The Rise of Mongolia

Once called the 16th Soviet Republic, Mongolia is now an emerging non-aligned power.
By: /
September 28, 2012

Long buried in the steppes of Northeast Asia is a landlocked country sandwiched between China and Russia. Formerly nicknamed the 16th Soviet Republic, Mongolia is now emerging at a speed that is unrivalled around the world. It boasted a 17.3-per-cent growth rate in 2011, and is set to keep cruising at that speed this year, according to the International Monetary Fund. This impressive growth rate is thanks to a burgeoning mining sector and a massive intake of foreign investment, including from Canada, which is among the biggest foreign investors in Mongolia, second only to China.

But as Mongolia’s economic status rises, so does its diplomatic and strategic profile. With only 2.8 million inhabitants and a modest GDP of $9 billion, the country that was once the centre of the largest empire ever built cannot possibly qualify as a great power – not even a middle one. Genghis Khan’s homeland now has a defence budget of $38 million, a military of only 10,000 troops, and no Navy – nothing to prevent the Russian or Chinese leaders next door from sleeping at night. But Mongolia’s geopolitical position and singular history are combining to enhance its influence in a region of the world that gains more weight on the strategic chessboard day after day.

Since it stopped being a puppet communist regime of the Soviet Union in the early 1990s, Mongolia has tried to make friends around the world in order to step out from under the shadow of its two giant neighbours. This is the so-called “third neighbour” policy. For more than three centuries, Mongolia struggled alternately under sometimes-violent Russian and Chinese tutelage. This struggle left the Mongolian people with bitter memories and an enduring wariness of both powers. Today, even if Mongolians know that they cannot escape their geographic fate – China is the largest foreign investor in Mongolia – they want to expand their relations with other countries around the world.

Ulan Bator has done this by designing an independent foreign policy. This means, on the one hand, stronger relations with the West. As a true democracy with a free-market economy – a rarity in Northeast Asia – Mongolia is a natural ally for like-minded western powers. Besides trade and investment, this collaboration has materialized through formal strategic partnerships. There are currently more than 100 soldiers from the Mongolian Armed Forces serving in the International Security Assistance Force in Afghanistan, and Mongolia signed an Individual Partnership and Cooperation Programme with NATO last March. Soldiers from Canada, the United States, Japan, and nine other countries also participate in the annual Khaan Quest military exercises in Mongolia.

With Canada, Ulan Bator co-operates through the Canadian Forces Military Training and Cooperation Program, and Mongolian police officers have crossed the Pacific for training with the RCMP.

But for Ulan Bator, a truly independent foreign policy also means exploring relations with other regimes, even those that are not too friendly to western powers. For example, Mongolia has had relatively close relations with the cloistered North Korean regime. Despite the aura of secret that surrounds this relationship, we know that Mongolia did not close its door to the Hermit Kingdom when it became a free-market democracy. The two countries had a fairly strong relationship when both were communist, and although there were some roller-coaster-like developments in the ’90s, their friendship resumed at the turn of the century. Ulan Bator and Pyongyang even reached an agreement in 2008 that would allow 5,300 North Korean workers to go to Mongolia over the following five years. Reports also assert that Mongolian authorities have sheltered North Korean refugees over the years, with the help of South Korean groups with whom Ulan Bator also has good relations, but that they have tried to downplay this in order to preserve a good relationship with Pyongyang. 

In 2009, Mongolia’s defence minister said, “We want to help transform [North Korea] from an authoritarian regime to a democracy and a market economy, but we are still considered a friendly country by North Korea. We could be an actor to let the North Koreans understand the situation.” His colleague at Foreign Affairs added that his government would like “to make a contribution, to the extent that we can, to normalize relations” between North Korea and the rest of the world.

More recently, Mongolia’s president, Tsakhiagiin Elbegdorj, continued in this vein by accepting an invitation from Iran to become the first foreign leader to that country’s main uranium-enrichment plant. Iranian state TV showed President Elbegdorj inspecting centrifuges in the facility of Natanz in early September, following the 16th annual summit of the Non-Aligned Movement in Tehran. The Fars News Agency reported that “Elbegdori underscored his country’s willingness to have massive cooperation with Iran in economic, infrastructural, political and academic fields [and] said Mongolia is in agreement with Iran’s initiative for a nuclear free zone, and recognizes all countries’ rights to use peaceful nuclear technology.”

Elbegdorj’s behaviour on that occasion is hard to decipher. Is Mongolia signalling that it wants to align itself with enemies of the West? Or was this simply a diplomatic blunder from an emerging nation trying to find its place in the world? It could be in line with seeking an independent foreign policy by diversifying its diplomatic and economic portfolio. Elbegdorj’s overtures to Iran and North Korea could also be part of an attempt to cast Mongolia as an honest broker and interlocutor between diplomatic foes around the world.

Of all these possibilities, only the first one is highly improbable, considering the nature of Mongolia’s regime and the huge amount of investments coming from western countries. That it was a “diplomatic blunder” is somewhat probable, but it is the last two options that are most likely, for either could logically follow from the independent foreign policy that Ulan Bator has been pursuing. Whether it wants to simply stay independent or go a little further to become diplomatically engaged as an honest broker on the international stage remains to be seen. But one way or the other, Mongolia appears to be seeking a “non-aligned path,” and may therefore emerge as a unique strategic ally to the Western world, and to Canada.

Photo courtesy or Reuters