MONGOLIA FORMS ITS FIRST-EVER COMPREHENSIVE STRATEGIC PARTNERSHIP WITH CHINA

On August 21-22, Xi Jinping, President of the People’s Republic of China paid a state visit to Mongolia. It is the first visit to Mongolia by a Chinese head of state in 11 years. This visit happened at a time when changes came out in world geopolitics due to the Ukraine crisis and appearance of split between US-led western countries and Russia-China-headed BRICS, an association of five major emerging national economies. For Mongolia, direct foreign investment is in a delayed condition, and investors are waiting to see what steps Mongolia takes. In this sense, a number of world countries are attentively watching the Chinese President’s visit to Mongolia, what talks and agreements will be developed between the two countries, and how their cooperation will be upgraded. As a result of the tete-a-tete meeting and extended talks between the heads of the two countries, the two parties signed about 20 documents on cooperation in politics, trade, culture and humanitarian spheres. It includes a Joint Declaration on the Comprehensive Strategic Partnership between Mongolia and People’s Republic of China; Intergovernmental Agreement on Transit Transportation to the sea and back through the territories of Mongolia and the People’s Republic of China; a Bilateral Agreement on a 162 million USD Commercial Loan between the Development Bank of Mongolia and the Development Bank of the People’s Republic of China; a General Agreement on Financing the Gashuun Sukhait-Gants Mod Ports Railway Construction between “Gashuun Sukhait” LLC of Mongolia and Shenhua Group and the Development Bank of the People’s Republic of China; a Protocol on Exchange of Note on “Agreement on Transfer of Prisoners between Mongolia and the People’s Republic of China”; Protocol on Cultural Exchange between Ministry of Culture, Sports and Tourism of Mongolia and Ministry of Culture of the People’s Republic of China and others. Moreover, the two countries’ entrepreneurs signed a number of cooperation documents that target intensifying economic expansion. The two countries established a good-neighbor partnership of mutual trust in 2003 and elevated the ties to a strategic partnership in 2011. The peak hour of this visit was signing a joint declaration to upgrade bilateral ties to a comprehensive strategic partnership. In other words, the two countries declare that their relations reached peak levels by signing a comprehensive strategic partnership expressing to develop talks and negotiations in all spheres in one rank, support each other at international and regional levels, respecting each other’s independence, sovereignty and territorial integrity and development path. China has become the first country in which Mongolia has developed a comprehensive strategic partnership. Mongolia’s President Ts. Elbegdorj highlighted the content of the Declaration pointing out that “The Parties shall respect each other’s independence, sovereignty, and territorial integrity, non-use of aggression, non-use of force, non intervention in domestic affairs, be fair and mutually beneficial, peaceful co-existence and shall mutually respect each other’s path of development. The Parties shall not take measures, establish any agreements and join any alignments or movements that shall harm each other’s sovereignty, security and territorial integrity.” In a speech delivered at Mongolia’s Parliament, Chinese President Xi Jinping stressed that “China always respects Mongolia’s independence, sovereignty and territorial integrity as well as development path selected by the Mongolian people. China regards its relations with Mongolia as a priority of its foreign policy. The two nations should be good neighbors, partners and friends, who can always trust each other. Both China and Mongolia are striving for reform and development and the revitalization of their nations”. The establishment of the Intergovernmental Agreement on Transit Transportation to the sea and back through the territories of Mongolia and the People’s Republic of China was one of the most important agreements. Geographically, Mongolia is a landlocked country sandwiched between China and Russia. In order to penetrate to the third market, Mongolia has no option but to pass through southern and northern neighbors. This time, Mongolia established an agreement with its southern neighbor for a 25 year term. According to the agreement, the Chinese side allowed the opening of northern and northeastern China’s seaports to Mongolia. This action is the start of Mongolia’s aspiration to penetrate the third market or export its products to international markets. By doing so, convenient conditions will be created for Mongolia’s economy. Furthermore, during the visit, the two sides signed a Mid-Term Program of the Development of Mongolia-China Trade and Economic Cooperation and set a goal of lifting bilateral trade to USD 10 billion by 2020. The Chinese side will grant a 162 million USD commercial loan with an 8 years term to Mongolia. In addition, China pledged to open a line of credit equal to 1 billion USD for Mongolia. Moreover, Mongolia and China agreed to jointly implement a project on coal processing; to cooperate in the railway sector; to construct power plants based on Mongolia’s coal deposits for exporting energy to China, improve infrastructure and management of border ports and others. For example, the two parties discussed making ports like Gashuunsukhait-Gants Mod and Siveekhuren-Sekhee be international ports; putting ports of Bayankhoshuu-Uvdug, Burgastai-Laoemyao, Khangi-Mandal and Khavirga-Arkhashaat into regular operation; and opening a new port of Tsagaandel Uul- Ulziit. Mongolia and China agreed to expand their relations and cooperation in education, cultural, health and humanitarian fields. Within this framework, a cultural exchange program will be realized for 5 years starting 2015. In the next five years, China will provide training for 1,000 Mongolian nationals, add an additional 1,000 full government scholarships, provide training to 500 Mongolian students in China, and invite 500 young Mongolians, and 250 Mongolian journalists to visit China. As well, the two sides will extend collaboration in preserving tangible and intangible cultural heritage, combat illegal trade of cultural heritage, continue the tradition of supporting each other in the international arena, promote Mongol studies and China studies in their respective countries and deepen exchange cooperation in national culture, language, tradition, history, arts, sport and traditional medicine, etc. Mongolia expressed its interest in cooperating with China within the Silk Road Economic Belt Initiative and participating in establishment of the Asian Infrastructure Investment Bank as a one of the founders. China expressed its position to support Mongolia joining a host of regional groupings, including the Asia-Pacific Economic Cooperation, and the East Asian Summit, to help boost its cooperation with countries in the region. China also supports the North-east Asia Security Ulaanbaatar Dialogue Initiative, proposed by Mongolia’s President Ts. Elbegdorj. China is willing to strengthen cooperation with Mongolia within multiple frameworks that include the United States, the Asia-Europe Meeting, the Conference on Interaction and Confidence-Building Measures in Asia and the Shanghai Cooperation Organization. China is willing to enhance cooperation with Mongolia under the Silk Road Economic Belt Initiative, and holds a supportive and open attitude towards the Savanna Road initiative proposed by the Mongolian side. The Chinese confirmed that the two sides can strengthen cooperation through these new platforms and others, including the Asian Infrastructure Investment Bank to increase mutual development and benefits. Moreover, the Chinese side reaffirmed its support to organize a trilateral meeting of state heads of Mongolia, China and Russia and intensify trilateral cooperation. Xi Jinping, President of the People’s Republic of China invited Mongolia’s President Ts. Elbegdorj to visit China at his convenient time, and returned to his country. Observes and researchers pointed out that the Chinese leader’s visit to Mongolia was significant in considering Mongolia’s security and development perspective. They noted that the outcome of the visit will depend upon what talks and agreements were made between the two countries. Looking at this content, the visit of China’s President creates an image from the development perspective that bilateral relations will be positive. Both Mongolia and China signed a number of documents; most of them are directed at enhancing the two countries’ trade and economic cooperation. Moreover, the visit confirmed that Mongolia will have no fear from the southern part in terms of independence. Generally, both sides provided preparations for the visit at the highest level. Therefore, the visit was successfully organized with great satisfaction on each side. Heads of the two countries also unanimously expressed their satisfaction of the visit’s results.