New PM and Cabinet, New Start with the IMF?

By Marissa J. Smith

On September 6, Parliament opened its new session. On September 7, Prime Minister J. Erdenebat and Cabinet were voted out by Parliament after the motion was announced on August 23rd by thirty members of Erdenbat’s party, the MPP. (A list of who voted for the motion is available here.)

For now, the MPP is holding its cards close to its chest; at press conferences held during the latest meetings of the party’s Udirdakh Zuvlul (executive council), little has been said beyond that the next meeting of the Baga Khural of the party would be held on the 25th.

The move has seemingly not been met with much surprise, and commentators seem relatively confident that the new PM will be U. Khurelsukh, the “deputy prime minister” (Шадар Сайд) who submitted his resignation and was then announced to be under investigation by the Anti-Corruption Office. At the same time, there is an atmosphere of watching and waiting — the IMF has also postponed a review of the bailout package until the new government is chosen.

Is the investigation of Khurelsukh a “show” to try and distance him from corruption allegations before his becoming prime minister? Perhaps, but looking at the deployment of distinct corruption allegations let us see Mongolian politics as a more complicated field.

Political discussions on social media since the presidential elections has remained occupied by corruption discourses that dominated the election campaign season. Attention on the “60 Terbum” scandal, “offshoring” associated with the Panama Papers scandal, and the provision of contracts by Ulaanbaatar city official Ts. Sandui maintained momentum over the summer.

But Mongolian politicians have been active participants in these discourses and positioning them at the center of politics. President Battulga has called for offshore accounts to be closed. The “60 Terbum” and possible removal of Ts. Sandui were the focus of press conferences given by the MPP after meetings of the Udirdakh Zuvlul in August. Meanwhile, DP member Ts. Oyungerel, who very publicly sheltered the 60 Terbum leaker Dorjzodov at her home in between campaigning for Battulga in the countryside, has continued to tweet about the 60 Terbum and “corruption” in general.

Again, one might view these as shows or deflections. It seems significant, however, that the motion to remove Erdenebat and his cabinet focused on the granting of 328 million dollars in contracts to the connections of ministers and a Cabinet secretary to build roads and power infrastructure.

An important question for those interested in Mongolian politics is now (and has long been), how such “megaprojects” can be financed and built without the relations involved in their financing and construction being viewed as corrupt.

Another indication that we should look in this direction is the renewal of interest in Ts. Nyamdorj. Though he has been named as a contender for the position of prime minister, he is seen and seems to position himself more as a kingmaker.

Nyamdorj was a major actor involved in Parliament’s ruling the sale of the Erdenet 49 percent illegal. His committee’s reports arguing for this move emphasized flows of money to finance the sale as illegitimate, including the involvement of the Mongolbank and use of the Development Bank (Chinggis Bond financing),  which are also key targets of reform named by the IMF.

Is this where the MPP and the IMF find common ground and a restart? If so, will the other flows of money, and the results of these flows, be seen as legitimate enough by what groups to stem the seemingly relentless flow of corruption discourse and loss of trust in Mongolian government and business?


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1 Response to New PM and Cabinet, New Start with the IMF?

  1. Mendee says:

    Dear Marissa,

    A great analysis and posing of an interesting questions. For me, the MPP arrives at the crossroad to either put the train on the right track or to let the patronage politics go for another round. If the party seniors choose the latter path, it would eventually pave its way to disastrous elections in 2020 and people would lose their faith in democracy. If the party sets their ideological orientations right and clear, puts professionals in charge of the cabinet instead of hopeful MPs, and lets corrupted ones to serve their times, it might have strong chance of gaining some trust from the business and public. It seems a very hard test for the MPP, but a good chance to fix. On a separate note, I don’t know if Nyamdorj is eyeing for the Prime Minister’s seat or he had some personal interests in the Erdenet case. For my observation, he seems to have a principle and courage to bring important issues, such as Erdenet or Bank of Mongolia, to the public attention. His push for having the public hearing on Erdenet was a classic example to disclose conspirators of Erdenet (similar attempt was also made by Temuujin on the July 1st incident). If Nyamdorj wasn’t there at the MPP, it would be hard to imagine any MPP members had a gut and experience to question the most-secretive deal of the DP-led cabinet. So, let’s wait and see,

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