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Wednesday, August 24, 2016

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Int'l Market

Erdene Provides Update on Gold Projects in Mongolia

HALIFAX, NOVA SCOTIA--(Marketwired - Aug. 23, 2016) - Erdene Resource Development Corp. (TSX:ERD) ("Erdene" or "Company"), is pleased to provide an update on its 100%-owned Bayan Khundii Gold Project ("Bayan Khundii") and Altan Nar Gold-Polymetallic Project ("Altan Nar"). In advance of the resumption of drilling in September 2016, the Company has been carrying out extensive technical studies on the styles and controls of gold mineralization at both Bayan Khundii and Altan Nar, as well as various studies and projects related to the anticipated development of the district.

Bayan Khundii (Rich Valley) and Altan Nar (Golden Sun) are near-surface, high-grade gold discoveries made by the Company within the Tian Shan gold belt of southwest Mongolia. These projects are approximately 19 kilometres apart with gold mineralization traced over 6 kilometres at Altan Nar, and 1.7 kilometres at Bayan Khundii. The current technical work program includes structural mapping studies, hyperspectral analysis of core and surface samples, evaluation by an expert in epithermal gold systems, geophysical interpretation, development of a 3-D model, and through this combined evaluation, develop the ideal approach to drilling in regards to both exploration targeting and eventual resource categorization for both projects. The following provides an overview of the technical program as well as preliminary plans for Q3-Q4 drilling programs.

Gold Deposit Type, Controls on Mineralization and Exploration Approach

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Permitting and Pre-Development Studies

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Project Plans (Q3-Q4 2016)

The results of the various studies will be evaluated by Erdene's technical team with additional exploration and drilling programs designed accordingly. Details of this evaluation and resulting programs will be announced once final. Drilling is set to resume at Bayan Khundii in September, and is expected to continue throughout the fourth quarter and will include a drill program at Altan Nar. A review of the Company's Altan Arrow high-grade discovery (situated on the Khundii licence, 3.5 kilometres north of Bayan Khundii) is also planned.

Regional Exploration in Southwest Mongolia

The Company continues to evaluate copper-gold opportunities throughout the Edren Terrane of Southwest Mongolia through its alliance with Teck Resources Limited ("Teck"). Field evaluations are currently underway focused on geochemical surveys and satellite interpretation. Erdene closed a non-brokered private placement with Teck in June 2016 to fund the regional exploration program. Since 2013, Teck has subscribed for $2.5 million in Erdene shares and owns 10.8% of Erdene's issued and outstanding common shares. The Company's Bayan Khundii and Altan Nar projects are excluded from the Teck alliance.

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TER closed +4.17% Tuesday to A$0.025

TerraCom Investor Presentation: Focus on Growth

August 23, Terracom Ltd. (ASX:TER) --

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Rainer Michael Preiss -- Bottom nears for Mongolia

August 23 (Nikkei Asian Review) Most investors know about Mongolia in the context of Genghis Khan and the startling history of how one extraordinary man from a remote corner of the world created an empire that led the world into the modern age.

More recently, Mongolia was the darling of the global mining industry and a frontier market investors loved. In 2011, Mongolia reported the highest economic growth in the world, was home to the world's best performing stock market and had a currency that rose over 35% in value against the U.S. dollar.

Since then, the boom has turned to bust and international discussion about the country has turned from exuberance about opportunities to despair over a chronic economic crisis and a potential sovereign debt default. The Mongolian tugrik is trading at record lows, having given up more than three-fourths of its peak value.

The country's vast natural resources have been a blessing and a curse as politicians, blinkered by greed, made wrong decisions just when the commodity cycle turned. Mongolia borrowed heavily close to the top of the cycle and its debts are coming due just as the sector starts to come out of a prolonged global bear market.

The long and unnecessary dispute between the government and metals producer Rio Tinto over the Oyu Tolgoi mine, which contains the world's largest untapped copper and gold deposits, has severely damaged investor confidence and delayed the country's economic development. Also stalled is the Tavan Tolgoi mine, considered by geologists to hold the world's largest untapped coking coal deposit.

Original estimates were for Mongolia's economy to grow 30-35% per year after the Oyu Tolgoi mine started full production. Mongolia's mining sector contributed 28% of gross domestic product in 2011; a number of industries including construction, retail and transport are closely linked to the mining sector's fortunes.

Mongolia's turmoil reflects the broader impact of "ultra-loose" monetary policies adopted by central banks around the world which led to a debt binge in developing countries.

Some good news

However, it is too early to conclude that the game is over for Mongolia. The new Mongolian People's Party government that took office in July after a landslide election victory has an acute sense of crisis and seems determined to make a clear break with its predecessor's policies and mistakes. The country is also strategically too important for external parties, particularly China, not to intervene if the government's funding situation worsens.

The rebound in commodity prices this year is also potentially good news for the resource-rich country and could see investor valuations of projects in the country start to recover.

Adding to the prospect of a pickup was the long-awaited approval of the expansion of the Oyu Tolgoi mine, announced on May 6 by Rio Tinto, the Mongolian government and Turquoise Hill Resources. The project, worth $5.3 billion, could be the country's savior.

To ensure sustainable and inclusive growth, Mongolia will need to strengthen institutional capacity to manage public revenues efficiently and limit the effects of "Dutch disease," the well-documented negative impact some economies experience after a sudden inflow of foreign currency. The government will need to allocate resources effectively among spending, investing and saving, reduce poverty and offer equal opportunities to both urban and rural residents.

To address some of these issues, the government has set up a task force to decisively deal with slowing growth, the collapsing currency and the soaring budget deficit.

With deposit rates of over 15% today, after a 4.5 percentage point rise on Aug. 18, and an inflation rate of less than 1%, Mongolia offers one of the highest real interest rates in the world. Investors make the most money when economic situations turn from terribly awful to just awful. Over the next few months, Mongolia could be in this sweet spot. Coincidentally, this is the time the risk/reward ratio is usually at its best.

Have we reached the nadir of pessimism on Mongolia and is it the right time to invest? Not yet. But will Mongolia default and go bankrupt? Probably not.

Investors in Mongolia will do well to follow developments in Ulaanbaatar closely and adopt the timeless Chinese adage, "Fortune favors the brave and the prepared mind."

Rainer Michael Preiss founded the Mongolia Frontier Fund, a multi-asset investment fund, and is a portfolio strategist based in Singapore.

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Similar:

This country went from boom to economic nightmare in 5 years – CNNMoney, August 23

Local Market

Mogi: either Univision or mse.mn is blocking the other.

Maturity Notice: ₮10 Billion 52-Week 14.65% Discounted T-Bills

August 23 (MSE) Dear investors, please be advised that the following government bond is about to mature.

Symbol of Government Securities	Amount /units/	Maturity /week/	Form of Interest payment	Interest rate (percent)	Issued Date	Maturity Date
ZGEB-BL-23/08/16-A0049-0	100,000	52	Discounted	14.65%	2015.08.25	2016.08.23

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MSE trades ₮160.2 billion stocks in first seven months

Ulaanbaatar, August 23 (MONTSAME) During trades of stocks by first seven months of 2016, 49.6 million stocks costing MNT 160.2 billion were traded, showing a decrease of MNT 474.8 billion or 74.8%, whereas the number of traded stocks increased by 28 million units or 2.3 times against the previous year.

1.6 million shares costing MNT 3.2 billion were traded in July 2016, which declined by MNT 2.3 billion or 41.6% against June, while the number of traded shares increased by 0.5 million or 39.8%.

In the secondary market trade of governmental shares, governmental bonds of MNT 63.7 billion were traded in first seven months of this year, which decreased by MNT 244.7 billion or 79.3% against the previous year.

In July of 2016, governmental bonds of MNT 0.2 billion were traded, declining by MNT 4.9 billion or 96.7% against June.

The TOP-20 index was 12,689.3 units in July of 2016, which increased by 1,237.4 units against June, but declined by 1,529.7 units against the previous year.

The total market capitalization of joint stock companies was set at MNT 1.5 trillion in July of this year, increasing by MNT 65.8 billion or 4.6% against June.

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Economy

Mogi: Finance Minister submitted budget amendment on Tuesday. Details in next issue. The package of bills will increase taxes but cut not so much

Fitch: Mongolia's Refinancing Risks Deepen as Currency Plummets

Fitch Ratings-Singapore/Hong Kong-23 August 2016: The rapid depreciation of the Mongolian tugrik - which has plunged more than 20% since end-June - underscores the country's strained external liquidity and escalating refinancing risks, says Fitch Ratings. Fitch believes the currency volatility reflects deep short-term external liquidity constraints and economic challenges, while immediate solvency risk is mitigated by the fact that the sovereign does not face significant external bond maturities until at least early 2017.

The tugrik's plunge reflects significant short-term economic challenges, including weak public finances, external liquidity risks, and a deteriorating near-term growth outlook. Fitch, which cut Mongolia's sovereign rating to 'B' in November 2015, has long highlighted strained external liquidity as a core challenge for the country. Its foreign reserves of USD1.3bn at end-June were broadly consistent with levels reported over the past two years, but headline reserves obscure Mongolia's extensive use of a CNY15bn bilateral swap facility with the People's Bank of China in that period.

Mongolia will continue to face heightened external liquidity risks in the short term, which have been exacerbated by loose policy settings in recent years. Refinancing risks also remain high, though Mongolia does not face significant external bond maturities in the immediate period - a sovereign guaranteed USD580m Development Bank of Mongolia bond comes due only in March 2017 and a USD500m sovereign bond is due in January 2018. A recent hike in benchmark rates by 450bp to 15% on 18 August is a sign that policy priorities may have moved towards stabilising these ongoing pressures after a number of key personnel changes at the Bank of Mongolia following parliamentary elections earlier this summer.

Public finances are also a key challenge. Mongolia already exhibits general government debt levels well above its 'B' rated peers, and recent public statements from the authorities suggest 2016 fiscal performance has fallen exceptionally far from a commitment to stick to a 4% budget deficit ceiling made under the recently implemented Fiscal Stability Law. This underscores the challenges the authorities face in addressing the country's weak public finances amidst a deteriorating growth outlook, but also highlights a weakness in the credibility of Mongolia's broader economic policy framework, exacerbated by uncertainties posed by the recent change in government.

Fitch continues to believe the ongoing development of the USD6bn Oyu Tolgoi underground copper mine will significantly enhance Mongolia's long-term growth prospects, and may eventually help ease the country's external liquidity and fiscal pressures. Still, the more pressing short-term challenge is whether the newly formed government can implement credible and coherent economic policies that increase confidence in the country's basic economic stability, a prerequisite to alleviating the country's ongoing refinancing risks.

Banks' loan quality will remain under pressure with the system-wide NPL ratio likely to easily exceed Fitch's earlier expectation of 9% by end-2016 (end-1H16: 8.6%) if the interest rate hike fails to stop the tugrik's depreciation. In addition, salary-backed loans could become more vulnerable if the authorities implement the announced significant salary cuts for staffs at state-owned enterprises and government agencies. Lenders with large retail exposures such as State Bank (B-/Stable) and Khan Bank (B/Negative) could therefore also see their impaired retail loan ratios rise, while the pressure on XacBank (B/Negative) stems mostly from its larger corporate and foreign currency loans.

The immediate impact from the interest rate hike on the banks' pre-impairment profitability could be mildly positive, while the impact on their liquidity should remain containable as these lenders can rely on deposits and bilateral funding.

Fitch maintains its Negative rating Outlooks on the banks whose ratings are not support-driven to reflect the pressure on asset quality from the weakening operating environment. Our banking sector Outlook has been Negative since December 2013.

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Reds are rates that set a new record at the time

BoM MNT Rates: Tuesday, August 23 Close

	8/23	8/22	8/19	8/18	8/17	8/17	8/16	8/15	8/12	8/11	8/10	8/9	8/8	8/5	8/4
USD	2,257.87	2,260.05	2,263.70	2,265.28	2,251.99	2,251.99	2,237.32	2,187.38	2,169.44	2,152.07	2,141.59	2,131.81	2,122.65	2,111.27	2,098.30
EUR	2,558.96	2,550.01	2,568.17	2,563.39	2,535.74	2,535.74	2,515.20	2,442.87	2,417.19	2,403.00	2,385.62	2,360.77	2,352.32	2,352.17	2,335.30
JPY	22.56	22.43	22.62	22.68	22.32	22.32	22.31	21.62	21.26	21.24	21.11	20.82	20.77	20.89	20.66
GBP	2,971.92	2,949.82	2,977.56	2,957.78	2,933.55	2,933.55	2,885.47	2,829.16	2,811.59	2,800.49	2,790.17	2,765.38	2,770.27	2,771.78	2,788.43
RUB	34.82	35.20	35.50	35.57	35.20	35.20	34.93	33.90	33.75	33.04	32.99	32.86	32.44	32.00	31.55
CNY	339.88	339.32	340.88	341.81	339.61	339.61	337.31	329.22	326.60	324.06	322.18	320.01	318.63	317.70	316.05
KRW	2.02	2.01	2.03	2.05	2.03	2.03	2.05	1.99	1.97	1.96	1.95	1.93	1.91	1.90	1.88
SGD	1,673.92	1,671.14	1,684.55	1,689.56	1,675.53	1,675.53	1,669.64	1,627.64	1,611.77	1,602.14	1,595.82	1,580.52	1,575.02	1,573.64	1,562.51
CAD	1,749.00	1,748.25	1,769.07	1,767.68	1,749.12	1,749.12	1,733.68	1,689.23	1,672.53	1,648.09	1,637.74	1,616.60	1,610.63	1,620.56	1,603.22
AUD	1,725.58	1,716.17	1,731.16	1,746.53	1,727.39	1,727.39	1,725.31	1,678.05	1,667.76	1,659.57	1,647.42	1,627.32	1,614.91	1,615.02	1,593.34
HKD	291.19	291.50	291.96	292.13	290.40	290.40	288.46	282.01	279.70	277.47	276.13	274.83	273.69	272.24	270.52
CHF	2,350.60	2,345.42	2,369.87	2,359.91	2,337.30	2,337.30	2,311.40	2,243.70	2,226.67	2,207.93	2,185.52	2,169.01	2,164.86	2,168.96	2,155.31

Bank USD rates at time of sending: Khan (Buy ₮2,250 Sell ₮2,270), TDB (Buy ₮2,250 Sell ₮2,270), Golomt (Buy ₮2,250 Sell ₮2,270), XacBank (Buy ₮2,250 Sell ₮2,270), State Bank (Buy ₮2,250 Sell ₮2,270)

MNT vs USD (blue), CNY (red) in last 1 year:

Link to rates

BoM sells CNY5.8m at ₮337, accepts US$26.5m USD, $1.4m MNT swap offers

August 23 (Bank of Mongolia) Spot trade: Commercial banks bid MNT2239.00-2245.00 for USD4.6 million, asked MNT2264 for USD0.5 million and bid MNT333.00-337.50 for CNY16.3 million, asked MNT339.20-339.40 for CNY1.8 million respectively. The BOM sold CNY5.8 million at the closing rate of MNT 337.00.

Swap and forward trade: The BOM accepted the bid offers of USD 26.5 million of MNT swap agreement, asked USD 8.4 million of MNT swap agreement from commercial banks. The BOM accepted the bid offers of buying USD 26.5 million and selling USD 1.4 million swap agreements.

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Mongolia's budget produces massive deficit in January-July as spending surges

August 23 (bne IntelliNews) A surge in government spending and falling revenue pushed Mongolia's budget into a MNT1.97tn (€774.6mn) deficit in the first seven months of 2016, state-run Montsame news agency reported on August 22. The deficit is well above its year-ago level of just MNT637.9bn.

While Mongolia's government relies heavily on external borrowing for domestic financing needs, it comes at the cost of high interest payments and exchange rate risk exposure, the World Bank said in a recent report.

Budget expenditure jumped 32.6% y/y to MNT5.01tn in January-July, while revenues fell by 3.3% y/y to MNT3.04tn.

Earlier this month, the newly-elected government roiled markets announcing the country is in a state of deep "economic crisis" and moved quickly to announce a number of austerity measures seeking to support the slowing economy and fight the soaring budget deficit. Yet, upcoming debt repayments will continue to put pressure on the government which might need to borrow more to pay back the debt.

The government debt burden is expected to reach 78% of GDP in 2016, above the target of 55%. The projected budget deficit is seen at $2.6bn, or 21% of the GDP.

Mongolia sold $1.5bn in sovereign debt in 2012, know as Chinggis Bonds, mainly to finance road projects. The government is due to repay $500mn in 2018 and the remaining in 2022. The Development Bank of Mongolia faces a $580mn repayment in 2017.

The country's central bank raised its policy interest rate by 450 basis points (bps) to 15% on August 18 in order to stem the fall in the country's national currency. The currency depreciated by over 8% against the greenback since the start of August and is now worth half of what it was in the fall of 2008.

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Mongolian economy faces meltdown, not collapse

By Wu Chuke

August 23 (Global Times) Recently, Venezuela's currency, the bolivar, was in a free-fall and there were signs that the country faced an economic collapse. According to media reports, an acute shortage of goods, food in particular, has posed a great challenge to everyday life for Venezuelans. Lately, Mongolia's currency, the tugrik, has also hit its weakest level in 23 years, having suffered a run of losses for over 20 days. The tugrik has fallen more than 11 percent against the US dollar this year, and media reports are speculating that Mongolia is set to be yet another nation on the brink of an economic meltdown.

I still remember a few years ago, when seeing stray dogs on the streets of Ulaanbaatar, some Mongolian friends said "there had never been a famine in our country, and as long as you catch sight of the stray dogs' round tummies, you'll understand that local people have eaten their fill." This is a reminder that the nation, still powered by a nomadic animal husbandry-based economy, is quite different from Venezuela.

Mongolia's economy might perhaps go into a meltdown, given that of the country's registered businesses - totaling more than 130,000 - over 60,000 have shut down this year, and there's even a rumor that the state can't pay the salaries of more than 2,000 national athletes. However, the government doesn't need to worry about whether people will be able to get enough food to eat. An economic collapse in Mongolia would result in many of the country's enterprises closing down, a large number of factories discontinuing production, the circulation of goods losing steam, and urban consumption abruptly shrinking. Nonetheless, the traditional economy based on nomadic animal husbandry will basically be kept unchanged, guaranteeing that the nation's food supplies maintained stable. The common sight of armed soldiers standing guard over supermarkets in an attempt to avoid food riots in Venezuela will not be seen in Mongolia.

Perhaps it's precisely because hunger has yet to affect Mongolians, that some of the country's politicians have launched election campaigns calling for patriotic strengthening against foreign investment, urging the public to stand up for the government's move to restrain foreign investment in strategic industries like mining. The country passed a new foreign investment law in 2012, which caused foreign investment flows to plummet. For a country with the world's largest reserves of coking coal who is unable to invest in its mining industry, and yet handcuffs foreign investment in the name of democratic politics, an economic decline is inevitable. Certainly, a smattering of the newly rich or traditionally wealthy in the country have no need to worry about a deterioration in their quality of life. Instead it will be the average person who sees their hard-earned money become worth less than a penny.

The Mongolian economy is only nearing a meltdown, rather than witnessing a complete collapse. This is because for a country with a traditional nomadic animal husbandry-based economy playing a primary role in the nation, it's imaginable that the majority of people would return to a pure natural economy. That might rather enhance the national consciousness of the Mongolian people who regard themselves as being unique, and perhaps lends a hand to extreme nationalism. In the eyes of most Chinese, the world would descend into chaos if necessities of modern life such as computers, cell phones, supermarkets, subways and airplanes were unavailable. But for a country of less than 3 million living on 1.56 million square kilometers, a nomadic way of life is wholly acceptable. Therefore, those who expect the Mongolia people to be mired in a deplorable situation are likely to be disproven.

At the Mongolian Economic Forum 2016 in late March, Mongolian President Tsakhiagiin Elbegdorj admitted that the country's current difficulties "have been caused by political impacts, and that there is no discipline among Mongolian politicians," and the country "is facing many problems due to poor responsibilities of the politicians, and lack of willingness to normalize the economy," according to Montsame, the Mongolian national news agency. Certain Mongolian populist politicians who originally vowed to serve the national interests, only succeeded in making themselves wealthy. In this regard, a country's development mode and choice of political system should be determined by its people, rather than a manipulated political election under the disguise of democracy. Often, political elections in Mongolia and Venezuela do not reflect the people's demand and appeal.

Lastly, Chinese sometimes value its relationships with neighbors even more than with their relatives, and this also applies to Mongolia. In recent years, senior Mongolian officials, including the Mongolian President and Prime Minister, have successively visited China, which indicates that Mongolia faces a tough situation in economic development and that the Mongolian people have a new understanding about democratic politics over decades of practice. The highlight of Mongolia's 2016 election this June was the changes to the country's election laws that included rejecting the party list system, as such a system "violated citizens' rights to directly elect their representatives," according to the Asia Foundation, a nonprofit international development organization. The change in the system suggests that Mongolians are tired of the fights between political parties and losing faith in their promises. We hope the country's new leader will be courageous enough to face the reality, as it will help to fix unfair trade practices between China and Mongolia, and will foster future trade relations. Such deeds will also serve to assist Mongolia's economy to bottom out and return to normal.

The author is a professor at Beijing's Minzu University of China. bizopinion@globaltimes.com.cn

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Economic imbalance leads to Mongolia crisis

By Li Xing

August 23 (Global Times) Choijilsuren Battogtokh, finance minister of Mongolia, said in a national television address earlier this month that his country is now "in a deep state of economic crisis." He said Mongolia has reached a point where the country cannot afford to pay the salaries and running costs of government departments. He noted that Mongolia's ratio of government debt-to-GDP is estimated to reach 78 percent, much higher than the budget target of 55 percent. Besides, Mongolian central bank's net foreign reserves are -$429 million. The heaped debts of the government undoubtedly aggravate the anxiety of investors.

According to Bloomberg, Mongolia's tugrik became the world's worst-performing currency among 154 currencies with a 7.8 percent drop in August. Since the beginning of 2016, the tugrik has declined by more than 11 percent. In order to stabilize the currency, Mongolia's central bank has raised its benchmark interest rate to a record high of 15 percent. The Mongolian currency has plummeted nearly 60 percent over the past five years.

Such drastic devaluation of currency and heavy debt loads have given rise to capital flight and panic buying. After Battogtokh's speech, the Mongolian government bonds tumbled the most on record and the country had its credit-rating cut to junk, striking another blow to its shattered economy. In the first half of this year, over 60,000 out of 130,000 registered companies have suspended their business or closed down, and the economic growth has come to a halt.

The Mongolian economy has been on the edge of a cliff. What has made Mongolia, which used to enjoy the highest GDP growth rate across the world, mired into such a daunting economic crisis?

Mongolia's over-reliance on mining has caused the severe imbalance in its economic structure and the lack of impetus for development. Mongolia is rich in natural resources, but due to its underdeveloped industry and finance sectors, the country is heavily dependent on imported foreign technologies.

Mining is the pillar of Mongolian economy, accounting for 80-90 percent of its total exports. The country's GDP growth reached an unprecedented 17.3 percent in 2011 thanks to its abundant coal reserves. However, given the unbalanced economic structure and low risk resistance capacities, the prosperity of the Mongolian economy was very short-lived.

Affected by the global financial crisis, the recent years have witnessed sharp declines in bulk commodity prices and economic slowdown. Besides, China, the biggest export destination of Mongolia, has shrunk its demands. Therefore, the Mongolian economy suffered serious hits.

In addition, Mongolia is plagued by severe corruption and poor administration. There is frequent political squabbling and lack of continuity in government policies. In 2012, when domestic nationalism rose, the Mongolian government passed the controversial Strategic Entities Foreign Investment Law to restrict foreign investment in sectors like mining, which greatly frustrated foreign investors and led to the withdrawal of foreign capital.

In view of the economic predicament, high expectations have been placed on the new government formed by the People's Party after a landslide victory in the parliamentary election in June to find a way out of the economic doldrums. Mongolian Prime Minister Jargaltulgyn Erdenebat recently announced a plan for economic recovery including attracting foreign investment, supporting the development of small-and-medium sized enterprise and reducing public expenditure.

The new government has presented to the public its confidence in future economic development. But if it really wants to revive the depressing economic prospects and resume the past achievements, it must transform its unbalanced single product economic structure and make more endeavors to develop a variety of industries including manufacturing, service, tourism and finance.

Mongolia has a unique strategic position as China's neighboring country. Despite an economic slowdown, the Chinese economy remains full of vitality. If Mongolia could realize economic transformation in a timely manner, it can take a ride on the express train of China's development.

The author is director of the Eurasian Studies Center and a professor at the School of Government, Beijing Normal University. opinion@globaltimes.com.cn Follow us on Twitter @GTopinion

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Politics & Legal

Political Atmospheres in the Lead-up to the Parliamentary Elections, 2016

This is the second in a series of posts about Mongolia's 2016 parliamentary elections that were held on June 29th.

By Rebecca Empson

17 August 2016 (UCL) Ulaanbaatar is dusty, bleak and windy. Waiting for the bus, I am forced to seek momentary refuge in a KFC doorway when, out of nowhere, the sky turns an ominous brownish yellow. High-speed wind torpedoes through the city and lashes across my body filling my nose and mouth with dust. I haven't learnt the art of always wearing a scarf around my neck to protect against such moments. The climate is unpredictable and so is the political atmosphere. Like political life itself the storm appears to come out of nowhere.

It's early May 2016 and there is still some ice on the Tuul river. Snow can be seen on the mountains to the South. Workmen are starting to put down new pavements and are planting trees along the roadsides. The news reports that the police are undergoing crash courses in English. Everything must be in place for ASEM (the 11th Asia-Europe Meeting). In contrast, deserted construction projects lie in wait for new investment. Small shops are getting rid of stock before they close down, with sales offering up to 30-40% off. Rumours spread that a measles epidemic has erupted and infant moralities are spiralling out of control across the city. No doubt the government will hide all of this from its foreign visitors when they arrive later in the summer.

With the so-called 'economic crisis' two things have become apparent. Where the rich are stuck with unfinished property and dormant mining licences they cannot act on, the poor have lots of cheap goods, now mostly broken and used for something else, but which they bought on credit and have to pay off. Everyone talks about debt and its vast accumulation. It is certain that the Democratic Party will not be re-elected, but who will take their place? Will it be a coalition? Will any of the Independent candidates be elected? What of the new and emerging parties – why do they seem to implode through internal factions?

In the afternoon of the 4th May, I receive an SMS message from a friend that a Mercedes-Benz has just driven past a bus stop in the centre of town and thrown hundreds of thousands of tögrög out of the window at people waiting for the bus. Could this be a political move related to the elections? Is it just the tip of the iceberg of many more such events? If so, who is the man in the car? Through what connections has he got hold of such large amounts of cash? By the end of the day, and on (apparent) police investigation, it is confirmed that this was simply the action of a man who had been arguing with his wife. The speculations die out and the event is soon forgotten.

On the 11th April, a prominent politician and businessman's offices are raided at the Bayangol Hotel, presumed, in part, due to the on-going 'railway scandal' where miles and miles of purchased tracks have been left to rust on the steppe. A large group of people, including the national judo team and various politicians come out to support him at the location. Special forces police officers can be seen seizing boxes and taking them away live on TV, but he's never arrested himself. 'We're just really living in a society where the law is no longer the law', his daughter laments. Speculations about internal factions aside, in this gesture of power we are invited to be reminded that the state holds ultimate power.

After the event, rumours circulate about future arrests and a list that has been drawn up with the names of those who might be targeted next. People in the countryside speculate that money laundering by big bosses has triggered flows of cash to purchase antlers from the forests. At night, people have been seen trying to sell their government-allocated shares to eager Chinese buyers (shares which the government later agreed to buy back), and during the day the atmosphere is intermittently hijacked by the stopping of traffic to allow blacked out cars with sirens to dart past with ASEM-related visitors as they speed through the city. The façade of buildings along the main roads are being painted. Motorway shoulders are being raised to hide unsightly slums.

The political atmosphere is characterised by a sense of fits and starts. Things suddenly emerge as if from nowhere. They are followed by a period of intense speculation and a search for connections and comprehension. Then, just as quickly, they seem to dissipate into the background again and things return to some sense of normalcy.

As the weather warms, the Tuul river begins to thaw. In the mornings men and women, sometimes with children in tow, come to gather plastic bottles along its banks, carrying them home in plastic woven bags on their backs. Every now and then these people travel back by bus from Zaisan sitting awkwardly with their enormous luggage slipping across the floor into the elites who live here. As it gets warmer, I walk across the river and up into the mountains beyond. A small trickle of water appears, but instead of this leading to a large torrent, a few days later the water disappears completely. People speculate that the government has syphoned off part of the river to provide water for the new ASEM buildings being built for the foreign visitors, providing further evidence, they lament, that they can't 'carrying the state' correctly. Two days later, however, the river begins to flow again when the ice thaws further up in the mountains, and just as suddenly the speculations disappear.

Recalling these events hints at the way in which politics is currently discussed in Mongolia. That is as rumour about the motives of politicians and businessmen, rather than an actual discussion about policy. The drying up of the Tuul river and the rumours which surrounded it, as well as the lack of interest when the actual reason was revealed, is just one such case. In the lead up to the Parliamentary elections this year, people were constantly searching for meaning – connections and explanations – in actions they found difficult to read and understand. In fact this searching for meaning and speculation is what politics is in Mongolia. It is the speculation of connections and motivations beyond the visible and tangible. To understand politics – or to think politics – is to understand the underside of things, beyond the way things appear to the ordinary eye, to uncover the workings of a kind of magic or religion.

'Nothing can be understood', one friend recounted, 'if the networks underneath are not known and understood'. He elaborated further, 'if you don't understand the motivations of individuals then politics in Mongolia is impossible to understand'. Searching for the motivations behind actions that seem strange is –sometimes – the only way people are able to process the wayward atmosphere that seems to characterise so much of political life in Mongolia. Speculation and circulation of rumours, of factions, motivations, alliances and actions of individuals dominates political talk. And while the new younger politicians are seen as potentially hopeful (they have not, as yet, the trail of speculated exchange of favours attached to them), they are all locked within the dominant parties and have little room to make a mark. It is as if, tightly held within alliances of debt and obligation, there is no room for new political visions to emerge. Everything is understood and explained as driven by personal business gains that bind people to each other and constrains as well as determines their actions.

In this atmosphere politics, as we might imagine it, appears a kind of empty shell. People feel they are living in an economic system (capitalism) rather than a political one (democracy now appears jaded and opaque). And because the economic system persists, regardless of who is in charge, politics itself appears defunct, a point that makes attaching the term 'crisis' to the word 'economic' a kind of political parody (cf. Roitman 2014, and Rebekah Plueckhahn on the political atmosphere of stalling and suspension after the elections). In this light, we might ask what work the term 'crisis' does in narratives about the economy in Mongolia? From one perspective it appears to be a political move to try to contain the moment in a specific temporal framework – a fallacy, of course, when it is now realised as the norm. Here, the ordinary is the speculation and incoherence of political life, there is no progress of access, or threat to another. The economic crisis is not an exception to the ordinary. There is, in many ways, a sense of a 'crisis ordinary', of […] 'a process embedded in the ordinary that unfolds in stories about navigating what is overwhelming' (Berlant 2011:10). In attending to these stories as they unfold, maybe politics is not such an empty shell after all. In these ways of navigating – sometimes overwhelming relations of debt, both monetary and social, and the complex entangled relations of obligation and favour that flow in their wake – life is always intensely political. It is just being played out in a different sphere from that which any election promises would have us believe.

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Business

ADB: Western Mongolia's Road to Development

August 21 (ADB) A highway linking Mongolia to neighboring Russia and the People's Republic of China is bringing development, jobs, and social services to the country's remote western regions.

Connecting Ulaanbayshint on the Mongolia-Russia border to Yarant on the Mongolia-PRC border, the western regional road is built under the umbrella of the Central Asia Regional Economic Cooperation (CAREC) program.

UB Mayor meets South Korean journalists

Ulaanbaatar, August 23 (MONTSAME) Mayor of Ulaanbaatar city S.Batbold received Monday a visiting delegation led by Jung Kyu Sung, the president of the Korean Journalist Association (KJA).

The Mayor expressed his satisfaction with a long-year development of the Mongolia-South Korea brotherhood friendly relations and the expansion of the political and inter-citizen ties.

"I am happy with a development of mutual visits of our journalists and widening of the collaboration in promotion of the national history, culture and custom. Ulaanbaatar city has friendly cooperation with Seoul, Pusan and Namyangju cities, and we have direct flights with Seoul and Pusan," the Mayor said.

Expressing thanks to the Mayor for the audience, Mr Jung noted that the KJA and the Confederation of Mongolian Journalists (UMJ) have been cooperating for four years now. He expressed his satisfaction with broadening of the bilateral cooperation, and hoped that the cooperation will become closer in a decade. Then he invited the Mayor to visit Namyangju city.

Present at the meeting were S.Altantsetseg, the CMJ executive director; D.Zayabat, a board member of the CMJ; E.Dagiimaa, head of the Press and Public Relations section of the City's Administration Office; Kwon Taehoon and Kim Dong Hoon, vice presidents of the KJA; and other officials.

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Mongolia's capital Ulaanbaatar is redeveloping its airport

August 23 (World Highways) Mongolia's economy is growing fast, with capital Ulaanbaatar the centre for activity. Being landlocked, the country depends heavily on aviation to carry passengers and cargo.

The existing Chinggis Khaan International Airport was built in 1956 and upgraded in 1987 and 1997 for international traffic. But the old airport cannot meet demands and boosting the country's capacity to handle flights is essential. The New Ulaanbataar International Airport (NUBIA) will triple passenger capacity to approximately 3 million/year and boost cargo handling by a factor of 10. According to project director Enkhbat Navaantseden, "The current airport faces safety, usability and operation difficulties."

For this reason, the new airport has been located in the Khushigiin Khundii valley, 52km from Ulaanbaatar. NUBIA is built on an elevated plain with no mountains in the immediate air corridor.

The airport is designed with a robust 3.6km runway, which is being built from concrete. This will allow the runway to withstand the harsh weather conditions of the extreme continental climate. This runway will be stronger structurally and will handle large aircraft, while the facility is also benefiting from a sophisticated new 24-hour all-weather air traffic control system.

To finance the airport project, the Government of Mongolia signed a 40-year loan agreement for US$645 million with the Japan Bank for International Cooperation. The Mitsubishi-Chiyoda Joint Venture (MCJV) won the tender process for the contract. In May 2013, the main construction package was signed between MCJV and the Civil Aviation Authority of Mongolia.

The construction work was awarded to the prime subcontractor Samsung C&T, while the specialist concrete paving work is being carried out by South Korean firm Sungdo Construction. The Korean company specialises in slipforming work and concrete paving started onsite in May 2014, using its Wirtgen SP 1600 and its smaller SP 500.

Dongin Park, Samsung C&T project manager for NUBIA explained, "We have to face the extreme climate with short, hot summers and long, icy winters. This gives us a construction time window of only three to four months during summer time. The wind from the Gobi desert and the intensive sunlight quickly dries out the concrete. That's why the main paving operation with the SP 1600 had to happen during night shifts."

For the new airport, the SP 1600 is paving the 45m-wide and 3.6km-long runway in several segments with a paving width of 11.25m and a paving thickness of 380mm on average. For this airport job, the machine was fitted with a second concrete paving kit, allowing it to pave dual-course concrete slabs in a single operation. The first layer paved by the SP 1600 is a 270mm-thick slab, followed immediately by the second 110mm-thick layer. Paving wet-in-wet delivers an effective bond between the top and bottom layers. Wire bar fabric between the two layers provides additional reinforcement, having been specified by Japanese consultant Azusa Sekkei and Oriental Consultants Joint Venture, which developed the airport design. Material compaction is delivered by up to 48 electric vibrators while the required concrete surface is being achieved using the SP 1600's oscillating beam and super smoother.

"Instead of using four SP 500 pavers, we decided to go just for one SP 1600, as we have had good experiences with this high-performance paving train in the past. Dual-layer paving with one machine speeds up our operation. We are paving concrete with a material cost of around $20 million and using around 135,000m3 of concrete for the runway, taxiways and aprons," explained commercial manager Seunghwan Lee.

The SP 500 meanwhile is being used for the 7,500m2 of aprons and 50,000m2 of taxiway sections. It is set to a paving width of 5.625m and is being used to construct up to five adjoining, parallel slabs.

Sungdo Construction brought stores of parts to the jobsite, with support being supplied by Wirtgen's regional service network. If there is a need for additional parts, these can be flown in from South Korean Wirtgen dealer Sambo Heavy Industries, or ordered from Wirtgen in Germany. Service engineers from Wirtgen China or Wirtgen Germany can be onsite within 24 hours.

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Color Event UB 2016 international festival to be held on August 27 at National Amusement Park

August 23 (gogo.mn) The first Color Event UB was organized in 2015 and gathered more than 1500 people. This year, the event will be held at 3 km running area of National Amusement Park under the auspices of City Tourism Department.

The Color Event UB 2016 aims to spread healthy and positive vibes among society. Participants will run along 3km road from start line to finish while colored with a different paints at each 600 meters. After the running, participants are able to spend their time healthy and positively by taking photos, fighting with paints as well as attending to the after party.

PROGRAM OF THE COLOR EVENT UB 2016:

4PM - Participants will take the white shirt, black sunglass and a bag of paint. At that time, DJs, singers and bands will perform.

5PM - Running will start. Participants will be colored with different paints at each 600 meters.

6PM - Chill time. Beverages, water and pizza will be served.

7PM - After party. Participants are able to have fun by dancing with their friends and family.

Tickets are available on sale at easyticket.mn, ticket.mn and Gegeenten cinema. Ticket price is at MNT 30,000 and it includes white T-shirt, black sunglass, a bag of paint and drinks.

Let's not miss this opportunity to run and have fun with your friends, family, children and colleagues while being colored.

When: On September 11 at 4PM
Where: National Amusement Park

Please note that is an alcahol free event. For more information, please click HERE.

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Diplomacy

Indian Ambassador meets Mongolia PM, raises possibility of Delhi flights

August 23 (gogo.mn) Indian Ambassador to Mongolia Suresh Babu met with Prime Minister J.Erdenebat and expressed his hope that friendly and close relations between India and Mongolia will be continued for long period in further.

Prime Minister of Mongolia noted:

"Even Mongolia is facing with economic crisis, our Government will implement sustainable and long-term economic policies which help to develop our country. It is beneficial to our economy to control the flow of mineral and agricultural raw materials and we need to process the raw materials locally. Therefore, we are ready to cooperate with India on developing processing industries".

Mr. Suresh Babu, the newly appointed ambassador, stated that Parliamentary election was conducted fair in Mongolia and the country has achieved a peaceful shift of new Government by people`s choice which made me proud of Mongolian democracy.

Indian Prime Minister Nerandra Modi has visited in Mongolia on May, 2015. Ambassador Suresh Babu requested PM to focus on the implementation of some agreements established during the visit including establishment of India-Mongolian joint school and educating 200 Mongolian students in India.

At the end of the meeting, Ambassador Suresh Babu said trade turnover between our two countries is not enough and its ranging between USD 15-20 million. He requested PM to study the possibilities on operating direct flights to Delhi in order to hold regular meetings of businesses of two countries.

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Related:

Prime Minister meets Ambassador of India – Montsame, August 23

Direct flights from Ulaanbaatar to Delhi – news.mn, August 23

Czech foreign minister to lead business delegation to Mongolia next month

August 23 (news.mn) Earlier today (23th August), Ladislav Horaak, economic attaché at the Czech Embassy met P.Bayarkhuu deputy UB city mayor. The diplomat congratulated P.Bayarkhuu on his recent appointment and discussed the forthcoming visit of the Czech Foreign Minister with a business group to Ulaanbaatar next month.

Last year, Jan Hamacek, Chairman of the Chamber of Deputies of the Czech Republic visited Ulaanbaatar. During the visit, Mr Hamacek met the previous Mayor of Ulaanbaatar and discussed a project to build a covered stadium and to increase street lightening.

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Three friendly neighbours

August 23 (news.mn) The transportation trial between China, Russia and Mongolia is currently going well. An echelon of trucks has already run along the transit route from the Chinese Port of Tianjin via Ulaanbaatar and is now nearing the Russian city of Ulan-Ude. Nine trucks from three countries as well as 60 people are involved in the transit transportation trial.

The opening ceremonies of the trial have been held in Tianjin and UB; the closing ceremony will be held in Ulan-Ude on 24th August. At tomorrow's ceremony delegations from three countries will evaluate the trial and discuss issues including the establishment of a joint logistics company, road transportation and constructing a new highway linking China, Mongolia and Russia.

The new transit transportation is expected to help increase trade volume by around 17-20% by 2020.

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Nature, Environment

#Mazaalai: Can it be saved?

August 23 (gogo.mn) The Gobi Bear or 'Mazaalai' dwell in part of the Mongolian Gobi. They are at home in the Altai Mountain ranges, surrounded on all sides by the Gobi desert, Segs Tsagaan Bogd Mountain, Tumurt Mountain Ranges, Khukh Us Mountain Ranges as well as the region around the Shar Khuls Oasis and Atas Inges ranges (Gobi-Altai Aimag) and an oasis in the middle.

The Mazaalai is a native inhabitant of the Altai Mountains in the Gobi region and can only be found in Mongolia. It is estimated that only about 30 Mazaalais are left in the world due to a yearly deteriorating environment and the shortage of meat that leaves them to only eat fodder granules or chaffs and migrate to other places to look for food. This eventually leads to their drifting apart from each other and stalling their reproduction.

In this connection, N.Tumenjargal, Head of the Mongolian Step for Mazaalai Rescue NGO said that the most important action among the preservation and protection efforts for Mazaalai being carried-out or studied by scientists is to develop new kind of feed for them. He continued "Mongolia has abundant experience and possesses a variety of methods in domesticating musk deer, wild horses and saiga antelope in cooperation with foreign specialists. The livelihood and number of this under-researched and rare species is unknown to the public. Since people have been showing their interest in the animal lately, our NGO has been working to discover and produce new food based on our observations, studies, images and records of automated cameras.

Because of the absence of food specifically for them, they have been surviving on mixed and cubed fodder for livestock animals produced with low-quality wheat, waste products of flour mills and chaffs provided to them by state and private organizations in the last three decades since the mid-1980s. The feed was supplied without any basic research and has caused many negative consequences. For instance, 2014 surveillance revealed that hungry wolves got diarrhea after they ate dog food provided for Mazaalai. During the springtime when the food is extremely scarce, it would draw more danger of (wolf attack) near the forager, especially for the malnourished and exhausted Mazaalais or their babies. When we put livestock offal and intestine meat of livestock, which was difficult to carry in the hot weather of the Gobi, close to the forager place, Mazailai did not even approach the place, but birds of prey, foxes, flies and greenflies were heaping the area and the meats became rotten after a day. Also, when we place carrots and beets in the forager in 2014, Mazaalai did not eat them as well, only the carrots were eaten by rabbits, and the beets dried up as nothing ate them.

We concluded that in the 'spring season' the Mazaalai is at its highest-risk for their entire life as they which emerge from hibernation drained of all their fat and energy after over 5 months or 150 days of harsh weather and environmental conditions in the Gobi. Therefore, we are planting some high protein vegetables and other fodder plants in the Gobi soli, creating new fodders for the Mazaalai and laying supplementary fodders at more than 20 forage centers in their living area in order to contribute to saving the Mazaalai from starvation and create condition for them to breed while fat and strong. We acquired a 'New Patent' from the Intellectual Property Office of Mongolia for our invention of supplementary fodder products produced in our new fodder factory with a capacity of 30 tons in Bayankhongor Aimag. There, we plant corn, soy, tomato, oat and rhubarb to supply raw materials for the factory. Employing more than 10 local people, we operate Mazaalai clubs at secondary schools in Bayankhongor Aimag and teach field work and planting techniques to children in the region.

The government has taken a large number of measures to save the Mazaalai. For example, the area Mazaalais inhabit was declared a natural reserve; was state-protected in 1953, and announced to be a State Protected Area of the Gobi. Because the Mazaalai is a rare and critically endangered animal that lives in a very small number in a truly dry and harsh ecological climate of the Mongolia Gobi, it was listed in the Mongolian Red Book of Endangered Animals (1987, 1997) and the first appendix of the Washington Convention on International Trade in Endangered Species of Wild Fauna and Flora.

Also, the Mazaalai was included in the list of endangered animals with a low restoration capacity and limited spread pursuant to Mongolian Laws on Hunting (1995), on Fauna (2000), and on Animals (2012). In 2007, the Mazaalai was defined as critically endangered – regional and international D classification of endangered animals by the International Union for Conservation of Nature Red List of Threatened Species in 2007, which indicates that the Mazaalai not only needs to be protected nationwide, but also internationally. By a resolution of the Minister for Nature and Green Development issued in 2013, a working group was set-up and has performed a good deal of work directed at improving the environment for the Gobi Bear, enhancing the quality of supplementary feeds for Mazaalai, sowing fodder vegetables, establishing fodder manufacturing factories, continuing necessary research, finalizing issues of species of Mazaalai and implementing programs to promote the importance of this animal.

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Sports

Mongolia's Olympic wrestling strip gets public backing

ULAAN BATAAR, Mongolia, August 23 (AP) — A skin-baring protest by a pair of Mongolian wrestling coaches at the Rio de Janeiro Olympics might have struck some observers as slightly bizarre. Back home in their landlocked Asian nation, however, it's been praised as the appropriate response to bad refereeing.

Mongolian media and the public reacted angrily to the decision to award victory to Uzbekistan's Ikhtiyor Navruzov over Mongolia's Mandakhnaran Ganzorig in the 65 kilogram freestyle bronze medal match on Saturday.

While Ganzorig, who had already started celebrating, fell to his knees in disappointment, his coaches went much further.

Byambarenchin Bayaraa took his shoes and shirt off and threw them to the mat in disgust in front of the officials.

Tsenrenbataar Tsostbayar stripped all the way down to his blue briefs. The Brazilian crowd started chanting "Mongolia! Mongolia!"

Former freestyle wrestler Nyamjav Baasanjav said Tuesday the referees should have given Mandakhnaran a warning instead of awarding a key penalty point to Navruzov.

"This shows the referees were biased and favored the Uzbek wrestler," Baasanjav claimed. "Everyone can see from the video recording of the wrestling that Mandakhnaran was the better wrestler. Mongolia was robbed."

Wrestling is one of Mongolia's traditional sports — alongside archery and horseback riding — and has an intense following in the country of slightly fewer than 3 million people.

Stripping one's clothes off is considered an acceptable way of peacefully protesting a decision and the coach's actions were widely embraced.

"The internet loves the Mongolian coaches for this protest action," said Myagmardorj Boldbaatar, an entrepreneur and active social media user. "The coaches didn't break anything or physically hurt anyone. It was nothing personal."

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Art, Entertainment

French pop singer Petite Meller's music video shot in Northern Mongolia

August 23 (gogo.mn) New music video by French pop singer Petite Meller has filmed in Khuvsgul aimag, Mongolia in last July. Her new single "The Flute" has released on Aug 19.

She noted "As I've always felt a bit of an alien, I had this idea of me founding my own tribe in Mongolia, where there are girls with natural blush. I remember how as a child, I saw a photo of a blushed Mongolian girl, and felt a strange connection. Directors A T, Napo and myself were juggling this idea for a year in our heads until it came to be reality".

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Travel

Avoid crowds on vacation with these destination alternatives

NEW DELHI, August 22 (PTI): For those who wish to escape the maddening crowd while on vacation, a new travel study has revealed alternative destinations to the most popular tourist spots across the world.

The study undertaken by 'Skyscanner' has crunched the data from 50 million unique monthly users across their website and mobile app to suggest alternative destinations to holiday hotspots popular among Indians.

"We understand the frustration of arriving at your destination only to find a sea of selfie sticks. Avoid the push and shove this year with our top pick of alternative holiday destinations," the search engine said.

According to their data, Mongolia is a "rustic beautiful" alternative to the massively populated China, which is believed to be home to an incredible combination of cultures, languages and cuisines.

"So far in 2016 there are 32 times less travellers searching for flights to Mongolia than China," the study reveals.

With one of the lowest population densities in the world, Mongolia is best known for its Nadaam festival, an annual affair that blends the place's "sporting tradition with its ornamental aspects."

A trip across the Gobi Desert on reindeers and camels as well as tasting the fermented mare's milk are among the most recommended activities.

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