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Relations are friendly, though contact has been limited and New Zealand interests are not substantial. Last year we celebrated 30 years of diplomatic relations. Trade is minimal.
New Zealand is perhaps best known in Mongolian government circles for providing the model for its public sector reform. The Mongolian Public Sector Finance and Administration Law was largely influenced by the New Zealand experience and New Zealand expertise was accessed by the ADB and World Bank to work on projects assisting the Mongolian government with implementation.
New Zealand and Mongolia share common views on a range of issues of importance to New Zealand, including disarmament and the environment. Over the past decade we have been partners on human rights issues, working together in international and regional forums such as the Asia Pacific Framework for the Promotion and Protection of Human Rights. We also work together in the ASEAN Regional Forum.
Some modest NZAID programmes remain in Mongolia. Small numbers of Mongolian officials participate in the English Language Training for Officials (ELTO) programme each year. Through this programme, many of Mongolia’s young diplomats and other civil servants have studied in New Zealand for seven-month periods at one time or another. A small Head of Mission grants fund is administered from the Beijing Embassy and Mongolian projects are able to access the regional contestable fund, the Asia Development Assistance Facility (ADAF).
Land Area - 1,566,500 sq km - Population - 2.8 million - Capital City - Ulaanbaatar (population approx 900,000) - Religion - No official state religion. Largest religion is Buddhism. - Official Language - Khalkha Mongol
Political System - Parliamentary Republic - National Government - Supreme legislative power is vested in the State Great Khural (Parliament) elected by universal adult suffrage for four years. The Great Khural recognizes the president on his popular election (for a four-year term) and appoints the Prime Minister (subject to the President's agreement) and members of the Cabinet. The President is the Head of State and Commander-in-Chief of the Armed Forces - National Legislature - A single-chamber parliament, the State Great Khural, with 76 members - Last Election - Parliamentary: 27 June 2004, Presidential: 22 May 2005 - Next Election Due - Parliamentary: June 2008, Presidential: May 2009 - Head of State - The President, currently Nambaryn Enkhbayar - Head of Government - The Prime Minister, currently Miyegombyn Enkhbold (appointed 25 January 2006)
GDP (US$) - US$1,524 million (2004) (EIU estimate) - GDP Growth (real) - 6.2% (2005) (EIU estimate) - GDP Breakdown (all IMF) - Trade: 25%; Industry: 26%; Agriculture: 21%; Services: 13% - GDP Per Capita - US$603 (2004) - Main Imports (US$) (all IMF) - Petroleum $210 million; Machinery and Equipment $201 million; Transportation Equipment $104 million - Main Exports (US$) (all IMF) - Copper $284 million; Textiles $97 million; Cashmere and cashmere products $79 million - Current Account - US$18.1 million (2004) (EIU) - Inflation (average) - 9.5% (2005) (Asian Development Bank) - Foreign Exchange Reserves (US$) - US$236 million (2004) - Total External Debt (US$) - US$1,380 million (2005) (EIU estimate) - Budget Balance - Revenues: US$830 million; Expenditures: US$589 million (2005) (Mongolian National Statistical Office)
NZ Exports (FOB) - NZ$1.787 million (2005) (vs. NZ$1.120 million in 2004) - NZ Imports (CIF) - NZ$79,907 (2005) (vs. NZ$83,677 in 2004)
Mongolia is a land-locked country sandwiched between China and Russia. Agriculture and mining underpin the economy: Mongolia has vast herds of sheep, goats, cows, camels and horses, and mining is its biggest foreign exchange earner. Tourism is a growing part of the economy, but more generally the service sector is underdeveloped.
Mongolia this year celebrates its 800th year of statehood and it is fiercely proud of the history of former warrior Chinggis Khan (as Genghis Khan is known in Mongolia).
The current population of approximately 2.8 million is predicted to increase to 3.1 million by 2015.
Politically Mongolia has made a remarkable transformation from Soviet satellite to fully democratic state. Since the democratic revolution in 1990, democratic elections have been regularly held in Mongolia (including presidential, parliamentary and by-elections), and are considered largely free and fair. In January this year, the Mongolian People’s Revolutionary Party (MPRP) pulled out of the 17 month ‘grand coalition’ and formed a new government with the support of small parties and defectors from the Democratic Party (formerly coalition partner of MPRP and now the main opposition party). The stability of this coalition is not assured.
The current prime minister, Miyegombyn Enkhbold, (appointed in January) is from the MPRP and the president was formerly prime minister and parliamentary speaker for the MPRP Party. The MPRP was the ruling party in Mongolia’s communist era, but following the 1990 democratic reforms MPRP has repositioned itself as a party “for a market economy with social care”.
A notable achievement in Mongolia’s political development was the establishment of a Human Rights Commission recognised as meeting the requirements for a free and independent body. The commission actively handles complaints and its major concern is arbitrary behaviour by state officials. The commission is supported by a UNDP/OHCHR project, which has funded Peter Hosking, a former New Zealand Human Rights Commissioner, to do capacity building work with the commission. The New Zealand Human Rights Commission has also had close cooperation and numerous visits and exchanges with its Mongolian counterpart. Both human rights commissions are members of the Asia Pacific Forum of National Human Rights Institutions (APF). The 2005 meeting was hosted in Ulaanbaatar.
There is a flourishing civil society in Mongolia (although predominantly in Ulaanbaatar) with a large NGO community and a relatively free media. Corruption, however, is a growing issue. Mongolia’s Transparency International ranking has slipped substantially from 43 in 1999 (out of 99 countries) to 84 in 2004 (out of 146 countries).
The collapse of the Soviet Union and the dissolution of the Trading Bloc of the Communist Economies (COMECON) left Mongolia with a debt of 10 billion rubles and Soviet investment and subsidised deliveries of raw materials ceased. Industrial output shrunk because of shortages of electricity, raw materials and spare parts. Over the past 15 years, the Mongolian economy has undergone major structural changes. The old centrally planned economic system has been abolished and measures have been taken towards privatisation, price liberalisation, banking reform, trade liberalisation, and opening up the economy.
Mongolia’s economy is based around four main industries: agriculture, mining, cashmere and tourism. World prices for minerals and textiles are volatile and can impact greatly on Mongolia’s economic performance. Last year, the government budget recorded a surplus of USD50 million, the first surplus since 1990, on the back of high mining foreign direct investment and high copper and gold prices. A planned revision to the mining law has concerned many mining investors. It is predicted that Mongolia’s economy will grow at 5-6% in 2006. Cashmere is largely exported in an unprocessed form, with value added in China. Tourism is growing, but the industry is constrained by a relatively short period of fine weather.
The number of people below the poverty line (defined at Tg25,000/month, or US$20) has remained at approx 40% since 1996. 28% of the population is considered undernourished (UN FAO 2001-3) and life expectancy is 64.9 years (CIA World Fact Book 2006). Severe winter disasters (dzud) in recent years have further highlighted the vulnerability of rural people to poverty. High unemployment (14%) is also a key factor. Poverty reduction remains both a government and an IMF/ADB priority.
Mongolia is still a large recipient of international aid (eight-largest per capita recipient) and aid makes up, on average, 20% of GDP.
Following its adoption of a market economy and democratic political system, Mongolia has moved quickly to forge new links with the wider international community, with particular focus on the Asia Pacific region. Mongolia seeks to maintain balanced relationships with its two large neighbours, while at the same time developing new relationships with its “third neighbours”. Mongolia is a member of the Asian Development Bank (ADB), the World Trade Organization, the ASEAN Regional Forum, the Shanghai Co-operation Organisation and it is seeking membership of APEC.
Mongolia is increasingly contributing forces to multilateral and UN peacekeeping missions. It currently has contingents serving in Afghanistan, Iraq, and most recently troops were dispatched to Sierra Leone. Mongolia’s defence forces are receiving capacity building training and language skills training from the United States and Britain in order to enable them to more effectively contribute to such missions.
Relations with the Russian Federation, while initially cool following Mongolia's reorientation and the withdrawal of Soviet support, are improving. The relationship with China is also complex, for historical reasons and because of the existence of over 3 million ethnic Mongolians in the northern Chinese province of Inner Mongolia. China has replaced Russia as Mongolia’s largest trade partner.
The Safetravel website provides a travel advisory for travellers to Mongolia [external link].
