CPSI NewsWire brings you market updates on Mongolia, compiled by CPS International, a Mongolian marketing arm of CPS Securities, a Perth, Western Australia based stockbroking and corporate advisory firm, specialising in capital raising for mining and junior stocks.
VOR rose 20% to close at 2.4c with 11 million shares traded
Voyager: RESPONSE TO ASX PRICE AND VOLUME QUERY
July 23, Voyager Resources Limited (ASX:VOR) --
We refer to the Price and Volume query issued by the Australian Securities Exchange on Monday 23 July 2012 and comment as follows:
1. Voyager Resources Limited (the Company) is not aware of any information that has not been announced that would explain the trading in the securities of the Company.
2. Not Applicable
4. The Company confirms that in its opinion it is, and has been at all times, in compliance with listing rule 3.1.
AKM closed flat at 13c
Aspire Mining appoints large scale project manager James Benson
July 23 (Proactive Investors) Aspire Mining (ASX: AKM) has appointed experienced project manager James Benson to oversee the Ovoot Coking Coal Project in Mongolia through construction of the mine infrastructure as well as management of the Erdenet to Moron Rail line.
Benson, who will become the project director, has over 30 years experience in engineering, procurement, and construction management with a focus on providing leadership and constructive solutions for large scale bulk commodity projects in remote regions, including over 10 years in Mongolia, Kazakhstan, Ukraine and Russia.
He has overseen multiple billion dollar construction projects whilst employed with companies including Parsons Brinkerhoff, FERREXPO, and Bogatyr Access Komir.
These include the development of an iron ore mine in Ukraine and a coal mine and associated Russian rail infrastructure in Kazakhstan.
"The quality of the Ovoot Coking Coal Project has again been able to attract a high calibre executive to the Aspire management team," Aspire managing director David Paull said.
"Jim's experience base provides an ideal fit for the significant challenges ahead in bringing the Ovoot Project into production."
Ovoot Coking Coal Project
Aspire is planning to start Stage 1 production at the project in early 2016 at an initial rate of 6 million tonnes per annum of high quality coking coal, ramping up to 12 million tonnes per annum in 2018 under Stage 2.
This will deliver a project with an internal rate of return of 43%, according to the recently completed Pre-Feasibility Study (PFS), which was based on Probable Coal Reserves of 178 million tonnes – the third largest coking coal deposit in Mongolia, by reserves.
Significantly and as a pointer to the future, Aspire to date has only explored 20% of the Ovoot Basin.
The staged development will de-risk the production ramp up and enable the first stage operational cashflows to underpin a future Rail Spur Line connection from Ovoot to link up with the Multi-user rail line at Moron. The Rail Spur Line from Ovoot to Moron will facilitate the targeted full scale 12 Mtpa coking coal operation.
This had Bell Potter issue the company with a buy recommendation and a 12 month price of A$0.27 earlier this month, more than double the current trading price of A$0.125. Proactive Investors is a market leader in the investment news space, providing ASX "Small and Mid-cap" company news, research reports, StockTube videos and One2One Investor Forums.
Guildford Increases Stake in Terra Energy and White Mountain
July 23, Guildford Coal Limited (ASX:GUF) --
The Board of Guildford Coal Limited (Guildford) are pleased to advise that the Company has moved to 74.76% ownership of its Mongolia based partnership with Terra Energy Ltd (Terra Energy), with a 4.76% increased stake.
Guildford is also pleased to advise that the Company has also increased its ownership stake in White Mountain Pty Ltd (White Mountain) to 59.6% with a 3.6% increased stake.
Guildford increased its stake in Terra Energy through conversion of a loan facility into shares. Mick Avery Managing Director of Guildford stated "this is a positive outcome for Guildford Coal leading into production from the South Gobi project this quarter. Guildford Coal and Terra Energy's partnership remains strong and we look forward to working together to further develop our Mongolian assets".
Guildford holds a 74.76% stake in Terra Energy which controls 1 mining licence, 1 mineral development licence and 5 exploration licences contained in two projects in Mongolia. The projects are located in the coal bearing basins of the South Gobi and Middle Gobi which contain coking and thermal coals respectively.
The South Gobi Project has a 70.4Mt JORC Indicated and Inferred Resource for the North Pit of coking coal in the Permian Delin Shand formation suitable for open cut mining. There is a further Exploration Target# of 70Mt to 893Mt that has been identified in another 3 conceptual pits (East, Central and West). The South Gobi site is expected to commence mining operations from the North Pit this quarter.
The Middle Gobi Project has 221.4Mt of Indicated and Inferred Resource of thermal coal in the Mid Gobi coal basin suitable for open cut mining. There is a further Exploration Target# of 165Mt to 830Mt that has been identified on this deposit. The Middle Gobi Project also contains fluorite mineralisation discovered outcropping on north western edge of the exploration licence with laboratory results of field grab samples revealing potential ceramic grade fluorite.
White Mountain Project Overview
Guildford increased its stake in White Mountain to 59.6% by taking up a full allotment of the first rights issue for White Mountain Pty Ltd. The other White Mountain shareholder, Galilee Co. Pty Ltd, elected not to participate in the rights issue, allowing Guildford the opportunity to also ascribe for these shares.
Mr Mick Avery, Managing Director of Guildford stated that "Guildford Coal is looking forward to developing the White Mountain Project, which has demonstrated the potential to support the development of a large open cut coal resource."
The White Mountain Project is located on the north eastern edge of the Galilee Basin in Queensland. Permian coal seams are known to outcrop in this location and were previously mined in the old Oxley Creek Coal Mine. The White Mountain Project is a potential early stage development opportunity located North West of Pentland and is well located to utilise existing rail and port capacity.
The White Mountain Project has a JORC Inferred Resource of 262Mt of thermal coal and there is a further Exploration Target# of 40Mt to 815Mt across the project. Subsequent to the JORC resource being estimated earlier in 2012, further coal intersections have been recorded and these results combined with further planned drilling should enable the JORC resource to be upgraded and increased this quarter.
MEC Annual General Meeting announced for 30 August
MEC: Annual Report 2012
July 23, Mongolia Energy Corporation Limited (HK:276) --
In this financial year, we completed building the Khushuut Road, secured its commission from the Mongolian authority, and commenced commercial production shortly thereafter. These progress mark a milestone to MEC after years of our efforts and hard works.
Although it is a new chapter for us, challenges continue to follow. The commercial production commenced near the close of this financial year, therefore, a low level of sales activities was recorded. This was expected by us at the initial stage of commercial operation. Our devoted staff are looking ways to improve our start-up issues facing us, and we hope to gradually ramp up our production and improve our sales price.
This year we recorded a massive impairment loss in respect of our mine assets, and this was based on the impairment analysis performed by an independent qualified valuer. A variety of factors and assumptions were taken into account by the valuer in arriving with the impairment. The major factor contributed to the significant impairment loss was due to a change made to our mine's infrastructure plan caused by the delay in obtaining a water permit for construction of a coal processing plant. As an interim measure, we have planned to build a coal washing plant in Xinjiang. In the immediate term, we have engaged a coal trading company with a washing plant to provide coal processing services to us. The impairment loss has no impact on cash flow in the financial year.
Mongolia has tightened up foreign investments in its strategic sectors by passing the Foreign Investment Regulation Law in May 2012. Investment or participation in the minerals sector by foreign investors of exceeding 1/3 or more of a Mongolian entity of the sector will require approval of the Mongolian government. It has no impact on our existing operation but we anticipate this may take longer lead time to get our new projects approved by the Mongolian government in the future. As part of our expansion plan, we will expand our horizon and actively assess potential resources investment opportunities in our nearby market, Xinjiang.
The Mongolian economy continued to grow at a very rapid pace; expanding by 16.7 percent year-on year in the first quarter of this year and coal export was its largest export earner. Meanwhile, the Europe problems continue to batter the global economy. Coking coal demand in China also displayed a downward trend due to the gloomy global economy in the first half of this year. Having said this, China was still the world's largest steel producer and consumer and a net coking coal importer last year. Against the backdrop of weak global economy, premium quality coking coal still has its market in China. Although we do expect the coking coal prices will fluctuate at the current stage, Xinjiang is a unique market as a result of the China's Go-West Policy, expansion on the western part of China is on the way with the continued growth of steel mills in Xinjiang. Our quality coking coal has the demand from the steel mills in the Xinjiang market. We strongly believe the economy of China will continue to boost and are confident that our strategic location near the Xinjiang market will reap the economic growth of China. Having coming into commercial operation, we will work proactively to expand our customer base in the coming period.
In government relationship and community affairs, we entered into two cooperation agreements with the Darvi soum and Tsetseg soum of Mongolia. The purpose of such agreements is to enhance cooperation between the local governments and provide successful implementation of our projects and investments while in return, we are required to provide support to the local communities. We will continue to contribute to the local communities around us and help them to build up a better living environment. As a responsible corporation, we will continue to protect and preserve the natural environment around us, contribute to all rehabilitation works and to provide a better place for our sustainable growth.
Mr. James Schaeffer, our former chief executive officer, retired in June this year. He contributed a lot to MEC since he joined us in 2007 and led our operation from inception up to commercial operation today. We now have a team of technical experts and professionals under the leadership of our managing director, Ms. Yvette Ong. We will continue to move forward to accomplish our mission.
I foresee the coming period will be a mix of opportunities and challenges. We have been through all the hard times in the past and I need your continuous support on our road ahead.
Lo Lin Shing, Simon
Asia Coal: Annual Report 2011/12
July 23, Asia Coal Limited (HK:835) --
During the year, the Group continued to engage in coal mining business and distribution of health and beauty products and services. But the logistic services business has been discontinued during the year.
In the coal mining segment, the Group continued to hold the mining rights to the Saikhan Ovoo coal deposit in the Bulgan province of Mongolia. The JORC compliant resources report prepared by independent technical advisers shows estimated resources for the Saikhan Ovoo coal deposit in excess of 190 million tonnes. The coal resources estimated (on air dry basis) based on the analytical work on 165 coal samples taken from 27 boreholes with a total of 5,222 metres drilled are as follows:
Independent Auditor's Report
Emphasis of Matters
We draw attention to note 19 to the consolidated financial statements. The Group owns two mining rights in Mongolia which may be revoked as a result of the enactment of the Mining Prohibition Law (the "MPL"). According to the MPL, the affected license holders, including the Group, are to be compensated but the details of the compensation are not currently available. If the Group's mining rights are revoked due to the MPL and the compensation received by the Group is significantly less than the carrying amounts of these concessions, the Group would incur a significant impairment loss on the related exploration and evaluation assets. The ultimate outcome of this matter cannot presently be determined and no provision for an impairment, if any, that may result from the above matter has been made in the consolidated financial statements.
Deloitte Touche Tohmatsu
MMC: DATE OF BOARD MEETING
July 23 (HK:975) The board of directors (the "Board") of Mongolian Mining Corporation (the "Company") hereby announces that a meeting of the Board of the Company will be held on Tuesday, 7 August 2012 for the purpose of, among other matters, considering and approving the interim results of the Company and its subsidiaries for the six months ended 30 June 2012.
CPSI is supporting the event and yours truly, Mogi, will be presenting at the event. For event info please contact email@example.com
Linkedin's Mongolian Mining Sector group's Networking Event
July 23 -- Mongolian Mining Sector Group on Linkedin with Partnership of Iarudi LLC and Mining Gate Mongolia LLC cordially invites you to our first networking event to be held at 7 p.m. on August 3rd, 2012 at Bojangles Restaurant in Ulaanbaatar Mongolia.
As our group, Mongolian Mining Sector on Linkedin has grown, it is time to meet each other and exchange ideas, expertise and knowledge on how we can improve the mining sector in Mongolia. This is a casual networking event that is aimed to help, advise and aid our esteemed members and colleagues in their endeavors.
The event will be held at 7 p.m. on Friday, August 3rd of 2012 at Bojangles Restaurant, Jiguur Grand Building on Narny Zam Street, next to Monnis showroom.
The IARUDI Group
Established in early April 2011, IARUDI Group is one of Mongolia's premier professional services firms. Based out of its offices in Central Tower and San Business Centre in Ulaanbaatar the group has approximately twenty five team members based in country full time. A highly skilled and experienced team of Mongolians is complimented by four international chartered accountants (from England, South Africa and Australia), an experienced ex investment banker from Australia and an Australian lawyer.
Boasting an impressive mix of international and local experience IARUDI has created a unique service offering platform to both international and Mongolian clients. The group provides an array of services ranging from transaction advisory and virtual CFO services through to back office accounting and local regulatory compliance. The group also actively identifies business opportunities within Mongolia and either invests or partners with local and international players to convert such opportunities into successful businesses.
BoM issues ₮35B 12-week 17.15% bills
July 23 (Bank of Mongolia) BoM issues 12 week bills worth MNT 35 billion at a weighted interest rate of 17.15 percent per annum. /For previous auctions click here/
Governing Committee of MPP has resigned
July 23 (Business-Mongolia.com) The Governing Committee of MPP has resigned. The Governing Committee of MPP, the main policy making body of former ruling party, has resigned in full force.
The State Great Khural's General Session is being suspended due to the absence of MPs from MPP. MPP abstained any attendance until its SK Party Group Meeting decision. SK Party Group of MPP has expectation to solve the issue of its two winners at Uvurkhangai electoral district, which was suspended by the district court of Khan-Uul, Ulaanbaatar, before any other issues to be discussed at the SGK level.
Now the main debate is made on nominating the new General Secretary of MPP. Possible candidates are Mr. Tsogtbaatar, Minister for Environment and Tourism, Mr. Sukhbaatar, former MP and lost his election campaign at Darkhan-Uul province, and Mr. Zandanshatar, former MP and Minister for Foreign Affairs and lost his election campaign at Bayankhongor province.
New Coalition Government of Mongolia is about to be formed
July 22 (Business-Mongolia.com) As the result of the National Consulting Committee Conference of Demparty of Mongolia, it made decision to enter in coalition with "Justice Coalition", MPRP and National Democratic Party of Mongolia, and Civil Will Green Party. Justice Coalition will form 25% of the Cabinet, while Demparty and CWGP jointly compose 75% of the Cabinet.
Some sources say that MP Ulaan will be appointed as the Deputy Prime Minister, MP N.Batbayar for Minister for Finance, Mr. Aruinsan, former Deputy Minister for Mineral Resources and Energy, for the Minister, MP Temuujin for Minister for Justice and Internal Affairs.
The main concern of the Coalition for the foreign investors and mining companies is the possible nationalization of the mining projects back to the state ownership or increase of the state ownership in mining projects. Foreign investors are mostly concerned with possible nationalization plan of Justice Coalition, stated in the platform for the election. Actually, nothing much and clear statement is made in the Justice Coalition platform. Here excerpts from the platform, concerning about the mineral or natural resources.
"… 1.2. Complete calculation of natural resources shall be made, as the result, the database will be established and will be transferred to the people and the state policy shall be developed and implemented to protect, restore and utilize it. The political, social and economic condition shall be formed for the far distribution of outcome of the natural resource, progress and development of the state…"
Also, platform of the election of Demparty and other parties which joined to the coalition Government is developed based on the heavy anticipation of the economic growth of the country. If the Coalition Government tries to nationalize mining projects and neglects FDI, it will commit complete suicide in front of the people of Mongolia. Business-Mongolia.com strongly recommends to our readers not to take this election result so pessimistic. There is a proverb about this situation which may most conveniently answer the question "Dawn comes not because of rooster chucks, but rooster chucks when dawn comes".
Female Lawmakers in Mongolia establish parliamentary group to promote gender equality
ULAN BATOR, July 23 (Xinhua) -- The newly elected female lawmakers of the Mongolian parliament have established a cross-party parliamentary group to address issues related to gender equality and children protecting, local media reported on Monday.
The number of female lawmakers has been tripled in the new parliament with nine female lawmakers succeeding in winning seats in the country's supreme legislative body.
This was considered as a big progress in promoting Mongolian women's representation in parliament, lifting the female representation in parliament to 12 percent from last parliament's 3.9 percent.
The group aims at tackling the gender-based issues and promoting women's participation in politics, economics and social development.
But this parliamentary group is an unofficial one because Mongolian law stipulates that only political parties can form groups within the parliament.
Gender imbalance widely exists in political and economic spheres in Mongolia and women's representation in parliament has always been low. Mongolia has taken measures to increase women's representation in parliament by specifying a minimum of 20 percent of the candidates nominated by political parties in the parliamentary election should be women.
Independent MPs to establish a committee
July 23 (news.mn) Three independent MPs- S.Ganbaatar, Ts.Davaasuren and Kh.Bolorchuluun, who elected as lawmaker on June 28 announced will establish a commission of independent candidates within the parliament.
"Electors voted for us because they supported our election platform. The commission will work actively to implement election platform each independent candidates" told independent MPs to journalists on last Friday.
The Commission officially will approved after nomination Speaker.
In question independent MP's will join to coalition headed by Democratic Party Ts.Davaasuren answered "Our goal is implement our election platform. If coalition will suggest condition for implementation of our platform we are agree to join".
"Discover Mongolia" International Mining Investors' Forum to take place in Ulaanbaatar Mongolia over the 30th and 31st of August, 2012
ULAANBAATAR, MONGOLIA (July 20, 2012) - The Organizing Committee of "Discover Mongolia-2012" International Mining Investors' Forum is pleased to announce the conference sessions and this year's sponsors.
This year's forum will take place in Ulaanbaatar over the 30th and 31st of August. "Mongolia and its investment opportunities have been at the center of investors' and media attention for the past few months, we believe that Discover Mongolia IMIF, celebrating its 10th anniversary, has the reputation of being the venue where investors and companies can formulate their own perspective on Mongolia's investment environment" said the Chairman of the Organizing Committee and Mongolia's first elected President H.E. Ochirbat Punsalmaa.
"Discover Mongolia - 2012" is pleased to announce that this year's conference will include the following sessions: Keynote Speakers, Mineral Exploration, Mining Operations, Mineral Resource Demand and the Supply Outlook in North East Asia, Infrastructure in Mongolia, Value Adding Processes of Mineral Products, Mongolia's Legal Environment, and Government Hour.
"Mongolia has a newly elected parliament and the Discover Mongolia Forum could be a platform for the government of Mongolia as well as private sector investors to engage in constructive exchange" said Mr. D. Damba, a member of the Organizing Committee and the President of Mongolian National Mining Association.
Each of the sessions will feature prominent and distinguished speakers including H.E. Ochirbat Punsalmaa, the first elected President of Mongolia, Ambassador Urban Rusnák, Secretary General, Energy Charter, Bank of Mongolia, Development Bank of Mongolia, as well as several leading think tanks from Korea, Japan, Russia, and China.
"The Forum's main focus will be centered on Mongolia's Mining and Exploration industry while emphasizing global and regional trends. I am sure having such distinguished speakers will add more excitement to the event" said Mr. D. Damba.
This year the event awarded its Premier sponsor, its most exclusive level of sponsorship, to Oyu Tolgoi LLC. Gold and Platinum level sponsors include: Erdene Resource Development Corp (TSX:ERD), Monnis Group, Aspire Mining Ltd (ASX:AKM), Xanadu Mines (ASX:XAM), Micromine, Ernst &Young, Mongolia Mining Corp (HKEx:975), Adamas Mining, and Sharyn Gol JSC.
About the organizers
'Discover Mongolia International Mining Investors' Forum' 2012 is being organized by Prime Info LLC, the leading event organizing company in Mongolia with specialization in Resource and Financial Service event planning. Prime Info LLC is working in close cooperation with the National Mining Association of Mongolia, the country's largest professional NGO and a long standing partner of 'Discover Mongolia' IMIF.
For more information please contact:
Mr. Bilguun Ankhbayar
Web Site: www.discovermongoliaforum.com
Mongolia to intensify efforts to develop tourism
ULAN BATOR, July 23 (Xinhua) -- Mongolian President Tsakhia Elbegdorj said Monday that his country will make more efforts to develop the tourism industry.
Elbegdorj made the remarks at a meeting with visiting Secretary-General Taleb Rifai of the World Tourism Organization of the United Nations.
Elbegdorj said Mongolia has rich and diverse tourism resources characterized by extraordinary natural landscapes, abundant historical heritage as well as unique ethnic customs.
The upcoming new government would not only develop Mongolia's mining industry, but also make more efforts to boost the tourism sector as well as related infrastructure, the president added.
Rifai highlighted the key role played by tourism in creating jobs and promoting economic development, saying the total number of tourists around the world had reached 1 billion at present and one out of 10 job places were created by the tourism industry.
He said Mongolia has great potential in developing ecological tourism.
Mongolia owns many unspoiled landscapes and unique ethnic customs, such as the fossil fields in the Gobi Desert, the beautiful giant Khuvsgul lake as well as the grand national celebration -- Naadam Festival, and all the attractions have laid solid foundation for the country's tourism industry.
Over the last three years, the number of foreign visitors to Mongolia increased 11 percent, with revenues up 32.5 percent during the same period.
In order to realize the target to attract 1 million foreign visitors per year by 2015, the Mongolian government is expected to adopt more measures and channel more investment to boost the country's tourism sector.
July 23 (NewSecurityBeat) Mongolia, a vast, sparsely populated country almost as large as Western Europe, is at once strikingly poor and strikingly rich. Its GDP per capita falls just below that of war-torn Iraq, and Ulan Bator has some of the worst air pollution ever recorded in a capital city. At the same time, Mongolia sits atop some of the world's largest mineral reserves, worth trillions of dollars, and its economy, already one of the world's fastest growing, could expand by a factor of six by the end of the decade as those reserves are developed.
As the government undertakes the long process of opening up the country's mineral wealth, Mongolia is nearing a familiar turning point for resource-rich but developmentally poor countries. However, a unique and dynamic set of environmental and cultural factors set it apart from places like the Democratic Republic of the Congo, Nigeria, Bolivia, and Afghanistan, as it works to avoid the pitfalls of the "resource curse."
Nearly 40 percent of Mongolians are herders whose livelihoods are irrevocably intertwined with their environment. Herding has been an economic and cultural mainstay of rural life since the days of Genghis Khan. Children as young as five race horses for miles across open grassland in the Naadam, Mongolia's annual national festival. The winning jockeys are celebrated and the winning horses idolized. Mongolia's reverence for its nomadic roots extends all the way to its 20-year-old constitution, which enshrines livestock as "national wealth" to be protected by the state.
But today, the livelihoods of families reliant on grazing livestock are under threat from a climate that is becoming increasingly harsh and unpredictable. Mongolia is feeling the effects of climate change "perhaps more rapidly than any other place in the world," proclaimed the vice chairman of parliament this year. Desertification is driving the Gobi Desert to expand by 10,000 square kilometers every year – enough to fit the state of Delaware two times over.
Compounded by increasingly harsh winter storms, the changing climate is driving herders to relocate to Ulan Bator and other cities in search of better opportunities. That migration is adding to sprawling slums, cook stove-driven air pollution, and a public health crisis that the president himself has called a "disaster." These changes are set to have a uniquely powerful impact on a national identity that is interwoven with the herding tradition.
Navigating the country's mineral wealth is not, therefore, just a matter of avoiding the standard pitfalls – corruption, inequity, and environmental destruction – of the resource curse; lawmakers will also have to contend with preserving a way of life that has defined Mongolia for centuries.
Every Mongolian a Millionaire?
Estimates for Mongolia's mineral wealth range from $1.3 trillion to $2.75 trillion in the 10 biggest mines – and those amounts reflect just the 27 percent of the country that geologists have mapped so far. While mining has long been a part of the country's economy, the past few years have seen the industry explode as massive gold, copper, and coal deposits in the country's south have been opened to foreign investment.
Oyu Tolgoi, a copper and gold mine, was opened up to Canada-based Ivanhoe Mines (and its majority shareholder, global mining giant Rio Tinto) in 2009 following six years of negotiations with the government, which owns a third of the mine. OT, as it is called, is scheduled to open next year and has already drawn more than $4 billion in foreign investment in construction – just shy of Mongolia's entire 2009 GDP.
Tavan Tolgoi, the world's second largest coal deposit, is slowly being opened up to investment as the government negotiates with Chinese, Russian, American, South Korean, and Japanese firms for rights to the deposit's western block. Meanwhile, state-owned Erdenes Tavan Tolgoi is slated for an IPO next year in advance of expanding its mining operations in the deposit's eastern block. Populist fears of foreign companies – especially those from China and Russia – gaining too much control over the country's resources have complicated negotiations; the government has said that if an agreement is not reached by mid-2012, it will begin developing the western block on its own.
Tavan Tolgoi and OT have led Mongolia to "the brink of an investment bonanza that could see its economy double in size every three or four years," according to the Financial Times. The country's GDP growth leapt from 6.4 percent in 2010 to 17.3 percent in 2011 in large part because of construction at OT, and on a per capita basis, its mineral wealth is enough to make all 2.75 million Mongolians a millionaire.
In spite of that resource wealth, Mongolia is still very poor. As a satellite country during the Soviet era, Mongolia received as much as a third of its GDP from Moscow; with the USSR's fall, education, health, and economic policies and programming went largely underfunded, resulting in a striking paradox that mires development today.
Education and employment offer a case in point. Even though more than 90 percent of Mongolians have attended school through the secondary level, there is a mismatch between the skills they learn and the skills the changing labor market demands, resulting in a well-educated but unemployed population where one in 10 are out of work. More than a third of the country lives in extreme poverty with a daily income of less than $0.40, and overall poverty rates have remained stagnant for decades.
Winters of White Death
Although pastoralism has been a mainstay of life in Mongolia for centuries, the past 20 years have seen an explosion both in the number of herders and in the size of individual herds. As former Soviet limits on herd sizes were lifted, Soviet factories shut down, and access to cheap Soviet goods like meat and dairy dried up, Mongolians turned to the countryside in record numbers.
Herders took on more animals as a way to hedge against uncertainty, including harsher, longer, and more volatile winter storms, or dzuds (literally meaning "white death"). From 1990 to 2010, the country's livestock population jumped from 10 million to 40 million, ultimately outnumbering Mongolians by a factor of more than 14.
These larger herd sizes are exacerbating environmental changes already underway. Mongolia's average annual temperature has risen three times faster than the global average, and almost the entire country –90 percent – is vulnerable to desertification. Taken together, climate change and overgrazing have degraded more than two-thirds of pastureland.
The 2009-2010 winter is proof of the combined toll that climate change, growing herd sizes, and dzuds can have on rural Mongolians. A dry spring and summer left little surface water or grass for livestock to eat or drink by winter, so they were more vulnerable to storms, which were the worst in living memory. According to the UN, the winter impacted nearly one-third of Mongolians and contributed to higher rates of malnutrition, a 35 to 40 percent increase in infant mortality rates, and double the usual maternal mortality rates. By the end of the season, 17 percent of livestock had died off and more than 20,000 herders had given up on rural life and moved to urban areas instead, according to UN estimates.
The lure of mining jobs and basic services like schools and hospitals (few and far between in the countryside) add to the pull that Mongolia's few cities exert over herders. Once in the cities, though, herders often end up living in slums made of gers, traditional felt yurts. In Ulan Bator, 60 percent of residents live in ger districts that are almost completely disconnected from the city's infrastructure and lack even the most basic sanitation services. Slum conditions are so bad that Dave Lawrence, a career development worker writing for the World Bank's East Asia and Pacific blog, wrote that "nowhere else in the world do so many people live as if they were refugees from war or a natural disaster."
According to a 2009 World Bank report, the slums – where families keep warm during sub-zero winters with little more than coal-fired cook stoves – are a driving force behind pollution levels that surpass even those of China's notoriously polluted skies. In 2010 the World Health Organization announced that Ulan Bator had "the world's worst air pollution" – an unexpected distinction for the capital of one of the world's most sparsely populated countries (second only to Greenland).
Pollution levels across the city reach their highest in the overcrowded, impoverished, and coal-heated slums during winter months. Mortality rates are an estimated 24 to 45 percent higher than what they would be if pollution levels were in line with international air quality standards, according to World Bank projections. Pollution levels peak during cooking times, suggesting that those responsible for cooking and other household chores – often women and girls – bear the brunt of indoor exposure.
A Struggle to Balance Mining and the Environment
The mining boom adds another layer to the country's delicate environmental balance. Mongolia is naturally susceptible to food insecurity (the proportion of undernourished has hovered around one-quarter of the population for the past two decades), and water access in particular plays a large role.
One-third of Mongolia's provinces fall "well below the international norm that defines absolute water scarcity," according to the UN Development Program, and more than half of the population lives without access to clean water. Mining is exacerbating both problems as unlicensed operations pollute scarce above-ground supplies (which are frozen half the year), while large-scale works divert the primary underground sources.
"My greatest fear is we won't have water," Mijiddorj Ayur, a 76-year-old herder in the Gobi, told NPR in May. "I don't care about the gold or the copper, I'm just afraid there won't be water."
Even in the northern part of the country, which has yet to see a mining boom on the same scale as the south, water remains contentious. In September 2010, a group of four activists armed with hunting rifles shot at foreign-owned mining equipment stationed along the country's longest river, which feeds into Lake Baikal. Based on an environmental protection law banning mining operations near headwaters, the riverside mine was illegal; however, weak enforcement meant the law was easy to ignore.
The incident is emblematic of a problem that even the country's mining regulators acknowledge. "The principle of the [headwater] law is right," Tamir Tegshsaikhan, an official at the country's mining regulator, told EurasiaNet after the 2010 incident. "The government adopted the law with a view to protect the environment, but the implementation side has many issues."
The Only Path Out of Poverty?
Corruption, which runs rampant throughout the government, makes implementation all the more difficult. A 2005 USAID report showed that Mongolians saw corruption as one of the top three challenges facing the country, following poverty and unemployment. That same report found that "by far the most problematic characteristic of Mongolia's corruption is that it takes place at an elite level and involves a conflict of interests between the state and private sectors."
With that warning, the prospects for equitably and safely developing the mining industry appear bleak, especially given the extreme reliance on the industry as Mongolia's best chance at prosperity. The country's standing in Transparency International's annual corruption perception index offers further cause for concern – since Mongolia first entered the index in 2004, its ranking has dropped from the 85th least corrupt country in the world to 120th in 2011, placing it alongside the likes of Iran and Kazakhstan (worth noting is the fact that during those years, 37 countries were added to the index).
Corruption is front and center in domestic politics this year after the former president, Nambaryn Enkhbayar, was arrested following allegations that he misused public funds while in office. While observers agree that Enkhbayar, like most public officials, likely enriched himself while in power, the case against him is seen as so politicized and poorly handled that it has become a lightning rod for criticism of the current government.
Because of the corruption case, Enkhbayar was barred from running in the country's recent parliamentary elections, which took place on June 28. The elections were billed as the answer to two key questions surrounding the mining industry: first, how should the government redistribute revenues given the country's widespread socioeconomic troubles? And second, to what degree should lawmakers welcome foreign investment? The Democratic Party, which won the most votes but fell short of a majority, announced last week that it would form a coalition government with Enkhbayar's Justice Coalition, which struck a strong nationalist tone during the elections; concerns about resource nationalism in the new government are reportedly already growing among mining companies.
"Exploiting Everything Is Not Development"
Perhaps unexpectedly, the country's lawmakers acknowledge the precariousness of its current situation. Mongolia "is in a critical stage of our development," said Prime Minister Sukhbaatryn Batbold last October at an Asia Society Forum. Reinforcing his concern, another senior government official said in 2010 that "it's a question of whether we become Nigeria or Chile." Lawmakers take study trips to places like Chile, Canada, and Norway, which have managed to balance resource wealth with socioeconomic advancement. "We don't want to reinvent the wheel," Batbold said.
To that end, lawmakers have taken noteworthy strides towards ensuring the resource boom leads to healthy development. Parliament passed anti-corruption legislation barring lawmakers from making campaign promises about jobs or money, and the major parties agreed to a ban on cash handouts in advance of the recent elections. The government established two funds with mining revenues, one to make payments to the country's poorest residents and the other to subsidize prices for basic goods when markets are volatile. And there is an active civil society: When lawmakers failed to make payments from the Human Development Fund, for instance, massive protests spurred them back into action.
While these measures offer hope for Mongolia's future, whether they can be successfully and effectively implemented remains to be seen. In advance of last month's elections, lawmakers found ways to skirt the cash handout ban through a buy-back program where the government paid Mongolians $760 each in exchange for their shares in the state-owned mining company. This pattern will have to change if Mongolia is to develop over the long term while avoiding the dangers of the resource curse and protecting a fragile but nation-defining landscape.
Tsetsegee Munkhbayar, one of the four herders involved in the 2010 shooting protest and the 2007 recipient of the Goldman Environmental Prize, warned that in a place like Mongolia, where so many depend on the land for their living, protecting the environment will be an essential part of ensuring that the mining industry is able to contribute to brighter future for his country.
"Exploiting everything," he said, "is not development."
Link to article
SUMO/ Harumafuji takes historic showdown over Hakuho on final day
July 22 (The Asahi Shimbun) Ozeki Harumafuji won the first final-day showdown between an unbeaten ozeki and yokozuna--and the first duel of unbeaten wrestlers on the final day in 29 years--by pushing Mongolian compatriot Hakuho out of the ring at the Nagoya Grand Sumo Tournament on July 22.
The win gives Harumafuji his third championship title and ends one of the most exciting 15-day rivalries in recent memory. Harumafuji won his first tournament three years ago and his second last year. Hakuho had been aiming for his 23rd title, and if he had won on July 22 that also would have been his ninth perfect finish, a summit that no one has ever reached before.
Though evenly matched at the face-off, Harumafuji got inside first and took a hold on Hakuho's belt with both hands. Hakuho never quite recovered from that, as Harumafuji bulled forward and thrust him over the edge with a surge of victorious gusto.
The last time that two unbeaten wrestlers had squared off to decide the title 29 years ago was between two yokozuna and this was the first such showdown between a yokozuna and an ozeki. Seeing the excitement the wrestlers were creating as they kept piling on the wins, sumo officials deliberately put off their showdown, which could have been fought as early as July 20.
"I put everything I had into the match,'' Harumafuji said, as his family looked on from the spectator seats. "I owe my win to my fans and all the people who have supported me.''
The ozeki said he would devote himself "wholeheartedly'' to winning again in September, which would earn him promotion to yokozuna.
Though overshadowed by the Mongolian winning streaks, the other ozeki fared pretty well on the final day.
Slamming out with his head first, Bulgaria's Kotooshu pounded Kisenosato hard at the face-off, lost his momentum momentarily and then charged ahead once again to finish at 9-6. The face-off was possibly the most energetic of the whole tournament. Kotooshu hit Kisenosato so powerfully that the sound of the impact echoed throughout the arena. Kisenosato ends with an impressive 10 wins.
Mongolia's Kakuryu also ended on a high note with a fine throw that sent fellow ozeki Kotoshogiku onto his back. While the two ozeki had a spotty record that kept them from being contenders for the title, they both close with strong numbers. Kakuryu, in his second tournament at sumo's second-highest rank, marked nine wins and Kotoshogiku got 10.
Baruto benefitted from a relatively easy draw on the final day, taking out Russian No. 5 maegashira Aran (9-6) with his much more powerful and better placed thrusts. Despite coming in with high expectations, the Estonian ozeki came up short this tournament after starting off extremely well--he won his first seven bouts, but then won only two more.
Sekiwake Tochiozan, fighting with a heavily taped left shoulder, drove out No. 5 maegashira Takayasu (6-9) for his fourth win. The injury sucked away Tochiozan's will to fight and he is likely glad this tournament is over. He will still have to fight his way back up the ranks, though, since a demotion is almost certain.
Komusubi Myogiryu kept the pressure on No. 4 maegashira Takekaze (7-8) to get his all-important eighth win, along with the special technique prize. Myogiryu was struggling earlier on at his new ranking, but managed to keep it together well enough to get by. He's never won more than three bouts in a row, however, so that's something he can work on.
Demotion-facing komusubi Toyonoshima goes home with five wins after defeating lowly No. 10 maegashira Tamaasuka, who closes out at 2-13. Top maegashira Kyokutenho, who shocked sumo fans by taking the championship the last time as the better wrestlers melted down, won his second bout in a row, but that of course was also only his second victory of the whole 15-day competition. That goes down in the sumo books as one of the worst performances ever to follow a championship effort.
Lower down, No. 2 maegashira Aoiyama won his eighth bout, over No. 9 maegashira Tokitenku. That puts him in good position for a promotion into the titled ranks come September.
"Mogi" Munkhdul Badral
Senior Client Manager / Executive Director
CPS International LLC
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