Vast and sparsely populated, landlocked Mongolia is situated between giant neighbours to its north and south: Russia and China. With a population of 2.8m people inhabiting its wind-swept, grassy steppes and vast expanses of desert, Mongolia is the world’s least densely populated country. The nation continues to emerge as a key centre for mining investment, with a wide variety of important mineral reserves and a number of major projects scheduled to either expand production or to come on-line altogether.
GEOGRAPHY: Completely landlocked, Mongolia covers a surface area of 1.56m sq km and is the 19th largest landmass in the world. The country is home to a vast desert in the south, large freshwater lakes in the north-west, and dry, grassy steppes and plains throughout most of its remaining expanses. The country’s borders stretch 8220 km and its only two neighbours are Russia and China, with the Kazakh border sitting just 50 km to Mongolia’s west. The far west is home to the country’s highest peak, the 4374-metre-high Huyten Orgil (Khü iten Peak), which sits along the border area where Mongolia, Russia, China and Kazakhstan meet. Ulaanbaatar, the capital city, lies just within the country’s north-eastern quadrant and is home to 1.3m Mongolians – around 46% of the country’s population, as per the 2010 census. The mountainous northern province of Khövsgöl, named after a large lake with the same name, is known for its dynamic population, as well as for being a home for one of the world’s fleeting communities embracing shamanism. While the Gobi desert to the south is renowned for conjuring seemingly endless images of sand dunes and arid panoramas, it is also highly regarded for its rich landscapes, including glaciers, canyons and oases. In addition, the Gobi desert is home to an array of wildlife – including its famous Bactrian camels – and many dinosaur fossils, not to mention Mongolia’s most important mineral deposits.
HISTORY: Scholars believe the land that is present-day Mongolia has been inhabited by modern humans for approximately 40,000 years, with the first major political systems developing in the first millennium BC. A succession of nomadic tribal confederations, including the Xiongnu, Xianbei, Rouran, Khitans and Khamag Mongols, ruled over large parts of the steppe between 200 BC and 1200 AD. It was not until the 13th century, however, that the Mongols burst onto the global stage with the Eurasian empire established by Chinggis Khan. At its height, this empire stretched from all the way from Europe to South-east Asia and counted over 100m people within its domain. This vast empire, the largest contiguous land empire in human history, was divided into four distinct political entities, or khanates, which gradually exhausted themselves and fell, the most famous being the Yuan Dynasty established by Kublai Khan, Chinggis’s grandson. Over several centuries, the Mongols eventually fell back to their original homelands, and by the late 17th century submitted to the rule of China’s Qing dynasty. When the Qing dynasty fell after the Xinhai Revolution of 1911, the Bogd Khan, Mongolia’s Buddhist spiritual leader, declared his country’s independence. China’s newly established republic, however, did not recognise Mongolia’s independence and took advantage of the Russian Revolution in October 1919 to occupy Mongolia’s territory.
COMMUNIST ERA: The new Bolshevik government of Mongolia’s northern neighbour favoured the formation of a communist Mongolian government and army, which, under the leadership of Sukhbaatar Damdin, expelled Chinese forces and drove White Russian forces under the leadership of Baron Ungarn Sternberg from Mongolia. The Mongolian People’s Government was declared in 1921, and after the Bogd Khan’s death in 1924, the full independence of the Mongolia’s People’s Republic was declared. The new republic was strongly influenced by and essentially became a satellite of the Soviet Union. The dictator Kh. Choibalsan, who ruled from 1928 to 1952, collectivised livestock, destroyed Buddhist monasteries, and purged tens of thousands of citizens, mainly monks. Mongolia continued to side with Moscow even after the Sino-Soviet split in the 1960s, with tens of thousands of Soviet troops stationed in Mongolia in the 1980s.
With the advent of glasnost and perestroika in Russia during the Gorbachev era, however, the first cracks in Mongolian communism began appearing. A series of protests and hunger strikes orchestrated by the Mongolian Democratic Union toppled the communist government in 1990. That same year, Mongolia’s constitution was amended to allow for opposition parties, and the country’s first multi-party elections were held. The former communist party, the Mongolian People’s Revolutionary Party, retained power until 1996, when it lost in elections and relinquished control to the opposition Democratic Party. Since then, Mongolia’s young democracy has seen sporadic political crises, but is currently characterised by relatively little violence and a healthy consensus for multiparty politics.
NATIONAL GOVERNMENT: Since abandoning single party communist dictatorship in 1990, Mongolia has been governed by a mixed presidential-parliamentary system. Members of parliament are elected by popular vote for fixed, four-year terms. The parliament, known in Mongolia as the State Great Khural, is made up of a single, 76-member chamber. It also nominates the candidates for the presidency, and the president is selected by popular vote in a general election every four years, and no president can serve more than a maximum of two terms. The president, while coming from one of Mongolia’s major political parties, is nominally a non-partisan political figure. He is the head of state, the commander-in-chief of the armed forces, and is responsible for appointing the prime minister based on parliamentary majority. The prime minister, in turn, appoints a cabinet that needs to be granted approval from the State Great Khural.
While Mongolia does in fact have a long legal tradition stretching back to the yasa (written code of law) of Chinggis Khan, the contemporary legal system has been strongly influenced by that of the Soviet Union.
Mongolia is administratively divided into 21 regions, known as aimags, with the capital city, Ulaanbaatar, operating as an independent municipality. Each province elects its own local khural. The aimags are further subdivided into administrative regions known as soum, which have their own local representative bodies.
POPULATION: Mongolia’s population is currently estimated at 2.8m people (growing at an annual rate of 1.49%). When its relatively tiny population is combined with its vast geographical size, Mongolia ranks as the least densely populated country in the world.
Mongolia is ethnically homogenous, with roughly 95% of the population being of Mongol origin, around 90% of whom hail from the Khalkha Mongol ethnic group, speaking the Khalkha dialect of Mongol. Other ethnic groups within Mongolia include the Buriat, Dorvof and Tuvad groups. The most significant group of the non-ethnic Mongol population is a substantial Turkic ethnic minority, accounting for approximately 5% of the population. Many of these individuals are ethnic Kazakhs and comprise the majority of the population of the western-most province of Bayan-Ulgii.
RELIGION: The most recent survey of religious belief in Mongolia suggests that around half of the population is Buddhist Lamaist, a sect of Tibetan Buddhism. Though most Buddhist temples and monasteries were destroyed under the communist regime in an attempt to negate the influence of religion on the population, a couple important structures were left untouched in the capital city of Ulaanbaatar. These include the famous Gandantegchinlen Khiid Monastery and the Choijin Lama Temple, as they were widely believed to be sites for exhibiting traditional Mongolian culture. Many temples in the country have been rebuilt or reinterpreted in the 20 plus years since Mongolia’s democratic revolution. Roughly 40% of Mongolians do not practice any religion, partly as a legacy of the ban on all religious practice, which stood in place for nearly seven decades and ended in 1990. There is also a Sunni Muslim minority – mostly made up of the ethnic Kazakh population – that comprises around 4% of the population. In addition, small Christian communities exist, most being Protestant. Shamanism is also important for many Mongolians. The constitution and the government both provide for freedom of worship.
LANGUAGE: Roughly 90% of the population speak Mongolian, most of them using the Khalkha Mongol dialect, which is the official language of Mongolia and belongs to the Altaic family of languages, which also includes Japanese, Turkic, and Korean languages. Since 1963, the language has been written in the Cyrillic alphabet due to the strong influence of the Soviet Union. However, with the support of the government, the traditional Mongolian alphabet is gradually being reintroduced. Turkic languages – principally Kazakh – are also spoken, mainly in the west of the country. Russian was spoken fairly widely in the past, sustained by the large number of immigrants from the Soviet Union; however, many left the country following its collapse and the language does not have as wide an influence any longer, though it is still the most widely spoken second language among the elder Mongolian generation.
CULTURE & HERITAGE: If Buddhism looms large as Mongolia’s most widely practiced religion, Nomadism (particularly the nomadic herding of livestock) stands as the other biggest influence on Mongolia’s culture. While most Mongolians are now settled into urban areas, especially the capital city of Ulaanbaatar, a significant number of city dwellers nonetheless continue to live in ger (the Mongolian word for yurts), traditional round wood and felt tents specifically designed for Mongolians’ traditional nomadic lifestyle.
Sport is a large part of Mongolia’s cultural identity and none is more popular than bukh, traditional Mongolian wrestling. It is celebrated alongside horse racing and archery, and during Mongolia’s most widely celebrated summer holiday and festival, called Naadam, which is also a major international tourist attraction.
Epic poetry also remains a key cultural tradition. Wrestlers at Naadam are honoured by poets, and the nation’s history is itself famously memorialised in the “The Secret History of the Mongols”, a poem describing the rise of the Mongol Empire in the 13th century.
Mongolia’s herding tradition is the prime influence on the country’s cuisine, making it based mostly around meat and milk. Staple dishes in the culinary tradition include steamed mutton dumplings known as buuz, deep fried meat pies called khuushuur, and a type of Mongolian stir fry, tsuivan. Popular traditional drinks include milk tea, vodka and airag, a lightly alcoholic beverage made from fermented mare’s milk.
CLIMATE: Mongolia’s weather varies significantly across its broad expanses, with considerably warmer weather (relative to other parts of the country that is) in the southern deserts than elsewhere. Owing to Mongolia’s landlocked status, the weather is extreme continental, and Ulaanbaatar, with it high elevation and distance from the sea, is the world’s coldest capital city. In January, temperatures fluctuate between a daily average of -32°C and -19°C in the capital city. Temperatures of -40°C are not uncommon during this time of year. In the summer, temperatures usually peak in July, alternating between average daily minimums and maximums of 11°C and 22°C, and sometimes even higher, meaning throughout the year, Mongolia sees a temperature range of nearly 70°C. The wettest month is July, with precipitation averaging roughly 76 mm in the capital.
NATURAL RESOURCES: Traditionally, agriculture, particularly herding, was the mainstay of the economy. The mining industry, of course, stretches back well before even the time of Chinggis Khan, but was usually secondary to Mongolia’s nomadic herding tradition. In recent years, however, the scale of exploration and mining activities have become the primarily focus of Mongolia’s government at the national level, as well as in many soums and aimags. As a result, it is the mining and extracting sector that has emerged as the key driver of foreign investment as well as Mongolia’s exports.
While exploration work is ongoing, Mongolia currently has very little to show with regard to significant oil or gas reserves. However, the country is important for mineral resources. Many deposits remain untapped, and those that are in production lack the resources to see their full potential, though a number of major new projects are slated to begin production in the near future. These are expected to significantly increase Mongolia’s status as a producer of minerals and greatly boost the country’s already impressive GDP growth.
The mining sector currently accounts for 30% of GDP and 32% of government revenue, according to research from Resource Capital. Much of the output is exported to its rapidly expanding neighbour, China, though a recent dip in demand from the south has set off worries that the country might be relying too heavily on its mineral resource sector. The country has some of the largest copper reserves in the world, with the Oyu Tolgoi site thought to be the world’s biggest undeveloped copper and gold reserve. Oyu Tolgoi gives Mongolia the second-largest copper reserves in the world (after Chile). Anglo-Australian mining giant Rio Tinto has assumed operational control of the site and is developing it in partnership with the government, which has a 34% stake in the project. Production at the mine, located in the South Gobi region, is due to begin in 2013.
Tavan Tolgoi, the world’s largest untapped coal reserve, is also a major focus. The state will divide the site in two, keeping 51% to develop on its own and inviting participation from global mining firms for the remainder. An international partner has yet to be chosen, but analysts hope that the government will make progress in the coming year. Mongolia is also home to vast proven and indicated reserves of fluorspar, uranium, tin, molybdenum, tungsten, copper, iron ore and gold.
A RISING TIDE: The government hopes that Mongolia’s commodities surge will boost the country’s other industries and slacken its dependence on volatile global commodity prices. While many industries remain small they are likely to benefit from GDP growth rates as high as 20% annually. The banking sector, for example, is too small to service the mining sector’s massive capital requirements, but an influx of mining money will provide liquidity through other channels. Anticipated growth areas include mortgages and auto loans.
Mongolia’s industrial base is modest, with Soviet-era factories having closed down in the early years of democracy. Major sectors include textiles (especially cashmere), food and beverages, and basic metals from mining. Together, these sectors account for more than 80% of Mongolia’s industrial output. Even as it turns into a mining powerhouse, Mongolia is doing what it can to preserve its pastoral landscapes, home not only to a distinctive national culture but also to economic potential through tourism, as well as agriculture. The country is seeking to market both its cashmere and its meat products as premium products grown in a sustainable, traditional manner.
Infrastructure development is widely regarded as the key to resource driven growth. The rail network remains incomplete thus getting exports to market is both time consuming and expensive. There are, however, plans for upgraded roads both within Ulaanbaatar and in the provinces, a new airport, and over 5000 km of new railways. This will not only make the country more accessible but will also benefit local construction companies.
Topics: Getting Started