During its regular session on July 19, 2023, the Cabinet made the following decisions:

Issuance of “Capital City” Securities Supported

Minister of Finance B. Javkhlan presented the draft of the Government Resolution "On Issuance of Capital City Securities" to the Cabinet members. To decentralize the city of Ulaanbaatar, reduce congestion, expand the network of highways and road facilities, and finance development projects and measures, the Office of the Governor of the Capital city’s plan of the phased trading of securities worth up to 500 billion MNT in the domestic market was discussed and supported by the Cabinet members. The Governor of the capital city and the Mayor of Ulaanbaatar D. Sumiyabazar was tasked to include the projects and programs to be implemented with the source of securities in the budget of the capital city and present them to the Cabinet meeting.

Prime Minister Mandates to Intensify the Preparations for the Winter and Spring of 2023-2024

The Minister of Food, Agriculture and Light Industry H. Bolorchuluun was mandated to present the implementation of the Government's resolution "On some measures to prepare for the winter and spring of the agricultural sector in 2023-2024" at the Cabinet meeting.

Brief News:

To implement the Joint Statement "Advancing the Comprehensive Strategic Partnership Between Mongolia and People’s Republic of China in the New Era,” a Working Group has been newly established to prepare for the "Mongolia-China Expo" event.

The Cabinet members discussed Mongolia's accession to the European Convention on Mutual Assistance in Criminal Matters and decided to submit the draft law on the ratification of the Convention to the State Great Khural for discussion.

Rio Tinto (ASX, LON: RIO) has flagged a likely cost estimate and schedule review for its Rincon lithium project in Argentina’s Salta Province, an emerging hub for greenfield projects.

The world’s second largest miner, which released an operational update for the three months to June 30 on Tuesday, said the $140 million cost estimate and schedule to develop a starter plant at Rincon was under review in response to cost escalation.

Rio Tinto noted that development work continues as usual with the company advancing construction of the camp and ongoing enabling works for the processing plant.

The world’s second-largest miner has sped up efforts in the past three years to boost its exposure to battery minerals.

After seeing its lithium ambitions partially crushed when Serbia revoked the miner’s licence for a $2.4 billion project in early 2022, Rio Tinto began looking elsewhere.

In March last year, the company bought the Argentinean asset, saying it would help Rio Tinto meet a double-digit growth in demand for lithium over the next decade, at a time when supply is constrained.

A July 2021 resource estimate of the lithium project lists measured and indicated resources of lithium carbonate equivalent at 5.8 million tonnes, as well as inferred resources at just under 6 million tonnes.

Rincon has reserves of almost 2 million tonnes of contained lithium carbonate equivalent, sufficient for a 40-year mine life.

Rio Tinto plans to use a direct, low-cost extraction technology at the operation, as it believes the method has the “potential to significantly increase lithium recoveries” compared to solar evaporation ponds..

The company, which is already running a pilot plant onsite, continues to think that market fundamentals for battery grade lithium carbonate are strong, with lithium demand forecasted to grow 25-35% a year over the next decade. y.

Rio Tinto estimates that committed lithium supply and capacity expansions will contribute only about 15% to demand growth over the 2020-2050 period. The remaining 85% would need to come from new projects.

The mining giant bought a stake this week in Sovereign Metals (ASX: SVM) (LON: SVML) for A$40.4 million ($27.6 million). The Australian developer aims to produce graphite for lithium-ion batteries at its its Kasiya project in Malawi.

The resolution on the measures to be taken in connection with the amendments to the Constitution was approved before the closing of the regular spring session of Parliament. As a result, the building of the National Institute of Justice will be transferred to the Secretariat of Parliament.

Last May, Parliament ratified Resolution No. 34 on Law Enforcement Measures, and it was decided to integrate the aforementioned institute into the Parliamentary Research and Training Institute and operate under Parliament.

It is said that this is being done in order to improve the ability to analyze draft laws and regulations, and to expand the parliamentary research office, but it can be said that the building of the National Institute of Justice was “seized” in order to accommodate the 126 members to be elected in 2024 in the State Palace. In accordance with the “assignment” of changing the organization of the State Palace building, joint and standing committee meeting rooms to create conditions for the normal functioning of Parliament, the transfer of the building to the Parliament Secretariat must be done by August 1.

The working group responsible for this is headed by Deputy Speaker of Parliament L.Munkhbaatar, and consists of the chairs of some standing committees, ministers, and the heads of related organizations under Article 6.1 of the Law on State Palace, which stipulates, “The internal organization of the State Palace and the distribution of rooms and chambers shall be determined by the deputy speaker of Parliament in accordance with the workplace standards based on the exchange of opinions with the secretary general of Parliament, the head of the President’s Office, and the head of the Cabinet Secretariat.”

In addition, it is planned to change the Law on State Palace during the next parliamentary fall session. The law stipulates that the building where the supreme authority and executive body of Mongolia are permanently located and operate, shall be called the State Palace, and the size and boundaries of the territory shall be determined by Parliament. Thus, the work of preparing the authorities’ rooms has already begun.

NSC office to be moved to Ikh Tengeriin Am

In connection with increasing the number of members of Parliament by 50, a lot of work is being done. However, the issue of the security of the State Palace building has been raised for many years. Specifically, the building of the State Palace was started in 1947 and put into operation in 1951. Then, in 1961, 1981, and 2008, it was expanded to find its current appearance. It has been a long time since the conclusion of the professional organization that the buildings put into operation in 1951 and 1961 need to be demolished and built anew were issued. Because it was concluded that they are not resistant to earthquakes. However, since it requires a lot of funds, the issue of dispersing the institutions operating in the State Palace has been discussed for many years at the level of the president, Parliament, and the government.

On the other hand, it is risky for national security if Parliament, the government and the president work under one place. It is considered inappropriate even by international standards and may become a factor affecting the loss of balances between governments. Indeed, it is safe to consider this in the situation where many members of Parliament are working in the Cabinet. For this reason, a proposal was made to transfer the Office of the President and the National Security Council (NSC) to the Ikh Tengeriin Am. This time, only NSC will be transferred to the place. Therefore, the buildings there are being renovated. However, the option of moving the President’s Office to the Winter House of the Head of State (also known as Marshal’s Town, Building No. 30) is being discussed.

Incidentally, there is talk of relocating the President’s Office to Kharkhorin from 2025. However, it is impossible to predict when this talk, which came out simultaneously with the establishment of the new capital in Kharkhorin, will be implemented.

As for the government, they were talking about moving the office to Government Building No. 13, or the building of the Ministry of Roads and Transport Development, and sending the Office of Ulaanbaatar Mayor to Yaarmag. As for Parliament, since it was said almost 20 years ago that a new palace would be built with the help of Kuwait, in 2017, many alternatives were put forward, such as moving it to the Government Building No. 11 (the building in front of the Tengis cinema), but there were problems. In any case, when Parliament intends to “loot” buildings, they will not change their location.

Lawyers oppose new regulation for National Institute of Justice

On the other hand, the merger of the National Institute of Justice into the Office of Parliament and the taking over of the building may have many negative consequences, starting with the influence of Parliament on the independent and professional activities of lawyers and researchers. For example, Chairman of the Standing Committee on Justice B.Enkhbayar opposed it when it was discussed. He expressed, “I don’t know which member of Parliament initiated the bill to dissolve the National Institute of Justice and merge it into a research and training institute attached to Parliament. The government did not initiate either. This is legal theft.”

The Mongolian Bar Association issued a statement urging members not to support the draft resolution, saying, “The institute was established by the development loan agreement between Mongolia and the International Development Association, the Hanns Seidel Foundation, and the US Agency for International Development. The agreement will be valid until 2041, and Mongolia is obliged to fulfill it. As the organization attached to Parliament works only within the framework of the legislation approved by Parliament, the study of other sources of law will be neglected and the integrated system is about to be abandoned.”

In addition, lawyer B.Gunbileg commented, “It is very unfortunate that the National Institute of Justice is being abolished. In fact, the National Institute of Justice should not be a research center attached to Parliament, but the center should be under the aforementioned institute.”

Lawyer Kh.Temuujin and other lawyers also announced that they will approach the Constitutional Court on the issue.

Moreover, Speaker of Parliament G.Zandanshatar once emphasized, “The status of the National Institute of Justice is being raised. In accordance with the bill, the institute under the ministry is being made under Parliament. Some ministries and offices have decided to take the institute under their wing. For this reason, it is going to be taken under the protection of Parliament. Parliament has exclusive powers to monitor and analyze the implementation of legislation. In this way, let’s strengthen the capacity of Parliament.”

The World Jiu-Jitsu Championship competitions began on Tuesday and last for three days in Mongolia. A wide international presence of 500 male and female athletes from 43 countries are competing in various weight categories.

The competitions will conclude on Thursday, with competitions in the weight categories of 56 kg and 77 kg for men and 48 kg and 63 kg for women.

A total of 32 referees from 26 countries are working at the 20th Jiu-Jitsu World Championship, one of which is an International “B” class referee from Mongolia Munkh Timurtogoo, a jiu-jitsu black belt athlete. He started his career as a referee in 2018 and “Ulaanbaatar-2023” is his first world championship as a referee.

On the sidelines of the Championship the Congress of the Jiu-Jitsu International Federation was held on July 15 with the participation of JJIF President Panagiotis Theodoropoulos, Director General Joachim Thumfart, and other officials and representatives.

Perth-based TMK Energy has reached another milestone at its Gurvantes XXXV coal-seam gas project in Mongolia’s South Gobi Basin, with all three of its pilot wells entering production testing.

After successfully discovering thick gassy coal intervals of up to 68m with its Lucky Fox 1, 2 and 3 wells, the company earlier this month installed three sets of downhole pumps and driveheads, in addition to surface gas-handling facilities, in preparation for flowing hydrocarbons to surface as part of its production tests.

TMK has confirmed its downhole pumps have now been turned on at low rates and are producing water from all three wells, in line with engineering expectations. It confirms coal-seam permeability and the successful installation of all downhole and surface infrastructure.

Water is a rare asset in the arid Gobi Basin and it will not go to waste in this instance as TMK has agreed to provide nearby coal miner Mongol Alt LLC (MAK), which also owns the Gurvantes lease, with early-stage water from the tests to feed its nearby power and water-hungry coal mining operations.

To produce gas, TMK plans to gradually increase downhole pump rates in the coming weeks to de-pressurise the gas-bearing coal reservoir to a point where gas “desorbs” from the coals, enters the wellbore and flows to surface in a phenomenon known as “gas breakthrough”.

Management says modelling suggests its gas breakthrough could occur at any moment, following initial reservoir de-pressurisation.

Since acquiring the Gurvantes XXXV Coal Seam Gas Project less than 18 months ago, TMK has drilled seven CSG exploration wells, discovered a significant gas resource, drilled and completed three pilot production wells, built and commissioned production facilities and has now commenced production testing from the pilot well program. First gas production from the extended production test will propel the Project out of the exploration phase and firmly into the appraisal and development phase for the Nariin Sukhait area. The 2023 exploration program aims to further demonstrate the true scale of the Project and we look forward to commencing this aspect of the work program over the coming months.

TMK Energy chief executive officer Brendan Stats

As production testing progresses, the company expects to measure sustained gas flow from the wells. The data will feed into TMK’s prefeasibility study for the Gurvantes project, which has an estimated (2C) contingent resource of 1.2 trillion cubic feet of high-methane gas.

Following initial gas flaring at site, steady flow from the pilot wells will feed an energy offtake agreement, signed in March this year between TMK and MAK. The deal will see produced gas used for modular power generation at site, which will then be sold to MAK at the prevailing local energy wholesale price, providing TMK with a clear pathway to early commercialisation.

Gurvantes is operated by TMK as part of joint venture with Perth-based partner, Talon Energy, and signals the company’s commitment to long-term gas production in Mongolia, where it has an exploration licence for 15 years in an area widely regarded as one of the most prospective coal-seam gas basins in the world.

In addition to the local Mongolian need for gas, other market opportunities for TMK includes China’s significant natural gas market, currently serviced by importing via long-distance pipelines from central Asia, Russia and Myanmar.

China also imports gas by sea, buying 63.4 million tonnes of tanker-shipped liquefied natural gas (LNG) last year, with total LNG imports meeting only 41 per cent of its demand.

The Chinese border is tantalisingly close, less than 20km south of the Gurvantes project. China’s huge west-east gas pipeline sits another 280km across the border.

With production testing kicking off at Gurvantes, TMK has continued its rapid development of the project after acquiring it less than 18 months ago. The company will continue to hunt this year for prospective resources along strike of Gurvantes where outcropping coals suggest more gas potential.

A 2D seismic survey is planned, with up to eight more exploration wells also in the company’s pipeline.

On the eve of the National Naadam Festival, entrepreneurs from Mongolia and the Republic of Korea convened at a B2B meeting, setting the stage for enhanced economic ties and cooperation between the two nations. Sigma Mongolia LLC, in collaboration with the Mongolian National Chamber of Commerce and Industry, spearheaded the event, which saw the participation of officials from North Chungcheongbuk-do province in South Korea, warmly greeting entrepreneurs from both countries.

Fostering Foreign Trade and Cooperation

The primary objective of the B2B meeting was to bolster foreign trade relations and expand cooperation opportunities for businesses from Mongolia and South Korea. Recognizing the potential for increased trade turnover and economic collaboration, the meeting provided a platform for fruitful exchanges and discussions on joint ventures and mutual business interests.

Confluence of Entrepreneurial Spirit

With 20 companies from North Chungcheongbuk-do and Busan provinces in South Korea, alongside more than 30 Mongolian enterprises, the B2B meeting showcased the diverse and dynamic entrepreneurial spirit of both nations. Entrepreneurs explored avenues for collaboration in various sectors, fostering economic integration and strengthening the foundation for long-term partnerships.

STS Foods: A Start-Up Embarks on Overseas Activities

A highlight of the B2B meeting was the debut of STS Foods, a Mongolian start-up entering the international market with its unique soup product. MonCertf LLC, the parent company of STS Foods, secured the right to export their product to the Republic of Korea and Russia, paving the way for overseas expansion. Additionally, the start-up is keen to explore opportunities in the market of Vietnam, marking a significant milestone in its journey toward global trade.

The establishment of STS Foods represents the entrepreneurial potential of Mongolia and its commitment to engaging in international trade, promoting its local products and flavors on the global stage.

Forging a Stronger Economic Alliance

As Mongolia and South Korea continue to strengthen their economic bonds, the B2B meeting served as a stepping stone toward deeper and more meaningful trade relationships. The event demonstrated the willingness of entrepreneurs from both countries to explore new frontiers and collaborate across borders, fostering an environment of economic growth and prosperity.

As a testament to the commitment of both nations to international trade, the B2B meeting was a resounding success, laying the groundwork for future cooperation, shared endeavors, and a flourishing partnership between Mongolia and South Korea.

BY:

Mamoon Alvi serves as an integral part of our global newsroom team. With a strong background in international news from his time at both BOL TV and Dharti TV, he came on board at BNN well-prepared to contribute. Mamoon's unwavering dedication to journalism drives him to relentlessly pursue the truth and deliver crucial stories to audiences around the world.

"Personal experience completely changed my view of China." Ganqimeg, a journalist from the Kent branch of the Mongolian Journalists Association, exclaimed during a joint media interview activity titled "Encounter with China, Encounter with the New Era" in East China's Shanghai city and Jiangsu province.

"China's fast economic development, stable people's livelihoods, extensive cooperation between the government and the private sector, and excellent infrastructure and ecological environment construction have left a deep impression on me," Ganqimeg added.

The activity was jointly organized by the All-China Journalists Association and the Mongolian Journalists Association, and hosted by the Information Office of the People's Government of Inner Mongolia Autonomous Region.

It was launched on June 25 in Hohhot, the capital city of Inner Mongolia, and concluded in Nanjing, Jiangsu province, on July 2.

Over the course of a week, nearly 30 journalists from 23 mainstream Mongolian media outlets had a unique opportunity to witness the remarkable progress being made in various fields in China. They toured several cities, including Shanghai, Suzhou, Nantong, and Nanjing. They were able to see for themselves the impressive strides being taken in China's achievements in technological innovation, urban governance, ecological restoration, and heritage protection firsthand.

The first stop for the China-Mongolia joint interview team was the Shanghai MicroPort Medical Co, where they gained in-depth insights into the development experience of the "MicroPort" series of medical robots.

The Mongolian journalists were amazed by the intense research and development capabilities and powerful product lineup demonstrated by the company.

Unurtogs, a journalist from the Mongolian Dardas Network, said, "In Mongolia, the mortality rates of cancer and cardiovascular diseases are high. Therefore, remote-controlled advanced medical technology and new types of robots capable of performing surgeries have captured my great attention."

In Shanghai's Wuliqiao sub-district, the interview team witnessed the latest achievements of urban governance. In recent years, Wuliqiao has actively promoted the installation of elevators in residential buildings and waste reduction through garbage sorting.

The Mongolian journalists took a ride on the elevators installed in residential buildings and showed great interest in this governance model, which residents and communities jointly promote. They appreciated the government's support, such as providing a 40 percent subsidy and a maximum of 280,000 yuan ($39,942.94) for elevator installation projects.

During the interview, the beautiful and environmentally-friendly surroundings of cities and countryside along the way deeply impressed the Mongolian journalists.

Altanzagas, a journalist from Ulaanbaatar News Network, said, "I can deeply feel China's achievements in ecological protection and green city construction. I hope we can learn more about ecological protection and the construction of green cities and apply them to the development of our own country."

The preservation and inheritance of Chinese traditional culture also left a deep impression on Mongolian journalists. Whether it was the Imperial Kiln Golden Bricks in Suzhou, woodblock prints in Qidong, or the ancient city walls in Nanjing, the infinite charm of traditional Chinese culture dazzled the journalists.

After the activity, the Mongolian journalists expressed their admiration for China's development achievements. They stated that they would introduce their experiences during the interview in Shanghai and Jiangsu to the Mongolian people, using their genuine feelings as a bridge for communication between the two countries.

Larixon Classifieds, a Cyprus-based company that operates leading marketplaces in small, early-stage classified markets from Mongolia to the Caribbean, has appointed Amartsogt Batbayar as its managing director in Mongolia.

An experienced business development manager with a history of working in the fintech and financial services industry, Batbayar will be responsible for Unegui.mn, the largest website and mobile app in the country, with over 7 million visits per month and annual revenue of up to MNT4 billion ($1.2 million U.S.).

“We believe that his experience and strategic vision for development will take us to a new level,” said Larixon Classifieds. “We have new and ambitious goals and tasks ahead of us.”

Batbayar (LinkedIn profile) has a bachelor’s degree in business administration and international relationships from the Mongolian Swedish Wind Horse College.

One of his most recent projects in Mongolia was EasyPay, a payment system integrated with POS terminal, QR payment and e-wallet tools, offering local merchants analytical tools and owner/admin dashboards, in a bid to make acquiring new clients easier and quicker.

In addition to Unegui.mn, Larixon Classifieds’ portfolio includes leading horizontals Bazaraki.com in Cyprus, Somon.tj in Tajikistan, Pin.tt in Trinidad and Tobago, and JaCars.net, the leading automotive marketplace in Jamaica.

Bayantal, Mongolia: Oyunbileg Dambii remembers when the Russian officers came. They brought money, guns and planes to this fertile land in southern Mongolia.

“It was nice,” the goat and sheep herder says. “You could barter things, you could exchange small goods here and there.”

Between Mongolian fields of green, the Russians built apartment blocks for servicemen in the middle of nowhere, erected statues of Soviet heroes and paved airstrips aimed not at the west or the east, but to the south, towards China.

The Soviet Union had reached its peak. March 14, 1979, reads the Russian broadsheet now peeling from the walls of the abandoned airforce base in Bayantal. Pravda reported that long-range television broadcasting capabilities had successfully been installed on a satellite orbiting 40,000 kilometres above the Earth. In Moscow, preparations were underway for the 109th anniversary of the birth of revolutionary Vladimir Lenin.

“Then they got kicked out,” says Dambii, who has spent all of his 64 years tending to the fields of Bayantal, where children gallop past on horses at 50 kilometres an hour, straight into sleeting rain.

Moscow shrunk as Beijing’s influence grew. One by one the bunkers filled with warplanes emptied. The runways that once countered the threat of China grew green with moss, the apartments with mildew.

Now a family of four, their dog and a yurt guards the entry to the last vestiges of a fallen military power, whose domain once stretched to the Chinese border but now struggles to maintain its own frontline in Ukraine.

“Russians are stupid,” says one of the base’s guards, who asks not to be identified because they are not authorised to speak publicly.

Dambii uses a bunker once filled with 20 Russian armoured vehicles as a shelter for his 200 goats and 800 sheep. The rent is five sheep a year paid to the local council. “It works really well,” he says. “It keeps them warm”.

Nearby, children play football on the rooftops of buildings where posters of revolutionaries once hung.

“I wish they would demolish it,” says 15-year-old Ermuun Enkhbayar. “It’s f---- ugly.”

Mongolia, like other states with deep links to the former Soviet Union, is wrestling with its ongoing ties to Moscow. It is divided into generations who were educated in Russian and those now learning in English. By those who believe they owe a debt of gratitude to the Russians that gave some of them running water and heating, and those appalled by what they are seeing unfold in Ukraine.

“This nation is squeezed,” says the leader of Mongolia’s youth-focused third party, HUN, Togmidyn Dorjkhand. “We are very opposed to this situation in Ukraine.”

At the height of its power in the 1970s, more than 50,000 Russian troops were stationed in Mongolia across half-a-dozen bases, accompanying 1800 tanks and 190 planes. By 1992 they were all gone. Older generations remember them fondly, but Russia’s war in Ukraine has damaged Mongolia’s rapidly modernising economy by restricting fuel, flights and goods to a younger generation that has become reliant on international supply chains.

“With the global economic fallout from Russia’s protracted invasion of Ukraine showing no sign of ceasing, Mongolian families, farmers and businesses will continue to feel the squeeze,” said Oyuntugs Davaakhuu, a researcher at the Economic Research Institute of Mongolia.

Increasingly, as Russia’s power has diminished, Mongolia has made its economy dependent on the emerging superpower to its south.

China now buys 90 per cent of Mongolia’s exports, mostly coal and other resources. But its economic support has done little to sway public opinion in a country that remains rooted in its own ethnocentrism, independence and history.

“The Chinese are picking us little by little,” says Tsendkhorloo Erdnebaatar, 56, a paver who has broken down in the eastern Gobi Desert with her family, on her way to a local service station.

“I’m very afraid of what will become of the younger generation.”

Gantugs Begzsuren, who sources 95 per cent of his products from China for his store on the Chinese border, cannot bring himself to contemplate stronger economic ties with his southern neighbour.

“It will be very difficult if there is more Chinese influence in Mongolia,” says the phone shop owner in Zaamin-Uud.

Wary of growing Chinese power, Mongolian ties to Moscow still run deep, even as Russia’s influence crumbles into the landscape.

In the middle of the Gobi Desert sits the remains of a 25-metre pool. The starting blocks rise above the blue tiles and black lines that once marked the lanes of Russian officers’ laps at one of their largest bases near the town of Sainshand.

“It was a living base,” says Erdnebaatar. “Russia is like a big brother. At least they gave us something.”

For younger Mongolians, the loyalty of their parents is being tested by the Russian recruitment drives which have targeted minorities and sent them straight to the frontline, including Buryats - ethnic Mongolians living in Siberia.

“There were a lot of young men who came through here, some of them with their families,” says Uyanga Otgonbaatar, who runs a store in Altanbulag on the Mongolian-Russian border in the country’s north.

They bought flour, eschewed Vodka, and talked little, she says. They wanted to get out before it was too late.

“They were fearful,” says Dashdondog Gankhuyag, who runs one of three money exchanges in Altanbulag.

At one stage the rouble was so volatile she could no longer afford to exchange large sums of the Russian currency for Mongolian tugrik.

“They were scared they were going to be sent to the front line quickly,” she says. “We feel close to them because they are like us.”

In Altanbulag, 1000 kilometres north of the Chinese border, Beijing is already making long-term investments.

The highway that leads to Russia is being built by the Chinese government. “China Aid” the sign reads into Khyagt, the Russian border town.

Chinese construction workers who were not authorised to speak publicly said Mongolia donated 30,000 sheep to China to help with widespread meat shortages during the COVID-19 pandemic. Now, the Chinese government is paying Mongolia back.

When it is finished this year, the four-lane highway will be able to carry much more than sheep.

Mongolia’s pastures provide a clear view of the geopolitics playing out between Beijing and Moscow since Russia shocked the world by invading Ukraine last year. That great game extends across the Eurasian landmass, and beyond.

China has repeatedly maintained its neutrality in the war and declared its “unbreakable bond” with Russia while taking economic and diplomatic advantage of Moscow’s misfortune.

“China is increasingly a power in Europe,” said Andrew Michta a non-resident senior fellow at the Atlantic Council, a Washington-based think tank.

Michta cites the series of recent high-level visits to China by German Chancellor Olaf Scholz, French President Emmanuel Macron, and President of the European Commission Ursula von der Leyen - all with the explicit purpose of lobbying China to use its economic leverage over Russia to end the war in Ukraine, turning Beijing into a major diplomatic power.

China also stands to benefit from cheap Russian energy that has few other export markets, transfers of military technology, the weakening of Russia’s borders and internal political turmoil.

“A protracted war of attrition in Ukraine serves Beijing’s interests in that it will lead to the long-term weakening of Russia, thereby fundamentally shifting the Sino-Russian power balance decisively in China’s favour for years to come,” he said.

Michta believes an extreme collapse of Russian power could see Russia’s central and eastern parts becoming subject to Chinese demand for resources, “or as unlikely as it might seem now - even colonisation”.

In Bayantal, Dambii says some Russians visit the abandoned bases in Mongolia to see the remains of Russia’s former glory.

“Maybe they go home a little heartbroken,” he says.

BY:

Eryk Bagshaw is the North Asia correspondent for The Sydney Morning Herald and The Age.