Preserving the political status quo in Mongolia www.eastasiaforum.org

Mongolia’s economy hummed through 2019 on the strength of brown coal exports, regaining some footing following the near-disaster state of government finances in 2017. Repayment of several sovereign bonds looms in coming years and coal and copper prices will have a major impact on Mongolia’s finances, as will the ability of political parties to resist the temptation to buy victory in the 2020 parliamentary election with populist presents.Mongolian President Khaltmaagiin Battulga attends an interview with Reuters at the State Great Khural (Parliament) in Ulaanbaatar, Mongolia, 31 May 2019 (Photo: Reuters/B Rentsendorj).
Some questions linger over the status of the giant Oyu Tolgoi copper project as the saviour of Mongolian finances. In November 2019 Mongolia’s parliament approved a resolution to improve the agreement with operator Rio Tinto. Constitutional amendments also passed in November include provisions that raise the status of ‘strategic deposit’ (potential or operating mines of significance to the nation) to a constitutional level and also specify that Mongolians must receive the majority of benefits from these projects. These largely symbolic amendments do not seem to imply any particular policies but they are now available to future political and populist games. Unexpected and ongoing technical and geological challenges at the Oyu Tolgoi site also spell further potential cost overruns that might strain the relationship between Rio Tinto as the operator of the mine and the government as an equity partner.

Mongolia’s most significant political news came at the end of 2019 as amendments to the Constitution were passed and ratified by President Khaltmaagiin Battulga. These amendments focus on a clarification of the balance of power between the Prime Minister and the President in a hybrid parliamentary-presidential system, but they await a final check by the Constitutional Court. The changes also set the stage for a parliamentary election in June 2020 — a test of the extent to which the landscape for political parties has been reduced to a duopoly, if that.

The changes to Mongolia’s 1992 Constitution were proposed in June and have been discussed somewhat vigorously since then with only a moderate number of blind alleys (a referendum, snap elections) and distractions. The main thrust of the amendments has been to clarify some of the hybrid features of the Mongolian Constitution, tilting it slightly more toward its parliamentarian elements over presidential ones. The Prime Minister, whose power rests on election by parliament, now appoints cabinet members rather than parliament voting on them. Only the Prime Minister and an additional four ministers may be sitting MPs. While the Prime Minister’s independence has been strengthened, parliament is also gaining more oversight powers over the budget and cabinet.

Parliament was also given the power to set up investigative committees, but the budget process was protected from individual MPs’ amendments. Since presidential support was required for these amendments, the apparent bargain between the Mongolian People’s Party-dominated cabinet and parliament and the Democratic Party-affiliated president has been that President Battulga may stand in the 2021 presidential election for what will now become a single six-year presidential term.

A number of the constitutional amendments will require further specification with new legislation. Among the most significant clarifications will be the powers of the General Judicial Council and the newly-created Judicial Disciplinary Committee. Some hope that these amendments will supersede legislation that was hastily passed in March 2019 that gave the National Security Council the power to appoint and suspend judges. It significantly weakened judicial independence at a time when endemic corruption is threatening the ability of the government to make forward-looking policy decisions.

Another amendment curtails civil liberties but is not set to take effect until 2028, raising the possibility of further revisions. This is a provision stating that the registration of political parties is conditional on showing a membership of at least 1 per cent of the electorate (more than 21,000 voters in 2019). Given the longstanding application of minimum electoral thresholds, it is unclear why Mongolians should not be allowed to form small political parties. This amendment reinforces the impression that many political and legislative decisions in 2019 were driven by a desire to preserve the political status quo.

In late December, the revised election law governing the June 2020 parliamentary election was passed. The election will follow the 1992 and 2008 examples in using plurality-at-large voting. As in previous elections, the main question will be whether voters’ frustration can find a constructive outlet in new parties or candidates, or whether legislation will have succeeded in advantaging the Mongolian People’s Party and what remains of the Democratic Party. This question will be important in judging the future fate of Mongolian democracy.

Julian Dierkes is Associate Professor at the University of British Columbia’s School of Public Policy and Global Affairs. He is one of the principal authors of the Mongolia Focus blog.

This article is part of an EAF special feature series on 2019 in review and the year ahead.

Mongolia: The Amendment On Constitution Of Mongolia www.mondaq.com

New Constitution of Mongolia established a representative democracy after revolution from Socialist society to Democratic society which was adopted on January 13, 1992 and amended in 1999 and 2001. Under the last amendment on the Constitution, the new paragraphs are added on following articles of sovereignty, human rights and freedoms, structure of state including State Great Khural, Government, Judiciary, Municipal governing body, Constitutional court and amendments of Constitution are included it. This Constitution was approved to protect the better human rights than previous constitutions which had been adopted in 1924, 1940 and 1960.

The State Great Khural of Mongolia passed amendments on the Constitution on November 14, 2019. This amendment shall be effective starting from July 01, 2020 or after the State Great Khural (Parliamentary) election.

In brief, the amendments of the Constitution additionally introduced several new articles more than changed or modified previous articles as follows;

Sovereignty & the human rights and freedoms;
State Great Khural (Parliament)
Executive Branch;
Judiciary;
Local governance.
2. Amendments of Constitution
1. Main changes in the Sovereignty in the Chapter One
Article 6 (amended) 6.2 The land, except for the property owned by the citizens of Mongolia, subsoil, its wealth, forests, water resources, and wildlife shall be state public property.
2. Main changes in the Human rights and freedoms in the Chapter Two
Article 19 (new) 19.1 The political party that united by at least one percent of Mongolian citizen who are entitled to vote in the election shall be established in according with Article 16.101 of the Constitution and conduct national policy.
3. Main changes in the State Great Khural (Parliament) in the Chapter Three
Article 21 (amended) 21.4 The election procedure of the State Great Khural (Hereinafter "Parliament") shall be determined by law.
It is prohibited to approve and amend the Law of Mongolia on election within one year prior to the regular election of the Parliament.
Article 22 22.2 The Parliament may decide to dissolve itself by at least two-thirds of the members of the Parliament if at least two-thirds of its members consider that the Parliament is unable to carry out its mandate, or if the President in consent with the Speaker of the Parliament proposes to do so for the same reason hereinabove. (amended)
22.3 If the President is not able to discuss and decide the proposal for appointing the Prime Minister of Mongolia within forty-five days, after its submission to the Parliament in accordance with Article 39.8 of the Constitution or the resignation of the Prime Minister in accordance with Article 43.1 of the Constitution or within thirty days after resignation of the Prime Minister, the President shall decide to dissolve the Parliament.(new)
22.4 The Parliament shall announce the election within ten days after the above decision and the election shall be conducted within sixty days upon announcement. The Parliament shall retain its power until newly elected member is sworn. (new)
Article 25 (amended) 25.1.7 The Parliament entitle to approve state finance, loans, taxes, monetary policy, state economic and social development policies, operational programs of the Government was developed as national security policy, state budget and its report of performance
Article 26 (amended) 26.1 The President, Members of the Parliament, and the Government shall exercise the right to initiate legislation. The scope and limits of the right to initiate legislation shall be determined by law.
Article 27 27.6 Sessions of the Parliament and sittings of its Standing Committees shall be considered valid with the presence of a majority of its Members, and the issues shall be decided by a majority vote of the Members present in such sittings unless otherwise provided by the Constitution. (amended)
27.7 The Members of Parliament shall resolve issues by openly voting. A secret ballot shall be held if it's supported by a majority voting of the members of the Parliament or specified in the Constitution and other laws. (new)
4. Main changes in President in the Chapter Three
Article 30 (amended) 30.2 An indigenous citizen of Mongolia, who has attained the age of fifty years and has permanently resided in his / her motherland for at least five years, shall be elected as the President only once for a term of six years.
5. Main changes in Executive branch (Government) in the Chapter Three
Article 39 (amended) 39.1 The Government shall be comprised of the Prime Minister and Members of the Government. The Prime minister and up 4 members of the Government may hold concurrently position of member of the Parliament.
39.3 The Prime Minister of Mongolia shall, in concurrence with the President, submit drafted law on the structure and composition of the Government to the Parliament. If the Prime Minister is not able to reach a consensus on this issue with the President within a week, then Prime Minister shall submit it to the Parliament.
39.4 Government members shall be appointed, dismissed and resigned by Prime Minister upon introduced to Parliament and President. Government members shall swear to the Parliament.
Article 43 (amended) 43.1 In case of not less than a quarter of Members of the Parliament shall make a formal proposal to resign the Prime Minister, the Government shall discuss it in three days and decide it within ten days. Resolution of the Parliament related to resignation the Prime Minister shall be deemed to approve if a majority of the Members of the Parliament support the proposal.
43.2 The Government shall resign in its entirety, if the Prime Minister has resigned.
Article 44 (amended) 44.1 If the Prime Minister introduces a draft resolution to be entrusted to him on specific issues of the state budget and policy, the Parliament shall discuss it in three days and resolve it within ten days by a majority vote of the Members of the Parliament.
44.2 If the Parliament passed the resolution, it shall be deemed that the Parliament entrusted to the Prime minister and to support it. If the resolution is not adopted, the Prime Minister shall consider resigning and the new Prime Minister shall be appointed within thirty days.
6. Main changes in Judiciary system (Court) in the Chapter Three
Article 48 (amended) 48.1 The judicial system shall consist of the Supreme Court, the aimag and the capital city courts, soum (county) or inter-soum (inter-county), and district courts and the court may be established by circumferential principal. The specialized courts, such as criminal, civil and administrative by task types of the administration of justice, may be established. The activities and decisions of these specialized courts shall not but be under oversight by the Supreme Court.
Article 49 49.5 Five members of the Judicial General Council (hereinafter "Council") shall be selected from among the judges and openly nominate the other five members. They shall work once for four years and a Chairman of the Council shall be elected from among of the members of the Judicial General Council. Report on Council activities in connection with ensuring the independence of judge shall be presented to the Supreme Court. Organization of Council, operational regulation, the requirement for its 4 members and the rules of appointment shall be determined by law. (amended)
49.6 The Disciplinary Committee of the Court has the following duties such as suspending from the position of judge, dismissing a judge and imposing other disciplinary sanctions under the procedure and the grounds specified in the law and its power, organization, operational procedures, requirements for members and appointment procedure shall be adopted by law. (new)
7. Main changes in local governance system in the Chapter Four
Article 57 (amended) 57.2 The legal status of town with national and local rank in the administrative and territorial unit as well as own governance and organization of soum(village) shall be prescribed by law.
Article 59 (amended) 59.2 Local self-governing organs in aimag, capital city, soum and district shall be the Khural of Citizen Representatives (Local assembly) in their respective territory, the General Khural of Citizens (Local meeting) in bag and horoo.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Central bank reports on outstanding pension loan balance www.montsame.mn

Ulaanbaatar /MONTSAME/. Concerning the issue of one-time cancellation pension-backed loan debts proposed by the National Security Council of Mongolia, which is under discussion at the parliament level, Bank of Mongolia today presented the latest pension loan balance report.

Government to manage sovereign wealth fund www.montsame.mn

Ulaanbaatar /MONTSAME/. Today, January 9, Parliament backed draft resolution on measures following the new amendments to the Constitution of Mongolia. The resolution is aimed at coordinating the concepts and visions set out in the recent amendments to the Constitution with corresponding legislations, carrying out law reform, and promoting their significance to the people of Mongolia.

Foreign exchange reserve increases, reaching its highest level www.montsame.mn

Mongolia's foreign trade profit has grown up and reached USD 1.5 billion in the first 11 months of 2019. An increase of the foreign trade profit positively affected to accumulation of foreign exchange reserves. As of November, 2019, foreign exchange reserves reached USD 4 billion.

Ulaanbaatar railway purchases eight locomotives www.montsame.mn

Ulaanbaatar /MONTSAME/ Eight locomotives purchased by Ulaanbaatar Railway JSC from the Russian Federation to meet the ever-growing railway transport demand were brought into the country this morning.

Teck to up coal shipping capacity 50% from BC port www.mining.com

Teck Resources Limited (TSX: TECK.A and TECK.B, NYSE: TECK) announced Wednesday an expanded commercial agreement with Ridley Terminals Inc. (RTI) for shipments of steelmaking coal from Teck’s British Columbia operations.

Cabinet approves agreement between India and Mongolia on Cooperation in the Exploration and Uses of Outer Space for Peaceful and Civilian Purposes www. pib.gov.in

The Union Cabinet, chaired by the Prime Minister Shri Narendra Modi, has given its approval for an Agreement between Government of the Republic of India and Government of Mongolia on Cooperation in the Exploration and Uses of Outer Space for Peaceful and Civilian Purposes.

The Agreement was signed at New Delhi on 20 September 2019 during the state visit of the President of Mongolia to India.

Details:

• This Agreement shall enable pursuing the following potential interest areas of cooperation such as, space science, technology and applications including remote sensing of the earth; satellite communication and satellite based navigation; Space science and planetary exploration; use of spacecraft and space systems and ground system; and application of space technology.

• The Agreement would lead to set up a Joint Working Group, drawing members from DOS/ISRO and Communications and Information Technology Authority of the Government of Mongolia, which will further work out the plan of action including the time-frame and the means of implementing this Agreement.

Financial Implications:

The financial arrangements to cover expenses for the co-operative activities undertaken within the framework of this Agreement will be jointly decided by the respective Participants on a case-by-case basis subject to the availability of funds.

Benefits:

Cooperation with and the Government of Mongolia through this Agreement would lead to develop a joint activity in the field of application of space technologies for the benefit of humanity. Thus all sections and regions of the country will get benefited.

Implementation Strategy and Targets:

The signed Agreement would lead to concluding specific implementing Arrangement and setting up of Joint Working Group, to work out the plan of action including the time-frame and the means of implementing this Agreement.

Impact:

The signed Agreement will provide impetus to explore newer research activities and application possibilities in the field of remote sensing of the earth; satellite communication; satellite navigation; space science and exploration of outer space.

Background:

• Department of Space (DOS) and the Mongolian Ministry of Infrastructure signed an 'Agreement for cooperation in space science, technology and applications' on January 15, 2004. Apart from training of Mongolian officials on space technology application, no major cooperative activities have been taken up. When our Embassy in Mongolia was contacted for reviving the cooperation, it is understood that Mongolian Ministry of Infrastructure is abolished and the space activities are presently handled by Communication and Information Technology Authority (CITA) of Mongolia.

• Embassy has further mentioned that, b high level delegation from Mongolia is expected to visit India during September 2019 and space cooperation would be one of the agenda. Embassy requested ISRO to share a draft Agreement on space cooperation for further taking up with CITA. Accordingly, a draft Agreement for India-Mongolia Space cooperation was drafted and shared with

Embassy, with approval of Chairman, ISRO/ Secretary, DOS. Subsequently, Mongolian side has given its concurrence and both sides have arrived at workable version and proposed to sign the agreement during high level delegation visit from Mongolia.

Full stream ahead: Russia & Turkey launch TurkStream gas pipeline www.rt.com

Russian President Vladimir Putin and his Turkish counterpart Recep Tayyip Erdogan have launched the long-anticipated offshore pipeline TurkStream, that will deliver Russian gas to Turkey and further to southern European states.
The 930 km pipeline across the bottom of the Black Sea became operational on Wednesday, with the two leaders attending a special opening ceremony. Serbia’s President Aleksandar Vucic and Bulgarian Prime Minister Boyko Borissovalso participated in the event, as the leaders symbolically launched the project from the stage.

"The supply of Russian gas through TurkStream will undoubtedly be of great importance not only for the economy of Turkey and the Black Sea region, but will also have a positive impact on the development of many South European countries, and will contribute to improving the energy security of Europe in general,” Putin said. He also thanked his Turkish counterpart for the “political will” that was necessary to implement such a massive initiative.

As Russia remains the main gas supplier for Turkey, the countries will implement new joint energy projects, Turkish President Recep Tayyip Erdogan vowed on Wednesday. Russia is also involved in another massive energy project in Turkey, Akkuyu nuclear power plant (NPP), which is set to become operational later this year.

In his remarks at the inauguration ceremony, Russian Energy Minister Alexander Novak said that the launch of one of “largest construction projects in modern history” marks a “historic day” for the world energy development as a whole.

TurkStream is the “Silk road of the energy world” and a big step forward for Turkey, as well as a cornerstone of the relations between the two nations, Turkish Energy Minister Fatih Donmez told the audience.

The TurkStream natural gas pipeline was created as an alternative to the South Stream pipeline after Bulgaria ditched the project in 2014, under pressure from the US. The two-string TurkStream boasts the total capacity of 31.5 billion cubic meters, with one line supplying Turkey and the other transferring the blue fuel to southern and southeastern Europe.

RT
In a last-ditch effort to stop Russia’s energy projects, US President Donald Trump signed into law the massive National Defense Authorization Act in late December. According to the document, companies involved in the construction of both TurkStream as Nord Stream 2 could face US penalties unless they quit the Russian projects.

However, unlike Nord Stream 2, the offshore section of the TurkStream had been already completed by that time. Ankara has also vowed to retaliate against any US sanctions.

pipeline to get the gas supplies from Russia. In late December, Bulgaria announced its readiness to receive natural gas from Russia’s Gazprom via Turkey. The new route is more economically viable for the country and could make gas cheaper for its consumers by around 5 percent, according to the country's Energy Minister Temenuzhka Petkova.

Serbia is also looking forward to getting Russian gas supplies and has already completed its section of the pipeline. But the country is not directly linked to the pipe, and will have to wait until neighboring Bulgaria extends TurkStream to its border. Russian President Vladimir Putin earlier accused Sofia of deliberately delaying the construction of its section, warning that Moscow can find ways to bypass its territory, if necessary.

“This pipeline will allow Serbia to get gas at decent prices, better than we’ve had been so far,” Serbian President Vucic said on Wednesday, as cited by the local media. He noted that the project would allow Serbia to attract more investment and develop industrial production.

Serbia’s northern neighbor Hungary also wants to use the TurkStream natural gas pipeline to diversify national energy supplies. Budapest hopes that Sofia and Belgrade will finish their legs of the project in time, allowing it to get the first Russian gas supplies in 2021.

Airfares for four routes by MIAT lowered www.montsame.mn

Ulaanbaatar /MONTSAME/. It has been recently reported that Mongolian national flag carrier MIAT Mongolian airlines lowered its ticket prices by 15-37 percent. The MIAT Company emphasized that four routes carried out by the airline are subject to price reduction, including;