Mongolia, about to go bankrupt

After the outbreak of COVID-19 epidemic, many countries with single economic structure, insufficient international reserves and high prices are facing major crises, including our neighbor Mongolia.

In the past three decades, Mongolia has experienced two large-scale economic collapses. Moreover, due to too many foreign debts, the only US dollar reserves can only be used to pay off debts, so Mongolia's prices soared, the necessities of life were seriously lacking, and the unemployment rate was once close to 10%.

According to Mongolian media, 20021-2024 is the peak period for Mongolia to repay its foreign debt, because its public debt accounts for 70% of GDP, foreign debt and private debt account for 300% of economic output, and the salaries of civil servants and troops have begun to be defaulted. There is no doubt that Mongolia is on the verge of bankruptcy.

1. Why is Mongolia's economy weak?

Mongolia is a famous mineral producer in Asia with vast grassland and beautiful scenery. At present, there are more than 80 kinds of minerals such as iron, copper, coal, gold and rare earth. Oyutolegai copper-gold mine, which is known as a world-class mineral deposit, has become one of the biggest driving forces of the country's economy.

Relying on its incomparable advantages in mineral resources, Mongolia once became one of the countries with the fastest economic growth rate in the world, with the highest GDP growth rate reaching 17.29%. However, Xiao He defeated Xiao He, just like Venezuela and other countries that only rely on export resources for development. Even though Mongolia is rich in mineral resources, its economy is still weak.

The data shows that even after years of simplification, Mongolia's mineral resources exports still accounted for 78.5% of the total foreign export trade in 20 18. In addition, because Mongolia has no industry, its export business supports 80% of its income. In other words, the quality of Mongolia's economic development depends entirely on how many minerals can be sold.

In the era of mining prosperity, with the help of gold rush and the export of mineral resources, Mongolia's economy can still develop, but under the single economic system, once the global demand for goods is weak, Mongolia will inevitably fall into economic crisis.

20 14 with the shrinking demand for mineral resources in China and the breakthrough in mining technology brought by the shale oil revolution in the United States, international energy prices began to drop sharply, and the prices of mineral resources in Mongolia continued to fall.

In addition to the single economic system, chaotic politics is also a major reason for the deterioration of Mongolia's economy. After the disintegration of the Soviet Union, Mongolia did not adjust the multi-party political management system. Although decades have passed since the disintegration of the Soviet Union, the political situation in Mongolia has become increasingly turbulent.

At present, the unemployment rate in Mongolia remains high, and the national economic aggregate is only 1/26 of that in Inner Mongolia, and the GDP is even lower than that in a flag county in Inner Mongolia.

Second, pretending to be a big mine of the country.

In fact, now Mongolia is more like a "big mine". As the development of domestic manufacturing industry is still in the primary stage, except animal husbandry and agricultural products, Mongolia relies on imports for daily necessities, mechanical and electrical products and spare parts, chemicals and chemical products.

This is because Mongolia became a satellite country of the Soviet Union after World War II. The Soviet Union implements the task allocation system for the management of satellite countries, which is simply a "tool country".

Mongolia, because of its rich underground mineral resources, has become a "Soviet mine" covered with a national coat. The Soviet Union's management of this "mine" in Mongolia was very rude. The mined ore is directly loaded on the train and transported back in series, and there is basically no industrial base in the local area.

Moreover, for a long time, Mongolia has regarded the mining industry with fast money as the lifeline of its national economy, and has also implemented the strategy of "rejuvenating the country through mining".

Therefore, coal and copper mines used to account for nearly 70% of Mongolia's total export revenue, and mining industry has also become a pillar industry and an important engine for Mongolia's sustained economic growth.

According to statistics, Mongolia, as a big country with mineral resources, ranks in the top 20 in the world and has never been explored and developed on a large scale. At present, there are more than 80 known minerals in Mongolia, with more than 6,000 occurrences. At the same time, Mongolia has important strategic resources such as iron, copper, molybdenum, gold and rare earth.

Among them, coal reserves are about 654.38+05.2 billion tons, copper reserves are more than 2 billion tons, and there are many gold.

Mongolia, with all kinds of mineral resources, naturally will not have a good opportunity to make money from them. In order to realize these resources as soon as possible, since the 1990s, Mongolia has begun to revise its domestic mining law (the strategy of "rejuvenating the country through mining") to attract more overseas investment.

Among them, the proven reserves of Oyu Tolgoi mine are 3 165438+ 10,000 tons of copper, 0/328 tons of gold and 7,600 tons of silver, making it the largest source of income in Mongolia. The output of copper concentrate and molybdenum has become one of the indicators of Mongolia's national economy, and the annual production income accounts for about a quarter of GDP.

In fact, there is no need for economists to conduct research and analysis. As long as Mongolia's economy grows, it must be attributed to mining, and vice versa. Mongolia has also opened its doors, enacted a foreign investment law and a mining law, introduced foreign capital from China, South Korea, Russia and other countries, and broadened the mining situation.

3. Does Mongolia have a future?

Geographically, Mongolia covers an area of 6.5438+0.566 million square kilometers. Its territory is dominated by grasslands and Gobi, and there is no third neighboring country except China and Russia. Moreover, because there is no seaport, only mining, animal husbandry and foreign economic assistance are left to Mongolia, and the industrial base is weak.

According to the latest data of Mongolian Statistics Bureau, in 2020, Mongolia's GDP shrank by 5.3%, while the total foreign debt increased by 1 1.6%, making Mongolia's foreign debt reach 30.8 billion dollars, which means that more than 3 million people in Mongolia can pay off their debts without eating or drinking for three years.

Due to excessive debts, Mongolia was listed on the "Watch List of Garbage Countries" by Moody's. In order to help pay off debts, from 2065438 to March 2007, Mongolia adopted the national debt repayment practice, which not only issued 580 million US dollars of national debt, but also distributed the debt repayment share to every citizen.

In fact, Mongolia is not without hope of economic improvement. Sandwiched between China and Russia, Mongolia has benefited greatly from its strategic position. Although Russia, as a resource-rich country, can't help Mongolia sell its resources, China's assistance to Mongolia has never decreased.

After the disintegration of the Soviet Union, Mongolia frequently fell into economic crisis, and the international community extended a helping hand many times to ensure the stability of Mongolia. In 2003, the international community held the 10 international aid conference, and provided $2.9 billion in loans and free aid to countries and international organizations providing assistance to Mongolia.

In 20 17, the International Monetary Fund provided a large amount of financial assistance to stabilize the economic situation in China, of which more than one third came from the People's Bank of.

In contrast, from 1990 to 2008, there were nearly 9,940 foreign investment companies with a direct investment of only $3.8 billion. Of course, to some extent, investment is auxiliary, and there are a few enterprises that really make money by investment.

From 199 1 to 20 10, China provided about 7.2 billion yuan of free aid to Mongolia. In 20 18, with the help of China, Mongolia's foreign exchange reserves have increased from the previous 1 1 billion dollars to 3.2 billion dollars.

Moreover, in order to further support the development of Mongolia, in just 20 19 years, China enterprises invested 270 million US dollars in Mongolia, up 132% year-on-year.

In fact, Mongolia's economy is not so much a crisis as a quick success after making a fortune through the "mining miracle". Not only the mining industry, but also the development of its traditional pillar industry, animal husbandry, because Mongolia has always held the idea of "relying on mountains to eat mountains".

It is reported that with the sharp increase in the number of livestock, the Mongolian grassland has been overwhelmed. The sandstorm in northern China in March this year is a direct reflection of Mongolian desertification.

Last year, Science magazine published an article, "It proves that the climate of the Mongolian Plateau has undergone major changes in the past 20 years, and it has fallen into a four-season cycle of high temperature, drought and extreme cold. Coupled with overgrazing and neglect of governance, the ecology of the Mongolian Plateau is likely to have passed the recoverable balance point. "

The data released by the Mongolian government also confirmed this conclusion. 70% of the land in China is desertified, and there are 6,646 rivers in Mongolia, of which 55 1 is cut off or dried up. There are 36 13 lakes and swamps, of which 483 are dry.

The survey shows that Mongolian nationals are pessimistic about the country's economic development prospects. They usually learn many languages, including Chinese, Russian and Korean, in order to do business with foreigners or emigrate overseas.

In fact, regardless of external factors or internal factors, Mongolia's economic development will not be smooth unless it makes up its mind to change the national attribute of its "big mine". You know, there are more than 200 countries (regions) in the world, and not every country will have a bright future.