Mongolians group the aimags (provinces) of this country in many ways, including by orientation, such as eastern or western, and by natural zones such as forest or desert. Governments divide aimags and merge or split soums (districts) for various reasons. Every time that happens, soums can get bigger, smaller, or even disappear.
Recently, discussions were held about the idea of restructuring 20 of Mongolia’s 21 provinces by merging them to form only five provinces. But Mongolian politicians are not capable of achieving anything bigger than organizational or structural changes. They don’t even know that even when addends are grouped differently, the sum does not change.
People brag about racehorses and traditional wrestlers from their aimags. They don’t care about political ideology, political party affiliations, or competitive business when it comes to their wrestlers doing well and becoming champions. They chip in money to buy off the tournament win for their wrestler, and afterwards feel no shame for their crime. On the contrary, they throw a huge party and claim that they boosted pride in their aimag. It’s an embarrassing act that they should be ashamed of when standing before their own children.
There are many other ways for Mongolians to be proud of the land they were born in, and develop their country. It would be better if aimags competed in the development of introducing local brands to the international market. This would bring about substantial improvements to rural life.
With this type of competition in mind, and to provide basic information and to involve more local people in economic development, the Economic Policy and Competitiveness Research Center (EPCR) prepared their first provincial competitiveness report, available on their website www.ecrc.mn.
You cannot manage what you do not measure. This annual report was devised to give provincial governments an idea of where they stand in comparison to others, and to allow them to make decisions and plans accordingly.
The report presents a ranking of the provinces based on their levels of competitiveness in terms of 180 internationally accepted indicators; in the areas of public governance, economy and infrastructure. The report ranks Orkhon Province first in terms of competitiveness and Dundgovi Province last.
The developers of this report have suggested that five issues be addressed to develop rural areas: get rid of corruption and excessive bureaucracy, improve health and education systems, promote effective spending of mining income, support small and medium-sized enterprises, and develop roads and infrastructure.
A report developed by the National Chamber of Commerce and Industry titled “Research on developing the indicators of local business environments and the 2011 index,” produced a similar analysis to that of the aimag competitiveness report.
This report, produced at the request of the National Development and Innovation Committee, provided significant data related to business environment indicators, such as starting a business (Darkhan-Uul ranked first, Dundgovi last), acquiring permits (Dornogovi first, Dundgovi last), registering property (Sukhbaatar first, Tuv last), finding loans or funding (Darkhan-Uul first, Khovd last), tax environment (Uvurkhangai first, Tuv last), conducting international trade (Gobisumber first, Gobi-Altai last) and implementing agreements (Sukhbaatar first, Tuv last).
Aimags should develop strategies to create products that are in demand and therefore compete effectively in the market. For example, Khuvsgul Province could develop its tourism industry by providing tourists with ski and golf resorts that meet international standards. Why not arrange direct flights from Southeast Asia to Khuvsgul so that tourists can easily escape from extreme summer heat to visit golf resorts in Khuvsgul? Every aimag could build their own golf resort, while also reflecting their unique features.
Furthermore, our provinces should focus on producing their own unique products, such as tea mixed with locally sourced berries and honey, dairy products, meat, wool and cashmere. They should have long-term plans to supply their products to Ulaanbaatar first, then to neighboring countries and, ultimately to the whole of Asia.
Economic diversification is necessary. Our aimags might stop trying to seize every opportunity to mine their land if mining royalties were allocated not just to the aimag permitting the mining, but shared across aimags. Canada allocates royalty payments this way.
We need to introduce policies to expand the economic power of aimags by, for example, adding a “local tax” to existing taxes without increasing the rate of taxation, issuing aimag bonds to fund social projects at the local level, and imposing no taxes on coupon payments.
The development of towns in rural provinces could reduce the financial pressures of maintaining infrastructure, like we see in Ulaanbaatar today, but Mongolia has no long-term policy for this kind of development.
If we manage to determine every aimag’s development outlook for the next 20 or 30 years, we will be able to develop them appropriately, and make the necessary preparations. For example, who is thinking about what will happen to Orkhon Province and Erdenet after their copper deposits are depleted in 30 years? Experience abroad shows that mining towns tend to become ghost towns when local leaders don’t think about what will happen when the mining stops. All aimags with mining industries should start thinking about what will happen when the mineral resources are gone, and how current revenues should be spent.
Erdenet Mining Corporation should be owned by the public, not the state, and a certain percentage of its shares should belong to the local people, so that they can accumulate mining revenue in a “Post 2040” fund.
It would also be smart to develop strategies to make one of the western aimags a regional center of education or health and start building the necessary infrastructure now.
If everything is calculated in this fashion, and a certain outlook for the future is determined, people will stop spending their lives divided along political party lines. Politicians will compete by doing things, not just by talking about what they are going to do. It will also be easier to measure their fulfillment of their promises.
It’s time to hold meetings and conferences between local governments, the private sector, civil society, and other stakeholders, including citizens, to discuss how aimags can identify their strengths and weaknesses, and how each can improve competitiveness.
The time has come for us to wake up and start competing with our brains and business sense, rather than racehorses and wrestlers, so that we can enter the international marketplace. When we conquered the world on horseback, every aimag contributed forces.
Translated by B.AMAR
2013.05.01