The MONTSAME News Agency interviewed Cultural Envoy of Mongolia and President of the Mongolian Tourism Association, D. Gantumur.

- It has been over a year since you were appointed as the Cultural Envoy of Mongolia. What defines the cultural policy in the travel and tourism industry during post-pandemic difficulties?

- There is no particular envoy of the travel and tourism industry, but tourism is a target market representing Mongolia. This industry clarifies why tourists should come to Mongolia, attracts foreign investment, and becomes a bridge of culture, diplomatic relations, and business. Tourism revenue contributes to the national GDP and supports local communities and small and medium enterprises. Therefore, tourism is the envoy that represents the culture. The cultural envoy signs a 5-year contract with the Ministry of Foreign Affairs and reports annually. It means that the cultural envoy accepts additional duties and responsibilities to their work.

Moreover, the Cultural Envoy makes a unique contribution to the geopolitical, political, and economic policies of any country, sometimes it becomes an invisible means. The primary approach of Mongolia is to maintain an economy, trade, and foreign relations balanced and not overly dependent on any country and to become a corridor region for Central Asia. Our tourism depends on 3 markets: China, Russia, and South Korea. Our country receives more than 100,000 tourists from each of these countries. However, it is not good to carry out a cultural policy that depends on over yen and yuan economy. Cultural cooperation is the first step towards sustainable and mutually beneficial balanced policies with neighboring countries. Tourism is an industry where you can earn US dollars from what you have in your country. For example, if a Russian tourist like the taste of meat while traveling in Mongolia, they can become a future buyer. The cultural policy should be coordinated with the third neighbor’s policy since this is tourism’s role. Mongolian culture offers a vital contribution to people’s mental development. Which procedure should be carried out in a particular country relies on the activities of the cultural envoy. Tourism will make commodities out of it and create a shared passageway. We must preserve and develop Mongolia’s advantages, such as nature-related freedom, democracy, and human rights, to benefit the Mongolian people.

- Mongolia opened its borders in February 2022. What are you currently working on?

- During the pandemic, the domestic production of Mongolia was de-escalated, and world countries were not fully open. The situation in our Northern neighbor is complicated, and the “zero covid” policy in our Southern neighbor is continuing. During this period, I worked online and researched how to introduce Mongolia to the world. I was selected for Mongolian culture and tourism projects of the World Bank, JICA, European Union countries, and the United Nations, and I did some expert research. I created a business model for managing the tourism economy in Mongolia, obtained a Doctor of Science degree in culture and tourism, and expanded my theoretical and methodological knowledge in art philosophy, the development of creative cultural production, and tourism promotion to the world. Moreover, the Ministry of Environment and Tourism and I jointly organized business meetings and cultural tourism promotions for South Korea, Japan, and Turkey.

I will organize a meeting of cultural envoys soon to discuss how to express our country to the world based on Mongolian cultural distinctions. A National Tourism Development Committee was established under the Prime Minister of Mongolia. It has 6 subcommittees. The committee will focus on promoting Mongolia based on slogans, brands, names, and the meaningful image of our country. I am researching what regular travel activities can be organized for tourists and what should be done, focusing more on the business and organizational management aspects.

- The Government of Mongolia announced 2023 and 2024 as “The Years to Visit Mongolia.” What are the main works to be done in this regard?

- Mongolia announced 2023 and 2024 as “The Years to Visit Mongolia” and approved the slogan “Welcome to Mongolia.” With this announcement, the government aimed to give state support to promoting Mongolia, bind the promotion and activities of many different industries into one policy, and increase the budget and workforce for this activity. On the other hand, the declaration of “The Years to Visit Mongolia” has the political importance of taking the lead to the State and moving forward during this time of tourism industry breakdown.

Many objects need to be improved, such as the standards of tourist services, availability of air transport, seats, prices, etc., implementation of the “Vision 2050” development policy by specific industries, and what advantages and positivity need to be formed for individuals. Therefore, the government and the private sectors need to work together to liberalize the business industry and develop the free business simulation. Our responsibility is to find a model that does not overextend the involvement of the public and private sectors and eventually pays off for the local citizen. We should be more specific in announcing the visiting year to contribute the number of transportation and its policy, and so many reception services when we receive so many thousand tourists from South Korea, instead of making just a slogan. Before the tourisb season begins, we are trying to solve problems and create the next model. The goal is to receive one million tourists next year.

- How appropriate is it that the government announced “The Years of Visit Mongolia” when the travel and tourism industry has not yet recovered its workforce, domestic flights, and activities for tourists after the pandemic?

- It is true that the tourism industry has lost workforce and personnel from the lockdown during the pandemic. Moreover, companies are unable to pay their bank debts, health, and social insurance. Even though the government encourages developing winter tourism, it needs to take into account how much burden of energy, land and real estate business owners take. Identifying and mobilizing a way to recover quickly and sharply instead of repeating the pandemic’s severity is crucial. “The Years to Visit Mongolia” will be a stimulus for this. Some things take time, such as the country’s infrastructure and internal competition, but those who do things faster get more successful.

- Before the pandemic, the number of tourists to our country reached about 570,000. Was there any target numbers to reach this year?

- Tourism is hugely dependent on different seasons in Mongolia. Tourists come only in the months of June, July, August, and September. You must make a reservation well in advance to be able to find a tourist camp, hotel, or service center during the Naadam festival. The dependence is high in this industry. In addition, the price of air transportation, the availability of domestic and international flights, and the guaranteed and stable seating terms make the tourism business difficult. There is a reason behind these fundamental factors, but there is also a solution. I do not think there is a country that received half the number of tourists they received before the pandemic. As of today, Mongolia received about 300,000 tourists. There were people who doubted the numbers asked whether the Russians should be counted as tourists. According to the World Tourism Organization, if a person gets a tourist visa when entering a country and leave within that period, that person will be counted as a tourist. In that sense, that person is regarded as a tourist. Of course, the situation is way better compared to the past two years when there were no tourists.

In China’s latest crackdown on cryptocurrency fraud, police say they arrested 63 people suspected of helping domestic and foreign criminal groups launder the equivalent of US$1.7 billion through virtual currencies, according to a statement released last weekend.

More than 200 officers of the law in 17 provinces, autonomous regions and cities of the Inner Mongolia autonomous region carried out simultaneous operations over last week, a news release published by public security authorities said.

Police say they spotted an “abnormal flow” of money in a trading account held by a suspect who allegedly moved more than 10 million yuan (nearly $1.5 million) monthly. Once officials learned the account was allegedly being used to launder money, they froze it and moved in.

About $18.6 million in illegal income was confiscated.

The group is alleged to have begun operations earlier this year, helping criminals launder their funds from pyramid schemes, fraud and gambling.

The group then converted the funds into Tether, a stablecoin pegged to the US dollar, and then attracted new people from around the world to open crypto accounts and help launder the funds. Stablecoins are crypto currencies linked to fiat currencies or to commodities such as gold in an attempt to avoid wild swings in value.

According to the statement, “buying virtual currency anonymously and then selling it” is a way to avoid identification. “There is no way to query the flow of funds or find the payee through traditional means.”

“The query and retrieval of virtual currency is also very complicated,” it added.

Authorities in China said they “solved the case using multiple methods such as interrogating persons involved in the case, investigation on overseas digital currency exchanges, and digital currency blockchain tracking.”

According to the 2022 Crypto Crime Report by Chainalysis, cybercriminals often move their ill-gotten funds to a service where they can be kept safe from the authorities and eventually converted to cash.

“That’s why money laundering underpins all other forms of cryptocurrency-based crime,” the report said. If criminals cannot ultimately use the money, “there’s no incentive to commit crimes involving cryptocurrency in the first place.”

Between 2017 and 2021, cybercriminals laundered more than $33 billion worth of cryptocurrency. Last year, about $8.6 billion was laundered, which represented a 30 percent increase in money laundering activity over 2020.

LONDON – Ulaanbaatar-based carrier Eznis Airways has been accused of transporting military supplies to Russia.

The Accusation…

A “concerned aviation worker” has approached AviationSource on condition of anonymity and has said that one of Eznis’ Airbus A330 aircraft has been grounded because of this.

“I have critical news regarding Eznis Airways and their newly acquired Airbus A330-200 Freighter, registration JU-1332”.

“The aircraft is currently grounded in Ulaanbaatar, Mongolia, with a shipment of military supplies from China, final destination Russia.”

“The aircraft is loaded with 50 tons of military apparel and equipment headed for Russia.”

“The insurance provider has started an investigation into this matter and found out that a large shipment of military goods has been brought from China.”

“Eznis Airways is directly assisting the Russian invasion of Ukraine.”

About JU-1332…

JU-1332 has not been in the Eznis Airways fleet for very long. The aircraft started out life as C-GGWC with Canada 3000 Airlines in May 1999.

By February 2002, the aircraft was handed over to Precision Aviation Consulting and Training Inc as F-WQQL.

Later on in that year, the jet was handed over to Volare Airlines, where it remained with the carrier until November 2004, with ILFC taking control of the leased jet as EI-DIR.

By February 2005, the aircraft was sent over to Etihad Airways as A6-EYV. The aircraft remained in the fleet until May 2008, when it was subsequently handed over to Air One and then to Alitalia by January 2009.

EI-DIR was ferried over to Ulaanbaatar on November 4-5 for Eznis as JU-1332, with the aircraft entering service on November 9.

Has The Aircraft Been Grounded?

The last flight that the aircraft did was from Beijing on November 30, with the flight losing ADS-B signal over Erenhot, China.

It could be suggested that if the aircraft were indeed headed to a Russian base of sorts, then the Russian Government probably would make sure that transponder signals are blocked.

All other flights that this aircraft has operated have been from Seoul only before this sudden change over to Beijing.

This would be a well-used strategy in preventing knowledge of hidden bases within the region.

On the other hand, we do know that the ADS-B signal strength around Mongolia and Russia is virtually non-existent, which could enable governments to contract flights like this.

No other flights have been operated with this airframe since November 30, which does back up the idea that the jet is grounded in Ulaanbaatar.

AviationSource has approached ILFC, AerCap, and Eznis Airways on this particular issue, but at the time of publication, neither party has responded.

Overall…

In the context of the Ukraine invasion, this is a controversial thing for carriers like Eznis Airways to do and would show where their loyalties lie.

All eyes will be on that particular A330 to see when it will be ungrounded and whether it will operate such flights into Russia again.

Ulaanbaatar Railways JSC is taking urgent measures to improve the distribution and meet the domestic demand for diesel fuel.

According to Head of the Transport Control Department of Ulaanbaatar Railways M. Tsogt, the company has shortened its transportation and unloading time by 16 hours to improve the distribution and meet the domestic demand for diesel fuel. Trains arriving through the border ports used to spend 36 hours at Tolgoit Station in Ulaanbaatar City for unloading and transferring oil products. Now the duration required for the abovementioned procedures has been reduced to 20 hours. He also informed that the customs office works 24 hours a day.

These works are being organized with the Ministry of Mining and Heavy Industry as discussed between the companies and enterprises that import and transport diesel fuel.

It was reported that diesel fuel is currently being imported from China in addition to Russia last few days. The duration required for the transshipment of diesel fuel has also been shortened as it no longer waits for transportation calculations and customs clearance.

The decrease in the diesel fuel imported from Russia poses a potential fuel shortage, not the transportation and unloading procedures. As of December 9, the company received 267 wagons of fuel from China and planning to receive 200 more wagons.

220 wagons out of 253 loaded with petroleum products from Russia have been unloaded at the railway station so far.

Since December 4, peaceful demonstrations is taking place at the central square by citizens demanding the government take decisive and swift actions to resolve the coal theft allegations.

As demanded by the demonstrators, specific measures are being taken by the President of Mongolia, the State Great Khural, the Government, and law enforcement agencies. For instance, a number of working groups have been set up and investigations are underway in accordance with the demonstrators' demands to reveal the violations in the coal sector.

The following decisions were made to resolve the current issue for the past few days:

December 5.

-The Chairman of the State Great Khural issued an ordinance to set up a working group to organize a public hearing on the coal theft allegations.

-The State Great Khural convened virtually to hear reports by the law enforcement agencies regarding the issue.

December 6.

-Prime Minister L. Oyun-Erdene held a press briefing, pledging that the Government would put concerted efforts to bring justice to the issues surrounding the coal theft allegations. Moreover, as chairman of the ruling party in the parliament, he expressed readiness to dissolve the State Great Khural before its legal term if necessary, announcing that he would initiate negotiations with political parties and other stakeholders on this matter.

-The Directors of the Independent Authority Against Corruption (IAAC), the General Intelligence Agency (GIA), and the National Police Agency (NPA) issued a joint order on establishing a working group to look into the criminal cases related to coal mining, export, transportation, and payment.

December 7.

-The President met with the representatives of the Cabinet and the heads of law enforcement agencies and tasked to expedite works on resolving the coal theft allegations. He then warned the authorities that the time is near to dissolve the State Great Khural and the Cabinet before their legal terms and grant the citizens’ right to vote as provided by the relevant law unless the issues are promptly resolved.

-The Cabinet established a working group to speed up investigations regarding the coal theft allegations.

-The Standing Committee on Economy of the State Great Khural decided to organize a public hearing on the issues of coal shipment and exports on December 21. At the public hearing, the information on offtake contracts established by “Erdenes Tavantolgoi” JSC, the enterprises that mined coking coal in the country and the amount of the output; the enterprises that transported coking coal and their revenue; and the detailed information on the coking coal exported through all border checkpoints of Mongolia will be presented.

December 8.

-During the State Great Khural session, a decision was made to extend the working period of the ad hoc committee in charge of investigating the difficulties encountered in cargo, transport, coal entry, and free zone operations at border ports by six months.

December 9.

-An emergency regime was imposed for “Tavantolgoi” JSC for a duration of six months and State Secretary of the Ministry of Justice and Home Affairs P. Sainzorig was appointed as the Government’s Special Representative.

-The Government disclosed nine contracts related to "Erdenes Tavantolgoi" JSC, which were classified as confidential.

-Minister of Justice and Home Affairs Kh. Nyambaatar and Chief of the NPA J. Bold were tasked to regularly provide the public with accurate and prompt information regarding the progress of the cases and investigation related to the ongoing issue.

-The Ministry of Digital Development and Communications and the Ministry of Mining and Heavy industry agreed to expedite works to establish a Minerals Commodities Exchange in cooperation with the private sector.

December 12.

-At its irregular meeting, the Cabinet resolved to have independent experts audit the operations of “Erdenes Tavantolgoi” JSC, offer the shares of the company to the public through the stock exchange, and publicly disclose the company’s procurement contracts on an official website.

-The Cabinet decided to impose a 6-month emergency regime for “Tavantolgoi Railways” JSC and appointed a special representative.

December 13.

-With the permission of the Prosecutor General’s Office, the IAAC released the names of the companies and their owners and executives that signed contracts with “Erdenes Tavantolgoi” JSC on coal transportation, purchase, and sales in addition to the details of the contracts. As disclosed by the IAAC, from January 1, 2018, to December 1, 2022, the company established 633 (double-counted) coal sales agreements. In the reference period, the company signed 576 procurement contracts worth MNT 20 million or more. As of today, 398 companies are carrying out coal shipments from the Tavantolgoi deposit to the Gantsmod border port.

-The names of 17 people who are being investigated by the IAAC were revealed. The IAAC underscored that it was revealed during the investigations that these people are directly or indirectly involved in the coal theft allegations, and the court will decide whether they are guilty or not.

December 14.

-The Cabinet decided to submit the amendments to the Criminal Code and Criminal Procedure Code to the State Great Khural for a prompt discussion. The amendment includes provisions such as prohibiting the court to charge minor sentences to cases of corruption and abuse of power or office by a state official and stiffening sentences.

Mongolia’s anti-corruption authority announced Tuesday that former President Khaltmaagiin Battulga is being investigated in a coal theft case that began in the wake of a large-scale demonstration in the capital, Ulaanbaatar, early last week.

The Independent Authority Against Corruption of Mongolia (IAAC) announced at a news conference that Battulga, in addition to 15 other notable figures, including former ministers and current MPs, were contacted and courts will decide their crimes.

“The following officials participated in coal mining, transportation, and procurement of goods and services with state-owned assets,” said M. Davaatogtoh, deputy head of the investigative department of the IAAC.

Davaatogtoh said a joint investigation related to coal mining and its sale and transportation was underway by the General Intelligence Agency of Mongolia and the National Police Agency.

“Investigations are underway in a total of 22 cases. During the investigation, 47 objects were searched, 15 people were arrested, and 10 people were detained,” he said. “In order to speed up the investigation, a sub-working group was also established at the IAAC. So far, 35 people have been charged.”

Separately, the IAAC published information about transactions conducted by state-owned companies, Erdenes-Tavantolgoi JSC and Tavantolgoi Railway, which amount to 633 contracts between Jan. 1, 2018, and Dec. 1, 2022.

“[Eleven] cases of investigation and 7 cases of investigation are currently being opened and investigations are being carried out in connection with the problems of giving advantage to others, taking bribes, and getting rich without reason during the construction of the coal transportation railway,” according to a statement.

Mongolia’s Cabinet of Ministers decided Monday to place Tavantolgoy Railway under direct control of the government and introduce a “special regime” for the company for six months.

Several hundred people braved freezing temperatures in Ulaanbaatar to protest corruption in the coal industry and the country’s ailing economy, with some trying to storm government buildings Dec. 4.

Ulaanbaatar was a place on the globe I wondered at as a child, an exotic, seemingly unreachable place. Once I learned that it was in the heart of the Asian steppe region where horses were thought to have been domesticated 1, it took on a new temptation to reach, not for its soft vowels and sharp consonants, but for its access to the horses that bind all of us in the world that share a love for them. There are 3.5 million people in Mongolia, but there are more horses than people. This is the land of the horse, say the Mongolians. It is the axis on which my world spins.

Ulaanbaatar, developed as a Soviet-era city, now has 1.5 million people, a population that has doubled in size in the last 15 years. In downtown Ulaanbaatar there are smart hotels and good restaurants catering for local professionals and businesspeople, as well as tourists and the small expat community. On the whole Mongolians, particularly the women, are very well educated, and there is a profusion of world class cultural activities including opera, ballet, folk music and dance, and art galleries. Otherwise, the old Soviet apartment blocks can appear grey and inhospitable, although inside they are often nicely decorated and updated. Surrounding the city, the ‘ger’ district (areas populated originally with traditional Mongolian tents and latterly with small houses) extends for miles, colorfully filling the hillsides like a child’s painting. In winter, the city is cloaked in a cloud of smog generated from the domestic coal fires that warm the population when temperatures drop as low as -40C 2.

Professor David Warburton is a world leader in child health at Children’s Hospital Los Angeles and the Keck School of Medicine, University of Southern California (USC) 3. He has been visiting Ulaanbaatar for more than 20 years, sharing knowledge and fostering training and research collaborations with the Mongolian National University of Medical Sciences, the National Center for Maternal and Child Health, and other hospitals to improve mothers' and children’s health, as well as to understand better and combat the ill effects of seasonal severe air pollution 4-6. During a research visit in 2017, along with a group of medical scientists from USC and Dr Carol Readhead from Caltech, he attended the summer horse races at the Mongolian Naadam Festival where they were hosted by local medical scientist Dr Jargalsaikhan Bardach 6. At Naadam, horses race across the steppe at speed over distances of 16 km or more.

“When we met with one of the major horse breeders and owners, I wondered what in their genetic makeup gave these Mongolian horses such endurance and stamina.

“Carol and I thought that by studying the genetics of his bloodstock we might be able to find out what made these particular Mongolian racing horses faster and more competitive than the rest of the more than four million other horses that occupy the vast geographical space of Mongolia and Inner Mongolia, China. That evening, after a quick google search, Carol found and contacted Emmeline. The project was off to the races.” recalled Professor Warburton.

Since the discovery of the ‘Speed Gene’ in 2009 7,8, my research groups at Plusvital Ltd and University College Dublin, Ireland, have generated genetic data for thousands of Thoroughbreds 9 and horses from other breeds 10,11. We teamed up with the Californian scientists to organize a sampling mission to Mongolia to try to answer their questions.

In the summer of 2018, we were warmly welcomed by the Ajnai Sharga Horse Racing Team, which has bred champion racehorses for decades on their farm in Khentii province. We were a team of both young and more established enthusiasts, including Carol, my 13-year-old son Henry, and research student Lucy Allen, from the Royal Agricultural University, Cirencester, UK.

In two vehicles with local drivers, we set off in convoy on the road to Khentii, an eight- hour journey due east of Ulaanbaatar. Perched in the back seat was Hulsen, Ajnai Sharga’s seven-year-old apprentice jockey who was returning from a visit to his home province 500 km west of Ulaanbaatar. Hulsen shared his bag of sweets with us as he watched DVDs streamed to the back seat of the jeep. His little strong legs were already taking a bowed shape; he had been riding from four years old, having his first race at five years old, and in 2017 at six years old he finished 11th in a 300-horse field. He weighed just 25 kg and at 30 kg his racing career would end.

We stopped at one point to marvel at a gigantic statue of Chinggis Khan on horseback, facing east towards Khentii, his birthplace. The statue, standing 40 feet high, has been credited by the Guinness Book of Records to be the largest equestrian monument in the world. It has a rightful place given Chinggis Khan’s influence in spreading the genes of horses from this region to all corners of the globe. The statue is sited on the place where, it is told, he found a golden riding whip, which identified him as the future Khan, universal emperor of the Mongolian steppe.

We were welcomed to the farm by the trainer and his mother who produced warm milk, donuts and milk curd cookies. Our hosts had gone to enormous lengths to ensure we were comfortable, sharing space in their gers that were adorned with photographs of champion racehorses and a traditional morin khuur (horsehead fiddle).

As the sun rose the next morning, in the deep quiet we could hear the hushed sounds of voices and horses being moved into the corrals. Generally, the horses are rarely handled and roam freely in small bands, yet during the next two days, with the help of the highly skilled herdsmen, we collected hair samples from 100 of the 500 horses on the farm. The tail hairs were processed and, considering local custom, the residue hairs were incinerated and carefully preserved in an urn.

By combining the genetic data that we obtained from the Mongolian horses with Thoroughbred racehorses and racing Arabian horses we compared their genomes to those of non-racing breeds to identify genomic regions under selection for racing. To identify genes that were functionally relevant to racing, we integrated the results from the population genomics analyses with gene expression data from Thoroughbred skeletal muscle. Since 2006 we have collected muscle biopsy samples from large cohorts of Thoroughbred horses at various exercise time points and stages of race training to understand the functional effects of exercise on muscle 12-15. By integrating the population genomics outputs with the gene expression signatures for exercise and training 12 we were able to identify a critical set of genes for racing. Whole genome sequencing of a set of Asian horses identified protein-coding variants in these genes, which clearly differentiated racing horses from other horses and were functionally relevant to exercise.

Manhattan plot for the results of the population genomics analysis to detect targets of selection among Racing breeds when compared with non-Racing breeds

Dr Haige Han, an equine geneticist 10,16 at the Inner Mongolia Agricultural University, China, and first author on the research paper said, “Testing hundreds of horses from racing and non-racing breeds identified seven essential genes for racing. These genes have roles in muscle, metabolism, and neurobiological functions, and are central to racing ability among horse breeds.”

Commenting on the work, co-author Professor David MacHugh, Professor of Animal Functional Genomics at University College Dublin said, “Although racing is a multifactorial trait, with management and training having a considerable influence on the success of a racehorse, our study provides good evidence for major-effect genes shaping the racing trait in horse populations.”

Selective breeding has resulted in certain horse breeds specialized for racing. Now, application of these research findings can help to accelerate breed development by more precisely choosing genetically suitable horses for racing through genome-enabled breeding. Some of the genes may also influence athletic performance in humans and other athletic animal species.

“Although man does not cause variability and cannot even prevent it, he can select, preserve, and accumulate the variations given to him by the hand of nature in any way which he chooses; and thus he can certainly produce a great result.” Charles Darwin, Animals and Plants Under Domestication

BY: Emmeline Hill

Professor, University College Dublin

I am an equine geneticist with a focus on Thoroughbred racehorse genetics. My scientific interests however are more broadly in animal population and conservation genomics, and functional genomics. In 2010 I co-founded Equinome, the first equine genetics testing company to test for a gene associated with racing performance, which we called the 'Speed Gene'. I am Chief Science Officer for Plusvital, an Irish equine science company that acquired Equinome in 2015.

Funding:

This work was supported by National Key R&D Program of China; National Natural Science Foundation of China; Science Foundation Ireland; National Institutes of Health Fogarty International Center and NIEHS; Royal Agricultural University Cirencester Fund; and Plusvital Ltd.

Mongolia will push ahead with plans to list a state mining firm embroiled in a corruption scandal that has sparked protests in the capital Ulaanbaatar, with new ownership likely to help drive out graft, the country's justice minister told Reuters.

The state-owned Erdenes Tavan Tolgoi JSC (ETT) owns a large chunk of a sprawling 6-billion tonne coking coal deposit near the Chinese border that has been at the heart of Mongolia's plans to grow its small and mining-dependent economy for more than a decade.

But development at Tavan Tolgoi has been held back by poor transport links and disputes about how Mongolia's strategic assets should be funded and owned. Fluctuations in global coal prices and cooling investor sentiment have also stymied previous efforts to list ETT's shares overseas.

"The prime minister is putting forward an initiative to change (ETT's) governance and make it public quickly," said Nyambaatar Khishgee, Minister of Justice and Internal Affairs, after thousands gathered in recent days to protest government corruption.

"It is expected that this will end the problems of transparency in the mining sector and public officials' corruption," he added.

A spokesperson for ETT was not immediately available for comment.

Protesters clashed with police in the capital Ulaanbaatar last week, as recent allegations of so-called "coal theft" at Tavan Tolgoi brought many to the streets demanding action against those responsible.

Hundreds of protesters were still at the city's central square on Tuesday, with some erecting traditional tents known as gers to stay overnight as temperatures plunged to minus 30 Celsius.

Mongolia earns about 50% of its export revenues from coal, mostly mined by ETT. However, around 400,000 tonnes of coal produced by the company in recent years is unaccounted for, the government said in October. Earlier allegations suggest almost 1 million tonnes of coal were exported but not registered between 2011 and 2017.

Nyambaatar said all contracts signed by ETT have now been made public. Details of the owners of 25,000 trucks involved in transporting ETT coal have also been disclosed.

The authorities are also investigating 7,373 trucks that repeatedly carried coal to the Chinese border between 2013 and 2017 but appeared to have arrived empty.

Mongolia also plans to appoint a top international auditor to look into ETT's finances, Nyambaatar said.

The government is working hard to ensure exports from the project are not disrupted by the probe, Nyambaatar said, and it will also steer clear of an inspection of Chinese coal buyers, who account for about 85% of sales.

"We are trying to reduce risk as much as possible," said the minister, adding he had met China's ambassador to Mongolia this week to reassure him that trade would not be impacted.

Mongolia has long been plagued by poor governance of its state-owned mining companies, which are saddled with billions of dollars of debt. But its economy has been further hit by strict COVID lockdowns from 2020 to 2021 that drove up unemployment, as well as high energy costs due to the war in Ukraine.

"How can we leave our children in this ugly debt-ridden society?" said Gantulga Tumentogtokh, 42, who stayed overnight at the central square for a fifth day, wrapped in a goat fur coat to stay warm.

"We should indeed issue shares (in state owned companies) and develop Mongolia. If we had already done that, our lives would be different. I want to see accountability," he added.

However some questioned whether the government's efforts will go far enough.

"Galloping price increases and widening poverty is the reason for public anger," said Otgochuluu Chuluuntseren, an economist and former government official.

"In the short term, we need reform in the governance of the SOE (state-owned enterprises). In the long term, the business must thrive on creating more sustainable and decent jobs," he added.

Reporting by Munkhchimeg Davaasharav in Ulaanbaatar. Additional reporting by David Stanway in Shanghai. Editing by Dominique Patton and Raju Gopalakrishnan

Mongolia has an opportunity to strengthen its business environment to create a more level-playing field for companies, particularly small and medium enterprises, (SMEs) and facilitate a more productive private sector beyond the mining sector, according to a World Bank report released today.

For two decades, economic growth performance has been impressive – though volatile – in Mongolia, with significant success in poverty reduction and human well-being. However, the country has become highly dependent on commodities exports, especially coal and copper with weak linkages between mining and the rest of the economy. Unemployment is high, and the labor force participation is falling, notably for women.

Establishing a more conducive and predictable business environment would benefit SMEs, which are more vulnerable to restrictive regulations and make up 97 percent of the active firms in the country, according to the Mongolia Business Environment and Competitiveness Assessment report. They contribute around 5.5 percent of GDP and 2.4 percent to exports (31 percent to non-mining exports). Mongolian SMEs could be positioned as active agents of the country’s much needed economic diversification and transformation, integrated in clusters and supply chains for goods and services, providing jobs and fostering inclusive growth, according to the report.

“The Government of Mongolia has recognized the need for a more conducive investment climate and implemented several significant reforms.” Andrei Mikhnev, World Bank Country Manager for Mongolia. "It is crucial for policymakers to stay the course when tackling business environment reforms – ensuring policy coherence and minimizing implementation gaps while modernizing policies and legal frameworks in the medium to longer-term."

The report recommends focusing on increasing competition amongst firms to encourage investment and foster innovation. It also highlights the importance of reducing barriers to international trade to facilitate competitiveness of domestic manufacturing and boost non-mining productive sectors. Other recommendations include digitizing and simplifying administrative systems to improve government services that create a conducive business environment.