Resource wealth key to ‘Minegolia’ poll

Mining and wealth distribution have become the central issues of the 2013 presidential election campaign in Mongolia.

As Mongolians prepare to vote on Wednesday, Anglo-Australian mining giant Rio Tinto is awaiting government approval to export its first shipment of copper from its massive Oyu Tolgoi mine, and state-owned coal mining company Erdenes Tavan Tolgoi is planning a $3bn initial public offering of the Tavan Tolgoi coal deposit .

The two huge projects are the biggest of a series of deposits that have led to the country landlocked between Russia and China being dubbed “Minegolia”, and there is hope among voters that profits from the resources will lift people into prosperity in a developing nation, where 29.8 percent of the population was classed as poor in 2011.

Professor Li Narangoa, head of the Mongolian Studies Centre at Australian National University, said the main election campaign issue was who would benefit from the mining boom, and how the wealth could be distributed evenly.

All three presidential candidates have advocated responsible mining in the Central Asian country, which has a population of about three million.

Criticism of mines

During the presidency of incumbent Tsakhiagiin Elbegdorj, rules that restricted foreign mining operations have been eased.

Elbegdorj, the Democratic Party candidate and election favourite, has been critical of the way the Oyu Tolgoi mine, known as OT, is run. However, he does not want to change the existing agreement between the government, which has a 34 percent stake in the project, and Canada’s Turquoise Hill Resources, majority-owned by Rio Tinto.

Badmaanyambuugiin Bat-Erdene, the Mongolian People’s Party (MPP) candidate and Elbegdorj’s biggest rival, and Natsag  Udval, the Mongolian People’s Revolutionary Party (MPRP) candidate and Mongolia’s first woman to contest the presidency, want OT’s agreement amended in order for the resource wealth to be more evenly distributed.

That has raised alarm among foreign investors.

Karr McCurdy, president and chief executive of Behr Dolbear, said that Mongolia’s volatile political climate had already taken a significant toll on mining policy and drastically affected the level of direct foreign investment.

“It’s a double-whammy,” McCurdy told Al Jazeera. “Uncertainty impacts companies’ ability to access international funds.”

Gary Gray, Australia’s resources minister, told Al Jazeera that he had advised Mongolian Mining Minister Davaajav Gankhuyag against renegotiating a pre-existing long-term contract.

” Poor management of resources can initiate a wave of economic stagnation, corruption, and conflict – resulting in what is known as the ‘resource curse’,” Gray said.

Bat-Erdene was one of four members of parliament to write a letter last year to coalition Prime Minister Norovyn Altankhuyag , of the Democratic Party, demanding he renegotiate the OT agreement.

Professor Li said a recent poll suggested that Bat-Erdene, a charismatic former wrestling champion, would probably get 35 to 40 percent of votes.

“H is idea of protecting the environment against irresponsible mining and renegotiating the mining contract with big foreign companies certainly will win significant numbers of voters,” Li said.

“His election slogan also includes: ‘I am clean, my hand is clean and my heart is clean,’ meaning that he is not corrupt.”

Li said that corruption had been another big issue in the run-up to the election.

Tuvshinbayar Tumurkhuyag, a mining engineer whose wife is expecting their second child in the capital Ulaanbaatar, told Al Jazeera that it was important to stop corruption and ensure processes were more open and transparent.

“The election is very important to me and all Mongolians,” said Tumurkhuyag, who cited infrastructure as being another big issue, hoping to see more highway and railway projects in the country.

Elbegdorj has advocated anti-corruption measures – and multimillion-dollar corruption cases have been successfully tried during his presidency, including that of Nyamdorj Enkhbayar, the now-jailed former president and prime minister.

Udval has campaigned for the release of Enkhbayar, the former MPRP leader, and said his conviction was politically motivated.

Mongolia’s corruption perception ranking dropped from 120th out of 174 countries in 2011 to 94th in 2012, according to anti-corruption watchdog Transparency International.

However, Elbegdorj has been accused of duping a South Korean investor over a mining licence during the run-up to the 2013 presidential poll. His aides have dismissed this as a smear campaign.

Li said that it was hard to say what effect this could have on the election outcome, and some voters might have become hesitant to vote for him, but it probably would not affect the final result.

Importance of the role

A survey of 1,480 people in Ulaanbaatar by non-profit pollsters the Sant Maral Foundation found that 54 percent of respondents would vote for Elbegdorj.

If a candidate secures more than 50 percent of the vote they will avoid a run-off.

Li said that the presidential elections were important. The president’s role is not only ceremonial; arguably the most powerful aspect is the ability to nominate three of the nine members of the Constitutional Court, the prosecutor-general and the deputy prosecutor to the parliament.

Another presidential power is to initiate, veto and endorse legislative bills, dismiss parliament if it fails to establish a government and introduce a no-confidence motion against the parliament.

“The presidential election is also important in the coalition government, especially in terms of power balance in the government,” Li said.

“Many voters think that if Bat-Erdene wins, the power balance between the Democratic Party, which rules the government, and the MPP would be better.”

Votes have already been cast in 39 diplomatic offices around the world, where 68 percent of Mongolians abroad (4,248) cast their ballots from June 14-16, in a presidential election first.

Ballot papers will also be counted automatically – for the first time in a Mongolian presidential election – in an attempt to thwart any irregularities.

Allegations of voting irregularity in the 2008 parliamentary election sparked deadly riots and led to the electronic voting system being introduced in last year’s governmentelection.

History

Mongolia held its first democratic parliamentary elections in 1990 and it adopted a democratic constitution in 1992. The first presidential election took place the following year. It has since conducted six legislative elections, with this being the sixth presidential poll.

Elbegdorj was one of the leaders of the 1990 Democratic Revolution in Mongolia, which was the culmination of a series of large-scale pro-democracy protests in 1989 and 1990.

Up until 1990, Mongolia was essentially a satellite of the former Soviet Union under the governance of the Communist MPRP, although it began to pull away from Russia when it established diplomatic relations with the US in 1987.

Mongolia adopted Soviet-style politics after the Outer Mongolian Revolution of 1921. It had been a province of China from 1691 until Russia encouraged Mongolian nationalism and Mongolia declared its independence from China in 1911, when the Manchu Qing Dynasty fell.

What was then known as Outer Mongolia established a theocracy under the Khutuktu, the spiritual head of the Gelug lineage of Tibetan Buddhism, who was installed as the Bogd Khaan, or Great Emperor of Mongolia in 1911.

There were up to 600 monasteries and temples in Mongolia during this time, according to Karénina Kollmar-Paulenz, History of Religions professor at the University of Bern in Switzerland.

However, Chinese troops recaptured the country in 1919 as revolution unfolded in Russia.

Resentment still smoulders in Mongolia against China and Russia, although some older urban Mongolians credit the Russians with introducing staple food and education. Many cannot forgive the massacre of thousands of Buddhist monks and razing of monasteries at the hands of the atheist communists.

There has been resurgence in the faith since 1990, when one working monastery remained and hundreds were in ruins, according to Professor Kollmar-Paulenz, who said almost 200 monasteries and temples had been restored throughout Mongolia.

There has also been a push to reclaim Chinggis Khaan, better known outside Mongolia as the 13th century conqueror Genghis Khan, founder of the Mongol Empire, which at one point stretched from the Sea of Japan to Eastern Europe.

There are countless tributes to him, including a 40m-high statue at Tsonjin Boldog, east of Ulaanbaatar. The capital’s airport is now named Chinggis Khaan International Airport.

There is a real buzz of optimism around the capital that the country could again become significant on the world stage, providing its abundant resources are managed properly.  

Follow Rebecca Falconer on Twitter: @BecardoF