14
|
World Coal
|
March 2016
M
ining is a political business – and nowhere is
this more evident than Mongolia. This
landlocked Asian country has huge mineral
wealth but, even at the peak of the
commodities cycle, was singularly unable to develop its
mining industry to any significant extent. Now
parliamentary elections, coupled with the downturn in
global commodity demand, look likely to keep Mongolia’s
mining industry development in the slow lane.
No confidence
A particularly apt example of how closely mining and
politics entwine in Mongolia came at the end of January
when the current Prime Minister, Saikhanbileg Chimed,
faced a vote of no confidence. Members of parliament
accused the prime minister of abusing his power when
he agreed a development and financing plan for
Turquoise Hill Resources’ Oyu Tolgoi (OT) underground
copper mine. The MPs claimed the deal offered little
benefit to Mongolian citizens.
The vote of no confidence was the latest act in the OT
drama that has elements of both tragedy and farce. OT is
one of the largest and purest copper deposits in the
world and should be the engine for Mongolia’s economic
development: if it ever reaches its full potential, it could
account for a third of the country’s GDP.
Yet it is OT’s size and value that has been its downfall.
Mongolia cannot develop the mine on its own. But the
2016 will be dominated by
parliamentary elections in Mongolia.
Jonathan Rowland
reports.
