The three Dilova Hutagt letters of 1932 to the US ambassador and of 1942 to President F.D.Roosevelt sent via Owen Lattimore, which researcher Saruul-Erdene found in the Congress library and have recently published in Mongolia, show how well the Mongolian elite of the time understood the geopolitical realities of their day and how they risked their lives to defend the national independence they had attained in 1911. More importantly, they remind us of the three foundational principles of Mongolia’s eternal national interests, when he wrote: “Led by Khalkh Mongol Zasagt Khan and Jalhanz Hutagt, Mongolian religious and secular representatives have resolved to defend the self-rule right of Mongolia and got a petition to the US administration to that effect approved by Javzandamba Hutagt (Head of State) in 1920. However, in 1921 the Russian Red Army soldiers suddenly entered the capital city with some Mongolian youth and, by force, set up a red-party government, with all its affairs directed from Russia with the purpose of eliminating religion and private property, while imposing harsh legal rules, banning people’s right to debate and possess arms. This manifestation of Russia’s intention to swallow and incorporate Mongolia was deeply resented by Mongols, who not knowing what to do, secretly appointed me as the representative of the like-minded brave in order to seek ways of getting Mongolia freed from Russia’s grip… An official of the government of Outer Mongolia was sent, in top secrecy, to order me find ways, while taking utmost care for discretion, to communicate with the USA and Great Britain about protecting Mongolian people’s interests based on 3 main principles:

1. Protect the independent statehood Mongolia has achieved
2. Stop other countries’ domination of Mongolia’s territory
3. Prevent stationing other countries’ troops or military advisors in Mongolia

As it is a dangerous assignment, I am not to letting anybody know of it and working with utmost carefulness. If Russians get wind of this, those colleagues will lose their lives and my safety will be under threat”

Indeed, these 3 aspirations were fulfilled only after the 1990 democratic revolutions, sweeping through all the former communist countries. For the first time in over 300 years, Mongolia gained the opportunity to engage with the whole world as a sovereign country with its own independent foreign policy. With her transition to democratic governance, based on UN fundamental human rights, and a market economy, relying on private property and economic freedom, she joined humanity’s mainstream development path. This has given her the chance to further expand its all-round amicable cooperation with its two neighbors, while rebalancing the historically conditioned unequal relations. The process was facilitated by the fact that the neighbors themselves were going through similar political and economic reforms. In particular, the new access to “third neighbor” countries’ technology and capital allowed her to exploit its comparative advantage in mineral deposits and accelerate its economic transformation by exporting them to the vast markets of their giant neighbors. In particular, the mega projects OT and TT were of decisive significance here.

Unfortunately, these projects have in recent years gotten into a state of stagnation and resuscitation as a consequence of a dog-in-the-manger type obstruction by oligarchic rent-seeking, taken advantage by populist politicians’ resource nationalism. The most pernicious manifestation of this folly has been the current attempts to criminally charge the two prime ministers, who as part of their regular official duties oversaw or directed the preparation of the related treaties or project documents in strict compliance with the country’s laws and regulations. They are being declared as corrupt traitors who sold out the country to foreign interests, without legally satisfactory evidence or truly independent courts. PM S.Bayar was jailed for 2 months for preliminary investigation, PM M.Enhsaihan‘s case was rejected by the court, but a new politically- appointed prosecutor is now charging him again under a terrorism related article with potential punishment up to life imprisonment, based on the very project proposals that have been submitted by the government but have not even been discussed by the Parliament, which was to approve it. Another former prime minister Saihanbileg and the last president Elbegdorj are being also threatened with criminal charges and are, reportedly, avoiding return to the country from abroad for fear for their safety.

These developments are shocking to Mongolia’s supporters who wonder if Mongolia is not just backtracking on its transition progress but is sliding into a familiar tin-pot-dictatorship that used to be prevalent in Africa and Latin America where rule of law is trampled by the capture of judiciary. Some even wonder if there is external influence. Those who were asking why you want to recall the just-appointed ambassadors- the former prime ministers who have rare education and experience necessary to promote meaningful relationships with western countries- now are asking why appoint one’s military advisor as ambassador to Russia? Would not restoring the old military cooperation and assistance make Mongolia a vassal state again, where are the enemies Mongolia would defeat with tanks and planes? They warn that the new railways running to the east via Russia would not become profitable whatever temporary subsidies are offered and the region’s world war two heritage of the divided Korea and absence of a peace treaty between Russia and Japan make promotion of economic integration difficult, as evidenced by some UN project efforts over the past 30 years. The prevention of depopulation and economic development of the Far East, including efficient railway access to Vladivostok or other warmer ports has been a permanent challenge for Russia. In fact, the eastern Chinese railways re-obtained under the Yalta agreements were transferred to China free of charge, because it was continually running losses and Mao demanded huge investments, if to be managed jointly.

What is the “terrorism” damage caused by the TT project proposal anyway? A mining operation does not have a permanent property to transfer to foreigners, it is just a question of extracting the resources and sharing in the income generated as wages, royalty or profit, all of which are larger, the longer and bigger the project is. The opportunity to benefit as much as it was proposed then, is long gone. And it is a chimera to hope for an IPO of a state-owned company that requires agreement by all citizen shareholders to decide major issues and whose profit is routinely raided by the government for distribution or financing unrelated public investments. Irrespective of what you call it, the best one can hope for now is probably some kind of bond/loan type deal collateralized by the best portions of the deposits and its true value would likely be several times less than the original proposal, and could increase the already unsustainable public debt level.

Even if the former Prime ministers were convicted, they would be able to appeal to the international human rights institutions once domestic remedies have been exhausted. There won’t be complete elements of a crime under international standards without proving corrupt payments by OT or unfair benefits obtained by Chinese companies at the expense of TT. In the end Mongolia might end up becoming a ‘shithole’ country where the international community regularly demands release of its political prisoners and whoever could flee persecution live abroad as political asylum-seekers and it could not be ruled out that someday a future government would be handing a former President to the international court as a human rights violator, as Sudan is doing now.

In the meantime, Mongolia is facing today many challenges as bad as coronavirus:

1. How to accelerate the construction of the Gashuun Sukhait railway line to carry mining exports that cannot be hauled by trucks, if the virus continues
2. What to do if Mongolia has to default on its public debt because of the discontinuation of the IMF program due to the breach of the conditionalities agreed.
3. If the pastoral animal husbandry, extremely vulnerable to climate change and animal diseases, fail in the conditions of increasing global warming and germs activation.
4. How to finance the import needs, given the evaporation of FDI into mining due to the poor treatment of OT and TT projects, exploration licensing and constitutional changes affecting the sector.
5. What other sectors, if not mining, provide any hope for fulfilling the ‘long-term development plans’ empty dreams

What we need most to meet these challenges is national reconciliation and sanity. There are enough bitter lessons from other countries where politicians, fighting over natural resources rent, destroyed each other and ruined their countries. Every Mongolian is a patriot, but we fail to compromise and cooperate, possibly, because the appropriate rules of game have not been developed as in other countries. The pre-electionary environment is aggrevating the disagreements and pushing people to abuse power. Therefore, it is called upon:

1. The Parliament to adopt a law guaranteeing that no politician be criminally charged for decisions he was involved with as part of fulfilling his official duties, however inadequate the outcomes were (this would apply to decisions of those in power now, too)
2. To stop and postpone any investigations that is alleged to be politically motivated until the elections are over
3. To resume them once truly independent courts and control mechanisms are put in place as envisaged by the recent amendments to the Constitution.
4. All lawyers are called on to actively use this opportunity to strengthen the independence of the judiciary, clean their ranks from those who fail to honour it and protect human rights in Mongolia.

March 2020

Batbold Tserenpuntsag, 

Economist, International lawyer