Summary: Mongolia – On the Move

Summary:  Mongolia – On the Move

• Mongolia is a poor struggling country – the Central Asian Ethiopia –  as poor as it was per capita in 1990, with an economy based on the same poorly managed sectors – livestock and mining – and seriously dependent on foreign aid.   Large numbers of Mongols have emigrated in search of work; they are joined by intellectuals and political dissidents.
• Mongolia’s two big neighbors are consumed by their own internal troubles and do not play a pro-active role, for better or worse, in Mongolia’s political or economic situation.  However, the consequences of these countries own internal troubles have had generally negative affects on Mongolia.  Moscow’s main impact was to pressure the country to settle its debts, on terms unfavorable to Mongolia.    China is wracked by economic, environmental, political and social problems and is a source of instability (and refugees).  Though it remains Mongolia’s largest trading partner, this trade is primarily in low-value raw materials and commodities.
• Mongolia has not managed to develop many elements of a modern economy.  Herding and agriculture are still 30-35% of the economy; resource extraction, primarily carried out by foreign firms, accounts for most of the rest.  The Mongolian finance and technological sectors are weak and generate few 21st century jobs.  Mongolia has reverted to more or less a command economy and the private sector is weak in general.  Direct foreign investment is low, as is foreign aid; loans are due.  Remittances from Mongolians overseas is a major source of GDP.
• The ineffectiveness and perceived corruption of the political classes in the early 2000s, and dissatisfaction with the way Mongolia’s Russian debts were settled, led Mongolians to rally around a strong president.  It is now generally viewed as another Central Asia “elected dictatorship”, with the President re-elected without serious opposition and benefiting from the attention of a servile press.
• Gochoo and Bumaa live in a ger slum outside UB.  Neither has regular employment. Their daughter and her husband are abroad as a manual laborers.  They hope to send their son to work as a miner in Czech.  Environmental conditions are harsh all round.