Chinese medical team provides free surgeries to cataract patients in Mongolia www.xinhuanet.com

ULAN BATOR, June 26 (Xinhua) -- A medical team from China's Inner Mongolia Autonomous Region has conducted 100 free surgeries to Mongolian cataract patients here during the week through Tuesday, said the Mongolian Red Cross Society (MRCS) on Wednesday.

Democratic but deadlocked, Mongolia braces for 'inevitable' political change www.reuters.com

ERDENE, Mongolia (Reuters) - An hour’s drive from Mongolia’s capital Ulaanbaatar, a lavish monument to national hero Genghis Khan could provide a salutary lesson to the man who built it a decade ago: champion wrestler, businessman and current president, Battulga Khaltmaa.

Beneath a giant stainless steel statue, portraits of the 13th century warlord’s successors line the corridors of a museum. Nearly all of them saw their lives cut short during vicious fights for supremacy in medieval Mongolia’s royal courts.

Mongolia is at a political crossroads as public frustration mounts over disputes holding back vital mining and infrastructure projects, and President Battulga is preparing for a power struggle.

Following a 1990 revolution, the former Soviet satellite has been regarded as an “oasis of democracy” sandwiched between the authoritarian regimes of Russia and China.

But power sharing between an elected president and a government appointed by parliament has left the country in near-permanent deadlock, unable to make progress on major projects or tackle chronic problems including choking air pollution.

Battulga said last year Mongolia was incapable of solving what he described as a “systemic crisis”. He is now trying to change the constitution, raising fears he is trying to usher in an era of “strongman” politics.

Battulga says he is not seeking to erode Mongolia’s 29-year old democracy.

“More than a quarter of a century has passed, but we still haven’t been able to achieve all the expectations we had in 1990,” Battulga told Reuters in his office in the State Great Khural, Mongolia’s parliament.

“What we all know is that change is inevitable,” he said. “All we need to resolve right now is how to carry it out.”

Sumati Luvsandendev, a political analyst and head of the Sant Maral Foundation, a polling group, said Mongolians were crying out for a “strong” leader like Kazakhstan’s Nazarbayev or Russia’s Putin. But with parliament likely to resist any erosion of democracy and its role, Battulga would struggle to make changes, he said.

“Battulga is desperately trying to play this role but definitely he cannot,” Sumati said. “I don’t think that there is anyone in Mongolia to play this role.”

RESOURCE NATIONALISM
Mongolia’s rich mineral deposits dominate its political discourse. Many citizens have grown increasingly frustrated by the country’s inability to convert resources into concrete gains for anyone but the privileged few.

With polls showing strong support for the public ownership of strategic assets, Mongolia’s mines have long served as political weapons, and Battulga is one of many politicians accused of using suspicions about foreign investment to win votes.

Distrust toward foreign miners was reinforced last year after a military operation to strip Chinese investors of a silver mine in Salkhit in northern Mongolia after they were accused of corrupting local courts. Attempts to reach the investors were unsuccessful and the site remains under government control.

The government has also been involved in a legal dispute concerning the nationalization of a 49% stake in the massive Erdenet copper project, sold to a private company by the Russian government.

With 2020 elections looming, some politicians are also questioning the benefits of the country’s biggest foreign investment project, the giant Oyu Tolgoi copper-gold project run by Anglo-Australian mining conglomerate Rio Tinto.

A parliamentary working group has made fresh calls to change the terms of the deal behind Oyu Tolgoi, which is 66% owned by the Rio Tinto-controlled Turquoise Hill Resources and 34% by the Mongolian government.

In May, some legislators complained the mine had brought nothing but debt, with Mongolia only scheduled to receive dividends after 2039.

Rio did not respond to requests to comment.

Battulga told Reuters he fully supported foreign firms which complied with local laws, but said the constitution was clear that strategic assets discovered using Mongolian capital - including the coveted Tavan Tolgoi coal deposit - should remain in Mongolian hands.

Battulga was elected in 2017 on a populist platform, warning about threats from China and Mongolia’s economic dependence on its giant neighbor, earning comparisons along the way to U.S. President Donald Trump.

But he has been unable to reduce Mongolia’s vulnerability to Chinese pressure.

Shortly after his election victory, a slowdown in customs clearances at the Chinese border created a tailback of coal trucks stretching more than 100km (60 miles), slashing export earnings. China’s customs authority said it was upgrading its monitoring equipment. Battulga did not comment on the issue.

“We are close to two dictatorships and their influence is huge,” said Erdene Sodnomzundui, the leader of the opposition Democratic Party, referring to China and Russia. “Neither country likes democracy. It is in their interest to break (Mongolia’s) democratic system. They both want to increase their economic influence over Mongolia as well.”

China’s foreign ministry said in a statement that China respected Mongolia’s sovereignty, independence and territorial integrity, and urged both sides to be on “high alert” against any attempt to disrupt the bilateral relationship. Russia’s foreign ministry did not respond.

“NOTHING HAS CHANGED”
Near the dust-blown township of Yaarmag on the outskirts of Ulaanbaatar, an unpaved road connects dozens of small brick houses to a highway lined with luxury apartment complexes where well-off Mongolians escape the capital’s asphyxiating winter smog. Nearby is a Porsche dealership.

In ramshackle Yaarmag itself, Battulga’s childhood home, angry residents say politicians have failed to keep promises.

In a tenement insulated with thick red carpet, Erdenebulgan Badarch, 56, blamed the government for soaring meat prices, high interest rates, poor housing and worsening pollution.

“Nothing has changed for the better,” said Erdenebulgan, whose husband was a classmate of the president. “We had very big expectations when Battulga was elected, but in two years we haven’t seen anything. It is not about whether he is good or bad, or what he could or should have done, but he is alone.”

A recent poll by Sumati’s Sant Maral shows more than 70% of Mongolians would prefer a “strong leader who does not have to bother with the parliament or elections”.

While three quarters of respondees said they still supported “democracy”, more than half disapproved of the existing system.

“I think it will be better if we have a presidential rule. The other countries with powerful presidents are actually doing better,” said local resident Amarzaya Batbayar, 34, during an anti-government protest in Sukhbaatar Square in late May.

Battulga said ordinary people “have suffered the most from the model we have chosen”. He also said he would seek public approval for any proposed constitutional changes, rather than leave it to parliament to decide.

But the president is not necessarily going to benefit from any changes.

Constitutional reforms aimed at breaking the deadlock are under discussion, and one option is to turn the presidency into a figurehead and strengthen the position of the prime minister instead, according to a lawyer familiar with the plans.

“Because parliament is in position to control the situation in the country, what we are observing is still the same struggle for power, but usually in most cases the president is losing,” said Sumati, the political analyst.

At the Genghis museum built by Battulga’s company, Sumati said the president should take note of how long Mongolia’s old Khans lasted in power.

“It was two or three years and then they were killed or poisoned,” he said. “There was only one guy who managed to sit on his throne for close to 20 years, but it was a miracle.”

Additional reporting by Munkhchimeg Davaasharav in ULAANBAATAR. Editing by Lincoln Feast.

Exploration Play in Mongolia Focuses on Promising Targets www.streetwisereports.com

Kincora Copper Ltd. (KCC:TSX.V) fell off investors' radar screens due to an extended period of inactivity in 2018, but now the company is cashed up, team in place, and ready for extensive drilling at five independent, large-scale porphyry targets with a 12-month funded budget for up to 18,000 meters (18,000m) of drilling.

Kincora has been operating in Mongolia for more than eight years. In 2016, the company secured unencumbered access to its promising Bronze Fox project and consolidated the dominant landholding in the Southern Gobi copper-gold belt, between and on strike with Rio Tinto Plc's (RIO:NYSE; RIO:ASX; RIO:LSE; RTPPF:OTCPK) Oyu Tolgoi (OT) copper-gold mine, and the Tsagaan Suvarga porphyry project, via the merger with IBEX, a private vehicle indirectly controlled by Robert Friedland.

This attracted a world-class technical team, credited with multiple discoveries of Tier 1 copper deposits, looking to repeat such successes. Since then, the company has been executing the first modern systematic exploration program across a district-scale landholding in a highly mineralized, but vastly underexplored copper-gold porphyry belt. Now, drilling is just days away.

These are exciting times for Kincora, the most exciting in the company's history. The company is in a prime position in the copper sector where new discoveries are being well rewarded and successful juniors acquired at significant premiums. For example, just this week Australian-listed MOD Resources was taken out by a billion-dollar market cap, Sandfire Resources NL (SFR:ASX).

A new cornerstone investor, Hong Kong-based New Prospect, now the second largest shareholder with about 12% of the company, is a natural resource specialist fund with an extensive global network. LIM Advisors remains the largest investor: One of the longest operating alternative investment managers in Asia, they invest across the capital structure in deep value and special situations.

Investors in small-cap natural resource stocks know that the best time to be in a junior is right before a big discovery. That's the time we could be at right now with Kincora. Management just raised $6.25 million ($6.25M). Will there be a new discovery! More than one!! None!!! Yes, there could definitively be zero new discoveries. . .This is a highly speculative situation, but backed by a team that has an excellent track record of large discoveries.

Even without blockbuster discoveries, the company has planned a very detailed and well thought-out drill program that's sure to cover a lot of bases and provide a pipeline of news flow over the next 12 months. Raising $6.25M in a very tough market at a $7M pre-money valuation was a big success in and of itself, demonstrating the strength of management, the projects/targets and the massive opportunity.

The derisking capital raise is strong evidence of the belief by cornerstone investors and seasoned management that Mongolia is a great place to, potentially, make the newest globally significant copper discovery since 2014. To learn more, please continue reading this interview of Sam Spring, president and CEO of Kincora Copper.

Peter Epstein: Can you talk about how we got to the point of a substantial drill program starting very soon?

Sam Spring: After 2018 being a transitional year of setting the right corporate foundations for success, we are entering an exciting period where the drill bit will drive Kincora's valuation once again. This month we will commence an aggressive, multiple rig, fully-funded drill program. The focus is discoveries on five large, independent copper porphyry targets on our 100%-owned Bronze Fox and East Tsagaan Suvarga (East TS) projects.

This will be the first drill program conducted by our industry-leading technical team, which has found multiple Tier 1 copper assets. For the last three years, we have undertaken the first modern, district-scale, exploration across this vastly mineralized, but significantly underexplored Southern Gobi copper-gold belt.

As readers may know, there are two large-scale porphyry projects in this region, Rio Tinto/Turquoise Hill Resources' Oyu Tolgoi open pit mine and underground development project, and a privately-held open pit development project called Tsagaan Suvarga. We believe there are more globally significant copper discoveries to be found.

Limited drilling supports our Bronze Fox project potentially hosting an independently defined, conceptual exploration target of 1.3 to 1.5M tonnes (midpoint = 3.086 billion copper equivalent pounds). That would be an in-situ value of $11 billion (1.32 CAD/USD, US$2.70/pound copper).

The first hole of the program will, for the first time, correctly test a very large zone (previously drilled in the wrong direction). However, prior drilling still managed to intersect 37m at >1% copper equivalent (Cu eq), within 864m of 0.38% Cu Eq.

Our East TS project sits in the shadows of a billion-dollar open pit construction project at Tsagaan Suvarga (TS). Within this brownfield setting, we're drilling three separate targets that are the closet analogues to the high-grade ore bodies at OT. . .since OT! While just targets, readers should understand that what we're exploring for is large and in a very favorable location and geological setting. OT's ongoing underground expansion is the largest hard-rock mining project in the world. It could become the third largest copper mine on the planet, with a 100-year+ mine life.

Kincora was formed in 2011, but we are in the strongest position today that the company has ever been in. Yet, our current market cap of $12M, (with $6M cash!) is a fraction of our peak valuation of nearly $50M. At that time, we had attracted a buyout offer for the company and had signed 14 NDAs (nondisclosure agreements) with interested parties.

While naturally I'm biased, I think it would be hard to find many juniors with similar risk/return profiles and multiple near-term catalysts, backed by a world-class management, board, technical team, advisors and key shareholders, trading at such a low valuation.

With the company shortly ramping up drilling of our existing exploration portfolio, and focused on ongoing expansion opportunities, Kincora is the most active foreign-listed junior seeking to make the next Tier 1 discovery in Mongolia.

Peter Epstein: You just closed on a $6.25M capital raise in a very difficult market. Who were the key investors in this very important round?

Sam Spring: About 60% was taken up by two large natural resource funds and associated groups, who will represent more than 40% of Kincora's shares going forward. These groups, LIM Advisors and New Prospect Capital, are both Hong Kong-based funds and have a track record investing in Mongolia.

In total, there were about 30 investors in the deal, with strong board/management participation and good support from high-quality sophisticated investors. As you can imagine, given current market conditions, a lot of work went into this raise. We truly appreciate the vote of confidence from those who invested.

Peter Epstein: How much of that $6.25M will go toward exploration? Please describe the upcoming drill program.

Sam Spring: The vast majority will support Kincora undertaking the most aggressive exploration and discovery drill program anywhere in Mongolia this year. About $5M will cover up to 18,000m of drilling at Bronze Fox and East TS, plus project generation activities and advancing earlier-stage exploration targets.

Mongolia has unique geological potential to host globally significant discoveries, and that is what we are focusing on. This raising, with the accompanying warrant package, aligns our capital markets strategy with our exploration and expansion plans and gives us a good shot (but no certainty) at making new discoveries.

We are on record stating that these drill targets are as good as you get within a global setting for their respective stages. The key driver in the next 12 months is proof of high grade and our geological concepts, to confirm our models and interpretations with positive drill results.

Peter Epstein: In addition to your management team and board, please describe recent due diligence done by independent advisors, consultants and analysts. Didn’t your largest shareholder also commission a study?

Sam Spring: Our drill strategy is the culmination of almost 30 years' copper exploration experience in this belt by senior members of our team, five years of exploration work and model refinements by ourselves and previous owners (including Ivanhoe Mines Ltd. [IVN:TSX; IVPAF:OTCQX] and IBEX Technologies [IBT:TSX.V; ]) that provide us with strong conviction to focus on the selected five targets.

Kincora has been through five technical reviews since mid-2017, including from 1) a leading natural resource private equity group; 2) the European Bank for Reconstruction and Development (EBRD); 3 and 4) LIM Advisors (twice); and 5) New Prospect Capital, all of which have resulted in capital being invested.

As you have picked up on, Peter, our largest shareholder commissioned an independent technical review of our targets, work programs and strategy before becoming a cornerstone investor in our latest offering. This review suggested a discovery had already been made at Bronze Fox, within the underexplored target zone to the west of a key regional fault in an area we are calling West West Kasulu. This is where the first drill hole will go. In the independent consultant's opinion, this target area has been significantly upgraded by recent exploration activities.

While we are optimistic, and management participated in the recent raising and have undertaken detailed systematic exploration, there's nothing left to do but drill these targets. Please let me reiterate that Kincora is a high-risk exploration play. Hence, there are high rewards for success.

Peter Epstein: A risk is that it might cost tens of millions to delineate an attractive NI-43-101-compliant resource. What is your team's goal for the upcoming drill program? Can you articulate what success might look like?

Sam Spring: Absolutely. We appreciate the fact that porphyries are capital intensive, and that exploration is very risky. More meters of drilling provide us a better chance of confirming our geological concepts and riding the value creation curve for shareholders.

The best recent example of a large-scale copper porphyry discovery is that of SolGold plc (SOLG:AIM) at its Alpala project in Ecuador. The deposit at Alpala is deep, so drilling costs there are significantly more than in Mongolia. In March 2016, SolGold raised AU$5.7 million at 2.3p/share, having drilled 13 promising holes and seeking to confirm its discovery—an equivalent drill program to what Kincora is now looking to complete at our two projects. They had fantastic results. . .Over the course of 31 months, SolGold drilled a further 54 holes, attracted both Newcrest Mining Ltd. (NCM:ASX) and BHP Billiton Ltd. (BHP:NYSE; BHPLF:OTCPK) as strategic investors, and rerated 20 time for shareholders.

That's what success at the target-testing phase of drilling can result in, even in difficult capital markets and a flat/decreasing copper price environment, which we believe is temporary.

At Bronze Fox, our drill campaign is designed to advance the strike potential away from the fault to the west, demonstrate the interpreted, significant increase in tonnage and grade potential, and confirm a new discovery. Prior higher-grade intersections include three of four holes drilled by Kincora that returned >1% Cu and/or Cu eq, including the best hole, F62, which hosted 13m of 1.15% Cu/1.41% Cu eq, within 37m at 0.83% Cu/1.04% Cu eq and 864m at 0.38% Cu eq.

At our East TS, the geological concept we are seeking to confirm is that OT-style mineralization is present. Each of the three targets at East TS have large-scale potential, with individual coincident geophysical anomalies equivalent in size to ore bodies at OT and SolGold's Alpala project.

While more conceptual and risky than the two targets at Bronze Fox, such a setting and scale of targets is unique. If located in more established copper districts around the world, it's likely the area around TS and East TS would have already seen extensive drilling.

A rule of thumb for porphyry discoveries is that ~50,000m of drilling generally provides visibility for ~5M tonnes Cu eq metal. Exercise of the warrants that were part of the recent offering would bring in an additional $15M (2.5x the recent raising), and enable another 100,000 meters of drilling.

Peter Epstein: There are many copper bulls, yet the price at US$2.70/lb is half of what some bulls think is coming. Do you have a view on the copper price?

Sam Spring: A good question; we get asked that a lot. I will leave the forecasting to the experts, but we're noticing that most investors see the writing on the wall. Like us, they believe the supply side will at some point (perhaps soon?) struggle to meet even average-trend demand growth, let alone any acceleration from increasing global electrification. This theme is being picked up by generalist investors as well, who have noticed what an unexpected supply shock has done to the iron ore price this year.

Regarding the industry players (mid-tiers and majors), there has been a notable, but quiet, shift toward looking at new growth projects again over the last 18 months. BHP and Rio Tinto are even talking about organic exploration success stories, focusing on copper as a preferred commodity for expansion. That said, we are just starting to see more of the traditional miners expand into earlier stage projects to rebuild their pipelines.

Time will tell, but I certainly think that even at current copper prices, if we find what we're looking for, there will be significant interest in Kincora. A tailwind from rising copper prices would, of course, be welcomed, but given the lack of exploration success industry-wide, globally, for many years now, the project pipeline is in great need of new, sizable discoveries. That is what we believe Mongolia and our targets offer investors.

Peter Epstein: Please talk about Mongolia. Some readers probably won't invest there. What do you tell investors, shareholders, prospective investors—about Mongolia country risk?

Sam Spring: At the time I joined Kincora in 2012, Mongolia was the fastest growing economy in the world. This was driven by the first phase emergence of delivering previously untapped resources to international markets.

This emergence meant that at the time it was almost mandatory for coal and copper majors to be seeking entry into the southern Gobi regions, with product trucked to the world's largest consumer of both commodities. We are five prime ministers, two governments, a number of high profile disputes and reversals to unfavorable investment laws later, but the rocks and big-picture potential remain unchanged.

In a landscape of few significant greenfield projects recently being commissioned, OT is proof of concept that Mongolia is a mature mining jurisdiction. OT is the largest development project in Mongolia's history. It's expected to account for up to a third of Mongolia's GDP (gross domestic product) by the mid 2020s. It paves the way for companies like ours by lowering barriers to entry, and we and others greatly benefit from newly built regional infrastructure.

When one looks at other copper jurisdictions, it's becoming harder and more expensive to operate. Chile's 2018 copper output was greater than the second, third and fourth largest country producers combined. The multibillion-dollar capex profile for Chile's Codelco, just to keep production flat, shows the increasing challenges regarding water, community relations and high altitude, not to mention a declining copper grade!

Many other large copper supply regions are also difficult and/or increasingly difficult to operate in; look at recent developments in the Democratic Republic of Congo, China, Panama, Russia, Zambia, Indonesia, Papua-New Guinea, etc.

Given the team and operational track record we have at Kincora Copper, we are eyes wide open to the risk/reward scenario in Mongolia, which we find compelling, exploring for the next globally significant copper discovery.

Your readers should stay tuned for drill results, which should start arriving in five to six weeks' time. We expect results to be ongoing for the rest of the year.

Peter Epstein: Thank you Sam, I think we covered a lot of ground. Bottom line, drill results will define Kincora Copper going forward, and a lot of smart money is betting on good drill results between now and year-end.

Peter Epstein is the founder of Epstein Research. His background is in company and financial analysis. He holds an MBA degree in financial analysis from New York University's Stern School of Business.

Mongolia-UN joint steering committee convenes www.montsame.mn

Ulaanbaatar /MONTAME/ The Joint UN and Government of Mongolia Steering Committee meeting to review implementation of the United Nations Development Assistance Framework (UNDAF) 2017-2021 for Mongolia in 2018 was held on June 24 at the Ministry of Foreign Affairs.

China blocks all Canadian meat imports as trade war with US heats up www.rt.com

China has suspended all imports of meat from Canada, saying it found traces of illegal feed and demanding action. The move comes amid a trade war with the US and extradition hearings for an arrested Huawei executive.
“In order to protect the safety of Chinese consumers, China has taken urgent preventive measures and requested the Canadian government to suspend the issuance of certificates for meat exported to China,” the Chinese embassy in Ottawa said in a statement on Tuesday, adding that a probe of meat imports has revealed as many as 1888 “counterfeit” veterinary health certificates and accusing Canadian authorities of “obvious safety loopholes.”

How Mongolia leverages its neutrality to influence diplomacy with North Korea www.nknews.org

Geographically remote and marginalized from participation in regional security dialogue, Mongolia has once again made a small foray into multilateral discussions over North Korea-related issues.

During a recent visit to Ulaanbaatar for talks with his Mongolian counterpart Damdin Tsogtbaatar, Japanese foreign minister Taro Kono implored Mongolian assistance in resolving the issue of Japanese citizens abducted by North Korea.

The two sides also reportedly agreed on the need to maintain pressure against Pyongyang in the form of sanctions.

Tokyo has recently sought to engage Pyongyang directly, with Japanese prime minister Shinzo Abe expressing willingness to meet with Kim Jong Un. North Korea, however, has been cool toward Japanese overtures.

The meeting between Japan and Mongolia’s chief diplomats comes on the heels of the sixth Ulaanbaatar Security Dialogue (UBD). The UBD has, since 2013, brought together participants from across Northeast Asia in a neutral forum where participants openly discuss issues according to Chatham House Rules.

In spite of Kim Jong Un’s dismissal of Abe’s gesture, Japanese officials hoped to meet directly with delegates from the DPRK at this year’s UBD. Nevertheless, Pyongyang withdrew its participation in the 2019 gathering in Ulaanbaatar, frustrating Japanese attempts at direct engagement with the North. North Korea’s withdrawal from this year’s UBD is somewhat surprising, given that Pyongyang has normally been a supporter of the Mongolian initiative.

Mongolia has hoped to position itself as a mediating force in North Korean security issues

Post-communism, Mongolian foreign policy is based on a policy of strict neutrality. Ulaanbaatar pursues a neutral position in diplomacy and interstate relations so as to prevent itself from becoming geopolitically entrapped by any single power or concert of states.

Although China and Russia by far comprise the biggest challenges to Mongolia’s maintenance of sovereignty, Ulaanbaatar nevertheless takes great care to not allow itself to become beholden to other less powerful states including Japan and the ROK, on which Mongolia depends in part for economic assistance and investment.

As far as the Korean peninsula is concerned, the Republic of Mongolia maintains diplomatic equilibrium between Pyongyang and Seoul in part to preserve an air of non-alignment with the informal but very real blocs involved in the Korean security crisis.

Furthermore, Mongolia values economic cooperation with both the DPRK and the ROK; the former providing Mongolia with access to the Pacific Ocean via the port of Rason-Khasan, and the latter for its vast investment potential.

In the context of the Korean security crisis, neutrality positions Ulaanbaatar to act in a mediating role between the DPRK and South Korea as well as the U.S. This in turn, Ulaanbaatar hopes, will cement other states’ respect for Mongolian sovereignty, insofar as Mongolia’s unique position serves as a method of advancing peace in Northeast Asia.

Mongolia maintains equal distance between the superpowers. Here, U.S. Acting Secretary of Defense Patrick M. Shanahan meets with the Minister of Defence for Mongolia Nyamaagiin Enkhbold at the Pentagon in 2019 | Photo: DoD photo by U.S. Army Sgt. Amber I. Smith

Japan’s direct outreach to the Mongolian government shortly after Tokyo’s failed attempt of dialogue with the DPRK on neutral Mongolian territory highlights Ulaanbaatar’s unique position in the North Korean security crisis. Although Mongolian diplomacy is ensconced in the notion of neutrality, Mongolian foreign policy emphasizes an orientation toward the Northeast Asia sub-region.

Mongolia’s relationship with Japan is based in part on the latter’s status as one of the largest donors to Mongolia. Ulaanbaatar has recently sought to expand trilateral cooperation between itself, Tokyo and Washington. Beijing and Moscow – which yield considerable geopolitical influence over Mongolia – could potentially see such trilateral cooperation with Japan and the U.S. as threatening.

The Mongolian government, however, has declared that the reason for such collaboration is to advance Ulaanbaatar’s interests in the North Korean security crisis.

Mongolia has hoped to position itself as a mediating force in North Korean security issues since the onset of the second North Korean security crisis.

Given Mongolia’s diminutive stature in Northeast Asian affairs, Ulaanbaatar relies in part upon American support for Mongolian participation in Northeast Asian security dialogues. At the same time, Washington has been largely unwilling to allow Mongolia a role as a direct mediator in the current standoff over Pyongyang’s WMD program.

Mongolia’s strict neutrality vis-à-vis the Korean security crisis has occasionally come under question, particularly in light of communications between Ulaanbaatar and Washington over North Korea unveiled during the Wikileaks revelations.

Although Mongolia’s diplomatic stance allows Ulaanbaatar room to maneuver in Northeast Asia’s tight geopolitical environment, Mongolia does have a concrete vested interest in seeing Northeast Asia realize greater security.

Post-communist Mongolian foreign policy is based on a policy of strict neutrality

Today, Mongolia and North Korea have a friendship treaty that calls, among other things, for mutual cooperation in securitizing the Asia-Pacific. Furthermore, the Mongolian government supports integrating North Korea economically with the rest of Northeast Asia. However, post-Cold War Mongolia-North Korea relations have not been without trials, depending in part upon the state of Ulaanbaatar’s ties with Seoul.

In particular, positive developments in Seoul-Ulaanbaatar ties have had negative implications for Mongolia’s ties with the DPRK. This has been particularly true not only of the general state of Mongolia’s relations with either one of the Koreas, but has also occurred in light specific issues such as past Mongolian assistance to North Korean refugees attempting to flee to the ROK.

At the same time, Mongolia has pressed for North Korea to implement reforms, albeit in a subtle manner. Rather than pontificating to the DPRK, Ulaanbaatar relies on using its experience transitioning to a democratic form of government and free-market economy to induce change within North Korea.

Ulaanbaatar’s best efforts notwithstanding, developments this month in Mongolia’s participation in resolving the North Korean security crisis underscore Ulaanbaatar’s limited capacity. Furthermore, the interplay between the DPRK, Japan, and Mongolia signal that the latter will have a tough time maintaining its position of neutrality.

North Korea’s dismissiveness toward Japanese overtures and Tokyo’s very public failed attempt to reach out to Pyongyang via Mongolia do not bode well for either Mongolia’s desire to use mediation or Japan’s hope that the Republic of Mongolia can play a positive role in advancing Japanese interests vis-à-vis the DPRK.

Deepening cooperation between Japan and Mongolia, while possibly serving both countries’ interests at the bilateral level, could also send the wrong message to Pyongyang about Mongolian neutrality. The onus will be on Ulaanbaatar, therefore to tread carefully in the midst of DPRK-Japan relations.

For the sake of maintaining its diplomatic balance between Pyongyang and Tokyo, Ulaanbaatar may find itself engaging in more direct outreach to the North in the coming months so as to assure the DPRK and developments in Japan-Mongolia relations don’t mislead the DPRK into thinking Mongolia is explicitly taking Tokyo’s side.

Edited by James Fretwell

Mongolia produces 48% of total raw cashmere in world www.akipress.com

Mongolia produces 48 percent of the total raw cashmere in the world, Montsame reports.

Mongolia told to strengthen finances www.publicfinanceinternational.org

Mongolia’s economy remains “extremely vulnerable” to external factors and it must strengthen its finances to achieve inclusive growth, it has been warned.

Foreign trade turnover increases by USD 514.5 million www.montsame.mn

Ulaanbaatar /MONTSAME/ In the first 5 months of 2019, Mongolia traded with 135 countries from all over the world and total trade turnover reached USD 5.6 billion, of which USD 3.3 billion were exports and USD 2.3 billion were imports. In May 2019, exports and imports reached to USD 751.4 million and USD 548.8 million, respectively.

Registered unemployed decreases by 2.1 percent www.montsame.mn

Ulaanbaatar /MONTSAME/ At the end of May 2019, the Labor and Social Welfare Services Agencies have registered 35.3 thousand job seekers, of which 23.5 thousand or 66.5 percent were unemployed and remaining 11.8 thousand or 33.5 percent were employed but looking for a new job.