Mongolia’s parliament approved a new investment law Thursday that caps future foreign participation in certain strategic industries, reflecting a growing public push to keep profits from the mineral-rich nation’s industries inside the country.
When it goes into effect, the law will require foreign investors to obtain government review and parliamentary approval for investments at 49% and above into industries such as resources, finance, telecommunications and media, according to analysts. The cap is specific to deals valued above about $75 million.
Investors owned by governments, such as state-backed Chinese companies, will also need special permission to buy into the sectors.
Foreign investment is critical to Mongolia’s future as a commodity powerhouse. But the law reflects anxiety among ordinary Mongolians that foreigners would enjoy the spoils of the country’s hoard of coal, copper, gold and other natural resources. Its passage comes weeks before a parliamentary election, the first in four years, for which politicians are expected to campaign on populist promises of ensuring profits are retained in Mongolia.