The China-Mongolia-Russia Economic Corridor (CMREC), first proposed by Xi Jinping in September 2014, is one of six flagship economic corridors under China’s Belt and Road Initiative. The corridor aims to improve transportation and infrastructure connectivity among the three countries, reduce freight times, and create new land and sea routes for the export of Mongolian goods and natural resources. In this Q&A led by Nathaniel Schochet, Mendee Jargalsaikhan provides background on CMREC, considers how it differs from China’s other major economic corridors, and discusses the impact on Mongolia and its relationship with China.

Can you explain the origins, objectives, and structure of the China-Mongolia-Russia Economic Corridor, and how it fits within China’s broader Belt and Road Initiative (BRI) and Global Development Initiative?

When China officially launched the Belt and Road Initiative in 2013, Mongolian leaders saw it as a great opportunity to advance the country’s transit connectivity dreams and immediately supported the initiative. Building on previous policies to improve transit connectivity—for example, the Transit Mongolia National Plan of 2008—the government quickly announced the Steppe Road initiative prior to visits in 2014 by Presidents Xi Jinping and Vladimir Putin. At that time, Mongolian president Elbegdorj Tsakhia proposed to hold the Ulaanbaatar Summit once every three years between the three leaders to discuss transportation and related infrastructure issues. However, both presidents made separate visits. President Xi visited in August and President Putin visited in September; nonetheless, both agreed to hold the first trilateral summit on the sidelines of the Shanghai Cooperation Organisation (SCO) summit in Dushanbe, Tajikistan, in 2014. Then, in Dushanbe all three countries agreed to incorporate China’s Silk Road Initiative, Russia’s Eurasian Infrastructure Development Plan (also known as the Greater Eurasian Partnership), and Mongolia’s Steppe Road initiative. 1

The following year, Mongolia was officially included in China’s Belt and Road Initiative as one of the six economic corridors, and the three presidents concluded a memorandum of understanding to establish CMREC during the SCO summit in Ufa, Russia. In 2016, at the SCO summit in Tashkent, the three presidents approved the CMREC plan, which included 32 projects, ranging from transit infrastructure connectivity to trade and customs coordination to various types of people-to-people exchanges. Furthermore, all parties agreed to establish a working group, to be led by deputy prime ministers, foreign ministers, or deputy foreign ministers and supported by a trilateral experts meeting. Importantly, parties agreed that the plan will be reviewed every five years and, if necessary, extended by another five years.

In 2025, the three countries held the seventh trilateral summit on the sidelines of the SCO summit in Beijing, where the three leaders agreed to extend the plan until 2031. Even though the main focus remains on previous projects, especially the north-south railway, roads, and connecting ports, parties discussed the possibility of including the trans-Mongolian gas pipeline to the project list. But in the end the gas pipeline project—known as the Power of Siberia 2 pipeline—was not included. This 2,600-kilometer natural gas pipeline is designed to transport Russian gas from the Yamal and Siberian fields through Mongolia to China. Apparently, the Chinese side has been only committed to the feasibility studies during this five-year planning cycle. At the SCO summit this September, President Khurelsukh Ukhnaa reiterated Mongolia’s desire to expand its transit capacity in separate meetings with Presidents Putin and Xi.

In terms of objectives, the three countries converge in some areas but diverge on certain interests. Since Mongolia shares the longest land border, extending from the Altai Mountains in the west to Manchuria in the east, the dimension of greatest shared interest is to increase trade between neighboring regions, provinces, and cities.

In terms of specific projects, however, Mongolia is solely focused on winning support from its neighbors to build infrastructure for rails, roads, pipes, grids, and cables in order to increase the transit trade between neighbors, reduce trade barriers (especially tariffs), and gain access to seaports. China seems to be looking at broader engagements, including people-to-people relations rather than merely physical infrastructure. Instead of investing in trans-Mongolian connections with Russia, China is seemingly more interested in the development of large mining deposits in Mongolia’s south and supporting infrastructure, such as rails and roads connecting to China’s industrial centers.

Even though the economic corridor idea aligns with Russia’s pivot-to-Asia strategy, the country wants to develop its own infrastructure connections in the Russian Far East rather than the infrastructure in Mongolia. However, because Russia has traditional leverage and geopolitical interests in Mongolia’s transit infrastructure (e.g., the trans-Mongolian railroad) and energy sector, it also wants to participate in the natural resource and related infrastructure development project. In fact, Russia holds a 50% share of the trans-Mongolian railroad.

It is important to note that the Central Asia Regional Development Cooperation (CAREC) Program, which is led by the Asian Development Bank (ADB), initiated the economic corridor, including agreements, customs facilities, and transit roads concepts. Mongolia joined CAREC in 2003 as an acknowledgment of its key location to connect China’s Xinjiang Uighur Autonomous Region through Mongolia to Russia’s Altai region and to connect Central Asia through Mongolia to Siberia. By 2025, ADB financed the construction of 750 km of roads linking China to Russia through Mongolian two provinces (Khovd and Bayan-Ulgii). Now this is the busiest road for trilateral trade and even links Kazakhstan to Russia through a 40-km land strip between Mongolia and Kazakhstan. CAREC also funded the construction of a logistics center in Zamyn-Uud—the central dry port between Mongolia and China and a rail and road transportation hub between China and Russia that transits through Mongolia.

Thus, on the Mongolian side, the corridor idea has been introduced and developed with the help of ADB’s project. Ultimately, CAREC helps improve Mongolia’s transit links, especially in the western part of the country, where Mongolia, China, Russia, and Kazakhstan are in need of transit connectivity.

How does CMREC differ from China’s other major economic corridors, particularly the China-Pakistan Economic Corridor (CPEC), in terms of strategic objectives, financing, governance, and geopolitical significance?

There are important differences between CMREC and CPEC. First, CPEC involves two countries with a long-standing partnership that could even be regarded as all-weather partners. In Mongolia’s case, CMREC involves three countries, two of which are traditionally geopolitical competitors, with recent memories of a militarized standoff in the 1960s–80s. The increase of influence over Mongolia remains an issue of concern for both great powers. Mongolia is the weak player in this trilateral dynamic. Second, the geostrategic and economic return of CPEC is very high for China—gaining direct access to the Arabian Sea, contributing to the stability of a key neighboring partner, and increasing trade and investment opportunities. Third, the coordination and administration of CPEC projects are more manageable than the economic corridor projects involving Mongolia. In the CMREC case, for example, the planning cycle is different for each country. China has a five-year cycle, Mongolia’s planning is dependent on the four-year parliamentary election cycle, and Russia’s cycle is subject to the president’s priorities and politics.

In my view, CMREC is quite similar to the China–Central Asia–West Asia Economic Corridor, which involves resource-rich, landlocked states of Central Asia. Here, we need to consider Chinese and Russian geopolitical and economic interests regarding the Central Asian states, especially Kazakhstan, the Kyrgyz Republic, and Tajikistan, which operate in the Sino-Russian sphere of influence. All Central Asian states are landlocked, like Mongolia, while sitting at the crossroads of Europe, Asia, and Caucasus. From Mongolia’s perspective, Kazakhstan has been playing the “game” very successfully, building important fast rail and road connections through ADB’s CAREC and China’s BRI. Kazakhstan gets along nicely with Russia, which is its largest, most important ally in Central Asia. Tajikistan demonstrates similar success by accommodating China’s and Russia’s interests while economically benefiting from BRI projects. But challenges in infrastructure development in Kyrgyzstan appear to be similar to those in Mongolia. For example, the trans-Kyrgyzstan rail connection to Uzbekistan and investment in large infrastructure projects have not been successful due to domestic politics and most likely Sino-Russian contests over the Kyrgyz Republic.

The significant difference between Mongolia and the Central Asian states, excluding Turkmenistan, is that all four states are members of both the SCO and the Russia-led Collective Security Treaty Organization (CSTO), while Kazakhstan and Kyrgyzstan are members of Russia’s Eurasian Economic Union.

Although I have not seen a comparative study of all of BRI’s economic corridors, the strategic objectives, geopolitical significance, and operationalization are different depending on the nature of external and internal politics and the economic significance. For example, Mongolia was a founding member of the Asian Infrastructure Development Bank (AIIB), but the AIIB has not financed any major infrastructure development project in Mongolia since 2015. If the AIIB is a key financial institution to fund roads, railways, and airports after assessing the benefits and feasibility, projects in Mongolia are deemed either risky or economically less attractive. Therefore, CMREC is politically endorsed but practically stuck compared with other corridors.

In November 2024, Mongolia, Russia, and China approved an updated list of 33 priority projects under CMREC. What are the most significant projects in this new phase of development, and what do they reveal about the corridor’s evolving priorities?

Back in 2016, Mongolia, Russia, and China approved a plan that included 32 projects, as I mentioned earlier, with most of these projects aimed at conducting feasibility studies, developing legal frameworks, and promoting exchanges in various sectors. Following the joint assessment in 2023, the three parties agreed to eliminate some of the projects and added new ones.

The priority remains railroads, roads, and ports. The fourteen projects within these categories mostly aim to build new transit infrastructure and improve the existing trans-Mongolian railway and road. In 2024 the three parties removed three railroad projects from the old list: a railroad linking Mongolia’s central lane to Russia’s Tuva Republic, a railroad linking the western part of Mongolia to China and Russia, and a high-speed railway linking three capitals. I think this is a very practical decision.

All three countries then agreed to improve the main railway (the trans-Mongolian railway), which is about 1,060 km, was built in the 1950s, and is still struggling to accommodate the current increased trade volume, especially after the Russia-Ukraine war. Because it is the busiest rail, allowing for Mongolia’s sea access through China, trade with China, Sino-Russian trade, and domestic passenger trains, the work needs to be tightly scheduled. Now the three countries have agreed to prioritize modernization of this central (north-south) railway, including signaling, double track sections, electrification, and expansion of the transshipment facility.

Another important rail project that will increase the trade volume will be a 227-km link connecting the trans-Mongolian central link to Baotou—the second-largest city in Inner Mongolia, China. This link will provide Mongolia with a much-needed connection to the Chinese rail network to access China’s seaports and railways going to Central Asia through Kazakhstan.

However, in Mongolia’s case, building the railroad will take time. For example, the 240-km railroad linking the Tavan Tolgoi coal mine to China took about twenty years to construct due to the challenges of geopolitics and domestic politics. Even today, the railway faces ongoing challenges, as the two countries did not agree to construct the additional 32-km connection over the border to connect to the Chinese rail until June 2025.

Besides these projects, parties are also in discussions to continue the feasibility studies for connecting rails through the eastern part of Mongolia. There is an old 238-km rail linking Mongolia’s uranium deposits to the Russian city of Chita. Now Mongolians wish to connect this link to the Chinese rail network in Manchuria.

The transit road connection is the next priority. Notably, as I mentioned earlier, ADB funded the western transport link, the 204-km highway of the central transit road, and improvements to the port facilities along the Sino-Mongolian border. Besides, the Mongolian government’s own effort, ADB has played a key role in improving the transit roads. Relatedly, the other priority project for CMREC is to build special economic zones at the borders with Russia and China.

In addition to these priority projects, the remaining projects aim to promote cooperation in areas of trade, customs, agriculture, health, science, technology, and education as well as people-to-people interactions. In my opinion, although after the 2023 joint assessment the three countries agreed to improve the existing trans-Mongolian railways, their infrastructure, and connecting ports at each end, as well as building two more rail links with China, these projects will continue to take time. Despite the Mongolian government’s wishes, the soft projects such as people-to-people exchanges and political dialogue will be more successful than the projects to construct hard transit connections by the time of the next assessment.

How successful has CMREC been in aligning with Mongolia’s Steppe Road program?

Mongolia has a strong interest in aligning its transit dream with CMREC. Following the launch of BRI, the Mongolian government announced the Steppe Road project with the aim of becoming the land link between China and Russia and even dreamed of connecting Europe and Asia. It expressed its interests in five types of projects: rails, roads, power grids, oil and gas pipelines, and fiber-optic cables. Mongolia has also expressed interest in establishing air logistics hubs using its newly built Chinggis Khaan airport, which was funded by a Japanese soft loan.

However, Mongolia has run into several challenges. The first one was the pandemic, which slowed down all construction projects for at least two years. The second was the visit of the Dalai Lama and subsequent announcement (reincarnation) of Mongolia’s tenth Bogd—a religious leader for the Mongolian Buddhists. The Chinese Ministry of Foreign Affairs’ statements and reactions have definitely poured cold water on China’s initial enthusiasm for CMREC. A third challenge is Russia’s geopolitics of shifting the priorities of Mongolia’s railroad development strategy. Like in the other countries of its neighborhood, Russia still maintains at least half of the stake of the railroad in Mongolia. Mongolia’s railroad runs at 1,520-mm gauge, while China uses the international gauge of 1,435 mm. Russia pressured Mongolia to stick to the 1,520-mm rails, which means that any new rails need the transshipment facility, delaying Mongolia’s desire to connect its mineral deposits in the south to China’s rail network. Sadly, as Mongolia sank into heated domestic debates, it canceled railroad extension projects that even looked beneficial to the Deutsche Bahn (German Rail).

Meanwhile, Russia built two new rail lines linking its far east to China. It is hard to say now whether this was done based on the Kremlin’s geopolitics or led by a simple economic calculation, as both Mongolia and Russia compete to increase their coal exports to China. Finally, as noted earlier, domestic politics have hampered CMREC, especially the fight between the political economic factions that ensued due to the perception of transit projects as particularly lucrative. This covers everything from feasibility studies to construction to operation and maintenance. These factors have contributed greatly to delaying the CMREC projects.

Based on joint assessments in 2020 and 2023, CMREC has not been successful. But now, because of its ongoing war in Ukraine, Russia realizes it needs to increase its transit capacity through Mongolia and its far eastern railroads. So, there is a joint push by Mongolia and Russia to construct the Power of Siberia 2 gas pipeline through Mongolia. That could give some importance to CMREC projects. However, China is still thinking about the feasibility study of the gas pipeline in this round of its five-year planning. Whether the emerging conflicts in the Middle East could trigger China to reconsider the urgency of the gas pipeline project, that we still need to wait to see.

The other crucial problem is the coordination mechanism for CMREC, which is still not streamlined. The Chinese side will wait for the next five-year planning cycle. It would be difficult to imagine that Russia will be spending money for projects in Mongolia, given the ongoing war in Europe. Even if Russia has funding, it would prefer to devote such resources to its own economic corridor links with China. Another factor will be how Mongolian politics play out in the presidential election in 2027 and parliamentary elections in 2028, as well as how the state of the economy will appear in the coming years.

Beyond physical infrastructure projects, there is also the soft infrastructure and other domains of BRI integration linking Mongolia to China, including financial flows, people-to-people exchanges, and trade. What impact have these developments had on Mongolia and its relationship with China?

If Sino-Mongolian relations are viewed across the long spectrum of over two thousand years, followed by the fairly recent two decades of Sino-Soviet tensions during the Cold War, this is probably the most amicable the two countries have been. Both have been enjoying the frequency of bilateral exchanges at the provincial or local levels. Despite Mongolia’s reluctance to permit China’s major banks from operating inside the country, both national banks renewed their bilateral currency-swap arrangements. Mongolians also enjoy visa-exempt entry, access to medical facilities, and tourism opportunities in China.

China has become a competitive destination for Mongolian students, considering its proximity and the availability of tuition provisions compared with schools in North America and Europe. However, South Korea, Japan, and Taiwan remain the favored destinations in Asia for Mongolian students. The Confucius Institutes, which are vital instruments of Chinese external influence and teach Mandarin and Chinese culture to local students, expanded their foothold in Mongolia—not only in Ulaanbaatar city but also in the far western Khovd Province as well as in eastern Dornod Province.

China is undeniably the most important source for Mongolia’s trade and investment and an essential destination for imports. In fact, Mongolia’s reliance on China’s fuel and electricity is on the rise as Russia struggles domestically because of the war in Ukraine. To overcome the scarcity of the fuel provided by Russia, the Mongolian government increased its fuel imports from China. Even Mongolia’s largest copper mine, Oyu Tolgoi, now relies on China for electricity. The flow of Mongolian travelers to China and South Korea is expected to steadily increase, while Russia has already become less attractive to Mongolians.

Nevertheless, there continues to be a trust deficit in the two countries’ bilateral relations. Because of historical memories, the asymmetry of power, and emerging geopolitical narratives, both countries adopt a somewhat cautious stance toward each other. Beijing likely does not approve of Mongolia joining the U.S.-initiated Board of Peace, even as it remains reluctant to endorse China’s global initiatives, such as a shared destiny or the SCO. The latter could easily trigger a heated debate over the country’s principled stance of nonalignment and complicated long history with its neighbors. Regrettably, negative comments and narratives in the Chinese and Mongolian blogospheres, as well as some incidents against nationals in the other country, can easily contribute to mistrust and reinforce negative attitudes on both sides.

Does CMREC provide Mongolia with greater economic opportunities and strategic autonomy, or does it risk deepening Mongolia’s dependence on Russia and China?

The best answer is probably that it depends on how Mongolia negotiates with these two great powers—particularly over the construction of transit railways, roads, pipelines, and electricity grids. I do not think that Mongolia could reduce its dependency on its two larger neighbors. Under any circumstances, China and Russia will have strong political, economic, and security leverage over Mongolia. Nevertheless, I would argue that CMREC will also increase or facilitate Mongolia’s wish to be connected to markets not only in its immediate neighborhood but also in Central and Northeast Asia.

BY
Mendee Jargalsaikhan is an adviser at Global Nomads of Mongolia. He previously served in senior research and leadership positions at the Institute for Strategic Studies and Defense Research Institute. His research focuses on Mongolian foreign and security policy, small-state security, geopolitics, critical minerals, and the political and socioeconomic impacts of extractive industries.

This Q&A was conducted by Nathaniel Schochet, a senior project associate with the Political and Security Affairs group at NBR.

Published Date:2026-09-29