Mongolia Page: 2 of 2
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Mongolia
U.S. Foreign Assistance
In recent years, U.S. foreign assistance to Mongolia largely
has consisted of security assistance. U.S. funding for
Development Assistance programs related to governance
and inclusive economic growth was phased out beginning
in 2015. In FY2017, Mongolia received $5.2 million in U.S.
foreign assistance, which included the following:
" Foreign Military Financing (FMF): $2.6 million to
bolster peacekeeping and other capabilities of the MAF.
" International Narcotics Control and Law
Enforcement (INCLE): $0.5 million to help build
capacity within the Mongolian criminal justice system.
" Nonproliferation, Antiterrorism, Demining, and
Related Programs (NADR): $0.25 million to address
weapons proliferation threats along Mongolia's borders.
" International Military Education and Training
(IMET): $1.84 million to familiarize MAF personnel
with U.S. military doctrine and values, build capacity,
and develop military-to-military relationships.
A two-year, USAID-supported Leaders Advancing
Democracy (LEAD) Mongolia program brings young
Mongolians to the United States to learn about how to
engage in civic action. The Peace Corps also is active in
Mongolia with 108 volunteers involved in English language
and health education.
The Millennium Challenge Corporation (MCC) carried out
an initial five-year (2008-2013), $285 million compact or
aid package in Mongolia, focused on property rights,
vocational education, health, road infrastructure, and energy
and the environment. In December 2014, the MCC
approved Mongolia for a second compact worth about $345
million. The MCC and Mongolian government are
developing a compact focused on improving the supply of
water to the capital city of Ulaanbaatar.
Politics
Mongolia's political system is "semi-presidential," with a
parliament and Prime Minister as well as a popularly-
elected President. The Mongolian Prime Minister is the
head of government with primary responsibility for
executive ministries, while the President plays a primary
role in foreign policy, chairs the National Security Council,
and serves as the Commander in Chief of the armed forces.
Since 1990, Mongolia has alternated between coalitions led
by the MPRP (now MPP) and Democratic Union (now
dominated by the Democratic Party). In 2016, the MPP won
a large majority of seats in the 76-member unicameral
legislature, the State Great Khural, gaining 39 seats in the
election while the ruling Democratic Party lost 25 seats, in
large part because many voters blamed the DP for an
economic slump that began in 2013 under its rule. The MPP
now holds 65 seats while the DP has nine. Prime Minister
Ukhnaagiin Khtirelstikh of the MPP was elected by the
Great Khural in October 2017 after it ousted JargaltulgynErdenebat, who had served for only three months as MPP
Prime Minister (July-Oct 2017), due to allegations ofcorruption and incompetence. The President, Khaltmaagiin
Battulga, who is affiliated with the Democratic Party, was
elected in July 2017 by a 55%-45% margin.
Mongolian politics have grown more fluid since the 2016
parliamentary elections. The MPP and the DP each have
had corruption scandals, political power has become more
personality-based, and campaigns have lacked substantive
policy discussion. The next elections are due in 2020
(parliamentary) and 2021 (presidential).
Economics
The economy is recovering from a slump that began in
2013 due to falling commodities prices, government
mismanagement and unsustainable expansionary policies,
and a drop in foreign investment. In 2017, Mongolia and
the International Monetary Fund (IMF) reached agreement
on a program of fiscal reforms and a $5.5 billion bail-out
package that includes support from the IMF, the Asian
Development Bank, Japan, Korea, China, and other donors.
Exports, which are primarily commodities, account for 40%
of Mongolia's GDP. China buys over 85% of Mongolian
exports, while Russia supplies Mongolia with 90% of its
energy (refined oil). Mongolia's trade with China, with
which it has a trade surplus, totaled $6.3 billion in 2017.
Leading Mongolian exports to China include coal, copper
and other ores, crude oil, and unprocessed cashmere.
Mongolia produces over a third of the world's raw
cashmere, most of which is exported to China and turned
into garments by Chinese manufacturers. As Mongolia has
developed economically, Ulaanbaatar has become one of
the world's cities with the highest levels of air pollution,
fueled by coal-heated dwellings (gers or yurts), coal-fired
power plants, and automotive exhaust.
U.S. trade with Mongolia, with which the United States has
a trade surplus, shrank during Mongolia's economic
downturn, from $707 million in 2012 to $66.5 million in
2016; it rose to $91 million in 2017. This decrease in large
part reflected a dramatic drop in Mongolian imports of U.S.
vehicles, machinery, and aircraft. Mongolia's exports to the
United States, of which the largest items are minerals, knit
apparel, and art and antiques, were valued at $9.5 million in
2017. Mongolia is a beneficiary of the U.S. Generalized
System of Preferences (GSP) program. Eligible products
include tungsten, one of Mongolia's top export items to the
United States; certain handmade or handicraft textile
products; and some non-apparel items that use cashmere or
furs. Cashmere sweaters are excluded.
The Mongolian government has entered into agreements
with China and Russia to jointly develop roads, railways,
and power grids that link the three countries. Plans include
a Mongolia-China-Russia economic corridor and free trade
zones on both borders. Mongolia and China envision
integrating Mongolia's road and development plans with
China's Belt and Road Initiative.
Thomas Lum, tlum@crs.loc.gov, 7-7616Ben Dolven, bdolven@crs.loc.gov, 7-7626
IF 10926www.crs.gov 17-5700
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Lum, Thomas & Dolven, Ben. Mongolia, report, July 10, 2018; Washington D.C.. (https://digital.library.unt.edu/ark:/67531/metadc1213097/m1/2/: accessed April 24, 2024), University of North Texas Libraries, UNT Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.