the right to perform Due Diligence, prior to both parties negotiating a Definitive Mineral Production Agreement.

Mongolian National Mining Consultants Limited is a Hong Kong company, with its principal business operations in Ulaanbaatar, Mongolia. MNMC is the registered owner of multiple mining properties that are located in Mongolia. Recent Surveys of MNMC’s mining properties indicate significant quantities of commercially recoverable Lithium reserves.

Nova Mining Corp. (NVMN) seeks the most out potentially lucrative mining projects and supplies of strategic high-demand minerals, such as Lithium, as part of its newly-instituted aggressive business model. Lithium is the main ingredient in long life batteries, like those used in many of Apple’s (NASDAQ: AAPL) popular electronic devices and General Motor’s (NYSE: GM) new Volt electric automobile. Lithium is currently in very high demand and is forecasted by to quadruple from an $11 Billion market to $43 Billion market.

More information on Nova Mining Corp can be seen at:

Link to release



June 18 -- SouthGobi Resources Ltd. (TSX: SGQ, HK: 1878) --

The board of directors (the “Board”) of SouthGobi Resources Ltd. (the “Company”) announces that Ms. Beverly A. Bartlett has retired as the company secretary and authorised representative of the Company and Ms. Allison Snetsinger has been appointed as the company secretary and authorised representative of the Company with effect from 17 May 2012.

Prior to  Ms. Snetsinger’s appointment as corporate secretary, she held the position of assistant corporate secretary since the Company’s Canadian initial public offering in December  2003. Ms. Snetsinger is a member of the Canadian Society of Corporate Secretaries.

The Board takes this opportunity to express its sincere gratitude to  Ms. Bartlett for her valuable contribution to the Company during her tenure and also extends its welcome to Ms. Snetsinger on her new appointment.

Link to release



June 18 -- The Directors of Mongolian Resource Corporation Limited (ASX:MUB) are pleased to announce the appointment of Stephen Hamblyn as a Non-Executive Director.  Mr. Hamblyn, who has a Bachelor of Metallurgy and a Bachelor of Economics degrees, has a long mining history and strong technical background in plant processing and metallurgical matters.

Mr. John Lee has resigned as a Director of the Company and remains as Company Secretary. The Board thanked Mr. Lee for his contribution as a Director and were pleased he had agreed to continue as Company Secretary.

Link to release



June 18 ( In the week of June 11-15, 2012, Mongolian Stock Exchange (MSE) has held 5 trading sessions, through which a total of 36.9 million shares of 61 JSC's worth 15.4 billion MNT were traded.

The Top 20 index reached at 18,846.99 points, compared with the previous week showed a decrease of 5.7 points or 0.03 percent. This was due to decrease of Shivee Ovoo (10.0%), Aduunchuluun (6.9%), Mogoin Gol (5.9%), APU (4.4%), Mongolia Development Resources (3.1%), Gobi (2.2%), and Sharyn Gol (0.5%) which were included in the index basket.

The total market capitalization increased by 12.8 billion MNT or 0.7% percent and stood at 1 trillion and 777.7 billion MNT. The most stocks prices rose were Dornod Yesun Erdene (32.2%), Mongol Savkhi (30.7%) and Durvun Uul (15.9%). The most stocks prices fell were Olloo (11.8%), Monnoos (10.0%) and Shivee Ovoo (10.0%).

Out of 61 stocks that were traded 34 stocks’ prices rose, 15 stocks’ prices fell and 12 were unchanged. The most actively traded stocks by number of shares traded were Genco Tour Bureau (15.0 million), Khukh Gan (10.6 million), Moninjbar (5.1 million).

The most actively traded stocks by value of trading were BDSec (3.7 billion MNT), Baganuur (2.2 billion MNT) and Khukh Gan (2.0 billion MNT).

Link to article



18 June 2012 (BDSec) – Blue chip stocks helped the major indexes finish up. BDS index added 52.70 points or 1.27% to 4204.10 points while MSE Top 20 rallied 1.12% to sit at 19058.10 points.

Most actively traded company was Sharyn Gol (SHG), as 946 thousand shares of SHG or approximately 7% of the company were traded on the exchange.

Winners outnumbered losers by nearly 2 to 1. Leading local bakery manufacturer Talkh Chikher (TCK) jumped 5.7% to close at MNT 13,001. A construction company Moninjbar (MIB) gained 4.0% to MNT 260. Shivee Ovoo (SHV), a coal supplier to local companies, recovered 2.8% to MNT 7,400.

Darkhan Nekhii (NEH) slumped 6.9% to MNT 6,050. Hermes (HRM) lost 4.0% to close at 96.

Local News in Brief

      MSE will organize block trading. According to resolution No 277A of Bayanzurkh district court of 16th 2009, MSE is organizing block trading of “Bayalag Nalaikh” joint stock company’s 99,800 shares at 1,267 tugrigs, the highest price of recent 6 months on the day of 21st June, 2012, in accordance with Securities Trading Regulation. Source: Mongolian Stock Exchange

      The oil refinery to be built in Darkhan will be in development next fall. The new oil refinery, which will be operational by 2015, will not produce the 80, 92 octane gasoline we use today, but rather replace it with the Euro-4 standard 95 – 100 octane gasoline which will be distributed domestically. “The gasoline the refinery will produce will be of high quality but about 5 – 10 percent cheaper than the fuel we buy today,” said T. Namjim, the President of Darkhan Oil Refinery Project LLC.

Signing the contract has enabled work on the loans to begin. In total, 85% of the project’s funding will be loaned from the Japan International Bank for Cooperation at a reduced interest rate, while 15% will be obtained from the Japanese Marubeni Corporation. Once the funding issues are resolved, construction will begin. The architectural planning for the refinery is nearly done.

At the signing ceremony, representatives from investors Mongol Sekiyu, Petrovis, Just and Magnai Trade were present.

It will have the capacity to process and refine 44,000 barrels of oil per day, or two million tons a year, and will supply seven different products. Once the refinery is fully operational, it will fully supply our daily use vehicle gasoline, airplane and diesel fuel, oil slurry and bitumen. It is also economically beneficial: the initial loans and funding will be paid back within 4.5 – 5 years of operation. Construction will be finished by the end of 2015. Technical testing and calibration will run for the first two to three months. Considering all this, the first of the products will be out on the market by the beginning of 2016. Source: UB Post

Link to article


Khan Investment Management Update (15/06/2012)

June 15, Khan Investment Management --

May was one of the worst months for equity markets in recent years. As the debt crisis in Europe intensified, few investors were in the mood to buy risk assets and instead rushed to Treasury securities - sending the 10 Year US Treasury yield to the lowest on record at 1.53% - versus the previous low of 1.55% seen in November 1945 (YES – the end of WWII!). For the month, the Dow fell 7.1%, the ASX All Ords shed 9.3%, MSCI Asia lost almost 12.5% whilst the Hang Seng tumbled over 14%. The S&P GSCI (formerly known as the Goldman Sachs Commodity Index) fell 13.72% whilst the MSE Top 20 Index was relatively unscathed falling 3.9%. The Khan Mongolia Equity Fund (KMEF) finished the month down 10.38%. 

8 positions in the portfolio finished down double digit percentage points. Petro Matad (MATD:LN) was the worst performer losing 58.31%. Draig Resources Ltd (DRG:AU) lost 40%, Aspire Mining Ltd (AKM:AU) slid 38.6% and Ivanhoe Mines Ltd (IVN:US) lost a further 22.65%, closing the month at USD 9.39 – up from a 52 week low of USD 8.39 (the KMEF sold a significant portion of its IVN holding at USD 18.20 on March 12th). The best performer in the portfolio was Gobi JSC (GOV:MO), the Mongolian cashmere and garment group, which recovered 10.44% from recent lows.  

At the beginning of May the KMEF portfolio consisted of 17 securities in total. Over the course of the month South Gobi Resources Ltd (1878:HK) was sold in entirety on the back of news that their offices in Ulaanbaatar were blocked by local law authorities and were being raided by agents of the Independent Authority Against Corruption. We were able to quickly and independently verify the reports, and the stock was exited in full (within 90 minutes of the initial report) at an average price of HKD 51.49 – a 3.2% discount to the previous trade of HKD 53.20. The stock is currently trading at HKD 39.90 (14 June 2012). A position in Mongolian Mining Corporation Ltd (975:HK) was reacquired at HKD 5.30, and the Fund made a commitment to invest in its first pre-IPO capital raising – Bold Resources Limited

A well-diversified portfolio has helped to shelter the Fund from the vicious price swings seen in many commodity stocks over the last several months. Contrary to the side-lined marginal investor, we continued to aggressively add to core positions and in the last week of May and moved the portfolio’s cash allocation from above 30% to below 10% in order to take advantage of further price weakness in key positions. We believe strongly that the importance of on-the-ground insight and information access cannot be overstated, as has been clearly demonstrated by our recent trading activity.  

The Khan Mongolia Equity Fund performance for May was -10.38%.

The Net Asset Value as at 30 April 2012 was USD 74.91

The May Factsheet can be downloaded by registered users of the Khan Investment Management website –

Narantuguldur Siajrakh recently attended the 2nd Coaltrans Mongolia conference in Ulaanbaatar on behalf of Khan which highlighted Mongolia’s emergence as a leading coal producer with the ability to influence international coal markets in the near term. The conference also afforded Khan the opportunity to hear from and meet with senior management of a number of companies that the Fund is already invested in or is currently reviewing, providing timely insights into strategy and development progress.  

Mongolia’s political situation, which has been attracting increased international attention recently, has kept many investors wary of the emerging economy. Parliamentary elections are due at the end of this month and the likely outcome remains uncertain. Much of the Mongolian economy seems to have slowed in the lead up to elections, with some business, economic, political and even personal decisions being postponed until after the June 28 polls.  

Contrary to recent international media reports relating to concerns about draconian resource nationalism, risks to democracy, increasing corruption and politically motivated arrests, Khan believes that Mongolia is firmly on the way to improving market governance and transparency and is taking positive steps to investigate corruption allegations and punish those found guilty whilst aiming to further establish the country as a business friendly environment that welcomes foreign investment.  

Khan believes that the next government will potentially be a coalition formed between either majority caucus (the Democratic Party or the Mongolian People’s Party) and a smaller minority caucus (either the Civil Will Green Party or Mongolia’s People’s Revolutionary Party).  

However, regardless of the election outcome, Khan believes the new government will be quick to hasten growth and development in line with the previous policies set by the former coalition, including the privatization of promising state-owned enterprises, encouraging growth in non-mining industries, and maintaining double digit economic growth targets. 

It is unlikely that we will see significant news flow coming out of Mongolia this month and the next whilst the new government is being formed and the country enjoys the  Naadam festival,  Mongolia’s largest national holiday, which takes place for the entire second week of July. 

Whilst most international investors remain side-lined waiting to see what happens at this weekend’s Greek elections, China continues to grow and the rest of the world keeps turning. China’s May exports, after seasonal adjustments, were up 13.8% yoy, and imports increased 8.3% yoy. Khan believes that China’s surprise rate cut combined with the publically announced decision to accelerate key investment projects indicate a determination to underpin solid growth before a once-a-decade leadership change at the top of the ruling Communist Party, due towards the end of this year. 

Many stocks within the portfolio continue to test new 52 week lows. We continue to average down and accumulate more of our high conviction positions in light of current price weakness, which we believe is driven by increasing global market correlation and marginal investor fears, and is not based on fundamental company analysis. We believe that certain stocks are trading at deep discounts to even modest estimates of value and are likely to bounce hardest on the return of (more) rational markets. 

I thank our investors for their continued support and I look forward to updating you further of our developments next month. 

Best regards, 

Travis Hamilton

Managing Director


Link to Khan site


Temasek bets on Mongolia

June 15 (FT) Temasek, the Singapore state investment agency, has become the latest investor to take a punt on Mongolia as it expands its natural resources portfolio.

This week Temasek confirmed it had taken a 5.5 per cent stake in Ivanhoe Mines of Canada. Ivanhoe controls a 66 per cent stake in Mongolia’s Oyu Tolgoi mine, with the country’s government holding the rest.

The mine, which is still under development, is expected to be one of the world’s biggest sources of copper and gold and is near Mongolia’s border with China, the world’s largest copper consumer. Ivanhoe is controlled by global mining group Rio Tinto.

Rio Tinto has estimated that the complex could add a third to Mongolia’s gross domestic product, employ up to 13,000 people and emerge as a top-five copper producer.

Mongolia’s economy grew 17 per cent last year and the country has become a leading destination for investment by global miners such as Rio Tinto, Peabody and Shenhua that are keen to exploit its vast deposits of copper and coal.

However, in spite of predictions that Mongolia could become “the new Qatar” through its mineral wealth, some observers are concerned about the impact that mining riches could have on the country.

Investors also face political risk. Legislation, which may soon be reviewed, currently restricts foreign ownership of “strategic industries” – including mining – in deals worth more than $75m to 49 per cent unless approved by parliament.

Link to article


Executive compensation at B.C. firms creeping higher

Top three business leaders, all departed Ivanhoe execs, earned a total of $50 million US

June 15 (Vancouver Sun) For the second time in three years, John Macken, who just stepped down as president of Ivanhoe Mines, is the province's top earner, bringing in $23.358 million in salary, bonus and options to purchase shares.

Macken was also the top earner in 2009, when he took home almost $10 million US.

The top three earners in The Vancouver Sun's 2011 top 100 executive pay summary are all former Ivanhoe executives. Along with Macken, former deputy chairman Peter Meredith ($14.041 million) and former CEO Robert Friedland ($12.574 million) round out the top three. Among them, they earned $50 million.

All three executives, along with former chief financial officer Tony Giardini (No. 11 at $6.598 million), resigned April 17 as part of the realignment of Ivanhoe management with new controlling shareholder Rio Tinto. Rio Tinto became the majority share-holder January 24 when it increased its holdings in Ivanhoe to 51 per cent. Rio Tinto's interest in Ivanhoe is over Ivanhoe's Oyu Tolgoi project in Mongolia, reputed to be one of the richest copper/gold properties in the world.


The Top 100 compensation list was compiled by data company Equilar, based in Redwood, Calif., from 346 publicly traded companies with head offices in Vancouver. From the initial list of 346 companies, Equilar looked for executives whose compensation package was $1 million or more. That pared the list down to 2,290 executives from 103 companies. Equilar tracks executive compensation from public documents primarily to assist client companies in benchmarking the amount of compensation executives receive. The data are then used by corporate boards to determine what they want to pay their own executive teams.

Link to article


DP MPs initiate a 2-3% Special Tax law on coal export to finance UB infrastructure

June 18 ( Some Democratic Party MPs (Z.Enkhbold, L.Bold, S.Erdene, D.Gankhuyag, R.Amarjargal and G.Bayarsaikhan) announced today that initiated a draft on Special Tax law.

The draft law aimed to set special tax on coal export and collected tax money will be finance for Ulaanbaatar city infrastructure and reduce air pollution.

MP’s told to journalists if set a special tax on coal export than Mongolia could earn MNT1.8 billion within the 3-4 years. “Collected tax money will ensure comfortable environment for 733 residents of ger district in Ulaanbaatar” said MP’s.

MP’s planning to built apartments in ger district land and also built lines for water supply and elecricity. As shows survey 70 percent of air pollution caused by ger district smoke while burning a coal.

The draft law says special coal tax will be 2 or 3 percent per ton.

Link to article


A new page in history turns: Railway foundation set

June 15 (UB Post) Work on building a new rail road began last week. The foundation of the Ukhaakhudag – Gashuun Sukhait railway, located in the Tsogt-Tsetsii Sum of SouthGobi Province, was set last Wednesday.

Since the State gave permission to Energy Resources LLC to begin work on the construction of the railway in 2008, Deutsche Bahn, a German national railway company has undertaken the technical and economic assessment for the construction. Thus the contract between Energy Resources, Energy Resources Rail, the Ministry of Road, Transportation, Construction and Urban Development (MRTCUD), Mongolian Railway and the State Property Committee has begun.

According to the assessment, the railroad will stretch for 267 kilometers and will be built from the Tavan Tolgoi area to the border point at Gashuun Sukhait, passing through Tsogt-Tsetsii, Bayan Ovoo and Khanbogd sums of SouthGobi Province. The whole railway will have 20 stations and will have the capacity to have 108 trains travelling at the same time. Annually, it is calculated that up to 30 million tons of goods could be transported through this railroad.

A number of officials, including representatives of the concerned organizations and administrations and the Governor of Tsogt-Tsetsii sum, G. Tog-Urnukh, were present during the opening ceremony.

During the opening ceremony for the railway construction, D. Naranpurev, head of the Road and Transportation Strategy Department from the MRTCUD said, “Although railroad transportation in Mongolia is a very important part of our economic growth, its limit in size and service is available only through one company. So there was definitely a need have more investors to the sector in order to have a greater competitiveness and also to extend the current railway system to better serve the companies in need. The idea to have a contract between the State and private companies to build the Ukhaakhudag – Gashuun Sukhait is both beneficial to the State and to the private enterprises - a method used by many developed countries. Also, I think it would be right to acknowledge Energy Resources Rail as the first Mongolian company to develop a railway construction economic assessment, fully prepared and planned in its funding. I trust that the railroad’s construction will be complete within a short time at a high standard.”

During a short interview, the CEO of Energy Resources Rail, L. Oyunbat said “We have generated funding of around USD 800 million for the project by ourselves with the assistance of many international banking and financial organizations without any difficulties. In 2009, a narrowed-down technical and economic assessment was made in cooperation with a German railway company and calculated all the necessary information, ranging from funding, profit and construction.” The banks providing assistance are the European Bank for Reconstruction and Development Bank and the World Bank.

He also elaborated on the conditions of the concession. “First it was agreed that a special permit granted from the State would allow us to use the railway for 30 years after a construction period of 2.5 years. But then this was changed to 19 years and after that 51% of the railway will be transferred to the State.”

According to L. Oyunbat, the management and engineering team will consist of 20 specialists from MVM Rail of Australia and about 40 Mongolian specialists. A total of 600 – 700 direct and 1,000 indirect jobs will be available. “To have qualified employees, our company signed memorandums with the Mongolian University of Science and Technology and the Mongolian Railway Institute,” L. Oyunbat said.

Studies on the impact of families and natural habitats in the close proximity of the soon to be built railway and its accompanying stations were made between 2008 and 2010. Over 1,000 shepherds and locals were interviewed and had their opinions taken into account.

Studies of the life of animals living nearby the railway were undertaken and appropriate changes were made to the project. “The banks we generated our funding from – the European bank for Reconstruction and development (EBRD) and the World Bank – set high standards on the treatment of nature and ecology; and we made sure that sufficient research was made into this and any issues were solved.”

Once the Sainshand – Tavantolgoi – Ukhaakhudag – Gashuun Sukhait railway is built, Mongolia will have a third border exit to the east, besides Zamiin Uud and Erenhot. Also, this railway aims to ease access to the sea. The railway is classified as “heavy-duty, mining” according to Australian and Canadian classification. The 30 million ton goods travelling on the railroad can generate up to USD 500 million a year.

It has been over 10 years since coal was extracted from Tavan Tolgoi; with the help of about 4,000 coal trucks transporting coal day in and out a total 11 million tons of coal has been exported from Tavantolgoi as of 2011.

Link to article


Mongolian Oil Refinery to Replace Current Fuel Used

June 18 (UB Post) The oil refinery to be built in Darkhan will be in development next fall. The new oil refinery, which will be operational by 2015, will not produce the 80, 92 octane gasoline we use today, but rather replace it with the Euro-4 standard 95 – 100 octane gasoline which will be distributed domestically.

“The gasoline the refinery will produce will be of high quality but about 5 – 10 percent cheaper than the fuel we buy today,” said T. Namjim, the President of Darkhan Oil Refinery Project LLC.

Several negotiations have been held between Japanese companies since 2006, and no progress was made until a significant agreement occurred on June 13th, where the Darkhan Oil Refinery Project LLC, Japanese Toyo Engineering Corporation and Marubeni Corporation signed contracts to develop the project. Toyo Engineering will execute and complete the construction of the refinery.

Signing the contract has enabled work on the loans to begin. In total, 85% of the project’s funding will be loaned from the Japan International Bank for Cooperation at a reduced interest rate, while 15% will be obtained from the Japanese Marubeni Corporation. Once the funding issues are resolved, construction will begin. The architectural planning for the refinery is nearly done.

At the signing ceremony, representatives from investors Mongol Sekiyu, Petrovis, Just and Magnai Trade were present, in addition to officials from the State Property Committee. G. Erdenebat, the Governor of Darkhan-Uul Province was also present, “Everything – from permits to permissions – regarding the Province have been resolved; 400 hectares of land is issued for the construction of the refinery. Everything concerning the infrastructure is ready. Our Province is near a railway, has three energy sources and there are no problems with the water supply. In other words, every condition required for the construction of an oil refinery has been fulfilled.”

The management at Toyo Engineering said, “Previously in 2006 we conducted a study on the energy supply in SouthGobi Province. Then in 2008, we developed the technical and economic assessment of this project. We concluded that the construction of an oil refinery like this will be profitable in Mongolia. We knew that one company only could not accomplish such a task so Marubeni joined. We did lose some time as we did not know the exact organization of the project. With the Government’s intervention, there was a giant leap in the progress of the project. Our company will work hard and will not disappoint.”

Fumiya Kokubu, Vice President of the Marubeni Corporation, emphasized that the gasoline produced by the future Darkhan Oil Refinery will be 20-30% more efficient that the fuel we use today.

The following is an interview with T. Namjim, CEO of Darkhan Oil Refinery Project LLC.

Which products will the new refinery produce? What percentage of the demand will the new refinery supply?

It will have the capacity to process and refine 44,000 barrels of oil per day, or two million tons a year, and will supply seven different products. Once the refinery is fully operational, it will fully supply our daily use vehicle gasoline, airplane and diesel fuel, oil slurry and bitumen. It is also economically beneficial: the initial loans and funding will be paid back within 4.5 – 5 years of operation. It will contribute to the State budget with around MNT 340 billion per year. The operation can be compared to that of Erdenet Copper Mine. Construction will be finished by the end of 2015. Technical testing and calibration will run for the first two to three months. Considering all this, the first of the products will be out on the market by the beginning of 2016.

What is the total cost for the project? What technology will be used for the construction?

It will cost MNT 680 million, and will be built by the latest Japanese construction technology. The oil will be processed through 14 – 15 different operations before it becomes a final product for sale.

It is said that crude oil will be imported from Russia to be used by the plant. Are there any long-term contracts on this?

There are a number of agreements. During Mongolia’s Prime Minister’s visit to Japan in December 2010, the Energy Ministers of both Mongolia and Russia signed partnership agreements on cooperation in energy. In the agreement, oil trade is included. Since then there have been many memorandums of understanding and agreements between many oil supplying companies, so we do not worry about oil imports.

What if Russia decides to put a ban or limitation on oil exports?

That will not happen. There is a long-term agreement between us. Besides, Russia joined the World Trade Organization this year, so there will be no problems with prohibitions and restrictions on oil.

Link to article


Bank of Mongolia Monthly Statistical Bulletin, May 2012

June 18, Mongol Bank –

Link to report


Discover Mongolia 2012 Date Changes to August 30-31

June 15 ( Mongolian Mining Investment forum “Discover Mongolia-2012” to be held on August 30-31. The forum scheduled on September 6-8 but decided to bring date a week earlier said organizer.

The forum mark 10th anniversary this year.

Foreign investors and mining experts well known about Mongolian mining thanks to “Discover Mongolia forum.

In last year’s forum participated around 1200 delegates from 20 countries.

Link to article



June 18 ( National Development and Innovation Committee of Mongolia and the Embassy of the Republic of Korea in Ulaanbaatar have together organized a business meeting under the topic "Current economic conditions of Mongolia, future trends and investment conditions" on June 15, 2012.

Delegations from South Korean companies, such as KEPCO, KAL, Samsung, Halla Construction and Hyundai, have participated in the meeting, where they familiarized with the necessary sectors for investment in Mongolia and with projects and programs as well.

The Head of the National Development and Innovation Committee Ch.Khashchuluun said, “Mongolia was previously a country that had agriculture based economy, now it has become a mining based economy country. The feature of a mining based economy is that it guides a large amount of money. However, we need to allot this monetary capital into the development of other sectors. But we cannot develop by ourselves. Thus, we need to import and implement foreign investment and experience. In its region, South Korea is one of the leading countries in economic and technological development. In this reference, it is one of the immediate countries that we need to establish partnership relations.”

Also, he mentioned that during this competition, in order to attract delegating investors of large South Korean companies, it was important for the Mongolian side to provide completely detailed and precise information on the possible opportunities. He was also concerned about the weak development of roads, transportation and infrastructure, and the low levels of competency indicators.

The Ambassador Extraordinary and Plenipotentiary from the Republic of Korea to Mongolia Lee Tae-ro said, “Our country knows no more than rumors about the rapid economic development of Mongolia. I have been appointed as the new ambassador to Mongolia three months ago. Starting that day, I have started to familiarize with your social and economic conditions. However today, Mongolia is developing in front of my eyes. Thus, the purpose of this meeting lies in attracting the investment of the world known South Korean companies in the further future of Mongolia. This meeting is the milestone for South Korean investors to familiarize with Mongolian economy.”

Link to article



June 15 ( The Turkish Airlines officially announced that the company was scheduling to conduct Istanbul - Bishkek - Ulaanbaatar flights starting from July 02, 2012.

They will make direct flights to Bishkek 7 days a week and to Ulaanbaatar 3 days a week on Monday, Wednesday and Friday. According to their announcement the flights to Ulaanbaatar will have a stopover in Bishkek.

Earlier, on April 27, 2012, the Head of the Civil Aviation Authority of Mongolia (CAA) S.Batmunkh and the Deputy Director General of the Directorate General of Civil Aviation at the Turkey's Ministry of Transport and Communication Bahri Kesici have signed on the memorandum of cooperation regarding the flight in route Istanbul - Ulaanbaatar and via versa.

Link to article



June 18 ( The Third Consultative Meeting between the Ministries of Foreign Affairs of Mongolia and Federative Republic of Brazil was successfully held in Brasilia, Brazil, on June 15, 2012.

The Director of the Department of Americas, Middle East and Africa, Ministry of Foreign Affairs and Trade of Mongolia B.Odonjil headed Mongolian delegates in this meeting, where the Ambassador Extraordinary and Plenipotentiary of Mongolia to the Federative Republic of Brazil T.Zalaa-Uul, Advisor for the Mongolian Embassy to the Federative Republic of Brazil D.Ganbold and the Honorary Consul from Mongolia to the Federative Republic of Brazil R.Silva also attended. Furthermore, the authorities of department of the Ministries of Foreign Affairs and Trade, Agriculture and Sports also participated.

During the political consultative meeting, the delegations made report on the latest Mongolia-Brazil domestic political, economic and social conditions. Also, opinions were exchanged on the current conditions, future trends and developments of Mongolia-Brazil relations and partnership issues on the fields of politics, economy, education, agriculture, energy, mining, investment, health, social welfare and sports. Moreover, the sides discussed about multilateral cooperation, especially in the field on UN reconstruction issues.

This meeting was distinct as it is the only political consultative mechanism between the countries, and is held once in 2 years.

The Second Consultative Meeting was held in Ulaanbaatar city in 2011, reported the Ministry of Foreign Affairs and Trade of Mongolia.

The Diplomatic relation between the Federative Republic of Brazil and Mongolia was established on June 19, 1987.

Link to article



Ulaanbaatar, Mongolia, June 15 /MONTSAME/ The Center of Standardization and Measurement (CSM) has joined the multilateral mutual recognition arrangement (MRA) of the Asia Pacific Laboratory Accreditation Cooperation (APLAC), becoming the 34th member organization.

The document on joining the MRA was signed during the 29th meeting of the MRA's council held on June 7-8 in Bangkok city, Thailand. Mongolia was represented at this meeting by G.Gantomor, head of the CSM; and S.Gantsetseg, an expert of the CSM.

The CSM become a member of the APLAC in 2004 in accordance with the #253 governmental resolution with a purpose to develop cooperation in improving the Mongolia's competitiveness in national production and supporting the free trade. The CSM also joined the International Laboratory Accreditation Cooperation (ILAC) in 2007 and the Pacific Accreditation Cooperation (PAC) in 2009.

APLAC is a cooperation of accreditation bodies in the Asia Pacific region that accredit laboratories, inspection bodies and reference material producers. It is recognized by the Asia Pacific Economic Cooperation (APEC) as one of five Specialist Regional Bodies (SRBs).

The APLAC's primary objectives are to provide a forum for exchange of information and to promote discussion among laboratory and inspection body accreditation bodies, and among organizations that are interested in laboratory and inspection body accreditation, and related activities; to improve the standard of accreditation services provided by members; to organize proficiency testing and related activities in the region; to build up and to maintain mutual confidence in the technical competence among Full Members and to work towards further development of the APLAC multilateral mutual recognition arrangement (MRA): to promote the mutual recognition arrangement among Full Members, to other regional arrangements and to individual national and regional accreditation bodies; to promote international acceptance of endorsed test, calibration and inspection reports and other documents issued by laboratories and inspection bodies accredited by signatories to the APLAC MRA; and to cooperate with other national, regional and international bodies with similar or complementary objectives.

Link to Montsame



Ulaanbaatar, Mongolia, June 15 /MONTSAME/ A project on Climate-Resilient Rural Livelihoods will be implemented in Mongolia to reduce poverty rate with a non-refundable aid from the Japan Foundation (JF) together with the Asian Development Bank (ADB).

An agreement on the project was signed on Wednesday by D.Khayankhyarvaa, the Minister of Finance; Robert Schoellhammer, the ADB Country Director for Mongolia; and T.Badamjunai, the Minister of Food, Agriculture and Light Industry. Present at the signing ceremony was Mr. Hiromichi Miyashita, the First Secretary of the Japan's Embassy in Mongolia.

In accordance with the agreement, the project will be realized in three soums in Bayankhongor aimag based on research works conducted by a joint working group of the Ministry of Agriculture and the ADB in 2011. The project's main objective is to imporve the sustainable livelihood of herdsmen in a way of improving the management of pasture and water-points, and preparation of fodder in the selected soums. In addition, some measures and training will be organized in order to give knowledge on agriculture to the herdsmen.

Since becoming a member of the ADB in 1991, Mongolia has been cooperating with the Bank in the socio-economic, energy and infrastructure sectors, and have been implementing many projects and programs. Moreover, the government of Japan has realized 12 projects in Mongolia by end of 2011 together with the ADB with USD 26.3 million.

Link to Montsame



Ulaanbaatar, Mongolia, June 15 /MONTSAME/ Mongolian engineers from the “Electronic transport” company has invented a new “JEA-800F” duobuses for public transport services in Ulaanbaatar.

The duobuses with 36 seats for 110 people have the double engines of diesel and generator. It will service in line from the end stop of the 3th and 4th residential areas to the trolleybus's end stop in Khan-Uul district.

The duobus has a good advantages to reduce air pollution, and its fuel consumption in 100 km and operational cost are decreased by four times.

The “Electronic transport” company has constructed first “JEA-800” trolleybus in 2006, then 41 trolleybuses and duobuses of new models such as “Electrobus”, “Monbus” have been created and assemlied.

Also, they have exported two “JEA-800 F” duobuses to Kazakhstan in 2009.

Link to Montsame



June 18 ( Mining has concealed tourism and cause the economic growth of Mongolia. Indraa Bold, director of the Mongolian National Tourism Organisation (MNTO) said that mining took the place of agriculture as Mongolia’s tourism’s competitors.

13.4 per cent of Mongolia’s GDP was accounted for tourism last 2004. The number is gradually falling and is currently at 10 per cent of the country’s GDP as of today. Meanwhile, the mining sector is responsible for 30 per cent of the Mongolia’s GDP. This number is expected to rise some more according to Resource Investment Capital, a consultancy in Ulaanbaatar.

Bold said that no matter what the tourism sector does, growth will be directly affected by mining. She also said that mining companies were able to acquire land-use rights in, unfortunately, places of historic interest including the Bichigt Khad Valley, the Darkhad Valley and the sacred meditation sites of Danzanraviaa among others. It is sad to see the irreversible changes being done.

The universal question is why Mongolia can’t enjoy growth with both tourism and mining running. Industry insiders say that human resources also have a significant impact on tourism. Enebish, owner of Tseren Tours, says that the unskilled workers hired are trained for language and management skills and once they are competent, they leave to apply for higher paying mining jobs. Ebenish has seen this right before her eyes as 5 of her best employees left Tseren Tours for the mining industry. Even hospitality and transport industries offer their services to the mining sector. Though Hyatt and Radisson opened recently in Ulaanbaatar, it did not do the tourism sector any good.

Most people that go to Mongolia are there for business purposes. In 2011, 43 per cent of the 457,514 people who visited Mongolia were Chinese. This is why the data is quite skewed. Most of these Chinese people are businessmen according to Stephen Kreppel, the director of the Mongolian National Marketing Coordination Office (MNMCO) from the Ministry of Foreign Affairs. Only 90,000 of the said number are tourists that are actually looking for leisure. Kreppel questions government policies regarding building tourist complexes to entertain tourists.

Surprisingly, some tourism operators say that mining has nothing to do with this problem. In their defense, mining projects are localized ones in areas that do not have tourism going on. On the other hand, Gantumur Damba from the Sustainable Tourism Development Center has not come into a conclusion yet and plants to watch what happens.

Despite all these opinions regarding this issue, Damba bravely said that Mongolia is big enough for all industries including mining and tourism. However, because of the issues regarding government policies on land protection, the situation is reversed. The suggested solution is for the government to make a clear policy regarding land-use-rights so that it lets residents and the tourism department meet in the middle. Hopefully, in the next few years, the mining company will be able to continue and prosper and Mongolia’s historic and amazing places to attract tourists.

Link to article


2012 Action Plan of All Political Parties: Education, Culture and Science FieldUB Post, June 18

2012 Parliamentary Election Action Plans for Political Parties: Health FieldUB Post, June 18


Sant Maral POLITBAROMETER #11(44), June 2012

The “Sant Maral” foundation presents the results of the June 2012 survey. The representative sample of 1000 respondents from the capital Ulan Bator and Suhebaatar, Arhangay, Selenge, Hovd aymaks (distributed proportionally by 4 regional divisions and Ulan Bator) was collected from June 6 to June 14, 2012. Tabulations are band by Ulan Bator, Countryside and Nationwide areas when necessary.

The survey is conducted with the support of the Woodmont International and the AmCham Mongolia.

Voting intention

1. “Would you participate in 2012 Parliament Elections?”



Ulan Bator


·         “Yes”




·         “No”




·         (No answer)




·         (Don’t know)





2. “Which party would you vote1 for?”                                                                                                             






Ulan Bator


Valid %2

Mongolian People’s Party





Democratic Party





MPRP, MNDP Coalition





Civic Will - Green Party





Third Power Coalition





MTUP (Traditional United)





Other Party





(No answer)





(Don’t know)





1 In expectations of the coming change in the existing Election law, the distribution in our survey is based on: one voter - one vote.

2 Excluding “No answer”, “Don’t know” and non-partisan options

Link to results


Sant Maral’s Politbarometer June 2012

June 17 (Julian Dierkes via Mongolia Today) The Sant Maral Foundation under L Sumati is the only credible polling that happens with any regularity in Mongolia. They have now released their second Politbarometer this year two weeks before the election following earlier poll results in April. Below are some of the highlights with a brief discussion.

Party Votes

Of valid answers to the question, “Which party would you vote for?”, the results were as follows with the April numbers in parentheses:

§  DP: 42% (33%)

§  MPP: 28% (32%)

§  CWGP: 3% (4%)

§  MPRP: 24% (12%)

§  Others: 3% (19%)

Clearly, some very important movement in these numbers. The current numbers have the DP far ahead of the MPP. A 42% share in the proportional representation would translate into 12 seats of so from the party list. To secure a parliamentary majority (39 seats), the DP would thus have to win 27 of the 48 majoritarian ridings. While this still seems like a tall order, it is also a distinct possibility.

In an earlier post, I had offered the following two scenarios as the most likely outcome:

A. slight DP plurality (30-35 seats), but not enough to form government with CWGP. Result: DP-led coalition with MPP, PM = Altankhuyag

B. Strong DP: DP with a significant plurality (35-37 seats), but no majority, CWGP as expected. Result DP-CWGP coalition, PM= Altankhuyag

Given the current poll results, those two still seem like the most likely result, although scenario D with a DP majority would probably move up to C displacing a MPP plurality which now seems almost out of reach. Recall, however, that the poll only reflects the popularity of parties, not that of individual politicians running in majoritarian districts where 48 of the 76 seats in parliament will be decided.

Of course, my earlier speculation had completely discounted the possibility of a significant MPRP surge, or had at least relegated this to the sixth position among likely scenarios. The Politbarometer results suggest that such a surge is more likely than I had originally thought, but that it might still lead to a DP government. Even if the MPRP result were to be on par with the MPP and lead to around 7 seats in the new Ikh Khural, the MPP might still end up with a significantly larger party faction in parliament based on members elected directly in their ridings.

The analysis of voter movements suggests that the MPRP gain comes largely at the expense of the MPP.

Since Sant Maral offers separate answers for Ulaanbaatar vs. elsewhere in the country, that both large parties as well as the MPRP have more support outside of UB, while CWGP is the only party with stronger support in the city.


The rise in the support for the MPRP must be linked to the arrest of frm President Enkhbayar and the support that he has gained through portraying himself as a political martyr in this process and/or an indication of the success of populist appeals to the electorate.

However, the Politbarometer numbers do not indicate the increased importance of corruption as an issue that I was expecting from the very public back-and-forth in the Enkhbayar case. In April as well as in the current Politbarometer, corruption was ranked 5th among socio-political or economic problems by voters, though its rating increased relative to a drop in importance attached to the two top issues, unemployment and standard of living/poverty/income. Also, 5th was a “move up” for corruption for its 7th position in May 2011.

The MPP is seen as the least competent in addressing corruption between DP, MPP, and MPRP. Unfortunately, as I assume anti-corruption to be one of the central tenets of the CWGP campaign, they were not included in this question.


As some commentators have raised questions about the fate of Mongolian democracy through this election, trust in government institutions is an important question in my eyes. Here, Sant Maral asks, “How do you approve or disapprove the following statement: ‘In principal you can trust that the government is doing the right things for citizens’?”

Adding “fully approve” and “rather approve” together, we get a level of trust in government of 57% and of distrust (“rather disapprove” and “fully disapprove”) of 37%. This compares to 50% and 45% in April, respectively.

If the Enkhbayar case were the only imaginable impact on trust in government over this three-month period, we’d have to conclude that the prosecution of the former president seems to have raised levels of trust, but surely there are many other factors at play as well.

Individual Politicians

To get a sense of the popularity of individual politicians, Sant Maral asks “Whom of the prominent persons in the country would you like to name; who, in your opinion, should play an important role in politics?” Respondents are not prompted with a list of names and can name up to three.

Some big changes in the results here. While Enkhbayar was ranked second in this question in April with 17% hoping for a prominent role for him, he has lept to first place in response to this question in June with 22.5%. As this parallels the rise of the share of the MPRP in party preferences, the MPRP’s fate – not surprisingly – seems very closely linked to perceptions of the former president.

Current president Elbegdorj also made slight gains while the biggest loss of support came for union leader Ganbaatar who is running as an independent in the election, but whose support dropped from 26% to 14.5%.

PM Batbold’s popularity has been relatively stable at 11% (12% in April).

CWGP’s Oyun has dropped out of the listing of 10 most frequently-mentioned individuals in the June figures, as has Battulga, seen as a potential challenger to Altankhuyag for the leadership of the DP.

Note that the results on individual politicians may have been biased somewhat by the sampling for the Politbarometer which was limited to Sukhbaatar, Arkhangai, Selenge, and Hovd aimags outside of Ulaanbaatar. For example, Ulaan and Zorigt are from Sukhbaatar, Udval and N Batbayar (DP) are from Arkhangai, and Bayartsogt is from Selenge which may explain their high individual ranking, rather than some kind of national prominence.

Link to article


First-Ever Diaspora Voting

June 15 (Mongolia Today Blog) Mongolians abroad voted for the first time since 1990. After the democratic revolution, Mongolians began to enjoy their freedom to choose places abroad to live, work, and study without any party guidance and surveillance. Mongolian communities have established themselves in Europe (particularly, Germany, the UK, and France), Asia (South Korea and Japan), and North America (the US and Canada) – where Mongolians were not allowed to visit during the Cold War. The 2010 Census counted 107 140 Mongolians living abroad and many of them work to support their families in Mongolia. Despite this economic link, which also contributes to the national economy through remittances especially at times of economic hardships, diaspora communities have never enjoyed the right to vote.

Out of 80 000 eligible voters, 4 320 registered for the election, and 2 779 participated in the first diaspora voting on 10 June 2012. According to the General Election Commission, these votes will be counted on the Election Day, June 28, 2012. There were no irregularities reported and Mongolian Embassies and Consular Offices organized elections.

There are some concerns about diaspora voting. The foremost is insufficient turn-out for registration and voting, but there are several understandable causes. First, the decision about diaspora voting was made in December 2011 – causing financial and administrative hurdles in the organization of the vote.

Because these plans were not reflected in annual budgetary process, there were no additions funds for embassies and consular offices to reach out to Mongolians in their area of responsibilities. The joint administrative regulations of the Foreign Ministry and General Election Committee came out in April after much consultations.

Another concern is people’s civic will to participate in the election, which probably requires more careful study and polling. Finally, geographic, financial, and work-related matters easily discouraged voters who were required to vote in person at an embassy or consular office.

But, if we see this in an optimistic way, Mongolians are learning and improving democratic governance. Hopefully, the process around the diaspora vote was indeed a good lesson for parliamentarians who approved the law without much thinking about logistics, bureaucrats at the General Election Commission and Foreign Ministry, diplomats at the embassies who organized jointly, and voters who gained their political rights. Now the question is how to improve this in a transparent and accountable way. This time Mongolians abroad only voted for political parties (they only participated in the proportional voting part), but they were not allowed to participate in the majoritarian part, where voters elect MPs for their ridings. partWould the next attempt include over 1 000 military personnel serving in hot spots? Could online voting be a solution? Then, Mongolia can offer this lesson for others.

Relatedly, the protection of Mongolian nationals abroad is declared one of the key national security concerns in the revised National Security Concept and is also highlighted in the Foreign Policy Concept in 2011. In the last few years, the public is increasingly pushing the Ministry of Foreign Affairs and its diplomatic posts to protect rights of Mongolian nationals abroad. (during the tsunami, Mongolia evacuated its citizens from Japan by organizing several flights from Japan). Similarly, the embassies are increasingly playing noticeable roles during crisis abroad.

Link to article


Exit Poll of Diaspora Voters

June 15 (Mongolia Today Blog) Some Mongolians living abroad have organized an exit poll of others living abroad as they cast their votes.

The results of this exit poll are reported on D Sainbayar‘s blog in Mongolian. Thanks to Sainbayar for allowing me to post this English summary.

Here are the highlights:

Voters were asked whether they were willing to participate in an exit poll in front of Mongolian embassies in London, Seoul, Tokyo and Washington DC, as well as the San Francisco consulate. Those who were were then asked to report the vote they cast.

Of the total of 711 voters in these locations, 249 participated in the poll.

These 249 voters cast their votes as follows:

§  DP: 44%

§  MPP: 25%

§  CWGP: 13%

§  MPRP: 12%

§  Other 6%

The results are broadly similar across the different locations in that there is no difference in the ranking of parties except for CWGP and MPRP. Voters in Seoul gave the DP the fewest votes (38%) and Washington the most (54%) representing a notable variation. The MPP finished strongest among voters in London (35%) and weakest in Washington (16%), the CWGP strongest in Washington (16%) and weakest in Seoul (11%), and the MPRP strongest in Tokyo (16%) and weakest in London (8%).

My Comments:

Obviously, the methodology (no sampling frame of any kind) doesn’t allow for any inference to the larger population of Mongolians living abroad, nor to the Mongolian electorate.

The result here is perhaps a bit stronger for the DP then what I might expect in the general election as an overall share of the vote 44% could translate into a majority for the DP depending on results in majoritarian ridings.

I would have also expected Civil Will-Green Party to do even better than 13% given its focus on urban professionals and its anti-corruption stance. I would have thought that these positions would have particular appeal among Mongolians living abroad, though perhaps these groups are more heterogeneous that I assume.

Link to article


What am I looking for in election?

June 16 (Mongolia Today) As I am about to leave for Ulaanbaatar, I’m thinking about what sort of things I’ll be looking for in following the campaign in the city, and hopefully a little bit in the countryside as well.


I have previously written that the on-going Enkhbayar saga may promote a more public and frank discussion of corruption in this campaign. Since many Mongolians seem to think of most incumbents as being variously corrupt, particularly members of parliament, I do not necessarily expect these incumbents to voluntarily take on the topic in their campaign events. To the extent that such events allow for some direct interaction with voters, I do expect individual voters to raise this issue in questions.

However, most campaigning that I saw for the 2008 parliamentary election was relatively passive as far as individual voters were concerned with party-organized rallies much more common than direct interaction between candidates and citizens.

Among the parties, I imagine that Civil Will-Green Party is the most likely to emphasize corruption or, perhaps more accurately, anti-corruption. One of my questions in visiting CWGP events will therefore be how central anti-corruption will be to their campaign. Clearly, their campaign will be different from 2008 in that proportional representation offers them a much better chance at significant representation in parliament, beyond their current two members, even though one of these MPs, Enkhbat, has chosen not to run again. If anti-corruption does play a central role in the CWGP campaign, then I will interpret their result as a proxy for the extent to which corruption has become a topic of major concern for voters.


What about the MPRP? I imagine that their electoral support would be split into two categories. On the one hand, traditionalists, particularly in the countryside who will go with the true-and-tested MPRP brand “because they always have”. On the other hand, the MPRP also has some potential to garner support of protest voters and those who are looking for a more forceful voice for populist concerns especially regarding the distribution of revenues derived from the mining boom. I don’t think that the MPRP has much ideological credibility rooted in the original MPRP’s state-socialist past when it comes to redistribution of wealth, especially since Enkhbayar’s corruption trial is unlikely to portray him as a poor fighter for common Mongolians. However, partly because of the perceived (and irregular in some aspects) persecution of Enkhbayar, the MPRP might well emerge as a bit of an anti-big-party vote. In MPRP campaign activities I am therefore looking for populist appeals aimed at the MPP and DP, as well as a relatively unrealistic and simplistic stance vis-a-vis mining revenues. If these turn out to be prominent themes for the MPRP, I will interpret their vote share as a bit of an indication of the rise/decline/fate of populism.

Voter Participation

What about voter participation? This has steadily declined from 95% (1992) to 76% (2008). This trend may continue, though perhaps the simpler voting format (unlike the multi-member multi-vote set-up in 2008) and the information efforts of the General Election Commission may make voters’ options clear enough that no one would stay away because of a lack of understanding.

It is still a little unclear (perhaps only to me) how the new biometric identification cards will have an impact on turnout. One of the challenges in 2008 and also in the presidential election in 2009 was voters who had moved, but failed to register their move with the authorities. I am not sure whether the identification cards will make it easier for local officials to let cases like that vote and thus raise the turn-out. Given these factors, I would expect turnout in the 70s% with the low 70s suggested some disappointment in democratic governance, perhaps, while the high 70s suggesting a more engaged electorate.

In its June 14 Politbarometer, Sant Maral reported that 82% of Mongolians expressed their intention to vote. That would be a terrific turnout, of course.

Link to article


Mongolia moves toward democracy 

Parliamentary and presidential elections are key milestones in country's tumultuous transition

June 17 (Vancouver Sun) Depending on whom one believes, Mongolia’s former president Nambaryn Enkhbayar is either a champion of democracy targeted for judicial persecution by an increasingly authoritarian regime or he is a corrupt charlatan whose finely crafted portrayal of martyrdom hoodwinked Washington, the United Nations and the European Union.

The evidence suggests the second view is nearer the truth and Mongolia’s Constitutional Court has upheld a General Election Commission ruling that because Enkhbayar, president from 2005 to 2009, is facing five corruption charges, he is not eligible to run in parliamentary elections on June 28.

That ruling has stalled and perhaps ended Enkhbayar’s attempts at a political comeback after his defeat in the 2009 presidential election.

The parliamentary elections next week and presidential elections next year give every indication of being key stepping stones along Mongolia’s tumultuous transition which began when it emerged as an independent state from the collapsed Soviet Union in 1990.

Since then Mongolia has struggled to create a functional democracy amid the contradictions thrown up by a rapidly changing culture.

The discovery of huge mineral wealth brought hordes of mining company carpetbaggers thundering into Ulaan Bataar, seriously unsettling a traditional economy and social culture based on the semi-nomadic herding of sheep, goats and horses on the country’s vast steppeland.

Next week’s election will carry forward two significant developments on the transition road.

The contest for seats in the 76-member parliament, the State Great Khural, will be fought under new rules mixing seats allocated by proportional representation and others directly elected.

Major contestants for government are the current ruling party, the Mongolian People’s Party of Prime Minister Sukhbaatar Batbold, and the Democratic Party of President Tsakhia Elbegdorj.

The new dispensation will give smaller parties the chance to win seats in the parliament and thus influence what continues to be the major unresolved issue of Mongolian politics.

That is what kind of laws does the country want to regulate and produce the most sensible benefits from the country’s huge reserves of copper, coal, gold and many other minerals.

The philosophical argument has swung dramatically and sometimes violently on the streets between the totally laissez faire approach advocated by the men from the World Bank and the International Monetary Fund who tendered advice to post-Soviet Ulaan Bataar 20 years ago, and the economic nationalists who want foreign investors thoroughly trussed and bound.

The issue also has sharp political and cultural implications because the obvious market for landlocked Mongolia’s mineral wealth is southern neighbour China.

But Mongolians have deep-seated, historically based suspicions of Chinese territorial and economic ambitions.

A recently approved new foreign investment law attempts to find some balance that will spread the benefits of mining revenues and lessen the wide disparity that has grown between those with their fingers in the till and the majority of the nearly three million population, around 30 per cent of whom live below the UN’s poverty level.

The new law identifies mining as a strategic economic sector and restricts foreign ownership to a maximum of 49-per-cent in transactions worth 100 billion tugriks, the equivalent of $76 million.

Larger investments will automatically be subject to review by government. And, in an evident bow to suspicions about China, the law contains much lower thresholds for review of investments by foreign state-owned companies.

The aim is that this law will help to contain and erode the rampant corruption that has overtaken Mongolia and distorted its development.

The capital’s transformation into a wild and wonderful gold rush city seduced many of Mongolia’s inexperienced public figures nurtured on the culture of semi-nomadic herding.

It’s alleged by Mongolia’s Independent Authority Against Corruption (IAAC) that Enkhbayar, who was prime minister from mid-2000 to 2004 and speaker of Parliament from then until becoming president in 2005, lined his own pockets on several occasions.

The five charges against him, whittled down from over 20 allegations originally, claim he diverted funds intended for a Buddhist temple, used the state airline as a personal jet service, and benefited from the improper privatization of state-owned properties.

As is his way, Enkhbayar has responded with bluster to the top court’s ruling that he is ineligible to run in the election. The decision, he said last week, was “illegal.”

Enkhbayar was arrested by the IAAC in April after he repeatedly failed to respond to requests for an interview about the allegations against him.

From the start he claimed he was the object of political persecution and his supporters say he went on hunger strike in prison.

An effective and persistent international lobbying campaign by his supporters and relatives garnered some prominent backers, including Britain’s former attorney-general Lord Goldsmith, the UN’s Secretary-General Ban Ki-moon, Amnesty International and United States Senator Dianne Feinstein.

Enkhbayar was released on bail on May 14 in what may or may not have been a response to international pressure.

Despite protesting his innocence, Enkhbayar shows little enthusiasm to have his day in court on the corruption charges.

Last Tuesday, the opening of his trial was postponed for the third time after Enkhbayar said his lawyer was not present because she is a candidate in the elections and was away campaigning.

The judge ruled the trial will start on Thursday, June 21, with or without the ex-president’s lawyer.

Link to article


The National Park opens door

June 18 ( The National Park opened the door on Sunday, in Bayanzurkh District of Ulaanbaatar. The Ulaanbaatar City administration took a decision to built the National Park in Ulaanbaatar in 2009.

Since 2009 planted 90 thousand trees in 55 ha and installed arrogation system. 

The National Park has parking for 300 car and special road with 3 km radius for running and bicycle and a fountain with 40 meter radius.

Link to article



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