Ulaanbaatar: Oyun-Erdene's half-finished reforms
The prime minister ousted by parliament had promoted a New Recovery Policy to make Mongolia independent from the mining industry interests. Despite economic growth and the reduction of public debt, his government has had to face growing criticism, triggered by the luxury flaunted by his son on social media. Now a new phase of political uncertainty has opened for the country nestled between Russia and China.
Ulaanbaatar (AsiaNews) – Prime Minister Luvsannamsrain Oyun-Erdene resigned yesterday, following a motion of no confidence in parliament, after weeks of protests. The new phase of political uncertainty brings to an end a few years of stability.
The protests, mostly by young people, began after videos were released showing the prime minister's son leading a luxurious lifestyle. This is a sensitive issue in Mongolia, where a few business elites control much of the wealth, while a third of the population lives in poverty.
Yet the rise of Oyun-Erdene, who is only 45 years old, was paradoxically aided by his reputation as a reformer and anti-corruption politician, taking over as prime minister following protests involving then-Prime Minister Ukhnaagiin Khürelsükh, now president.
Oyun-Erdene’s term, which began in January 2021, has been marked by initiatives to diversify the economy. His policy agenda was dubbed the New Recovery Policy, launched in December 2021 as part of a long-term project called Vision 2050.
The goal was to reduce Mongolia’s dependence on the mining sector, traditionally the engine of the economy, through a series of investments in strategic sectors. Thanks to this impetus, the economy recorded a 4 per cent growth in 2022, exceeding forecasts.
Oyun-Erdene had promoted the digitalisation of public administration with the E-Mongolia project, promoted a series of constitutional changes to enlarge Parliament and make it more representative, and launched an ambitious campaign to promote tourism, simplifying visa requirements (with exemptions for visitors from 34 countries) while opening new air routes.
He also promoted the development of infrastructure, such as the Zuunbayan-Khangi railway link in 2022, and reduced public debt, managing to repay the “Chinggis bond” of US$ 1.5 billion in December 2022.
In an attempt to manage the country’s mineral resources more equitably, he had proposed the establishment of a sovereign fund to reinvest the profits in sectors such as health, education, housing, and direct financial support for citizens.
Despite these efforts, the perception of corruption in the country has not improved, which according to some international reports is endemic.
Last year, for example, US prosecutors sought to seize two flats in New York belonging to former Prime Minister Batbold Sükhbaatar who had purchased them with proceeds from illegally awarded mining contracts.
The demonstrations that led to Oyun-Erdene’s resignation also cited inflation, rising unemployment, and poverty as reasons for dissatisfaction, in addition to the excessive spending by the prime minister’s son.
Oyun-Erdene has consistently rejected the corruption allegations, calling them a smear campaign orchestrated by “major, visible and hidden interests,” while protesters have broadened their demands, calling for an end to the coalition government and a commitment not to amend the constitution.
The latter demand, in particular, appears to be aimed at President Ukhnaagiin Khürelsükh, who may be interested in consolidating his power despite coming from the same party as Oyun-Erdene, the Mongolian People’s Party (MPP).
Earlier this year, Oyun-Erdene said he wanted to form a coalition government to overcome Mongolia’s inertia due to excessive politicisation, also involving the Democratic Party (DP) and the People’s Party (HUN).
Only 44 of 126 MPs voted in favour of the motion of confidence in the government. It is now unclear whether the MPP, which holds 68 seats, will be able to form a new government.
The outgoing prime minister will remain in office for 30 days, within which a new head of government must be chosen.
“It was an honour to serve my country and people in times of difficulties, including pandemics, wars, and tariffs," Oyun-Erdene said after the vote. “No matter how intricately woven, a web of self-interest can never overcome the will of the people,” he added.
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