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Why we need to wake up the sleeping Mongolia


August 2nd, 2017


Д.Жаргалсайхан
@jargaldefacto


1007   0


8 min


The world has five types of resources: human, financial, material, information, and time. Countries and individuals have various degrees of development, depending on availability, utilization, and processing of these resources. Every nation and every person use these resources to create value and live by exchanging with others. Subject to education levels of people, there are differing demand and supply for the values that have been created.

The use of these resources is best regulated by the market, but government involvement is still required. An individual on their own cannot ensure their own security and protect their freedom and properties. For this reason, people establish a government and keep changing and improving it. Besides protecting, the government needs to find and maintain value for the public. This includes infrastructure such as road and water system, which is not profitable for any individual to build and sell.  

In a democracy, the government is set up by the political party elected by the people, who oversee their performance and have the power to replace them. Unfortunately, Mongolians still have not determined the right mechanism for oversight. This is the reason why only a small group of people has been able to benefit from all available resources under the name of political parties.

The so-called resource-rich Mongolia has most of her people living in poverty while a handful few are enjoying a life of luxury, because people do not understand the underlying reasons, do not come together and unite even if they understand, and do not even know where to begin.  

We are sleeping, and our development needs a lot of catching up. While we are asleep, certain groups of individuals keep stealing from all our resources, especially material and financial resources.  

Centralization of material resources

Material resources include natural resources, land, and all things people can build, such as facilities and buildings. The right to use natural resources is granted by the government, not individuals. Given natural resources are not created by people, every citizen in a democracy must benefit from those resources. Therefore, the Constitution of Mongolia says in its Article Six “the land, its subsoil, forests, water, fauna and flora and other natural resources shall be subject to people's power and State protection. The land, except that given to the citizens of Mongolia for private ownership, as well as the subsoil with its mineral resources, forests, water resources and wildfowl shall be the property of the State.”

Mongolia’s political elites see and follow these clauses in their own way. For instance, exploration and mining permits are only granted to those who have given bribes to associates of the Mongolian People’s Party (MPP) and Democratic Party’s (DP) leadership. Along with the permit, they start owning the natural resources, and make big profits by reselling their licenses without any taxes.  

Furthermore, government officials have owned and been controlling the land, its subsoil, forests, water, fauna and flora. A clear example is the land in our capital city. All land to the north of Tuul River has been sold by the mayors of the city, whereas the land to the south was embezzled by the ministers of environment (the name of ministry changes every time the government is restructured). After acquiring the land around Bogd Mountain and Yarmag hill under their own name or their associate’s name, they have split the land in different sections, and sold on to have apartments and houses built. The ministers of mining have also been conspiring and selling mining licenses and permits. Mongolia’s wealthiest people have come from the capital city, mining, and large state projects. The ruling power has become an item on sale – sold and purchased for whatever it takes.  

Government officials at all levels of the government are now getting wealthier by embezzling from public material resources, breaking laws, and making other laws that would serve to protect them. These officials who have worked for the government for all their lives have savings that are dozens of times greater than businessmen. It can be seen from this year’s income report of senior government officials (http://www.ikon.mn/visualdata/c/uvr). Mongolia’s materials resources are centralized under the networking business of government officials, and our government has become a sanctuary for the corrupt officers.
 
Using financial resources as political tool 


It is impossible for any business to make progress without finding a financial source and spending money. The overall cost would be smaller if the financial resources are available and come at a relatively cheap price. Because our capital market is not developing, Mongolia’s financial market is completely comprised of the money market and commercial banks. All financial resources have centralized under 14 commercial banks. Therefore, the use of all other resources is now dependent on those banks.

Mongolians have been attempting to run a business with bank loans that has more than 20 percent interest rate for nearly 20 years, which is a rare thing to see in the entire world.

Eighty percent of total assets of Mongolian banks belong to four big banks today. Two of them are now directly involved in politics, which was seen at the presidential election.

The owner of Golomt Bank went on his own TV channel (Eagle TV) and announced how much he ‘loved’ the MPP candidate. The police disclosed that the one billion tugrugs that were found in a van (only one of many others that were used to give cash to people on behalf of the DP candidate) had been wrapped by the Trade and Development Bank.

The government is now spending the public budget in order to make political gains, which is evident from the 161 billion tugrugs that were distributed to children before the voting took place. The International Monetary Fund is demanding the government to cut spending elsewhere to make up for this sudden expenditure. It has also been recently surfaced that MPP spent an additional 173 billion tugrugs in the last election. And, it goes without saying that DP also spent dozens of billions.  

This is how much a single election cost in our democratic Mongolia. It does not say that Mongolia is a poor country – what it tells us is how corrupt our country has become.  

Isn’t it the time we already started overseeing the performance of our government, disclose political party financing, and demand the corruption to be get rid of at all levels of the government? Why can’t we demand the political parties to dismantle when they keep their financing secret or report falsely while stealing from Mongolia’s resources? How many more years do we have to wait for Mongolbank to hold the commercial bank owners accountable for their actions – politicizing and putting the savings of their clients in risk?

In order to develop, the least Mongolia must do is getting rid of corruption. It is time for the awake to wake up those who are asleep.

2017.07.26

Trans. by B.Amar


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