Last Friday, the President of Mongolia received leaders and representatives of political parties, holding seats in the Parliament. The meeting addressed the main politically attractive issues including Oyutolgoi, Tavantolgoi, Asgat silver deposit that are of strategic significance. They are both interested in trading mineral deposits for votes at this time of election. Because none of party leaders responded to the question of the President “Shall we hold the meeting open?”, it is suspected that they have made their bargaining over deposits mutually beneficially and amiably. The meeting lasted for 3 hours. A task group comprising of Mongolian People’s Revolutionary Party (MPRP) and Democratic Party (DP) members introduced the main principles already, therefore it is interesting what the positions of other parties were.
A task group, with the aims to set the portion of the state ownership in these deposits and to formulate a draft on making amendments to the Minerals Law of Mongolia, held an introduction. The principal amendment of the draft is that the state shall vest ownership over not less than 51 percent of the deposit, explored by state properties. Those, except Republican supported this idea. Moreover, they agreed upon the fact that it must be addressed and resolved before the election. However New National Party (NNP) and Republican Party (RP) do not believe it would be resolved during spring session and settled before the election.
Let’s hear what the public say
This idea was raised during the meeting. Mr. L.Gundalai, Leader of the PP said it was proper to hear what the people say on how to use mineral deposits and what percent should go to the state ownership, whilst Mr. B.Jargalsaikhan, Leader of RP admitted that public poll should be run in order to get their votes on taking the road of market economy or centrally planned one. The PP expressed the state should rely on own capacities instead of going after foreign investments. On the contrary NNP said it was better to leave this issue, which was related to economy, entities and businesses to the discretion of the Government and the President, considering it would be a time-consuming matter. NNP also reminded that foreign company would have over-exceeding power than the state if it has more ownership in deposits of economic importance.
Underground reserve belongs to state, on-the-ground reserve belongs to whom…
According to the Constitution of Mongolia, underground minerals belong to the people of Mongolia. If a company explores and estimates the reserve with its own assets, the state shall get up to 34 percent. The task group proposes to amend it “not less than 34 percent” and parties support it as well. They admitted that foreign and domestic investment company must pay all operation taxes. Furthermore, loyalties shall be considered as state taxes. If the company pays all related taxes, it could “own” minerals. However, they preferred state regulation in any occasion by owning dominant percentage.
DP and MPRP, stop lying the people
Mr. B.Jargalsaikhan, Leader of RP stood against the proposal developed by the task group on state ownership above 51 percent in mineral deposits. He also criticized the task group headed by N.Batbayar and comprised of 4 MPRP and DP members respectively, the Prime Minister and Minister of Industry and Trade. He admitted that there were 7 parties and MPRP and DP should not decide such an important matter related to the economy of the nation alone. Moreover he said the state should include domestic private companies in the ownership. Mr. B.Jargalsaikhan blamed MPRP and DP for trading deposits for votes. “Ts.Elbegdorj talks nonsense. What is he talking about USD1000? It will take 15 years to mine coal in Tavantolgoi and 10 years to compensate the investment. It is not so easy. Let’s assume we mine coal from Tavantolgoi. Nowadays coal price is USD30. If we multiply it with the amount of coal we mine, it will be USD90 million, of which USD 50 million go to mining expenses. We need to export the coal and transport takes away half percent of the leftover money. And now we have USD20 million, of which USD 10 million go to the mine and USD 10 million to the state. If we divide USD10 million into 2.5 million population, the result would be 50 cents per capita. This is the fake promise they give to us. False promises won’t work well for running for the election and developing the nation” says Mr. B.Jargalsaikhan. Moreover he proposed to establish another task group comprising of other 5 parties, which was supported by others.
Now there are 2 task groups divided via small and big.