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Monday, September 29, 2014
Headlines in Italic are ones modified by Cover Mongolia from original
Mongolia Near Mine Funding Pact With Rio Tinto, Official Says
By Michael Kohn
September 26 (Bloomberg) Mongolia and Rio Tinto Group are days away from resolving a protracted dispute over development of one of the world's largest copper and gold deposits, according to a board member at the company managing the mine.
Oyu Tolgoi Board to Meet on October 2 to Discuss Feasibility Study
September 25 (news.mn) Oyu Tolgoi's Board of Directors will hold a meeting to discuss the new feasibility study of the underground expansion of the Oyu Tolgoi project on October 2nd.
Mining Minister D.Gankhuyag commented, "After the feasibility study of the underground expansion of Oyu Tolgoi is discussed by Oyu Tolgoi's Board of Directors, the Mongolian Minerals Resource Council will also review it. Efforts will be made to have the feasibility study discussed."
In addition, the Tax Dispute Settlement Council of the General Department of National Taxation issued a decision to cut the disputed 130 million USD in taxes that Oyu Tolgoi was directed to pay to Mongolia to 30 million USD.
Mining Minister D.Gankhuyag commented on the 100 million USD tax cut for Oyu Tolgoi LLC: "Mongolia owns 34 percent of Oyu Tolgoi, but it is inappropriate to intervene in the company's internal issues. Both the Mining Ministry and the Government of Mongolia avoid intervening in state-owned and private companies' internal issues. Numerous issues were raised related to taxes. Therefore, the Tax Dispute Settlement Council drew a conclusion consulting with independent parties from both sides of the argument."
Progress on Oyu Tolgoi?
By Julian Dierkes
September 25 (Mongolia Focus) The Mongolian government has been battling a homemade economic crisis for some two years now. It has been a largely self-inflicted crisis brought on by some hasty policy decisions regarding investments that have led to a massive loss of (foreign) investor confidence, coupled with some large-scale public borrowing and spending on variously popular and populist projects.
In May this year, I wrote an editorial in the UB Post that tried to make the case that the main task for the Mongolian government should be to get Oyu Tolgoi (construction and operations) (back) on track. There are some tentative signs this week that Mongolia is coming up to a turning point for short and medium-term economic development. The long-term prospects for Mongolia have not really been in doubt given its mineral wealth and positive factors like a small population, democracy, and a young and educated workforce.
Two pieces of news came in the last days regarding the giant Oyu Tolgoi project which is controlled by Rio Tinto but in which the government of Mongolia holds a 1/3 stake: First, a tax dispute seems to have been settled on mutually agreeable terms, but perhaps more importantly, a new feasibility study that examines the continued construction of Oyu Tolgoi underground has been released. These two pieces of news may be just the impetus that continuing discussions between Rio Tinto and the government have needed. This is especially true as a September 30 deadline from banks regarding the financing of the expansion looms.
Resolution of Tax Dispute
The resolution of the tax questions is hopefully an indicator that both parties recognize the importance of cooperation in all areas. Obviously, the Government of Mongolia should expect Oyu Tolgoi to fully comply with all regulations and laws of Mongolia, but Rio Tinto as the partner in Oyu Tolgoi should also expect cooperation form the Government in the form of the pursuit of a productive relationship.
OT Feasibility Study
The feasibility study is important not because of the price tag it quotes for underground expansion (which is in line with previous estimates), but because costs for construction up to the beginning of production had been a bone of contention for over a year between Rio Tinto and the government of Mongolia. Some of the costs associated with construction of above-ground facilities and some underground operations had been questioned by Mongolian officials. President Elbegdorj raised many of his concerns in a speech to parliament in February 2013. As part-owner the Government of Mongolia balked at approving further expansion until a feasibility study provided some potential clarity on costs that would arise from this expansion. The feasibility study announced US$4.9b as the necessary expansion of capital for underground operations.
The costs incurred in construction crucially determine any calculation on part of the government for when they might actually begin to see income streams from their stake in Oyu Tolgoi following the massive up-front investment costs of a block-caving operation.
Up until the announcement of these news items, there had been very little movement on discussions between Rio Tinto and the government for a very long time, at least no movement that was publicly visible. Obviously, some of the discussions between partners in a commercial venture ought to be held privately, but the Mongolian public certainly deserves to be kept informed about significant progress in negotiations. While government officials had claimed that such progress was being made in the last year, there was little evidence for such claims giving rise to suspicions that Rio Tinto may be relatively happy to accept a stall in the interest of avoiding further capital investments at a time of financial strain, or to seek out investment in the project by some other third party which would complicate matters for the government, especially if that third party was a Chinese concern.
The fact that the announcement of the feasibility study has come from Rio Tinto (via Turquoise Hill Resources, its Oyu Tolgoi "vehicle") suggests that strategic decisions for further construction and expansion may have come from Rio Tinto and potentially alleviating the fears about contrary plans.
If these announcements are indeed a turning point in the relationship between Rio Tinto and the government, this comes at an opportune moment.
Not only is the financial crisis in Mongolia growing more acute with the massive decline in FDI and the ballooning of debt, but Mongolia is also potentially being squeezed by its immediate neighbours, Russia and China, in the context of a cozying up to China by Russian Pres. V Putin following his ostracism by European and North American countries over the Crimea and Ukraine.
While any agreement between Russia and China poses no existential threat to Mongolia, it is likely to constrain the country in terms of its foreign policy options. For example, is there room for Mongolia to not participate in a proposed Russia-China-Mongolia customs union even though the Mongolian meat sector may be the only potential beneficiary while other benefits would primarily accrue to Chinese and Russian exporters? Pres Elbegdorj's tightrope walk to retain Mongolia's observer status at the recent meeting of the Shanghai Cooperation Organization points to some of the challenges that Mongolia will face in coming years.
This context is relevant to the OT decision because the recent visits by Pres Xi and Pres Putin involved a warm embrace of economic "goodies" on offer in terms of investments and commitments to infrastructure projects, etc. These overtures along with the likely participation of Chinese and Russian investors in the offering of new exploration licenses in Mongolia (delayed from the originally planned Sept 24 date) might signal an ever-increasing economic collaboration with the immediate neighbours that will be balance well by a reassertion of foreign (ie non-Chinese and non-Russian) interest in OT.
It is also hard to imagine that any Russia-China collaborations would support Mongolian democracy in any way should it ever be challenged by deepened economic crisis. This would be especially unfortunate as Mongolia is just beginning to play a role in democracy-promotion around Asia, particularly vis-à-vis the Kirghiz Republic and, potentially, Myanmar.
Contrary to Mongolia's potential role in democracy promotion, the current developments may come just in time in terms of the electoral cycle as well. Almost two years remain before the next parliamentary election and already the rumour mill about a replacement of the current governing coalition by a grand coalition has been heating up all year. Any decisions about Oyu Tolgoi that do not come very soon are likely to be doomed by politicization of the process and the looming electoral campaign.
Not out of the woods, but…
There is nothing definite in the current news that spells out a quick resolution of the Oyu Tolgoi disputes between Rio Tinto and the government, but for the first time in a while, there is some concrete and positive movement.
CG closed +1.12% to C$5.43 on below average volume
GoM Proposes Taking 20% Stake in Centerra's Gatsuurt Gold Project as Strategic Deposit
September 25 (Cover Mongolia) Cabinet meeting held today determined the government stake to take in Centerra Gold's (TSX:CG) Gatsuurt gold deposit in making it a "strategic" deposit, and has decided to submit the bill to parliament.
The government will take a 20% stake in "Erdenes-Gatsuurt," a joint venture company to be created to hold Gatsuurt deposit's special permit. Erdenes MGL will contribute the government's portion of $100,000 needed to establish such a foreign invested company or $20,000.
Erdenes-Gatsuurt LLC, becoming a "state-involved" company, will be mandated to resolve project financing issues on its own, without "overburdening the shareholders," during the exploitation of the deposit, most likely meaning that the government will not be providing financing for the project, perhaps in a similar fashion as OT.
Gatsuurt deposit has a registered resource of 27.6Mts of ore, 75.9 thousands kilograms of gold.
State Wants to Have Shares of "Gatsuurt" Deposit – Montsame, September 25
SGQ closed flat at C$0.62 Friday, 1878 -0.22% to HK$4.59
SouthGobi Resources Announces the Completion of the Construction of a Paved Coal Highway to Mongolia-China Border
HONG KONG, CHINA--(Marketwired - Sept. 28, 2014) - SouthGobi Resources Ltd. (TSX:SGQ)(HKSE:1878) ("SouthGobi") announced today that construction of a paved highway from the Ovoot Tolgoi Complex to the Shivee Khuren Border Crossing has been completed. Traffic opening ceremony of the highway was held on September 27, 2014.
"With the completion of the paved highway, I am pleased to announce that we have achieved one of our key objectives for 2014. The highway will significantly increase the safety of coal transportation, reduce environmental impacts, and improve efficiency and capacity of coal transportation" said Ross Tromans, President and CEO.
On August 2, 2011, the State Property Committee of Mongolia ("SPC") awarded the tender to construct a paved highway from the Ovoot Tolgoi Complex to the Shivee Khuren Border Crossing to consortium partners NTB LLC and SouthGobi Sands LLC, a wholly-owned subsidiary of SouthGobi (together referred to as "RDCC LLC"). SouthGobi Sands LLC holds a 40% interest in RDCC LLC. On October 26, 2011, RDCC has concluded a 15 year build, operate and transfer agreement with the SPC and commenced the construction of the highway on June 16, 2012.
The paved highway has a carrying capacity in excess of 20 million tonnes of coal per year.
Viking Mines moves to complete acquisition of Auminco Mines
The company has already secured acceptances in respect of 97.93% of Auminco shares as of the close of its off-market takeover bid on 26 September 2014.
Auminco shareholders will emerge with a 47% stake in Viking after Viking's takeover offer which is significant as Auminco was established by founding shareholders and management of Coalworks Limited that was sold to Whitehaven Coal (ASX: WHC) for ~$200 million in mid-2012.
Auminco's flagship Berkh Uul Bituminous Coal Project has already signed four non-binding memoranda of understanding with Darkhan Thermal Power Plant, Erdenet Power Plant, Darkhan Metallurgical Plant, and the Khutul Cement and Lime Plant relating to future potential coal supply.
It also holds:
- The Khonkhor Zag anthracitic coal project in the Trans-Altai Coal Basin in Govi-Altai Province, South West Mongolia;
- The early stage Buduun Project in a proven hard coal region in Khovd Province, Western Mongolia;
- The Dalt and Budargana coal projects in Dundgovi Province, Central Mongolia; and
- The Tsairt Zinc joint venture project in Sukhbaatar province in eastern Mongolia.
Berkh Uul Project
The Berkh Uul bituminous coal project is located in the Orkhon-Selenge coal district in Selenge Province, Northern Mongolia, approximately 40 kilometres from the Russian border and 200 kilometres east of Darkhan City.
Notably, it is located just 40 kilometres to the existing Trans-Mongolian Railway, which provides a transport link to Darkhan to the south and Russia to the north.
Berkh Uul occurs in the Upper Jurassic - Lower Cretaceous age Sharin Gol Formation within the Orkhon-Selenge Coal Basin, which also hosts a number of large hard coal deposits including the Mongoin Gol, Shariin Gol and Ulaan Ovoot deposits.
It consists of shallow, consistent coal seams of high quality bituminous coal amenable to open pit mining.
Berkh Uul coal is of sales quality without washing. There is potential to further value add to the resource by washing and producing a high quality, high energy thermal coal suitable for export markets.
Mining studies are planned for 2014 to accompany a Mining Licence Application to be lodged during 2014.
GUF trading -11.76% this morning after the announcements
Guildford: Baruun Noyon Uul Mine First Trial Coal Test Results
September 29 -- Guildford Coal Limited (Guildford or the Company) (ASX: GUF) is pleased to announce the results of the recent trial batch washing and laboratory results at the Baruun Noyon Uul (BNU) mine. As previously announced, Guildford delivered the first trial batch of coal (8,000t) from the BNU mine to Ceke (border of Mongolia and China) which has now been tested. The test results provide an opportunity for Guildford to confirm an initial BNU coal quality and negotiate with potential customers with more certainty about the BNU coal brand.
Whilst the first washing trial of the BNU coal has been encouraging, the Company expects the extraction process and the yield will become more favourable during subsequent delivery of trial batches. The first batch of coal was taken from a stock pile of coal that had been dormant and exposed to the weather at the BNU mine for a period of time. In addition, the Zhongmeng wash plant utilized by Guildford at the Ceke border had been dormant for an extensive period of time and the less than efficient process undertaken at the wash plant for the BNU coal will be improved as more batches of coal are washed.
The following are outcomes from the trial:
· BNU coal can be washed to meet a very clean premium quality hard coking coal specification with very low sulphur
· BNU coal is naturally very low in inherent ash and sulphur. Bulk washing of BNU coal will result in a highly marketable premium hard coking coal for the China market
· BNU coal can be friable, resulting in fines generation. The existing wash plant has equipment that is designed to recover coal particles down to ‐0.35mm, which is sufficient for the BNU coal, although the Company is mindful that additional operating experience at the wash plant is needed to improve the performance
· Float/sink testing of the bulk sample prior to washing demonstrated the BNU Coal to be amenable to washing showing yields of premium hard coking coal greater than 80% are achievable when generating a product with ash less than 8% and sulphur less than 0.6%.
· Guildford is confident that once the efficiency at the Zhongmeng wash plant is achieved, an improvement in the yield performance of the BNU coal will result
· The next batch of 12,000t is due to be shipped commencing 11th October
· The company is currently negotiating with several interested Chinese customers for the sale of the BNU coal. Independent samples have been supplied to potential Chinese customers directly from the Zhongmeng wash plant product stockpile. Draft Offtake agreements have been prepared in anticipation of the BNU mine commencing operation
· The recent announcement by the Chinese Government of restricting the import of coal that does not meet particular Ash and Sulphur specifications, to 40% and 3% respectively, is welcome news to the Company and will attract further strong interest in BNU mine coal
Guildord Coal Delays Appointment of Wal King Until Takeover Offer is Determined
September 29 -- The Board of Guildford Coal Limited (Guildford or the Company) (ASX: GUF) wishes to announce the following board changes.
As a result of the Sino Construction Ltd intention to make a conditional off‐market takeover bid to acquire all of the issued shares in the Company, the Board and Mr Wal King have resolved to delay the appointment of Mr King as Chairman of Guildford until the proposal has been determined.
Also, due to overseas business commitments, The Hon Craig Wallace has resigned from his position as a Non‐Executive Director of Guildford effective 29th September. The board would like to thank Craig for his services to the Company during its transition from developer to producer.
The Board further advises Mr Chris Munday will commence as Acting CFO from the 8th October. Chris is a Fellow of the Institute of Chartered Accountants in Australia and New Zealand and holds a Bachelor in Economics from the University of Adelaide.
Chris will report to the Group MD, Mr. Peter Kane and will be responsible for the financial, commercial, treasury and strategic management functions at Guildford.
Chris has in excess of 20 years' experience as a Chartered Accountant, including the last six years as a Partner in the Transaction Advisory Services division of global accounting group, Ernst & Young.
During his career he has had extensive experience working with Executive teams and Boards of ASX listed companies, assisting with their restructure, refinance and growth strategies.
MOU last traded A$0.004 Thursday, +300% in last 3 months
Modun Resources: Annual Report, 30 June 2014
September 26, Modun Resources Ltd. (ASX:MOU) --
Central Asia Metals: Interim Results
September 25 -- Central Asia Metals plc (AIM: CAML), a copper producing company focussed on base metals in Central Asia is pleased to announce unaudited interim results for the six months ended 30 June 2014 ("H1 2014" or the "Period").
The Company is also pleased to declare an interim dividend of 5 pence per ordinary share (H1 2013: 4 pence) which represents a 25% increase on the 2013 interim dividend and equates to 25.8% of the attributable revenue for the period. The Company's dividend policy is that it will return a minimum of 20% of the attributable revenues to shareholders.
Operations outside of Kazakhstan
The Group continues to hold for sale the assets it owns in Mongolia and is actively seeking to sell the Ereen and Handgait projects. The sale process remains extremely slow due to political and regulatory uncertainties within the country and the implications of a court case brought against Zuunmod UUL LLC by the minority partner on the Ereen project.
In May 2014 the Group sold Bayanresources LLC for nil consideration.
Eumeralla Resources: Annual Report, 30 June 2014
September 29, Eumeralla Resources Ltd. (ASX:EUM) --
OPERATING AND FINANCIAL REVIEW
The Company is an Australian based mineral exploration company.
The Company has a tungsten project in Mongolia and has ben assessing other potential mineral projects in Mongolia and Myanmar.
Due to the poor economic conditions in Mongolia, the Company continued to focus on opportunities in Myanmar. The Company considers that Myanmar provides excellent opportunities through its abundant natural resources and location in the heart of the world's fastest growing region. Being in the early stages of economic development, Myanmar is considered to have the 'greenfield' advantage over more developed economies.
MRL Disposed Mongolia Interests – Annual Report
September 29, MRL Corporation Ltd. (formerly Mongolia Resources Ltd., ASX:MRF) --
The 2014 fiscal year has been one of advancement by the Company.
In April 2013 the Company announced its intention to acquire substantial graphite project assets in Sri Lanka. This decision had arisen after changes in Mongolian mining legislation had made it increasingly difficult to operate in that country's legal environment. The directors' decision has been vindicated as exploration activity in Mongolia has essentially ground to a halt, with both junior companies and multi-nationals of the substance of Vale of Brazil withdrawing from the country.
23 Discontinued operation
On 15 November 2013 the Company disposed of the 70% interest it held in Khangi Prospecting LLC in Mongolia. The cash consideration received for the disposal was US$53,789.
MSE News for September 25: Top 20 +0.29% to 15,902.72, Turnover ₮6.3 Million
By B. Khuder
Ulaanbaatar, September 25 (MONTSAME) At the Stock Exchange trades on Thursday, a total of 14 thousand and 701 shares of 20 JSCs were traded costing MNT six million 325 thousand and 106.00.
"Hermes center" /8,504 units/, "Genco tour bureau" /4,679 units/, "APU" /582/, "Aduunchuluun" /429 units/ and "Mongolia Telecom" /200 units/ were the most actively traded in terms of trading volume, in terms of trading value were "APU" (MNT two million 152 thousand and 508), "Hermes center" (MNT one million 445 thousand and 680), "Aduunchuluun" (MNT 771 thousand and 580), "Material impex" (MNT 528 thousand and 320) and "Talkh chikher" (MNT380 thousand).
The total market capitalization was set at MNT one trillion 600 billion 747 million 752 thousand and 696. The Index of Top-20 JSCs was 15,902.72, increasing 45.48 units or 0.29% against the previous day.
MSE News for September 26: Top 20 -0.52% to 15,820.69, Turnover ₮4.1 Million
Ulaanbaatar, September 26 (MONTSAME) At the Stock Exchange trades on Friday, a total of 9,417 shares of 11 JSCs were traded costing MNT four million 055 thousand and 059.00.
"Genco tour bureau" /7,929 units/, "Merex" /400 units/, "Moninjbar" /331/, "Tavantolgoi" /276 units/ and "APU" /250 units/ were the most actively traded in terms of trading volume, in terms of trading value were "Tavantolgoi" (MNT one million 433 thousand and 390), "APU" (MNT 917 thousand and 200), "Genco tour bureau" (MNT 642 thousand and 249), "Sharyn gol" (MNT 286 thousand) and "Mogoin gol" (MNT220 thousand).
The total market capitalization was set at MNT one trillion 560 billion 849 million 218 thousand and 863. The Index of Top-20 JSCs was 15,820.69, decreasing 82.03 units or 0.52% against the previous day.
Finance Ministry to Transfer SCHCD's Securities Clearing and Settlement Functions to MSE
September 25 (Cover Mongolia) Government of Mongolia issued a resolution during a cabinet meeting held on September 18 announcing the following decisions regarding Securities Clearing House and Central Depository LLC:
1. To appoint Ministry of Finance as the shareholder of Securities Clearing House and Central Depositary LLC (SCHCD).
2. To transfer central depositary and share registry functions of SCHCD into a state-owned entity to be newly established.
3. To assign the duty of establishing the entity in Clause 2 of this Resolution to Minister for Finance Ch. Ulaan.
4. To assign the Ministry of Finance the duty of restructuring SCHCD with the roles of securities clearing and settlement functions.
5. To transfer full ownership of the legal entity in charge of securities clearing and settlement to the Mongolian Stock Exchange.
6. Clause 2-5 to take effect once the legal entity set out in Clause 3 is established by government decision.
Mongolia Must Hike Rates Further to Curb Inflation: IMF
September 27 (International Business Times) Mongolia has taken some measures to strengthen the economy but the country is still in need of strong fiscal and monetary reforms to shore up growth and control inflation, the International Monetary Fund said.
GDP growth has slowed sharply this year while inflation rate has soared in the land-locked northern neighbour of China. Foreign reserves of the country have improved this year but it was on account of increased borrowing from abroad, IMF noted.
"With the balance of payments still facing difficulties and inflation above target, the mission sees the need for further policy adjustment. The deficit including Development Bank of Mongolia spending brought gradually down to 2% of GDP," said Koshy Mathai, the IMF official who just completed his Mongolian visit.
This year alone, the Mongolian central bank has increased the policy rate by 150 basis points to 12%.
"The Fiscal Stability Law's deficit and debt targets should be maintained, and DBM spending should also be covered. Monetary policy should also be tightened, and the exchange rate kept flexible. Finally, measures to improve bank supervision and strengthen the banks are a priority," Mathai said in a statement released on Friday.
Mongolia has been one of the world's fastest growing economies as a result of large investment in the mining sector but faced a severe setback last year in the form of sharp declines in foreign direct investment and coal exports.
The Mongolian currency had fallen to a record low of 1,882 per US dollar in August, 13% down since January. But it has rebounded 3% after that. The Tughrik is still 10% down so far in 2014.
The authorities eased macroeconomic policies to buffer the economy and were able to maintain double-digit growth, but with the balance of payments still in deficit, the currency has depreciated and inflation rose, the fund said.
The inflation rate in Mongolia has been above 10% for about a year and came at 13.70% in August. It has averaged 12.5% over the past seven years.
"This year, while growth has slowed sharply, the trade balance has improved, and reserves have risen on account of increased foreign borrowing," the fund said.
The east central Asian country has seen its GDP growth slowing to 7.4% as per the latest quarterly estimate, after three consecutive quarters of above 11% growth, indicating the impact of a sharp drop in FDI in the mining sector of the mineral-rich Mongolia.
IMF noted that the People's Bank of China swap line, recently extended to 2017 and expanded by 50 percent to 15bn yuan, provides an important, additional cushion to Mongolia, but added that with FDI continuing to decline, the overall balance of payments remains in substantial deficit.
"It will be important to implement structural reforms to improve the business climate, make the economy more competitive, and boost FDI, with due regard for labor rights, environmental protection, and the needs of the most vulnerable," Mathai said in his statement.
Meanwhile, a Bloomberg report on 26 September showed that Mongolia and Rio Tinto Group were nearing a resolution for tax dispute over the development of one of the world's largest copper and gold deposits.
Development of the Oyu Tolgoi mine has been held up for more than 18 months due to a tax dispute, cost overruns and shareholder conflicts between the two parties. An agreement will unleash $4.2bn to develop the underground section of the mine, where 80% of Oyu Tolgoi's wealth lies, the report said.
IMF Staff Concludes 2014 Article IV Mission to Mongolia – IMF, September 26
Early morning USD rates: Khan (Non-Cash Buy ₮1,830 Sell ₮1,842), TDB (Non-Cash Buy ₮1,830 Sell ₮1,841), Golomt (Non-Cash Buy ₮1,831 Sell ₮1,843), XacBank (Non-Cash Buy ₮1,830 Sell ₮1,844), State Bank (Non-Cash Buy ₮1,830 Sell ₮1,842)
BoM MNT Rates: Friday, September 26 Close
September MNT vs USD, CNY Chart:
BoM FX auction: CNY80.5m sold at ₮299.5, accepts US$15m MNT swap offer
September 25 (Bank of Mongolia) On the Foreign Exchange Auction held on September 25th, 2014 the BOM has received bid offer of 13.1 million USD as closing rate of MNT 1837.31-1840.13 and 138.5 million CNY as closing rate of MNT 299.00-299.98 from local commercial banks. The BOM has sold 80.5 million CNY as closing rate of MNT 299.50.
On September 25th, 2014, The BOM has received MNT Swap agreement bid offer in equivalent to 15.0 million USD from local commercial banks and accepted the offer.
BoM issues ₮124.7 billion 1-week bills, total outstanding -7.4% to ₮384.8 billion
September 26 (Bank of Mongolia) BoM issues 1 week bills worth MNT 124.7 billion at a weighted interest rate of 12.0 percent per annum /For previous auctions click here/
Forum on Mongolia-China Monetary and Financial Relations to Be Held September 30
By N. Khaliun
Ulaanbaatar, September 26 (MONTSAME) The first forum themed as such will be held September 30 at the Ministry of Foreign Affairs of Mongolia.
It will be co-organized by The Mongolian Academy of Sciences, the Institute for International studies and the Chinese Central University of Finance and Economics.
The participants are to discuss a wide range of issues such as the monetary and financial relations of Mongolia and China, a current economic situation in both countries, a reform in System of International Reserves, an internationalization of the Yuan, an implementation of monetary policy in Mongolia, a macro level dynamics of China's stock market.
Cabinet to Discuss Merging Ministries and Agencies in Next Meeting
By B. Amarsaikhan
Ulaanbaatar, September 26 (MONTSAME) The Prime Minister N.Altankhuyag gave some directions and obligations to the leaders of Ministries and agencies on certain issues at the above-named monthly online meeting on Friday.
The draft 2015 budget was discussed at the cabinet meeting on Thursday and the budget proposals per package were rounded off, and these are will be presented to parliament soon, he said. Operational expenses have been cut off by the highest possible amount, and an initiative of allowing local administrations with budget authorities will be submitted, according to the Prime minister. The Premier noted that this year's budget draft is distinctive as it offers rights to the local administrations to decide their expenditures such as budgets for building schools and kindergartens. By reducing the expenses of ministries, and transferring some amount to the localities, operational expenses were cut off, he added and reminded the ministries and agencies to coordinate their activities with localities.
At the cabinet meeting on Thursday, the State Secretary of the Ministry of Energy D.Delgertsogt took some measures prior to his resignation from the office, and the reason of this measure was due to the state secretary's irresponsible operation of stripping down the newly built road of Airport and beginning of construction of pipes, the Premier said. He strictly warned the leaders at the conference not to repeat his mistake. The Government's next session will discuss matters on uniting some ministries and agencies because of their inconsistency of activities, he said.
Mogi: an MPRP guy replaced by an MPRP guy. Erdenejamiyan is the one who sent an email asking Interpol to stop searching for ex-Pres. Enkhbayar's sister.
Cabinet Appoints Deputy Minister for Justice of Mongolia
September 25 (infomongolia.com) The regular Cabinet meeting of the Government was held on September 25th and during the meeting, Minister of the Cabinet Office of the Government of Mongolia Ch.Saikhanbileg stated that the Cabinet held its regular meeting 38 times and 11 irregular meetings in the first 9 months of 2014.
During this period, 310 Government Resolutions were issued, 117 Prime Minister's Ordinances were authorized, 104 issues were submitted to the State Great Khural (Parliament), 7 issues were agreed to consult at the Standing Committees of Parliament and 15 issues to introduce at the National Security Council of Mongolia.
Moreover, one of the issues resolved today was an appointment of the official to the post of the Deputy Justice Minister of Mongolia. Accordingly, Mr. Tsogoo UUGANGEREL is appointed as the Deputy Minister of Justice, who used to serve as the Deputy Director-General of the Customs General Administration to date.
Newly promoted Deputy Minister Ts.Uugangerel succeeds Erdenebileg ERDENEJAMIYAN, who used to serve in this post since September 2012.
UNDP Sends Mongolian Officials to Study Turkish Experience in Development
By B. Amarsaikhan
Ulaanbaatar, September 25 (MONTSAME) Working group for Mongolia's Long-term Development Policy got acquainted with the Turkish development policy, its planning, results and practices during their visit to the Republic of Turkey on September 22-26.
The delegation included N.Battsetseg, D.Zorigt MPs, and L.Dashdorj, the President's advisor on citizen's participation and economic policy, along with other officials from the Ministry of Economic Development.
The Turkish minister of development Cevdet Yilmaz and a vice-director of Standing Committee on Budget and Planning of the Grand National Assembly Sureyya Sadi Bilgic received the delegation to discuss with them the development policy and planning of Turkey and to express their readiness to cooperate with Mongolia and to assist it in this field.
During a banquet, hosted by the vice-chairman of the Grand National Assembly Sadik Yakut on September 23, the latter requested a support from our side on realization of some cooperation projects that had been negotiated earlier.
The delegates also had meetings with the Turkish officials from the Ministries of Development and Finance, and exchanged opinions on coordinating development and budget policies, formulating the local and branch policies basing on researches. The Mongolians also got au fait with the development-planning and citizen's participation of the localities, while visiting Kayseri town.
This visit was funded by the UN Development Program.
Mongolia: Slow Progress in Changing Media Codes
First Half 2014 (The Konrad-Adenauer-Stiftung Media Programme Asia) --
Legislative Agenda for the Autumn Session of the Mongolian Parliament
September 26 (Hogan Lovells) On 22 September 2014, the Chairman of the Parliament of Mongolia ("Parliament") adopted Order #147 which approved those matters which will be discussed at the autumn session of Parliament.
The Order provides that the following draft laws and resolutions will be discussed in the following order:
1. Law on the Ratification of the Agreement on Transparency in Matters Related to International Trade and Investment between the United States of America and Mongolia;
2. Resolution on Measures to Ensure the Implementation of the State Policy on Railway Transportation;
3. Motion to dismiss a certain cabinet minister from office;
4. Resolution on the Approval of the State Policy on the Road Transportation Sector;
5. Law on Fire Safety;
6. Law on the Budget of Mongolia for 2015;
7. Law on the Budget for 2015 of the Human Development Fund;
8. Law on the Budget for 2015 of the Social Insurance Fund;
9. Resolution on the Approval of Main Directions for State Monetary Policy for 2015;
10. Law on Trade;
11. Law on Amendments to the Tax Laws;
12. Law on the Pledge of Movable Properties and Intangible Assets;
13. Law on the State Registration of Legal Entities;
14. Law on Crimes;
15. Law on Minor Offences;
16. Law on Combatting Domestic Violence;
17. Law on the Mongolian Language;
18. Resolution on the Revision of the State Policy on Education;
19. Law on Amendments to the Law on Procedures for the Implementing the Law on Prohibition of Exploration and Mining in Headwater Areas, Protected Zones for Water Reserves and Forest Lands;
20. Law on Inspections;
21. Consolidated Law on Elections;
22. Law on Political Parties and the Law on the Financing of Political Parties;
23. Resolution on the Approval of the Long Term Development Policy of Mongolia;
24. Law on Amendments to the Minerals Law;
25. Laws and other draft decisions of Parliament that have been under discussion by Parliament; and
Other laws and resolutions that are not listed in the above can be included with the approval of the Council of the Chairman of Parliament.
The autumn session of Parliament will commence on 1 October 2014 and end on 10 February 2015.
Of particular interest to investors are the following potential developments.
Ratification of the US-Mongolia Agreement on Transparency
One of the significant benefits of ratification of the Transparency Agreement is the joint undertaking to provide opportunities for public comment on proposed laws and regulations and to publish final laws and regulations in English, which should facilitate the ability of not only U.S. but other foreign enterprises to do business in, and invest in, Mongolia.
Law on the Pledge of Movable Properties and Intangible Assets
Access to finance is one of the major challenges faced by many Mongolian businesses. Current weaknesses of the Mongolian system include lack of clear legal framework and the absence of a registration regime for taking security over movable assets such as equipment, machinery and certain types of intellectual property rights, and over shares or securities in unlisted Mongolian companies. Reforms in this sector should improve access to finance by enabling lenders to take a broader range of collateral as security.
Law on the State Registration of Legal Entities
Whilst improvements were made to the process for incorporating companies by foreign investors in Mongolia by the passage of the Investment Law in October 2013, amendments to the law will introduce an online registration process for incorporation of legal entities and registration of subsequent changes in the registered details of a legal entity as well as provision of services by the Legal Entities Registration Office. The amendment will hopefully make the registration process and other related services more efficient and increase the level of transparency and openness of the state register.
Long Name Law (Item 19)
While historically this legislation has been controversial, appropriate and balanced amendments to the Law on Procedures for the Implementing the so-called Long Name Law would assist to bring much-needed clarity and opportunity to continue operation to investors in the mining sector (mainly in the alluvial gold sector) whose exploration investments and activity have in practice been on hold since the initial passage of the law in 2009.
Oyu Tolgoi Board Meeting Approaches
By B. Amarsaikhan
Ulaanbaatar, September 26 (MONTSAME) Oyu Tolgoi feasibility study has been submitted by "Turquoise Hill Resources" Ltd. to the Board of directors of Oyu tolgoi company, the latter will discuss the study this October 2.
After this the feasibility study will be considered by Council for Minerals of Mongolia, said the Mining Minister D.Gankguyag on Tuesday while giving an overview of the mining sphere.
He also said a law on minerals sector transparency, discussed by the government on September 18, will be submitted to the State Great Khural. The transparency is supposed to reduce corruption, to raise public control over mining companies' activities, to increase a number of taxes and payments to localities and state budgets, he said.
The cabinet had also discussed draft resolutions on re-estimating petroleum reserves and measures taken for fuel reserves, "related ministers have been told to have the petroleum reserves reach 83,350 tonnes which equals 30-day need, and to resolve the funding for this activity," he reminded.
By August of 2014, the mining sector collected MNT 802.8 billion in the state budget, the minerals export also increased, namely, the coal export by 27.6 percent reaching 12.2 million tonnes, oil—by 45.5 percent reaching 4.4 million barrels, and the export of copper concentrate doubled in amount, he said. Some 844.3 thous.tonnes of copper concentrate were exported by the end of August, he added.
The Minister went on that gold sold to the Bank of Mongolia reached seven tonnes. A "Focus Metal Mining" LLC commissioned a new wet-concentrate plant on September 6 based on Khudag Baishint iron deposit in Bulgan aimag, this plant is to market 1.9million tonnes of wet-concentrate and 69 thous.tonnes of regular concentrate within five years, and is estimated to make profit of USD 228.2 million, he said.
Mongolia Exploration Licenses Delayed by at Least a Week: Agency
By Michael Kohn
Sept. 24 (Bloomberg) -- Delay caused by modifications to electronic system that establishes appointments for mining companies, according to Uuriintuya Dombon, Director of the Mineral Resources Authority of Mongolia.
* Modifications will require at least one week, to be followed by recommendations by National Information Security Council: Uuriintuya
* Licenses to be issued on a first come, first serve basis
* Licenses will be first issued since a 2010 moratorium lifted in July
* Agency had planned to start issuing new licenses today
Mongolia's Fiscal Terms Remain Attractive as Interest in Oil Shale Grows, says GlobalData
September 24 (GlobalData) The fiscal and regulatory terms governing Mongolia's upstream oil and gas sector remain attractive, with recent clarification of the legal framework surrounding exploration and production (E&P) operations boosting investor confidence, according to research and consulting firm GlobalData.
The company's latest report* states that while the new Petroleum Law, passed on 1 July 2014, makes few significant changes to the fiscal and regulatory terms governing conventional hydrocarbons, it contains specific provisions for unconventional hydrocarbons for the first time.
The only specific fiscal incentive is a 10% royalty, instead of 15% for conventional resources. However, the flexibility of the Production Sharing Contract (PSC) framework means that contractors will likely be able to negotiate more attractive production sharing terms for unconventional PSCs.
Will Scargill, GlobalData's Upstream Fiscal Analyst, comments: "This is an important step for Mongolia, where there is growing interest in oil shale resources. The government has already started to sign agreements with investors for shale oil extraction pilots, envisaging conversion to a PSC once commerciality is established.
"The law also offers longer contract periods for unconventional compared to conventional operations, which are likely to prove an incentive to investors. The exploration phase can last for up to fifteen years, three years longer than normal, and the production phase is extended from 25 to 30 years."
GlobalData's report also states that the fiscal regime for conventional hydrocarbons under Mongolian PSCs grants the investor a significantly higher share of revenue than in other countries with similar levels of reserves.
Scargill says: "Mongolia reports proven reserves of 2.4 billion barrels of oil. When compared to countries with similar levels, such as Colombia, Gabon and Uganda, which all have reserves of 2–2.5 billion barrels, the Mongolian PSC is the most favorable to investors across all field sizes when other factors are assumed constant.
"However, the lack of infrastructure to commercialize reserves is a significant problem. Combined with the relatively unexplored nature of much of the country, this means that significantly increased competition for acreage is unlikely in the medium term and should keep the negotiated fiscal terms in conventional PSCs relatively stable," concludes the analyst.
Mongolia: Global Investor's Guide 2014
"American Days" Exhibition to Promote Best Goods and Services in Ulaanbaatar, Sept. 30 - Oct. 1
September 26 (infomongolia.com) Mongolian National Chamber of Commerce and Industry (MNCCI) in collaboration with the Embassy of the United States of America in Ulaanbaatar are organizing the "American Days" Exhibition at the MNCCI, Ulaanbaatar on September 30 and October 01, 2014.
The two-day event will feature over 40 companies representing the best American goods and services and the exhibition is sponsored by leading firms such as Peabody Energy, GE, Wagner Asia Equipment LLC, as well as Fuji Altai LLC and Mongol TV.
French-Mongolian Economic Forum Takes Place
By B. Amarsaikhan
Ulaanbaatar, September 26 (MONTSAME) A second Mongolian-France economic is running these days at Blue Sky hotel themed "Cooperation in energy sector".
Taken part by high-class French and Mongolian companies, the forum is discussing four main topics such as "Energy policies and current status of the sector", "Investment in energy sector, energy capacity of Mongolia: Traditional and ecofriendly energy", "New resource of energy, extraction of liquid and gas fuel from coal" and "Efficient use and reserves of energy; Smart network and Smart cities".
A host of the event--French-Mongolian Chamber of Commerce (FMCC), established in 2007, has now 50 member-companies such as French Air Liquid Ltd., AREVA, GDF Suez, Schneider Electric Corp., Mongolian "Erdenes Mongol" state-owned company, "Tavan Tolgoi" LLC, MAK Corporation.
The Ambassador Extraordinary and Plenipotentiary of France to Mongolia addressed the forum, noting that France is the fifth largest economy in the world with highly developed industry of satellites and missile production. France is eager to share with Mongolia its experiences in exploiting both nuclear and renewable energies, he stressed.
Speaker Attends AmCham Mongolia Monthly Meeting
By N. Khaliun
Ulaanbaatar, September 26 (MONTSAME) Parliament Speaker Z.Enkhbold Wednesday participated in a monthly meeting organized by AmCham Mongolia.
Opening remarks were given by Mr Kirk McBride, Deputy Chief of Mission of the U.S. Embassy in Ulaanbaatar, and by a Chairman of AmCham's Board of Directors Jackson Cox, who noted that the autumn session of the State Great Khural will discuss many important bills related to foreign investors. The Speaker gave an overview of the legislative priorities of this session and ways to forge partnership with American, and other "Third neighbor" companies to encourage investing Mongolia. He also stressed an importance of the issues to be discussed by the autumn session and named several crucial bill such as a draft resolution of parliament on some measures for ensuring the implementation of state policy on railway transportation; an issue of discharging some members of the cabinet; a draft resolution of parliament on the general law of Mongolia; a draft law on crime; bill on financing of political parties; a draft amendment to the law on the rule of maintaining the law on banning mineral exploration and exploitation near water sources, forests and protected areas; and others.
He also gave information about the projects "Silk road" and "Steppe Road" and highlighted the position of parliament over these matters. He said the visits of the President of Russia Vladimir Putin and President of China XI Jinping played an important role in enhancing trade and economic cooperation, and then answered some questions.
The American Chamber of Commerce (AmCham) in Mongolia is an independent membership-driven organization that seeks to build, strengthen, and protect business between the United States and Mongolia and to actively promote Mongolia as a destination for American investment. AmCham Mongolia is accredited by the U.S. Chamber of Commerce as its official affiliate in Mongolia. Based in Washington, DC, the U.S. Chamber of Commerce is the largest business federation in the world with over 3 million member-companies. AmChams have been established in over 100 countries.
Ulaanbaatar-Singapore Direct Flights via Beijing Every Wednesday and Saturday
September 25 (infomongolia.com) On September 24, 2014, MIAT Mongolian Airlines commenced its first direct flight between Mongolia and Singapore on regular basis to support growing demand for business and leisure travel, which will operate a twice-weekly service on every Wednesdays and Saturdays.
The MIAT Mongolian Airlines conducts Ulaanbaatar-Singapore flight from Chinggis Khaan International Airport to Changi Airport via Beijing to refill with its Boeing 737-800 aircraft that accommodates 174 seats and according to schedule to depart at 6:15 am with flight OM231 from UB on Wednesdays and Saturdays and the flight OM232 will depart Changi Airport at 6:20 pm on Wednesdays and at 6:45 pm on Saturdays, and the roundtrip ticket on economy class is starting from 1,088,000 MNT, which is a promotional offer until October 25, 2014.
At the inaugural flight from UB to Singapore, President and CEO of MIAT Mongolian Airlines.
Jargalsaikhan, Minister of Roads and Transportation A.Gansukh and other officials were on board, and they were welcomed in Singapore by Ambassador Extraordinary and Plenipotentiary of Mongolia to Singapore Mrs. B.Delgermaa and Executive Vice President of Changi Airport Mr. Yam Kum Weng on September 24, 2014.
Mongolia to Join Safety and Health in Mines Convention
September 26 (infomongolia.com) At the regular Cabinet meeting took place on September 25, 2014, it was agreed Mongolia to join the Safety and Health in Mines Convention, 1995 (No.176) recognizing that it is desirable to prevent any fatalities, injuries or ill health affecting workers or members of the public, or damage to the environment arising from mining operations.
The Convention was adopted at the 82nd Session of the International Labour Organization held in Geneva on June 22, 1995 and entered into force on June 05, 1998.
In the scope of joining the Convention, Mongolia shall to follow and comply with the Convention acts and regulations, in particular, clearly determine the roles and responsibilities of employers and workers, as well as provide for:
- the supervision of safety and health in mines,
- the inspection of mines by inspectors designated for the purpose by the competent authority,
- the procedures for reporting and investigating fatal and serious accidents, dangerous occurrences and mine disasters, each as defined by national laws or regulations,
- the compilation and publication of statistics on accidents, occupational diseases and dangerous occurrences, each as defined by national laws or regulations,
- the power of the competent authority to suspend or restrict mining activities on safety and health grounds, until the condition giving rise to the suspension or restriction has been corrected,
- the establishment of effective procedures to ensure the implementation of the rights of workers and their representatives to be consulted on matters and to participate in measures relating to safety and health at the workplace;
As of Mongolian mining industry, the General Agency for Specialized Inspection reports that workers are most affected by the industrial accidents and in the past 6 years, 510 workers have been affected in the mining industrial accidents, whereas one third died and 49 persons become disabled as a result of an accident. Thereof, Government of Mongolia deems by ratifying the Convention it will improve the labor safety in this sector in accordance with international safety standards.
Mogi: got a big lol out of this
The Madness of Nothing "Made in Mongolia"
By Michael Gorman, Managing Director, Independent LLC, Mongolia, www.independent.mn
September 23 -- About a month ago I received an enquiry from a major Japanese food manufacturer that had had found my Mongolian company Independent LLC through LinkedIn and our website www.independent.mn. We import frozen New Zealand fish and successfully manufacture and market Mongolian made frozen English style sausages, sausage rolls and pastry. Needless to say, I was quite flattered to have been approached.
The Japanese wanted to export frozen Hamburgers with a specially designed sauce to Mongolia. Their selling point, a long shelf life shelf life for their frozen product was, as is usual in the frozen meat industry, twelve months when kept frozen to – 18 C. Although I politely declined their proposal, it gave me me an idea: since beef is readily available in Mongolia we could manufacture a similar product ourselves in Ulaan Baatar, market it domestically, and if it was a success and the prices competitive, export it to other countries in Asia.
So I carried out some basic research, tried the Japanese product and concluded that we could produce an even better version ourselves. I asked my production and marketing team in Ulaan Baatar to look into this while I created a recipe for use with Mongolian beef which in my opinion, later confirmed by my team, was indeed better than the mass-produced Japanese product.
However, when my staff asked GASI (The Government Inspection Agency) for guidelines on frozen meat products, their response was straight out of The Mad Hatter's Tea Party. After a series of insane conversations my staff managed to extract, with great difficulty, the staggering fact that such standards as there were, were withdrawn in 2013 and not replaced; and because there is no replacement all meat products with a shelf life longer than 48 hours are dangerous and illegal. Never mind that Japan and other industrialized economies operate on a 12 month shelf life at -18c; this is Mongolia. Or that woolly mammoths have been found perfectly preserved in Siberia after 15000 years. But the Japanese, the GASI Controller suggested darkly, add a special ingredient that makes it possible, but is not permitted in Mongolia. I checked this, they don't.
Yet there is one special added ingredient that works every time in Mongolia - a sweetener. And that is the central problem in barring Mongolia's entry to the league of civilized nations; its rampant and endemic corruption orchestrated by Chief Balalaika Player Elbegdorj for the Mongol State Circus whose remarks are published by the BCM. (Mogi: LOL)
"The economic independence of Mongolia must improve, not only through mining but also through projects in agriculture and the provision for our own needs delivered from domestic production," said Elbegdorj.
Elbegdorj and his band never tire of plucking merrily on the three strings of their balalaikas: venality, drunkenness, and dereliction. Despite the soaring rhetoric he can't get his minions to put the basic regulatory frameworks in place to encourage domestic production that would provide desperately needed employment for Mongolian people let alone exports. They can't be bothered. And that is the problem;
Mongolian politicians can just about swallow their rabid xenophobia and sell mineral rights to foreigners if the backhanders are fat enough. But actually helping their own people is not what they bribed their way into government for. Now even Mongolian made frozen hamburgers are off-limits.
But there's always the vodka. The lunatics really are now running the asylum.
Plane Ticket Journals -- Capitalism Takes Flight: Scott Osheroff
By Jon Springer
September 26 (Forbes) Scott Osheroff, 25 this month, is someone emerging markets investors should keep their eyes on. When not traveling Asia to check in on markets for Asia Frontier Capital and his other ventures ranging from mining to agricultural commodities trading, he is primarily based in Cambodia. The California native has been interested in investing since elementary school when he had a ploy to buy Toys R' Us before the Christmas holidays and sell it after the holidays. Actively investing since he was 17 in the penultimate year of high school, Mr. Osheroff today sees himself well positioned to invest successfully in emerging markets he expects to grow rapidly.
With his investing interest firmly shifted toward the emerging markets of the world's most populous continent, Mr. Osheroff flew to Singapore with a one-way ticket after his collegiate graduation in summer 2012. He arrived with some savings from his paid internships during his time at Northeastern, one suitcase "with a suit and everything [but] nothing glamorous." He immediately set about exploring countries and working to build a network beginning with a schedule of Singapore for 7 days, Kuala Lumpur for 2, Bangkok for 4, a week in Cambodia and 4 days in Hong Kong.
Mongolia, with a stock market that had risen 121% in 2010, was still the darling of many frontier market investors in 2012. Mr. Osheroff had already begun investing in the Mongolia Stock Exchange before leaving the United States and had coordinated to meet up with Mr. Wallace and Mr. Tell at a mini-conference they were holding in Mongolia about investing in Mongolia a few months after his arrival in Asia.
Mining the legacy of Genghis Khan
By Dave Tacon
September 29 (Sydney Morning Herald) It's more than 800 years since Genghis Khan and his Mongol horde galloped out of central Asia, but today Khan looms large in the Mongolian capital Ulaanbaatar. He is the face of commerce emblazoned on bank notes and multiple brands of vodka. There is even a Grand Khan Irish Pub.
From the steps of parliament, a statue of Khan glares down from a bronze throne. On the banks of the Tuul River, 54 kilometres east of the city, he sits mounted on the world's largest steel horse, one hand grasping a golden whip.
Under Khan's advance, all those centuries ago, cities fell, east and west, their civilian populations put to the sword. At his peak, Khan ruled a quarter of the world's population. Only the Black Death halted his men and heralded his empire's gradual decline, which culminated in the humiliation of Mongolia's annexation by Russia in 1783. (Mogi: by China, more precisely the Manchurians)
Mongolia emerged from the 1991 collapse of the Soviet Union a dusty backwater, but with its culture mostly intact, isolated by a national language spoken only by its own people and a population of around 2.5 million. The once mighty empire was now sandwiched between two dominant neighbours, Russia and China, with combined populations almost 500 times their own.
Still, the last 20 years have seen a meteoric rise in the fortunes of Mongolia. The country is experiencing its most profound social and economic changes since Khan's reign. Although 40 per cent of Mongolians still live as nomadic herders, democracy, market capitalism and a resources boom catapulted the nation's economy to achieve the world's fastest growth in 2011 with GDP growth of 17.3 per cent. Trillions of dollars of natural resources – coal, copper, gold, uranium, silver, fluorite and other minerals – lie beneath its steppes.
But as in Russia, post-Soviet resource wealth has been spread oligarch style. A handful with government connections became rich overnight. Today, Mongolia's richest ten citizens include two members of parliament and a former prime minister. Predictably, the Mongolian elite have a taste for luxury brands and prestige cars.
"It changes each year," explains Belgian Chris De Gruben, managing partner of M.A.D. Investment Solutions, a real estate and consultancy firm established in Ulaanbaatar in 2008. "The first must-have car was the Hummer, then it was the Range Rover and this year it's the black G-Class AMG [Mercedes 4WD]." One parliamentarian, he says, has four Rolls-Royces. "They drive through the city in convoy: one for him, one for his wife, one for his daughter, one for his son."
Yet within the last two years, Mongolia's boom has turned to bust. Dependent on the mining industry for 90 per cent of its GDP (with more than 90 per cent of exports destined for China), Mongolia has been hurt by a downturn in minerals prices, in particular coal, and a decline in China's economic growth.
More contentiously, a government elected on a nationalist platform has introduced a raft of economic policies intended to protect the country's sovereignty. One new law has greatly complicated foreign firms' acquisition of mining or other strategic assets.
Additionally, a freeze on 106 mining licences due to a corruption scandal and an ongoing dispute between the Mongolian government and British-Australian mining giant Rio Tinto over profits and expenses from the gargantuan Oyu Tolgoi (Turquoise Hill) copper-gold mine reduced direct foreign investment by almost 90 per cent in two years. Ulaanbaatar's Western expatriate population dropped from around 7000 to 2500 in 18 months.
Still, Oyungerel Tsedevdamba, the Stanford-educated Minister for Culture, Sports and Tourism and one of three female government ministers, says the sudden spike in expat numbers brought by the mining boom was a mixed blessing.
"For regular citizens of Ulaanbaatar, [the drop in expatriate numbers] was good news," she says. "High numbers of well-paid expatriates had brought high inflation on basic products like meat, house rent and house pricing… One thing I know is that Mongolia has seen worse times and that our nomadic economy has proved resilient."
Despite measures by the government to remedy an investment climate described as "toxic" by a leading Mongolian economist, conditions, including an already deflated property market, are likely to worsen before they improve.
Mongolia has already been bailed out by the International Monetary Fund five times. On average a domestic bank fails every 18 months. With the economy on the verge of collapse, Mongolia's powerful neighbours are circling. In August President Xi Jinping became the first Chinese leader to visit the country in 11 years while Russian President Vladimir Putin visited earlier this month.
Despite an average yearly income of $4000, Mongolians are well-educated. More than half of the country is under 25 years of age. The children of wealthy families are often educated abroad.
The country has shifted away from its nomadic roots, but xenophobia is deeply ingrained. "The Russians and especially Chinese are trying to suck out everything from us ... It's why we hate the Chinese," says Tsuki Batar, 22, who recently returned from fashion design and French studies in Los Angeles.
Yet for most Mongolians, life is a struggle. According to the World Bank, around 30 per cent of the country lives in poverty. Most of them live in the Ger District, a sprawling slum of traditional tents ("gers") and cheaply built homes that cover the northern hills of Ulaanbaatar.
Many residents are climate refugees of the cruel winter of 2009-10. These former nomadic herders fell victim to the dreaded zud, a weather phenomenon in which snow is frozen solid by temperatures as low as minus 48 degrees. Eight and a half million cows, horses, goats, sheep and camels starved and froze to death during an extreme 55-day cold snap.
From the air, in the clear, mild summer, the Ger District looks like dull confetti sprinkled on the slopes and folds of the city's northern hills. In reality, these are the cramped tents and cheaply built houses of 60 per cent of the city, which has swollen to 1.6 million. Soviet town planners designed Ulaanbaatar for 400,000.
The area has no running water, no sewerage system or regular garbage collection. Alcohol dependency is rife, estimated at 13.6 per cent of the entire population by the Health Ministry of Mongolia and World Health Organization (WHO), compounded by an unemployment rate of around 34 per cent.
In winter, drunks have been known to freeze to death in Ulaanbaatar, the coldest capital city in the world. The average temperature for December and January is below minus 20.
Poor Mongolian families struggle to keep warm by burning raw coal and any combustible material in their small iron stoves. Come winter, Ulaanbaatar becomes the second most polluted city in the world, after Ahwaz in Iran, according to the WHO.
With another zud likely this year, non-government organisations such the International Federation of Red Cross are preparing for the worst. The national currency, the tughrik has depreciated by 40 per cent in the last two years, the price of meat, the mainstay of the Mongolian diet, has increased by 500 per cent, while residents of the Ger District are already spending 60 to 70 per cent of their winter income on coal.
With harsh times ahead, many are looking to Rio Tinto's Oyu Tolgoi mine for salvation. When fully operational, the South Gobi Desert mine, 550 kilometres south of Ulaanbaatar, is expected to contribute 35 per cent of Mongolia's GDP.
The site holds the world's third largest untapped source of gold and its sixth largest untapped source of copper.
"'Super giant', is the geological term," explains Grant Hendrickson, who led the geophysical team during the discovery years.
"Such an experience perhaps only comes once in a lifetime. During the exploration drill out phase, we had the feeling that it was infinite."
The ore body appears to extend at least 26 kilometres. The 370 million-year-old deposits could be mined for up to a century. Hendrickson admits to a general feeling on his team that such an immense deposit was destined to become a political football in such a relatively poor country.
Rio Tinto, the site manager of Oyu Tolgoi, began producing copper concentrate from its open pit mine in January last year. Close to $6.7 billion has already been invested, but the miner is yet to make a profit from it.
Critically, progress on the mine's second phase, deep underground, stalled in August last year. Oyu Tolgoi has since shed around 1700 workers linked to the underground mine. The $5.5 billion second phase is the world's largest project funding exercise with 14 banks involved. Yet with a September 30 deadline for its funding, already extended by six months, time may be running out.
There are signs of progress on the disputes with Rio Tinto. Mongolia has offered to cut its tax claim by $US100 million, and while Rio Tinto and its subsidiaries have not yet accepted the offer, they have responded by publishing a new feasibility for the second stage of Oyu Tolgoi. After months of silence, the flurry of activity over the past month suggests the relationship is thawing.
Still, cost overruns of up to $US1 billion have infuriated the Mongolian government, which has a 34 per cent stake in the mine.
Mongolia already has two other foreign-funded projects in international arbitration.
Rio Tinto refused requests for interviews. But in an interview with Fairfax Media, Sainbileg Chuluunbat, the government's deputy chief of cabinet and board chairman of Erdenes Mongol, the body that presides over Mongolia's resources industry, denied the country's economic downturn was any result of government policy and rejected rumours that the second phase of funding for Mongolia's largest foreign investment was in jeopardy. "We are still confident that underground mining will start in 2016," he said via a translator.
Mr Chuluunbat claimed Mongolia could fall back on its agriculture in hard times (Mogi: lol). However, this aspect of the Mongolian economy, which suffered in the country's post-Soviet restructure, is also fragile.
Back in the Ger District, Tsetsgihee, 60, who declined to give her surname, hopes Oyu Tolgoi will create jobs, but is yet to see any evidence. She has lived here since she lost her job at a state-run meat distributor at the close of the Soviet era. "I don't think it is bad to dig up those things, but the government promises apartments and comfortable lives and we're still living in mud houses," she says.
While the short term view for Mongolia's economy is bleak, the country still has the potential to become one of Asia's wealthiest nations.
Only 15 per cent of Mongolia's 1.55 million square kilometres has been exhaustively surveyed for mineral exploration. Australian Xanadu Mines recently released a report of significant discoveries of copper and gold mineralisation at their Kharmagtai site, 420 kilometres south-east of Ulaanbaatar.
"Ideally, I'd like Mongolia to be like Norway or Australia [as a resource rich and wealthy country]," says Ms Tsedevdamba, "but it's a very long process... The Mongolian nomadic lifestyle didn't change for thousands of years… In the end we have to adjust and we will adjust."
Presentation: "Smart Ulaanbaatar"
By Bat-Ulzii Batchuluun, Head of Metropolitan Department of Information Technology
High-Level Forum on "Setting the vision for smart sustainable cities", 24 September 2014, International Telecommunication Union
More than half of UB cars are Toyotas
September 26 (news.mn) According to an official report issued by the Ulaanbaatar City Statistics Office, city registered car usage in Ulaanbaatar has risen 16.5 percent in the past three years.
According to annual increases, city registered car usage was 28.9 percent in 2011, but in 2012, it fell to 9.1 percent. In 2013 a total of 257.5 thousand cars were involved in state vehicle inspections, an increase of 28.5 thousand compared to 2012, and 46.8 thousand from 2011.
Only 66.9 percent of all vehicles were covered by state vehicle inspections across the country.
According to the 2013 results of state vehicle inspections, 71.6 percent of all inspected vehicles were private passenger cars.
This data suggests that 7 out of every 10 vehicles is a private car, and almost 85 percent of private cars are registered by individuals and civilians. The rapid growth of private car use in the city contributes to increasing traffic congestion.
The report also indicates that 4.4 percent of the vehicles are Honda models, 9.5 percent Nissan, 15.2 percent Hyundai, 51.9 percent are Toyotas, and the remaining 15 percent are vehicles from other manufacturers. A total of 723 vehicles were registered by foreign residents.
"Khuden" to open 2014 Ulaanbaatar International Film Festival, October 8-12
September 26 (news.mn) Ulaanbaatar International Film Festival is taking place from October 8-12th. The Ministry of Culture, Sport and Tourism is organizing the festival in collaboration with Arts Council of Mongolia and Mongolia's Film Council.
The Ulaanbaatar International Film Festival will be attended by filmmakers from more than 10 countries in Asia and Europe, as well as Mongolia and the USA.
Traditionally, a film by a Mongolian director opens the festival. This year the drama "Khuden", by Mongolian director B.Tavanbayar, will be screened on the first day of the film festival.
Mongolia Eyes Non-Permanent Seat at UN Security Council at 2022 Elections
September 25 (infomongolia.com) On September 24, 2014, the General Debate of the 69th Session of the United Nations General Assembly has been commenced to continue until September 30th, and in the Afternoon Session, 19 heads of state and government including the President of Mongolia have delivered statements.
The President of Mongolia Ts.Elbegdorj delivered the following statement themed "Delivering on and Implementing a Transformative Post-2015 Development Agenda".
DELIVERING ON AND IMPLEMENTING A TRANSFORMATIVE POST-2015 DEVELOPMENT AGENDA
September 24, 2014
Ladies and Gentlemen,
At the outset may I join others in extending our heartfelt congratulations to you, Minister S. Kutesa, on your unanimous election as President of the current session of the General Assembly.
You can count on my delegation's full support in the discharge of your onerous responsibilities in steering our work in the months ahead.
The world is faced with multiple crises - violent conflicts in various parts of the world, terrorist activities by extremist groups, unprecedented epidemics and natural calamities.
At this time of turmoil we, as a family of nations, must rally around the World Organization, as a centre of multilateralism, upholding its Charter and universal principles of international law.
We need peace and development.
We need to do our utmost to implement the right of peoples to peace as emphasized by the Declaration on the Right of Peoples to Peace adopted 30 years ago at the initiative of Mongolia.
We have consistently supported joint efforts of the international community against terrorism in all its forms and manifestations.
Mongolia is a party to the majority of international counter-terrorism instruments.
Unthinkable atrocities, committed by the terrorist group named the ISIL (Islamic State of Iraq and the Levant), pose alarming threats to the regional peace and security.
The international community ought to take resolute action and resolve this issue comprehensively in compliance with the UN Charter.
Mongolia commends the Secretary-General's leadership in rallying international support and establishing the UNMEER (UN Mission for Ebola Emergency Response) to ensure a rapid, effective and coherent response to the Ebola crisis.
We support the resolutions of the Security Council and the General Assembly to this effect.
The situation in Ukraine should be resolved only through political dialogue refraining from the use of force.
Current ceasefire needs to be made more sustainable taking into account all efforts towards finding a solution, including the "Putin Plan" outlined in Ulaanbaatar earlier this month, as well as the Minsk Protocol and its Follow-up Memorandum.
25 years ago Mongolia chose its development path - to embrace rule of law, democratic governance, market economy and open society.
Among the countries known as the third wave of democratization, the transition to democracy was in many respects unique in Mongolia.
We made a simultaneous transition to democracy and market economy. We made that transition peacefully.
The 1990 democratic parliamentary elections were not only first of its kind in the region, but it was fully free and fair.
To ensure an inclusive growth and citizen's participation a national policy on decentralization through direct democracy has been introduced.
As a result, citizens have been enabled to directly participate in identifying development priorities and allocation and monitoring of the local budget.
To identify a long-term development pathway and regain confidence of investors a number of multi-stakeholders' events were introduced - the Mongolia Economic Forum, Business Summit and Discover Mongolia.
In addition, new laws, particularly on investment, on investment's fund and petroleum, budget transparency and others were adopted.
At the international level, Mongolia served as Chair of the V International Conference of New and Restored Democracies and the Community of Democracies.
We currently chair the Freedom Online Coalition. It is for the first time that an Asian country leads the Coalition. We support the Human Rights Council's decision that Internet freedom is a basic human right.
Mongolia as a staunch advocate of democracy and freedom will use the opportunity of chairing the Coalition to promote both nationally and internationally the Internet that is free and secure for all.
To support emerging democracies Mongolia has set up an International Cooperation Fund.
We have nothing to preach, but we have experience and lessons learned. Hence, we shared with Kyrgyzstan our experience in parliamentary democracy and legal reform, organized training for Afghan diplomats and Myanmar journalists.
Mongolia highly commends Secretary-General's leadership to galvanize and catalyze the global action on climate change.
Climate change is not a challenge for the future; it is a matter of urgent priority today.
Yesterday's Summit offered world leaders a unique opportunity to voice their commitments to cut the emission gap, pledge for the 2 degrees scenario in the lead up to COP 21 in Paris next year.
But this pledge will remain a mere ambition if not backed up by bold action and strong political will.
We are running out of time. But we cannot run out of our Planet Earth.
The time to act is now.
Moreover, the Green Climate Fund needs to be made fully operational. If resources are actually transferred as incentive to countries which reduce their GHG emission, it will have a multiplier effect.
No one country is immune to climate change.
Even my own country - Mongolia, which has centuries-old tradition to live in harmony with nature - is experiencing its disproportionate effect.
Conscious of this reality Mongolia has recently adopted a Green Development Policy.
We expressed our support to the Statement on Carbon Pricing, and to the New York Declaration on Forest to combat deforestation.
This session of the General Assembly has an important task to articulate the post-2015 development agenda based on the legacy of the MDGs (Millennium Development Goals).
In this regard, we look forward to a synthesis report by the Secretary-General prior to the intergovernmental negotiations on SDGs (Sustainable Development Goals) during this General Assembly Session.
We also welcome the Outcome of the Open Working Group on SDGs and commend its hard work over the last 18 months.
Rio+20 underscored the special challenges facing the most vulnerable countries, including landlocked developing countries.
Yet, we are of the view that the Outcome Document of the Open Working Group could have better reflected the special needs of LLDCs (Landlocked developing countries).
We look forward to the upcoming intergovernmental negotiations to redress that situation.
In the run-up to the ten-year review of the Almaty Program of Action we hosted a high level international workshop on "WTO Agreement on Trade Facilitation: Implications for LLDCs" last June.
We also joined the "Intergovernmental Agreement on Dry Port" to engage ourselves in regional connectivity.
Mongolia, China, Russia Summit
Facilitation of transit transportation, infrastructure development and reduction of trade barriers were among the issues discussed during the recent visits to Mongolia by President Xi Jinping and President Vladimir Putin.
We agreed to expand our cooperation in those areas.
Those agreements were once again reiterated at the first ever trilateral summit between Mongolia, China and Russia on the sidelines of the SCO Summit in Dushanbe earlier this month.
The expansion of our cooperation with two neighbors augurs well for regional trade and investment and paves the way for enhanced economic collaboration with our 3rd neighbors.
Mongolia is redoubling its efforts to join APEC, become a dialogue partner of ASEAN and to constructively engage in the East Asia Summit.
Last July, we also signed an economic partnership agreement with Japan.
Strengthening peace and stability in Northeast Asia is one of our national security priorities.
We firmly believe that dialogue and open discussions enhance confidence among nations.
Following up on the "Ulaanbaatar Dialogue" initiative, we have successfully hosted a series of fruitful platforms – Women parliamentarians meeting, International research conference and City mayors meeting of Northeast Asian countries.
The stability on the Korean Peninsula is crucial for maintaining regional peace and security.
We stand for an early resumption of the Six-Party Talks.
As a country with a declared nuclear-weapon-free status, Mongolia firmly believes that the Korean Peninsula must be nuclear weapons- free.
In a time of major geopolitical change, the UN system must reflect new economic and political realities.
We need to accelerate the reform process, including the long-overdue expansion of Security Council membership in both permanent and non-permanent categories.
The issue of the Council's working method is also important for all small States, which make up a majority in the United Nations.
Out of 193 members of the United Nations, 70 states have never been elected as members of the Security Council, including my own country - Mongolia.
As a responsible member of the international community, Mongolia has put forward its candidature for a non-permanent seat of the Security Council at the elections to be held in 2022 and is seeking the valuable support of its fellow members.
In conclusion, may I express my confidence that this session of the General Assembly will be able to deliver a common development strategy beyond 2015.
A strategy that will inspire and guide us to collectively work towards a safer, more equitable and prosperous future in the years to come.
Thank you for your kind attention.
President Addresses 69th Session of UN GA – Montsame, September 25
Turkey Provides $1 Million to Mongolia Annually in Defense Assistance
September 26 (infomongolia.com) Delegates from the Ministry of National Defense of the Republic of Turkey headed by Minister Ismet Yilmaz are paying an official visit to Mongolia on September 25-26, 2014.
On the first day of the visit, Defense Minister of Mongolia D.Bat-Erdene welcomed his counterpart of Turkey at the Ministry of Defense with guards of honor, after, parties held a meeting discussing issues concerning bilateral relations as well as the partnership broadening in the defense sector and its further plans.
During the bilateral meeting, the two Ministers inked on intergovernmental document of "Agreement of Military Financial Cooperation" and it's "Implementation Protocol".
Also, Defense Minister Ismet Yilmaz met with Mongolian military representatives and peacekeepers served in Iraq, Afghanistan and other states to express his appreciation for successful mission.
Afterwards, Minister D.Bat-Erdene presented a thoroughbred racehorse to the distinguished guest, Defense Minister of Turkey Ismet Yilmaz, and after receiving this honorary gift, Minister I.Yilmaz gave a name to the horse as Bilge named after the Great Bilge Khagan.
As part of his official visit programs, Defense Minister Ismet Yilmaz and accompanying delegates were received by the Prime Minister of Mongolia N.Altankhuyag in the Government House on September 25, 2014. After which, the delegation visited historical sites of Khushuu Tsaidam Memorial Complex in Arkhangai Aimag, Tonyukuk monuments in Nalaikh district and Chinggis Khaan statue at Tsonjin Boldog in Tuv Aimag.
Cooperation in Defense sector between Mongolia and Turkey has been successfully developing since 1999 and according to intergovernmental negotiations, the Government of Turkey annually assists Mongolian Defense sector with grant aid equivalent to one million USD. Moreover, 79 Mongolian officers have graduated from Turkish Military Academy since 2000.
Defense Minister of Turkey Visiting – Montsame, September 26
Premier receives Defense Minister of Turkey - Montsame, September 25
Turkish Defense Minister arrives in Mongolia – news.mn, September 25
Hungary to Reopen Embassy in Ulaanbaatar for 65th Anniversary of Diplomatic Ties
September 25 (infomongolia.com) On September 23-24, 2014, the President of Mongolia Ts.Elbegdorj held several bilateral meetings with heads of state and government, who are attending the 69th Session of the United Nations General Assembly in New York, USA.
At the meeting with President of the Republic of Hungary, Janos Ader held on September 24th, President Ts.Elbegdorj emphasized that Mongolia and Hungary will celebrate 65th anniversary of the establishment of the diplomatic relations in 2015 and underlined the traditional and historical ties between the two countries have been lasting to date. The parties discussed opportunities to educate students and undertake joint research for the students from the two countries. Hungary is considered as a center for Mongolian studies in Europe. Also, President Ts.Elbegdorj expressed his gratitude that Hungary is set to reopen its Embassy in Ulaanbaatar.
President of Hungary J.Ader mentioned that President Ts.Elbegdorj co-chaired the Water Management discussion at the World Economic Forum in Davos and delivered an interesting speech about the tradition of Mongolian nomadic culture. Mr. Janos Ader expressed Hungary's readiness to share its experience in biotechnology sector and interest to cooperate with Mongolia in developing and modernizing the Biokombinat factory.
Following attendance at the 10th Asia Europe Meeting (ASEM10) to take place in Milan, Italy on October 16-17, 2014, President Ts.Elbegdorj will pay a working visit to Hungary and Austria on October 17-18, and share detailed conversation on issues of bilateral relations.
Moreover, President Ts.Elbegdorj plans to attend at the Austria-Mongolia Business Forum in Vienna and Hungary-Mongolia Business Forum in Budapest on these days.
President Holds Talks with Counterparts from Hungary and Estonia
By B. Amarsaikhan
Ulaanbaatar, September 25 (MONTSAME) The leader of Mongolia Ts.Elbegdorj held bilateral meetings with Presidents Hungary and Estonia on September 24 on fields of the General Assembly of the UN in New-York in the USA.
At the meeting with Hungarian leader Janos Ader, our President noted about the 65th anniversary of diplomatic relations which falls on 2015, and ancient ties between our countries. Then the dignitaries discussed a student exchange between the two countries, noted that Hungary acts as a center of Mongol studies in Europe. Our President appreciated a re-opening of the Hungarian Embassy in Ulaanbaatar.
The Hungarian leader recalled seeing our President's addressing the Water-Management conference of the World Economic Forum, and said he had learned many things to learn from Mongolian nomadic livelihood on economical use of water. He expressed a willingness to share with Mongolia practices regarding bio-technology and to cooperate in innovation of "BioKombinat" state-owned company of Mongolia. Other important matters will be discussed during our President's visit to Hungary this October 17-18, when he will be returning from Milan ASEM (Asia-European Summit) 2014.
After this, Mr Elbegdorj met with the Estonian President Mr Toomas Hendrik Ilves. "Estonia is one of the leaders in the world by its development of E-governance, we would like to introduce it to our country, and we can also cooperate in information technology," he said. Then he asked his counterpart about Estonia's use of oil-shale.
According to Mr T.Ilves, his country has some one hundred years of experience in processing oil-shale, which provides now 95 percent of electricity and 50 percent of fuel needs of the country.
After this he asked Mongolia, who is chairing the Online Freedom Coalition after Estonia, to attract more Asian countries to this coalition.
The sides also discussed a submitting of a joint initiative on Online Freedom to the UN.
The President of Estonia Ilves will in person participate in the upcoming conference of Online Freedom Coalition in Ulaanbaatar in 2015.
All-China Women's Federation Leaders Meet With Women Delegates from Mongolia
September 28 (-China Women's Federation) Vice-President and Member of the Secretariat of the All-China Women's Federation (ACWF) Zhao Donghua met with a visiting delegation of the Mongolian Democratic Women's Association in the China Women's Activity Center in Beijing on September 26. Vice-President and Member of the Secretariat of the ACWF Cui Yu had a conversation with the delegates on September 28.
Freedom Online Coalition Meeting Hosted by Mongolia and Estonia in NY
By B. Khuder
Ulaanbaatar, September 25 (MONTSAME) A high level meeting of the Freedom Online Coalition (FOM) ran Tuesday in New York City.
It was co-hosted by Mr Urmas Paet, the Foreign Minister of Estonia--previous chair of the FOM, and by Mr Bold, the Foreign Minister of Mongolia, currently heading the coalition.
This gathering propagandized the FOM and introduced its actions to the UN members. The Ministers ran discussions on implementation of documents released by the 4th Conference of the FOM in Tallinn and on preparation for the next conference to run in May in Ulaanbaatar.
Several reports were also delivered during this high meeting by Mr Carl Bildt, the FM of Sweden; Mr Frank William La Rue, the UN Special Rapporteur on the Promotion and Protection of the Right to Freedom of Opinion and Expression; and by authorities of the Human Rights Watch and the Facebook.
North Korean flees the country by cycling for 12 days through China to reach Mongolia
Park Young-jin braved dangers and the Mongolian cold to flee North Korea
by Sarah Barth
September 27 (road.cc) A man who fled hardship and oppression in North Korea has revealed how he cycled for 12 days through China to freedom.
Park Young-jin, 24, was on his second attempt to flee last year when he packed a few essentials and rode away on his bike.
He faced extreme danger even in China, as the country refuses to grant refugee status to North Korean defectors and considers them illegal economic migrants.
The Chinese authorities arrest and deport hundreds of defectors back into North Korea, sometimes in mass immigration sweeps. Chinese citizens caught aiding defectors face fines and imprisonment.
"One time I was sent back to North Korea through a broker so I couldn't trust anybody any longer. So when I came out to China again I got a map and a compass and a bicycle, I just went", he told The Guardian.
"I prepared a little mini tent, a change of clothes, a little of the money I earned.
"I didn't know how long it was going to take so I couldn't bring food".
At first, he said, if was fun - he felt "young and free". But as he got closer to Mongolia and felt the temperature drop he realised "it wasn't going to be that much fun".
Eventually, when he reached Mongolia, Park was able to travel to South Korea, arriving around a year ago.
Since 1953, between 100,000 and 300,000 North Koreans have defected, most of whom have fled to Russia or China.
Journey of a North Korean defector: from escaping by bike to singing at Harvard – The Guardian, September 26
'Silk road' diplomacy for inclusive growth
By Wang Yiwei
September 24 (China Daily) President Xi Jinping floated the idea of a new Silk Road economic Belt and 21st Century Maritime Silk Road last year, and his just concluded four-nation visit to Central and South Asia is expected to make the concept a policy priority.
As a major part of China's diplomatic strategy of all-round opening up, the two "silk roads" are aimed at boosting the economy of China along with that of other countries, especially its western neighbors. An interconnected transport network, comprising railways, highways, air and sea routes, and oil and gas pipelines across Eurasia, should ideally give rise to a wide range of industrial clusters, which will have a radiating effect on sectors such as construction, energy, metallurgy, finance, communications and even tourism.
The two new "silk roads", once operational, will help further integrate the Asia-Pacific region and European Union – the world's economic engine and largest economy respectively – into a potential "Eurasia market", inside which free trade zones can thrive, and economic and technological cooperation between countries and regions can be deepened.
In this context, the "silk road" diplomacy is mainly aimed at achieving better communications among countries in adjoining regions. In specific terms, however, the transport "highways" connecting the Pacific Ocean, Indian Ocean and the Baltic Sea, should be jointly built by "roadside" countries such as China and Sri Lanka. And to boost regional trade and investment, all states along the "silk roads" have to establish special financial institutions to finance the two "silk roads" and ease bureaucratic norms for cross-border financial transactions, and more exchanges of advanced technology and high value-added products. Besides, to stimulate trade, all states have to widen their foreign exchange policies and settle their businesses in local currencies.
Also, communication and coordination on policies and cultures need to be strengthened to make Eurasia an integral whole with a shared destiny.
That China is not merely seeking regional cooperation with its western neighbors is evident from Xi's visit to South Asia where he mooted the idea of building a Mongolia-China-India-Myanmar economic corridor, which is needed to geographically and economically link the two "silk roads".
Last year, India had expressed doubts about such a north-south corridor because the India-Myanmar border is still "closed" because of the rampant militancy in India's northeastern states which border Myanmar. So by choosing India as the last stop on his four-nation tour, Xi sought to reassure New Delhi of Beijing's concrete efforts to enhance economic ties by promising to invest $20 billion in India in the next five years.
If a Eurasian free trade zone or market becomes reality, it will have a huge impact on the global economic landscape and world order for three reasons. First, as part of China's efforts to promote inclusive development, the "silk roads", unlike ocean routes-based globalization, attach greater importance to relatively less developed landlocked countries such as Mongolia and Kazakhstan, and aims to help them catch up with the well-off coastal states.
Second, apart from promoting trade and cultural exchanges, the proposed "silk roads" are a perfect interpretation of China's peaceful development. As an emerging power not aligned with the United States, China can only rent or co-build a port to ensure smooth navigation in the seas and serve the needs of its aircraft carrier Liaoning in international waters. And the proposed "silk roads" can help it do that.
And third, compared with the goals of the EU-proposed Eurasian integration from Lisbon to Vladivostok, those of the "silk roads" are more achievable and inclusive. In addition, it will help counter the US-led Trans-Pacific Partnership and Transatlantic Trade And Investment Partnership which are aimed at excluding China from closer trade cooperation by taking high standards. Therefore, the "silk roads" proposal will reshape the world order in a constructive way.
The author is a professor of international relations at Renmin University of China.
The woman who saved Mongolia's stolen dinosaurs
By Jeff Hecht
September 27 (Slate.com from New Scientist) Oyungerel Tsedevdamba is minister of culture, sports, and tourism for Mongolia. She is also president of the Democratic Women's Union of Mongolia and an adviser on human rights to Mongolian president Tsakhiagiin Elbegdorj. She has studied at Stanford University and at Yale University. Though illegal for more than a century, looting Mongolian dinosaur fossils was commonplace—until Tsedevdamba stepped in.
You were trained in public policy. What got you interested in dinosaurs?
In 2006 I was driving in the Mongolian countryside with my family. I stopped to take a photograph of camels in the sunshine, and talked with tourists who were also taking pictures. One was from the American Museum of Natural History in New York and he invited us to come for a back-room tour.
A few months later I began a program at Yale University, near New York, and got to take that tour. On it, I asked about the Mongolian dinosaurs I saw. The guide said they were Mongolian property and would be returned if we had a dinosaur museum. I knew little about paleontology, but I wondered why we never had a museum if we had so many dinosaurs.
Did you end up looking into it?
Not for some time. On a trip to Chicago in 2010 I met a Mongolian paleontologist named Bolortsetseg Minjin, who told me she wanted Mongolians to learn about paleontology so they would stop stealing their own dinosaurs.
I asked what I could do to help. She gave me books about illegal fossil hunters and paleontology expeditions to Mongolia—as well as lots of Web links to read. And she asked me to write an article that would change Mongolians' attitudes toward dinosaurs.
Did you write that article?
Eventually. At the time, I read the books. But soon after I was granted an Eisenhower fellowship—for people in international leadership roles to study in the United States. I told the committee that I wanted to study dinosaurs and fossil management. When they asked why, I said I wanted to bring dinosaurs home. Mongolia was—and is—having a mining boom, so we needed to know more about preserving paleontology sites.
On my fellowship I visited Dinosaur National Monument in Utah, where I met chief park paleontologist Dan Chure. He told me why there was so much that Mongolians needed to learn and do, and explained how smuggling was becoming a big problem. That's how it struck me that I must do something. In March 2012, I finally wrote that article.
What was the piece about?
I wrote it from the point of view of a dinosaur. I introduced myself as Tarbosaurus bataar, a dinosaur similar to Tyrannosaurus rex, that once lived in Mongolia. "I am supposed to be a superstar," I wrote, "but I am nobody because nobody knows me." I also wrote about other dinosaurs that could be heroes for Mongolia, if only we cared about them. A Mongolian newspaper published the article in May 2012.
Did your writing spur further action?
The very morning after it was published I was having breakfast when my husband came in and said, "You have to see what is on my computer. It is important." Then he showed me an article saying that somebody was about to auction a 70-million-year-old Tarbosaurus bataar fossil in New York.
I thought, this is the case that can save Mongolian dinosaurs. But it was Friday, and the auction was scheduled for Sunday.
With so little time to act, what did you do?
I couldn't get in touch with the minister of education, who is responsible for dinosaurs. So I called the president, Tsakhiagiin Elbegdorj. At first he said, "What dinosaur are you talking about? Why are you calling me?" I begged him to give me just 30 minutes to explain. Finally he told me to come to his office. I brought all of my dinosaur books and papers, put them on the table, and referenced them as I explained how, even with my limited knowledge, I knew this was a Mongolian dinosaur—and that it was state property that he should claim.
He asked what would happen if it didn't work. I told him, "Then you will be the first president who ever claimed a dinosaur. But if you succeed, you will be the first president who ever succeeded in claiming a dinosaur." He decided to go ahead.
Once you convinced the president, were you able to stop the auction?
I found a U.S. lawyer who got an injunction to stop the sale. The auction went ahead, but the sale, for just over $1 million, was later voided. The dealer, Eric Prokopi, eventually pleaded guilty to lying on U.S. customs forms. And when federal officers raided his premises, they found many other Mongolian fossils.
How were dealers able to steal so many fossils?
I wondered that as well—how someone could boldly take fossils from Mongolia without anyone noticing. Then I read Dinosaurs of the Flaming Cliffs, a book written in 1996 by the paleontologist Michael Novacek of the AMNH. In it he described his expeditions in Mongolia, as well as his concerns about how easily people could take advantage of Mongolians.
He also wrote about where he found Tarbosaurus bataar, oviraptors and other dinosaurs—meticulously describing not only what he found, but what he left behind and its location. It wasn't his intention, but I saw how his book could be used as a handbook for smuggling: The very things he mentioned were found and sold by Prokopi. The years from 2000 to 2012 were a big smuggling time in Mongolia.
Why does Mongolia have so many dinosaur fossils—and what makes them unique?
Dinosaurs lived in many places, but in dry areas like the Mongolian Gobi desert, the fossils remain very well preserved. This means they reveal many details about the creatures and the ancient world—fragile connections in the skull and the stomach, skeletons with every single bone, even baby dinosaurs in the egg nest. This type of preservation makes them invaluable to science.
Has the experience with theft influenced the way Mongolia now protects these fossils?
The tide has turned. Our police and people know much more about dinosaurs since the Tarbosaurus case, and we are in better control. We've also found that educating people about science is a great tool to stop fossil theft. Mongolians are fascinated by paleontology now, and are much more serious about their resources than they were two years ago.
But I still really want to tell researchers who visit other countries looking for fossils: Please do not describe what you leave behind.
What happened to the Tarbosaurus skeleton?
It came home to Mongolia, and it is now housed in what used to be the Lenin museum. We finally got the building back this June, and the hall where Tarbosaurus bataar is on display is now open to the public.
What other fossils are you recovering?
Prokopi's other fossils are being packed in New York to be shipped back. Two dinosaur eggs and the head and feet of a Deinocheirus were recently donated to our museum as well.
We also wrote to the AMNH asking them to return some materials gathered by American paleontologist Roy Chapman Andrews during his Mongolian expeditions between 1922 and 1925. Nothing has been returned yet, but we hope to have the fossils on display by the 100th anniversary of his expeditions.
Meanwhile, many Mongolian dinosaurs are being studied around the world under research contracts. Now, once the research has finished, they will come back to Mongolia.
National Museum of Natural History requires ₮24 billion for restoration
September 25 (news.mn) Mongolian Natural History Museum has been closed for quite some time. The half century old museum building is expected to be replaced with a new building, but the original museum has not been torn down. Museum Director N.Zorigtbaatar commented on the matter.
N.Zorigtbaatar: The project design scheme for the museum's new building is ready. The new museum building is expected to be a seven-story building, three times bigger than the old building. The Mongolian Natural History Museum's new building project requires 24 billion MNT. It is impossible to fund such an amount of money at once. But we hope the government will fund it through next year's budget. First and foremost, we need to have the funds to tear down the old museum resolved.
- How has the museum stored its collection?
- The collection is stored, safe and sound. Besides storing and protecting the showpieces the museum is also conducting measures to add more and conducting restoration.
- The museum is currently not open to the public but making renovation, but how?
- The Mongolian Natural History Museum has 8,000 pieces in its collection, but only 10 percent of it is on display for the public. There are still rich resources waiting to be discovered and shared in our country. Soon, the new museum will be open, and all of the collection will be displayed. But more pieces need to be enriched and restored. Our museum experts search for museum pieces, working everywhere in the countryside, hunting, collecting, seeking out rare animals, herbs and minerals, and buying items from antique dealers throughout the year.
- Are there many unparalleled pieces in the Natural History Museum?
- Countless. It is more crucial to protect ancient, unique, inimitable artifacts. In recent years, species are disappearing quickly around the world. So many fish species are disappearing due to the drying up of river and lakes. We have over 3,000 pieces sent by citizens and foreigners to the museum. Unfortunately, the old museum did not have enough space and resources to display all those items.
Mongolia Adopts National Program for Protection of Endangered Gobi Bear (Mazaalai)
September 26 (news.mn) The Ministry of Environment and Green Development has adopted a national program for the protection of Mazaalai, the Gobi Bear.
Mazaalai is found in no other place in the world outside of Mongolia. The national program for the protection of Mazaalai is designed to improve Mazaalai habitat, to increase their numbers by conducting an artificial breeding program, and protecting its current population.
In the scope of the national program, a series of measures will be taken to provide more sources of drinking water for the Mazaalai in their desert habitat. The planting of natural food sources for Mazaalai will be in operational in September.
Mogi: appreciated AJ's angle of raising awareness of environmental issues here but the headline here is a bit
Mongolia's mines threaten traditional herding
Nomadic families have used the same grazing grounds for generations, but mines are destroying those traditional areas.
By Philippa H Stewart
Ulaanbaatar, Mongolia, September 27 (Al Jazeera) - Mongolia's herders have been roaming the steppes for centuries, moving their animals from winter grazing grounds to summer haunts, keeping their livestock - their livelihood - safe and well.
The encroachment of the modern world, such as electricity and cars, has largely made the lives of these nomads easier, but fundamentally their lifestyles and homes - the round "gers" or yurts that will often stay with a family for decades - have remained the same.
They even use the same expanses of land for their animals each season, with unspoken agreements of who has first claim to which swath of Mongolia's vast countryside.
But this way of life could now be under threat, as Mongolia's mining industry begins to take its toll on traditional herding grounds.
"You can see the black holes all over the countryside now where they have just left the mines open," said Tsolmon Khurekbaatar who, along with her husband Ganbat Batbaatar, has been herding for 25 years.
"It is getting harder - we can't use the same lands as we used to, and the mines pollute the water and the animals get sick if we stay too close to mining sites. You can see the holes they have left all over the countryside. And there is less water now because the mines use so much.
"We do understand how important mining is to Mongolia - but it should be more controlled, they do not look after the land properly."
Herding is a key part of Mongolia's existence. With very few industrial facilities for mass production of meat, the people living in Ulaanbaatar's poorer ger districts rely on herding families for meat and animal products.
Producing cashmere - perhaps Mongolia's most popular export - also relies on herding families to provide the fine goat wool needed to make the product.
Mining vs environment
Mining, however, is also essential to Mongolia's survival. The industry was responsible for the country's 2011 financial boom, when rich copper and coal deposits made it a focus for investors.
That year, mining accounted for a 17.3 percent increase in GDP, making Mongolia the fastest growing economy in the world.
The level of growth was unsustainable, however, and the government is now facing a rapidly depreciating currency, and an unstable economy.
As the government struggles with the realities of its previous financial mismanagement and looks to mining to solve its problems, the environment, and the herders' way of life, could be put under greater threat.
"The so-called 'long-name law' is a law prohibiting mining in forest and river areas. That killed almost all of the gold mines," Chuluunbat Ochirbat, vice minister for economic development told Al Jazeera.
"For the sake of the protection of the environment, we have almost killed the mining industry. That was a mistake and we have confessed this mistake."
Environmentalist groups now fear the repeal of the "long-name law", which is actually called the Law of the Prohibition of Mining Operations in the Headwaters of Rivers, Protected Zones of Water Reservoirs and Forested Areas, would allow mining companies to work almost unchecked in Mongolia's countryside.
"We are fighting to keep mining away from rivers and forested areas," Tserenkhand Yadambaatar, head of the Angir Nuden Mundookehei environmental group, told Al Jazeera.
"The government wants to get rid of the law that stops this from happening - it will have a devastating impact on Mongolia and on the environment. There are already problems because companies do not reconstruct sites properly after they have finished mining and they just leave open holes in the ground.
"We want the laws to be properly enforced to protect Mongolia."
Mining sites have been highlighted as responsible for increasing air and noise pollution, but the infrastructure needed to reach mines, such as roads through the countryside, also adds to pollution issues.
'Herding is Mongolia'
As more well known, international mining companies invest in Mongolia's copper and coal deposits, reconstruction of areas has started to be more common, although it is far from universal.
"I can understand the angst on the part of the herders and the part of society and much of it is actually warranted because a lot of fly-by-night miners and operators have come in and dug the earth and walked away - [it] has led to this so it is not a surprise," Arshad Sayed, president of the Peabody Group for Mongolia and India, which recently reconstructed a mine to show the government mining best practices, told Al Jazeera.
"The policy makers here are genuinely deeply concerned about this but there is also an understanding of the constraints of technical knowledge of resources. Another possible way to deal with it is to make sure you have companies that are well known and they have to do these things.
"I think there is a hunger [to improve environmental policies]. A desire for it."
This desire for change in the mining industry could be the only hope on the horizon for herder families trying to continue the way of life that is often synonymous with Mongolia.
"I cannot imagine Mongolia without herding," Ganbat told Al Jazeera. "Herding is Mongolia, it is how the country survives. I worry about the future, of course, the land is less green than it was and the mines bring trucks and noise, but herding will carry on.
"I will be a herder until I die, and so will my son."
SUMO/ Hakuho wins autumn tourney to move into tie for 2nd on all-time list on Day 15
September 28 (Asahi Shimbun) Yokozuna Hakuho of Mongolia won the Autumn Grand Sumo Tournament on Sept. 28 to capture his 31st Emperor's Cup while furthering his status as one of the greatest wrestlers in the history of the sport.
In the day's final bout at Tokyo's Ryogoku Kokugikan, Hakuho sprang free from Kakuryu's right-hand grip to the belt and threw his fellow compatriot and grand champion down to improve to 14-1. Kakuryu fell to 11-4.
With the win, Hakuho moves into a tie with yokozuna great Chiyonofuji and is just one behind sumo legend Taiho for the most championships.
"I'm very relieved," the 29-year-old Hakuho said. "I watched (Chiyonofuji) when I was young and always aspired to be a wrestler like him so I am very happy."
When asked about the prospect of equaling and surpassing Taiho's mark for the most titles, Hakuho replied, "I just want to relax and savor this win for a while."
Hakuho made sure there was no extra title-deciding bout with upstart Mongolian Ichinojo, who won earlier to keep his title hopes alive. Ichinojo needed Hakuho to lose to send the tournament to a playoff.
But Hakuho held a 32-4 advantage over Kakuryu heading into the day's final bout so it was going to be a tall order from the outset.
Still, it was an impressive outing for makuuchi division debutante Ichinojo, who stunned the sumo world with his meteoric rise up the leaderboard.
Maegashira No. 10 Ichinojo kept his title hopes alive when he got both arms around Aminishiki and waltzed the veteran grappler out to improve to 13-2.
The 21-year-old Ichinojo attended high school in Tottori Prefecture after moving to Japan from Mongolia. He won the juryo division championship at the summer tourney. He then went 13-2 as a juryo in the Nagoya tournament in July.
Ichinojo was bidding to become the first wrestler to win a title in his debut in the elite level since Ryogoku did so in 1914 at the summer tournament.
For his efforts, Ichinojo was awarded an Outstanding Performance Prize and a Fighting Spirit Prize.
Aminishiki, a sixth-ranked maegashira, finished with an impressive 10-5 record.
In other major bouts, Goeido wrapped up a winning record in his ozeki debut when he shoved out sekiwake Takekaze to improve to 8-7. Takekaze fell to 7-8.
Maegashira No. 8 Tochiozan put the finishing touches on a superb showing when he beat fourth-ranked Takarafuji (8-7) to close out the tournament with an 11-4 record.
Egypt's Osunaarashi, a maegashira No. 4, shoved out crowd favorite Endo to improve to 7-8. Top maegashira Endo has struggled mightily at the autumn meet and finished with an unflattering 3-12 record.
Fifth-ranked maegashira Toyohibiki secured a winning record of 8-7 when he upended komusubi Jokoryu, who finished with a 4-11 record.
Mongolia's Sanchir Nominated for Basketball MVP at 2014 Asian Games
By B. Amarsaikhan
Ulaanbaatar, September 26 (MONTSAME) The Mongolian basketball player T.Sanchir has been nominated as the Most valuable player (MVP) at the Asian Games–Incheon 2014.
Mongolian team's tremendous development shown at this year's Asian Games surprised many basketball players all around the world. It had close match with S.Korean and Chinese teams, and defeated Jordan's team.
On the fifth day of basketball tournament, our Sanchir became one among three best forwards of the games, bringing 21.4 points to his team in every match. He also leads the list of best cutters, having cut 34 attacks in five matches.
Korea Diary: Mongolian water babies up against Asia's best
11-year-old Balchindorj gets a taste of the big time as part of young squad
By Alaric Gomes, Senior Reporter
Incheon, South Korea, September 26 (Gulf News) One of the developments at the ongoing Asian Games here is the evident changing of the guard taking place among several countries belonging to the Olympic Council of Asia (OCA).
Take Mongolia as an example. The majority of their 249-member squad is made up of youngsters. And they are very, very young.
No doubt this is being done with an eye on the future development of sport in Mongolia. But to have athletes who are mere babies does not look too good, especially when they have to pit their skills against some of Asia's top sportspersons.
Of particular interest at the 2014 Asian Games swimming pool was the presence of five bubbly teenagers in Mongolian kit who were making an impression on the spectators while gaining a lot of experience.
Of the five, one is aged 15, two are 14, one is 13 and one is just 11! That's the baby of the squad — Enerel Balchindorj, who was born on May 28, 2003. She goes to school at Ulaanbaatar University in the Mongolian capital, which is home to more than 45 per cent of the total population of the country. She stands just 158cm tall and weighs only 45kg, but she competed against the best in Asia.
Age or height is not on her side, but Balchindorj has the disposition and attitude to turn into a top-level swimmer, with an eye on "several Olympic Games and medals in the future".
"I love swimming and I want to swim to be an Olympic champion one day," Balchindorj told Gulf News. "I love what I am doing and I don't see myself stopping any time soon. I am a champion in Mongolia and I want to be a champion of the world."
Another good story coming out of the Mongolian camp was sumo wrestling champion Yokozuna Hakuho donating $16,000 (Dh59,000) to the nation's baseball team so that the squad of youngsters could compete in Incheon.
In 2012, the same wrestler donated 120kg of rice bearing his name to a wrestling school so that they could eat well and grow to be champions one day.
Mogi: hmmm, our local media better start making out the difference between AIDS and HIV
27 new AIDS case reported this year
September 25 (news.mn) A new case of AIDS has been reported in Mongolia. In the first three quarters of 2014, 27 new cases of AIDS have been reported. A study at National Research Center for Infectious Diseases shows that there is an increasing number of HIV carriers in the country.
In Mongolia, a total of 177 cases of AIDS has reported, affecting 144 men and 33 women.
"In 2013, 23 cases of AIDS were registered. But in the first three quarters of 2014, 27 cases have been newly reported. Since the start of 2014, two patients infected with HIV died," says Ch.Urtnasan, press officer at the National Research Center for Infectious Diseases.
Hungarian Hospital Offers to Build Vascular Facility Under Concession
By B. Amarsaikhan
Ulaanbaatar, September 26 (MONTSAME) The Minister N.Udval received a Hungarian delegation on Thursday who proposed constructing a facility for Vascular Center at the Third State Clinic on concession contract.
To the guests--a director of Hungarian VMD Hospotal Technology Group Gapshar Marot, the company specialist Tamas Darvos and an executive director of Galk LLC Mesarosh Ishtvan--Ms Udval said this proposal has precisely coincided with her Ministry's intention to erect such centers, about which was talked over at a recent "Health sector economy and investment" conference, and promised to have the proposal discussed by the Government,"once it is supported, we will extendedly talk on further cooperation".
Mr Marot expressed a readiness to collaborate at any time. "Our group has performed constructions of medical facilities in many countries, and we considers that a hospital building must be in compliance with detailed requirements and hi tech standards, so before commencing the work we run research into a nation's tendencies and differences," he said.
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