Mongolia’s coalition government edging towards collapse amid interparty strife, street protests www.intellinews.com

Spring is typically a time of political upheaval in Mongolia, a season when protesters take to the streets and politicians find ways to disrupt the status quo. This year is no different. 
The country’s coalition government, formed less than a year ago on the premise that it could increase political stability and push forward large-scale infrastructure projects, is edging towards collapse amid protests and internal strife.
The situation in Ulaanbaatar is fluid, with daily developments unfolding in rapid succession.
On May 21, the Mongolian People’s Party (MPP) voted behind closed doors in a party congress to oust the Democratic Party (DP) from the coalition government. The vote doesn’t automatically end the coalition, but the fractures could be beyond repair.
MPP alleges violation
The MPP alleges that the DP violated a cooperation agreement with coalition members when some of its members supported calls from protesters for the prime minister to resign. DP members responded by saying that they have a right to be critical of the MPP.
As the largest party in the 126-member Great Hural, the MPP is meeting to determine if it will move forward with the government alone or forge a new coalition. The MPP holds 68 seats in Parliament while the DP holds 42. A third coalition member, the HUN party, has eight.
At the very least, an end to the coalition will result in a cabinet reshuffle. The Democrats hold eight cabinet positions – these would need to be refilled if the party exits the coalition. One of these seats is held by DP leader L. Gantumur, who has threatened to step down as head of the party. 
The shake-up could also force Prime Minister Oyun-Erdene Luvsannamsrai to resign – he has previously said he would step down if the coalition were to break up. He is already up against mounting pressure to leave the job from the protesters assembled on Sukhbaatar Square in Ulaanbaatar.
Called back from Harvard
The protests were triggered earlier this month amid questions over transparency, centred on Oyun-Erdene’s son Temuulen, 23. Temuulen, who attends Harvard, has been called back to Mongolia as authorities probe his spending habits and lavish gifts given to his fiancée.
An online petition calling for the prime minister to resign has gathered over 58,000 signatures.
Amar Adiya, editor-in-chief of Mongolia Weekly, a business intelligence newsletter, says the political turbulence could stall important projects and economic initiatives for weeks or months.
He suggests the internal party strife could partly be coming from those who have lost confidence in the prime minister’s economic plans.
A slowdown in GDP during the first quarter of 2025 has some analysts worried – the economy grew by 2.4% year-on-year compared to 7.9% in the same period a year ago.
“The Oyun-Erdene administration’s emphasis on state-centric economic management has led those favouring a more private role in the economy to seek a pause on the government’s aggressive agenda,” Amar said. “This could impact and delay the government’s signature 14 megaprojects.”
Julian Dierkes, a Mongolia expert at the University of Mannheim, said on May 22 that nothing definite has been settled and it’s too soon to declare the coalition over. But he says that if the trend of events continues, a breakup of the ruling coalition could benefit the DP.
“If the DP has any chance of reviving and gaining credibility as an opposition party, leaving the coalition is essential,” said Dierkes.
As for potential challengers to the prime minister, Dierkes points to Amarbayasgalan Dashzegve, the current parliament chairman, saying: “Perhaps [he’s] unusual for Mongolian politicians in that he has appeared to be a genuine social democrat at times, that is, to have an actual ideological orientation and the desire to make the world a better place.”
“Any kind of political programme has been largely missing from other elected officials. [Amarbayasgalan] might be a bit different, perhaps,” adds Dierkes. “However, no substantive policy changes seem all that likely.”
By Michael Kohn

Macro advisory: Mongolia rising, but critically linked to China www.intellinews.com

Three years ago, Mongolia was broke and facing a possible debt default. It suffered a big drop in the volume and value of copper and coal exports to China during 2020-2021 and the dispute with the controlling shareholders of the Oyu Tolgoi copper mine also delayed development of that project. The budget was severely strained and the government had little money to spend on infrastructure expansion and upgrades or in helping such industries as agriculture and addressing the severe environment problems affecting Ulaanbaatar.
The situation today is still far from perfect, but it has significantly improved from 2021. The reopening of the Chinese borders from late 2022 and the dispute between Beijing and Canberra allowed for a significant rise in Chinese purchases of Mongolian coal. This happened at the same time as demand for copper rose strongly as the production of electric vehicles also grew steeply. Rio Tinto resolved issues concerning its mining operations which allowed it to commit to a major expansion of the Oyu Tolgoi copper and gold mine.
The budget has reported a surplus since 2H22 and both the trade and current accounts have seen strong surpluses in 2023 and in 2024. This allowed the government to meet its debt obligations and to start building financial reserves. Total external debt is still very high, at over $37bn or 150% of GDP. But sovereign debt, which was at almost 70% of GDP in 2021, is now down to 40%. The government is planning the components for a multi-layered sovereign wealth fund and foreign exchange reserves are growing. Reflecting these improvements, all three international rating agencies upgraded their assessment of sovereign risk and with positive or stable outlooks.
But does the coalition government provide political stability? 
The ruling Mongolian People’s Party (MPP) took advantage of the improved financial resources and persuaded the DPM and HUN parties to form a grand coalition, which brought political stability to the country and allows for greater coordination to advance industrial and social reforms, although there are many critics about the “heavy-handed” control of dissenting media and other critics.
The economic and industrial development plan adopted by the MPP-led coalition is the Mega Projects strategy. This aims to build 14 large-scale infrastructure projects which can help modernise the economy and create a platform for future growth. The projects include new, cleaner, energy generation, greater transport networks, better water management, a new city to alleviate the pressures in the capital, etc. There are many who are critical of the major development plans, especially given the long history of delays, corruption and environmental damage from projects in the past. But with a coalition government, several of the projects are advancing more quickly than predicted.
But, this relatively positive picture remains very dependent on the expansion in the mining sector, on export receipts and, critically, China. At present, 90% of exports currently go to China so demand for coal and copper in that market is key to Mongolia’s future development and government options; especially as the government has committed to a balanced budget and conservative debt management. The money for the Mega Projects will have to come from mining sector taxes and export receipts.
Mongolia is not directly impacted by the proposed new US import tariffs. But because China is its major trading partner, it is very much exposed - albeit indirectly. If Washington and Beijing fail to agree on an acceptable (to both) deal, then industrial output in China will decline and that will reduce demand for coal and copper and/or negatively impact the price China is willing to pay, especially as Russia will be willing to sell such materials at a discount in order to regain export markets post-conflict.
The government is also targeting a bigger tax-take from the mining sector. It will have to be careful with its proposed plan to change the taxation structure in the mining sector. Officials are pushing for a greater state tax take in the industry so as to cover the cost of the projects and to fund the three-part Sovereign Wealth Fund. Changing the tax and royalty rules for profitable industries and projects after the foreign investors have completed major investment spending, is not uncommon in the Eurasia region (e.g. in Kazakhstan with the oil projects). However, it is a delicate and dangerous balance, especially as Mongolia needs to attract a lot more foreign investment into the planned new projects and for mining sector expansion.
Public suspicion is far from eased too. The other issue for investors and the government is whether the public protests seen last winter will be repeated and grow in the summer or come next winter. The last large-scale protests were in 2022, when the so-called “coal mafia” details were revealed. 
This involved very senior elected and government officials getting kickbacks for selling coal to Chinese buyers at discounted prices. People remain angry about state corruption and are far from convinced that the issues are being dealt with. Surveys show that the majority think the Mega Projects provide another excuse for wide scale corruption. People are also fierce defenders of the country’s natural beauty, wildlife and nomadic culture, all of which, they fear, could be overwhelmed by rapid infrastructure development.
Environmental problems are also still to be addressed. People are also angry at the failure to address the often-extreme environmental issues in Ulaanbaatar, including clogged traffic, poor services and dangerously unhealthy air quality; the latter having been made worse with the rapid and uncontrolled growth of “ger” suburbs - created as rural inhabitants were forced to the city after the extreme “dzud” (a severe winter phenomenon) conditions of the past two winters. 
One of the remedial responses of the government has been to increase pension and public sector wages by close to 20% in nominal terms. But the ability to do this or to keep it growing, is also critically dependent on China’s economy and the tax-versus-investment balance in the mining sector. 
Inflation is another major concern in terms of socio-political stability. The headline rate is expected to exceed the Bank of Mongolia’s target rate (set at 8%) throughout this year and then stabilise within the target range beginning in 2Q26. Increasing government spending and higher energy prices are amongst the principal drivers, pushing headline inflation to 9.6% year-on-year in February, albeit lower at 8.5% in April. It is expected that rising domestic prices for flour, meat, and meat products will drive up food inflation in the coming quarters. As domestic demand grows and the Mongolian tugrik is expected to decline a little further, prices for both imported and locally produced goods will rise.
For investors and foreign companies, the major opportunities in Mongolia continue to be related to the mining sector as all operators have significant plans for output and export growth. That will also depend on China demand and pricing. 
The government, via its “Third Neighbor” strategy is trying to diversify its customer and investor partner base with a growing engagement with India. Exports of coking coal are increasing via Vladivostok port too. India is also funding the construction of the country’s first oil refinery near Ulaanbaatar.
The next major opportunity will be for construction equipment, engineering and related services linked to the Mega Projects. The timing and scale of such opportunities is directly linked to China’s economy and appetite for imported materials.  
By Chris Weafer CEO of Macro-Advisory

President of Mongolia Welcomes Federal President of the Republic of Austria www.montsame.mn

At the invitation of President of Mongolia Khurelsukh Ukhnaa, Federal President of the Republic of Austria Alexander Van der Bellen is paying a State Visit to Mongolia on May 25-28, 2025. 
On May 26, 2025, President of Mongolia Khurelsukh Ukhnaa and First Lady Bolortsetseg Luvsandorj welcomed Federal President of the Republic of Austria Alexander Van der Bellen and First Lady Doris Schmidauer at Sukhbaatar Square. Upon a report of the Commander of the State Honor Guard, the National Anthems of Mongolia and the Republic of Austria were performed. The two Presidents paid tribute to the State Ceremonial White Military Banner, and Federal President Alexander Van der Bellen greeted the State Honor Guard of Mongolia. 
At the Welcoming Ceremony, the two Heads of State greeted the Mongolian and Austrian delegations, heads of diplomatic missions, and representatives of international organizations in Mongolia.
Then, the two Presidents paid tribute to the Statue of Great Emperor Chinggis Khaan. Following the Welcoming Ceremony, Federal President of the Republic of Austria Alexander Van der Bellen signed the Book of Honored Guests at the State Palace of Mongolia.

Mongolia and China Exchange Views on Mining Product Exports www.montsame.mn

 State Secretary of the Ministry of Economy and Development of Mongolia Batkhuu Idesh received Trade and Economic Advisor of the Embassy of the People’s Republic of China in Mongolia Liu Jinji.
At the meeting, State Secretary Batkhuu briefly informed about the export of mining products from Mongolia and the measures being implemented, and expressed interest in actively discussing these issues at the Mongolia-China Intergovernmental Commission. The two sides agreed to organize the Working Group meeting for the 17th Session of the Mongolia-China Intergovernmental Commission in late June 2025 in Ulaanbaatar, and exchanged views on preparation work for the Session. 
The Chinese side informed that the “Mongolia-China Expo” is planned to be organized in Hohhot, Inner Mongolia Autonomous Region of the People’s Republic of China, on August 18-25, 2025, and requested the Mongolian side’s participation and support for the Expo.

GIZ and the Mongolian Billion Tree Fund to Cooperate in Mongolia’s Forestry Sector www.billiontree.mn

Within the framework of technical cooperation between the Government of Mongolia and the Government of the Federal Republic of Germany, a Memorandum of Understanding has been signed with the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), which has been operating in Mongolia since 1992. Since 2002, GIZ has made significant contributions to Mongolia’s forestry sector, particularly in legal and management reforms and the implementation of the multi-purpose National Forest Inventory.
As part of the forestry component of the GIZ-implemented project “SUSTAINABLE ECOSYSTEM ANDAGRICULTURE MANAGEMENT FOR RURAL DEVELOPMENT IN MONGOLIA” (STREAM+), the parties have signed Understanding of Memorandum and agreed to cooperate with the Mongolian Billion Tree Fund. 
The Mongolian Billion Tree Fund is committed to establishing a sustainable finance mechanism for Mongolia’s forestry sector by creating diverse source of funding, thereby contributing to climate change mitigation and the implementation of sustainable forest management. The fund independently, transparently, and in accordance with the principles of good governance in line with international standards.
The main objective of the cooperation between GIZ and Mongolian Billion Tree Fund is to support effective forest restoration and sustainable forest management in Mongolia, promote the development of responsible and economically viable forest enterprises, and raise public awareness of the importance of forest conservation.
Key areas of collaboration:
•     Strengthening reforestation cooperation to promote sustainable forest management and   green development in Mongolia
•     Joint implementation of the STREAM+ and SPACES II project activities
•     Enhancing technical capacities in the forestry sector
•     Supporting responsible and sustainable forest enterprises
•     Introducing green technologies
This cooperation aims to support both policy and practical efforts toward forest protection and restoration in Mongolia, contributing to the long-term goals of environmental sustainability and ecological resilience.

MPP decides to govern independently www.gogo.mn

The Mongolian People's Party (MPP) has formally decided to withdraw from the coalition government and proceed to govern independently. This decision was made during the party’s sixth conference, which began yesterday at approximately 17:00 and concluded at 04:00 the following morning.
During the session, the MPP leadership conducted a political evaluation of the coalition government's performance, citing repeated breaches of the cooperation agreement by members of the Democratic Party (DP) parliamentary group serving within the administration. In response to feedback and criticism from the party’s primary and secondary branches, the conference adopted a resolution recommending the formation of a government that excludes political parties which violated the coalition agreement. The resolution also calls for the full implementation of the MPP’s platform for the 2024 parliamentary elections, according to MPP Secretary General Ya.Sodbaatar.
The resolution, endorsed by the MPP's highest representative body, was formally presented to coalition partners today. The Policy Council, established to oversee the coalition framework, is expected to deliberate on the matter.
Prime Minister L.Oyun-Erdene's position and resignation plans
In light of the MPP’s decision, Prime Minister Oyun-Erdene Luvsannamsrai convened a meeting with coalition party leaders this afternoon to review their ten-month-long cooperation agreement. 
The Prime Minister had previously expressed his intention to resign if a coalition government could not be sustained, citing concerns that a government formed without a strong parliamentary majority would encounter significant challenges in implementing major projects and key policy initiatives.
Reiterating this stance during the conference, Prime Minister L.Oyun-Erdene provided a detailed account of the current political landscape to party members and engaged in open discussions with conference participants. He has since announced his intention to submit his resignation following consultations with coalition party leaders. Parliament is scheduled to address the matter during its session on Friday, May 23, 2025.
With 68 out of 126 seats in the State Great Khural (Parliament), the MPP is now expected to form a single-party government.
D.Amarbayasgalan, Speaker of the Parliament, noted that the balance of power between the MPP and opposition parties is relatively even, warning that without a coalition, the legislative process could be severely hindered.
As the dissolution of the coalition government appears imminent, speculation is mounting regarding the appointment of a new prime minister. Meanwhile, internal competition for cabinet positions has already begun within the MPP ranks.

Rio Tinto CEO Stausholm to step down in surprise move www.reuters.com

MELBOURNE/LONDON, May 22 (Reuters) - Rio Tinto (RIO.AX), opens new tab CEO Jakob Stausholm, who in his 4-1/2 year tenure oversaw a big bet on lithium and a cultural overhaul at a firm strongly criticised for workplace toxicity, is to step down, the miner said on Thursday in a surprise to investors.
In a statement to the market, the company said only that Stausholm will step down later this year once a succession process, already underway, concludes. It gave no further details.
The world's largest iron ore miner named Stausholm as its top boss in late 2020 while grappling with legal, public and investor angst over the destruction of Australia's ancient Juukan Gorge rock shelters, which led to the ousting of its former CEO.
One of Stausholm's early moves was commissioning a report on workplace culture at the firm, which in 2022 outlined widespread incidents of bullying, harassment and racism.
During his tenure the group also pledged a strong pivot towards addressing climate change, committing to achieving an "impeccable ESG" performance.
"This news comes as a big surprise, and in our view was not expected," Berenberg analyst Richard Hatch said. "No clear reason for his departure has been given by the company other than to state that now is 'a natural moment' to appoint a successor – but it does not feel that natural to us."
Under Stausholm Rio has taken a big bet on battery metal lithium, with its Rincon project in Argentina, $6.7 billion acquisition of U.S.-based Arcadium Lithium and $900 million investment in Codelco's Maricunga lithium project.
"We had expected Mr Stausholm to remain with the company and drive the integration of the lithium business, so his exit comes as a surprise," Hatch said.
Stausholm - one of a number of candidates considered for the role in 2020, including BAE Systems CEO Charles Woodburn and Newmont boss and former Rio executive Tom Palmer - will continue at the helm until a new CEO is appointed.
Internal contenders are expected to include Chief Commercial Officer Bold Baatar, head of iron ore Simon Trott and aluminium boss Jerome Pecresse.
Investors said they expected Rio to mount an external search, but it may have to compete for candidates with BHP (BHP.AX), opens new tab, whose CEO Mike Henry is widely expected to step down in the next year.
The global steel and construction sectors are racing to decarbonize and use a greener type of furnace.
"He's done a good job on the soft issues," said analyst Glyn Lawcock at Barrenjoey in Sydney, including repairing relationships after Juukan Gorge and advancing the company's Oyu Tolgoi copper project in Mongolia.
Under Stausholm's tenure, Rio Tinto's London share price fell around 15%, despite reaching an all-time high in 2024, while total shareholder returns stood at 30% on earnings. The Australian share price rose 6.5% over the period.
"Jakob has stabilised the company and has built up a very good internal team, he's reset the culture and he's got the company on a growth path with the lithium acquisitions. So he's going at a pretty good time, and Rio can now have an orderly succession," George Cheveley, portfolio manager at Rio shareholder Ninety One, said.
But there has also been controversy. Sources and documents seen by Reuters showed earlier this year that accidents at the company's giant Simandou iron ore project in West Africa had killed more than a dozen workers between June 2023 and November 2024.
Stausholm had also faced a push by activist investor Palliser Capital and more than 100 other shareholders to review its model of listing in both London and Sydney, a campaign rejected by shareholders in May.
Reporting by Melanie Burton, Clara Denina, Rishav Chatterjee; Writing by Jan Harvey; Editing by Savio D'Souza, Jan Harvey, Veronica Brown and Jason Neely

Protests against prime minister in Mongolia could lead to government shake-up www.apnews.com

L.Gantumur: I have submitted my resignation as Party Chairman www.gogo.mn

L.Gantumur, Member of Parliament and Chairman of Democratic Party, responded to journalists’ questions on current political developments.
-Some members of the Democratic Party (DP) signed a statement opposing the joint government, considering it a breach of the coalition agreement, and now face dismissal. What is your position on this?
-Three members signed the statement. I believe the Mongolian People’s Party (MPP) has made a highly irresponsible decision, without considering the national interest. Also, they need to stop spreading falsehoods and start telling at least part of the truth. Is it really justifiable to bring down a government because MPs like Lodoisambuu and Bayarmaa voiced their opinions? Should a Member of Parliament not be allowed to speak their mind?
If the MPP intends to remove the government every time one of its MPs offers honest criticism, is that the future we want? That’s not what governance should look like. The coalition agreement never included a clause saying MPs must stay silent. The agreement was about how to govern and which policies to pursue. It was a commitment to take bold steps for the sake of development.
That’s why we are asking the MPP to stop accusing the Democratic Party of violating the agreement. At least tell part of the truth about why this government is being dismantled. What we’re seeing now is the MPP backing away from the principles it advocated just a few months ago. It is reverting to its old ways and losing the public’s trust. Still, I urge party members not to act against Mongolia’s national interests.
Politics in our country has consistently harmed the public. Politicized decisions are almost always flawed. We’ve been engaged in political battles for 35 years. After all this time, we finally formed a coalition government based on a shared vision for the country. I was one of its architects. Now that the situation has shifted, I have submitted my resignation as party chairman to the Political Council.
-How do you see the political process unfolding from here?
I will hold a meeting with L.Oyun-Erdene, Chairman of MPP and T.Dorjkhand, Chairman of HUN Party, to discuss the way forward. The agreement contains a clause about joint responsibility in case of its dissolution. Beneath it all is also the idea that canceling the agreement might help avoid scrutiny and investigations.

Severe Coronary Artery Narrowing Now Treatable in Mongolia www.montsame.mn

The Second State Central Hospital of Mongolia has installed and put into operation the IVUS+NIRS imaging diagnostic device, a technology globally recognized in cardiovascular medicine.
With the introduction of this advanced technology, it has become possible to treat severe coronary artery stenosis, which was previously untreatable in Mongolia. The system also allows for the treatment of coronary artery dysplasia in accordance with international standards, helping reduce complications and mortality rates. It improves the precision of percutaneous coronary intervention (PCI) procedures through evidence-based diagnostics.
Studies have shown that the use of stents placed with this device reduces the risk of vascular failure by 38–45 percent over a three-year period compared to other treatment methods. According to the Ministry of Health, the adoption of this equipment paves the way for Mongolian patients to access internationally recognized, effective treatments for complex coronary conditions.
In line with the Government's Health Policy, a team of five physicians from the Second State Central Hospital recently completed specialized training in Shanghai, China, aimed at localizing the treatment of severe coronary artery stenosis and vascular dysplasia in Mongolia.