By Enkhbat A
Different Approaches to Mining
The Mongolian parliamentary election will take place on June 29, 2016. There are 13 parties and 3 coalitions campaigning for the upcoming election. A brief analysis has been conducted on the four political entities, Mongolian People’s Party (MPP), Democratic Party (DP), Mongolian People’s Revolutionary Party (MPRP) and “Independence and Unity” coalition. All these entities are campaigning with more than 39 candidates and hoping to qualify to establish a government. Their platforms were reviewed and commented by the National Audit Authority and were posted on the Mongolian Election Commission’s website.
Mining industry development and policy were not reflected in the MPRP platform. But the objective section has a declarative statement that says that Mongolian mineral reserves are the foundation of the happy life of the public. On the other hand, the “Independence and Unity” coalition included a quite general objective of establishing mining and metallurgical complex, transferring the strategically important mining projects to state ownership, justly monitor the Oyu Tolgoi project, leave Tavan Tolgoi deposit to public ownership, and to implement principles of environmental “pollutant as payers” and “users are protectors”
Platforms of MPP and DP
As for the two biggest political entities, the election platforms of the MPP and DP introduced mining development and policy in details in particular. The MPP platform’s Chapter 2 (Economic Policy) and section 2.4 (Mining Development) and the DP platform’s Chapter 3 (Mining) were devoted to parties’ discussions of their mining development and policy.
The MPP concluded that the current investment in mining is reduced by 4 times and proposed their solution. As for the DP, they proposed to sustain the stability and growth in the export income from mining sector. The following table illustrates the difference and main objectives of the two parties.
2.4.1 To create the most favourable legal and economic environment for inviting the well-known global companies and to produce value-added, final products from the natural resources destined for the global market.
2.4.5 To improve the operations of the State-Owned Enterprise “Erdenes Mongol”; to create conditions to distribute benefits of the large companies like Oyu Tolgoi, Tavan Tolgoi, and Erdenet to every citizen.
2.4.7 To keep the state’s involvement in mining projects at the proper level and to prioritize policies to collect taxes and royalties.
2.4.8 To streamline the legal coordination and policy for citizens cooperate in artisanal mining sector as stated in the article 3.1.2 of the “State’s Policy for the Minerals Sector”.
· To develop human resources and to increase employments in the mineral sector.
· To increase the deposits of strategically important mines such as Tavan Tolgoi coal and Erdenet copper and molybdenum; to start mining operations at Asgat silver, Gatsuurt gold, and Tsagaan Suvarga copper mines; to support the implementation of the underground mining of Oyu Tolgoi.
· To issue mining licenses on the basis of prior consultation with the local community and to make the license issuing processes, monitoring, and data bases transparent.
· To support the introduction of new techniques and technology and re-processing of the mining industry waste with policies.
· To prohibit all activities related to nuclear waste in the territory of Mongolia.
· To intensify the exploration for the discovery of new oil fields. To develop a policy concerning the oil sector up to 2030. To increase the annual oil production to 1.7 million ton and income of the export to 500 billion tugrug.
· To establish the foundation for a coal refining industry.
· To approve the regulation and standards for the usage, storage, transportation, and sale of gas and liquid fuel in order to provide the public safety.
Drawing from the table, MPP declared its intention to increase foreign investment in the mining sector, ensure appropriate involvement of the state in the mining deposits and companies, and obtain payments through taxes and royalties for use of mineral resources. On the other hand, the DP centres their mining policy on human resources, equipment, technology development and production in addition to prohibiting all activities related to nuclear waste, developing oil shale production, and improving natural gas safety and security. In brief, the MPP announces that they will create environments to increase foreign investment, and reduce state involvement in the mining sector. But the DP’s policy proposes to develop and bridge the mining sector with the industrialization and strengthen the state monitoring of the sector.
TT Shares, Industrialization, and Environment
Also, both parties platform includes similar objectives to increase the value of 1072 stocks of Tavantolgoi, establish a fund from the revenue from the mining sector, improving mining closure and reclamation, develop transparent and responsible mining, increase public participation, improving legal environment for the artisanal mining and gold procurement, create geological central database, carry out researches and the mapping , and create favourable investment environment for the mineral resources sector.
Furthermore, both parties propose in their platforms that they will develop manufacturing sector based on the mineral resources, and process the mineral products. The MPP states specific names of mining projects and proposed the processing of the minerals in contrary to the DP’s proposal to develop the mining complex and industrial zones.
The environmental chapters in the parties’ platforms also included sections related to mining. The MPP highlights to work in mining reclamation and importance of improving public participation in it and the DP put forward the proposal to protect drinking water, sourcing water from rivers with outflow for the mining projects.
In addition, the DP signals that they will give priority to the extractives sector development within the economic framework and will secure safety reserves of the energy and fuel sources by increasing the capacity of specific projects.
Mining has remained as one of the central themes in the party platforms and been regarded as the main economic leverage; thus demonstrating that Mongolia has become a mining country.
About Enkhbat A
Dr. Enkhbat is associate professor in the Department of Humanities of the School of Business Administration and Humanities of the Mongolian University of Science and Technology. His special areas of interests are history of Mongolian mining and comparative examination of mining history of Mongolia and Inner Mongolia.