Mongolia: The Next Asian Tiger?(0)
The news of July’s agreement in principle of the Mongolia-Japan Free Trade Agreement (FTA) was merely another addition to Tokyo’s stable of trade agreements in Asia. But for Mongolia, the trade pact with Japan is of far more significance—and not merely because it was with the world’s third largest economy. The conclusion of negotiations represents Mongolia’s official entry into East Asia’s proliferation of trade agreements, as this is the country’s first FTA. Meanwhile, Ulaanbaatar is also studying proposed agreements with South Korea and China.
But will Mongolia’s drive for FTAs and a greater push for economic regionalism help its economy? After years of soaring economic growth, the Mongolian economy has precipitously cooled over the past year with a sharp decline in GDP growth and a looming deficit of foreign direct investment (FDI). Indeed, Ulaanbaatar remains heavily dependent on the mining sector for its economic fortunes, which have been battered over the past two years due to the sinking price of coal as global supply outpaced demand. But while the demand for coal is once again slated to surpass supply in the coming years, Mongolia’s FDI numbers remain low.
Over the first six months of 2014, FDI to Mongolia dipped more than 70 percent as compared to the year before. This lack of capital flow compounds an already sizable challenge facing the Central Asian country, which saw its FDI numbers halved in 2013 after record growth in previous years. In addition to concerns about FDI in its minerals sector, Ulaanbaatar’s economy is likely to continue to feel pain in the coming years as a result of significant economic imbalances due to government policies aimed at stimulating economic growth. Without improved FDI flows, Mongolia’s trade imbalance—currently under -10 percent—will likely worsen as the country continues to depend on imported energy and infrastructure, rather than focus on strengthening its exports.
According to the most recent World Bank report, other key sectors are faltering too—such as agriculture, electricity and construction. These economic pressures are contributing to double-digit inflation in Mongolia and less purchasing power for domestic households. This inflation is also contributing to an already overheated housing market in Mongolia that is rapidly increasing household debt.
The news of the FTA with Japan—a significant source of regional FDI—is a good sign for kick-starting Mongolia’s drive to improve its investment appeal. But FTAs won’t be the only solution here. The government of Mongolian president Tsakhiagiin Elbegdorj continues to try to repair Mongolia’s international image after it rounded circles on its mining investment regulations over the past couple years. The new investment law has been more transparent and less restrictive than previous legislation, which handcuffed foreign investors and curtailed large investments in key projects, such as the multibillion-dollar Oyu Tolgoi copper mine.
What can Ulaanbaatar do to change the course of its economic fortunes? There are a number of domestic policies—including reigning in spending and attacking inflation—that are necessary, as noted previously. There are also key foreign-policy actions that Mongolia should undertake. First, Mongolia must address its FDI gap with a full-court press on international investors and a more transparent environment to court multinational companies. Second, Ulaanbaatar needs to recognize the limits of its “third neighbor” policy—which focuses on diversifying Mongolia’s strategic partnerships beyond Russia and China. While the policy has been, in general, a success story, Mongolia must work harder towards also pushing for stronger economic and investment ties with Beijing and Moscow.
Mongolia’s recent history as a landlocked vassal to these superpowers has understandably cautioned Ulaanbaatar’s appetite for stronger ties. But despite historical resentment, most acutely focused at China, Mongolia must remain pragmatic in order to maintain its economic success of the past decade. This pragmatism was on display during Chinese president Xi Jinping’s two-day visit to Mongolia last month. The visit, the first by a Chinese leader in over a decade, was a significant step towards an improved economic relationship between Beijing and Ulaanbaatar. During Xi’s visit, both sides agreed to elevate their relationship and enhance economic cooperation in the minerals sector and also in areas such as infrastructure development. Beijing also relished the opportunity to attempt to upstage Japan’s surging engagement with Mongolia.
Ties with Russia also remain vital to Mongolia’s prosperity and Elbegdorj has looked to enhance the relationship with Moscow, despite strong international pressure against Russia due to its actions in the Ukraine. At the recent Shanghai Cooperation Organization (SCO) summit in Tajikistan, Elbegdorj took part in a trilateral summit meeting with Xi and Russian president Vladimir Putin. During the meeting, Xi proposed the three countries create a trilateral “economic corridor” that would serve as a modern-day Silk Road.
But while the prospects of large FDI numbers from Beijing and Moscow are appealing, Mongolia will have to tap-dance around the geopolitical pressure from both. This maneuvering is becoming increasingly more difficult as both Moscow and Beijing seem adverse to U.S. and Japanese efforts to strengthen partnerships in the region. Indeed, Xi demonstrated this baggage during this week’s trilateral summit by inviting Mongolia to next year’s commemoration of the 70th anniversary of the end of World War II—an opportunity to celebrate “the victories of the World Anti-Fascist War and the Chinese People’s War of Resistance Against Japanese Aggression.” In other words, Ulaanbaatar’s ability to balance its economic needs with its desired geopolitical trajectory will be put to the test in the coming years, especially if its economy fails to regain momentum.
J. Berkshire Miller is a fellow on Japan and Chair of the Japan-Korea Working Group with the Center for Strategic and International Studies Pacific Forum. Follow him on Twitter:@jbmllr.
Image: Flickr/Mario Carvajal/CC by 2.0
Anti-Western alliance in Asia(0)
The Shanghai Cooperation Organization is planning to expand and become an alternative to Western-dominated international institutions. But experts say a lack of resources may hinder the process.
The 13th annual summit of the Shanghai Cooperation Organization (SCO) is set to start on Friday, September 12 in Tajikistan’s capital Dushanbe. The two-day forum will be attended by regional leaders, including Russian President Vladimir Putin, and his Chinese and Iranian counterparts, Xi Jinping and Hassan Rouhani.The SCO is an intergovernmental organization of Central Asian countries aiming to promote cooperation between its six member states: Russia, China, Kazakhstan, Uzbekistan, Kyrgyzstan and Tajikistan.
Topping the agenda are plans to expand the alliance: India, Pakistan, Iran and Mongolia, – all countries with observer status – are expected become members. Should this happen, the group would then control 20 percent of the world’s oil and half of all global gas reserves. On top of that, the bloc would represent about half of the world’s population.
The unknown alliance
Despite those numbers and large-scale joint military exercises – the SCO’s ‘Peace Mission 2014′ counted some 7.000 soldiers – the forum receives very little attention in Western media.
The SCO’s main goal has been to serve as a forum to ease tensions in the region. In the organization’s 2002 charter “confidence-building measures” were set as the alliance’s first priority. A key aspect of this strategy is the fight against the so-called “three evils:” terrorism, extremism and separatism. Moreover, the members of the group are encouraged to engage in economic and technical cooperation.
Russia and China’s interests
Russia and China strive first and foremost for stability. To achieve this, a steady bilateral relationship between the region’s two dominant powers is necessary, says Enrico Fels analyst at the Germany-based Center for Global Studies of the University of Bonn.
For a long time, Russia had been a declining power in Central Asia, while China was on the rise; so the SCO served as a way to coordinate regional interests, helping reduce tensions between the two countries.
Simultaneously, Central Asia is of strategic importance to both nations, as the maps shows. While Moscow feels threatened by the expansion of NATO and the European Union on its western border, China – the world’s largest exporter of goods and one of the largest importers of raw materials – is highly dependent on its ports. Beijing is under pressure in the east from the United States and its regional allies, Japan and the Phillipines.
Analyst Fels summarizes the situation by saying that given the outside pressure exerted on both countries they feel like they must get along in Central Asia. Stability in the region is also key to protect Russian and Chinese economic interests. Both countries depend on a functioning infrastructure, such as pipelines and railways.
China not only imports gas and oil from Russia and Central Asia, but it is also the largest supplier of goods in the region. Not least, both Moscow and Beijing do not want Central Asia to become a location for Western military bases – namely American – as it once was.
Central Asian perspective?
There is no Central Asia perspective, as Beate Eschment, analyst at the Research Center of East European Studies at the University of Bremen told DW. The countries’ interests are pointedly different: while Kyrgyzstan and Tajikistan are economically and militarily dependent on Russia, Turkmenistan – which is not a member of the SCO – isn’t, as it is trying to maintain as neutral a position as possible, says Eschment.
Furthermore, Uzbekistan is pursuing a completely different policy, sometimes leaning towards Russia and sometimes towards China. At the same time, “the leadership of the biggest and both militarily and economically strongest country in Central Asia – Kazakhstan – is Russophile,” says Eschment.
However, there are huge tensions between the two, as the Kazakhs are wary of too much Russian interference. Given the situation in Ukraine, Astana is afraid of a possible annexation of their northern territories by Moscow, since the area is home to a large Russian minority. As such, China may have an advantage in these countries, as it is seen by their leaders as having only an economic interest in them, Eschment adds.
Against the West
What links all SCO states – whether members or observers – is the rejection of Western-dominated institutions, be it the United Nations, World Bank or the International Monetary Fund, which are all US-based. “The SCO, like the BRICS with the establishment of their Development Bank, sees itself as a forum against the global order,” says Fels.
“They are seeking to provide alternatives to these international organizations. However, I don’t think that the SCO will be an anti-NATO or an ‘OPEC with bombs,'” the analyst says. Their approach, he adds, is comprehensive and based not only on a military alliance, but also on economic ties and soft power.
In spite of this, Fels says that “very little else has been done beyond letters of intent and military exercises.” The reason for this is that the SCO is poorly equipped, he says: “They want to cooperate and have geostrategic operations. But the question is how many resources will be allocated for this?”
Moreover, they work along the principle of non-interference, which has long dominated Chinese foreign policy. However, this approach can only go so far when applied to an international alliance. For instance, when violent conflicts between ethnic Kyrgyz and Uzbeks in Kyrgyzstan broke out in 2010 – claiming the lives of 2,000 people and leading to the displacement of hundreds of thousands – the SCO decided to follow the non-interference principle and remain, by and large, passive.
SCO Seeks Transport Hub in Mongolia, Eyes to Boost Market in India(0)
MOSCOW, September 10 (RIA Novosti) – The Shanghai Group is expected to consider Mongolia as the next member of the organization, which is set to become a transport hub, the director of the Russia department of the SCO International Relations Institute said Wednesday.
“We hope that the SCO will consider the issue of accepting new member states, includingMongolia. New members will receive aid to develop security,” Feng Noyzun said at the International Information Agency Rossiya Segodnya press conference.
“We will seek more innovative ways of collaboration. China, Russia and Kazakhstan have reached a lot of mutual understanding in Central Asia, the oil and gas pipelines are just the start of the partnership,” he said.
“For Mongolia, we need to see how it can become a transport hub in SCO, and how it could offer a new model of cooperation,” the Chinese expert added.
Chen Yu Zhu, who also heads the international relations institute, said expanding the SCO is important as it will lead to stronger influence of the organization on the international arena.
“The SCO today faces a difficult situation. India, Pakistan, Afghanistan hope that if they join the SCO they will enhance their security, and it will be a good stimulus for their economy. The SCO will increase the market for India, the telecoms leader in the region,” he said.
Andrei Kortunov, Director General of the Russian International Affairs Council, said: “Mongolia’s membership is a prospect. Mongolia has its own keys to North Korea. So the SCO is not a war or economic bloc, but a more flexible, more functional organization. And that is why the Mongolian case is needed.”
The Chinese experts participated in the video link-up between Moscow and Beijing organized by the International Information Agency Rossiya Segodnya press center ahead of the SCO summit to be held in Tajikistan’s capital Dushanbe on September 11-12.
SCO is a Eurasian political, economic and military organization founded in 2001 in Shanghai by the leaders of China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan. Afghanistan, India, Iran, Mongolia and Pakistan are currently observer members.
North Korean group to visit Europe, Mongolia(0)
Pyongyang: In a bid to improve its diplomatic relations, a delegation of North Korea’s ruling party Saturday left here to visit Europe and Mongolia, the official KCNA news agency reported.
The Workers’ Party of Korea (WPK) delegation, led by Kang Sok Ju, a political bureau member of the WPK Central Committee, will visit Germany, Belgium, Switzerland, Italy and Mongolia, Xinhua reported.
North Korea, which faces strained relations with South Korea and the US, is now seeking to break the ice in diplomacy with a series of moves.
Last week, Japanese lawmaker Antonio Inoki went to Pyongyang to stage a two-day international wrestling tournament.
During his short stay here, he held talks with DPRK officials over the re-investigation into abductions of Japanese nationals in the 1970s and 1980s.
The visit, which drew worldwide attention, was widely called “sports diplomacy” and believed to help warm DPRK-Japan relations.
Surabaya chosen to host Asian Fashion Week 2014(0)
Previously scheduled to be held in Ulaanbaatar, Mongolia, but due to circumstances the venue was altered to Surabaya, stated the President and CEO of Fashion Week Group, Arwin Sharma, in Surabaya on Monday, 12th May 2014 as reported bytempo.co.
The Asian Fashion Week 2014 will bring together fashion designers and fashion enthusiasts from all over Asia and other countries. Among those participating in the Asian Fashion Week are Afghanistan, Armenia, Azerbaijan, Bahrain, Bangladesh, Bhutan, Brunei Darussalam, Cambodia, China (including Hong Kong and Macau) India, Indonesia, Iran, Iraq, Japan, Jordania, Kazakhstan, South Korea, Kuwait, Kyrgyzstan, Laos, Lebanon, Malaysia, Maldives, Mongolia, Myanmar, Nepal, Oman, Pakistan, Palestine, the Philippines, Qatar, Russia, Saudi Arabia, Singapore, Sri Lanka, Syria, Taiwan, Tajikistan, Thailand, Timor Leste, Turkey, Turkmenistan, United Arab Emirates, Uzbekistan, Vietnam and Yemen.
The event is also a part of the Fashion Week Group that include the Indian Ocean Fashion Week, Silk Road Fashion Week, World Islamic Fashion Week, and World Indigenous Fashion Week.
Asian Fashion Week promotes Asian cultural diversity, encourages dialogue and networking in Asia through the development and growth of its respective Fashion Industries, and the creation of an Internationally-recognized quality “Asian Style Brand” through innovative, unique yet intricate designs of accessories, apparel & garments, handbags, jewellery, products, shoes etc. The event moreover promotes and encourages the preservation of traditional methods and techniques in Fashion.
ASIAN Fashion Week is aimed to become a major Fashion movement for Asian Designers and a facilitating platform to optimize their exposure internationally, while developing global reach for its expansion, leading to economic growth and, understanding on the principal of fair and free trade.
Surabaya is Indonesia’s second largest city after Jakarta. There are many international flights direct to Surabaya including from Singapore and Australia, Domestically, Surabaya is a one hour flight from Jakarta and forty minutes from Bali.
More information available at: http://www.asianfashionweek.org/
Nature, Opaque and Mysterious, in All Its Seasons(0)
Four of the five sections of “From a Firefly’s Eye,” a suite of dances presented by Zendora Dance Company at the Brooklyn Academy of Music’s Fishman Space over the weekend, took their titles from the seasons. But the show was no pastoral, no pretty nature calendar, and the music was definitely not Vivaldi.
Instead, Nancy Zendora, a choreographer long interested in ancient culture and ritual, presented nature as mysterious, strange and beautiful, but possibly frightening. The five dancers in diaphanous shifts designed by Jennifer Lee could have been initiates in a cult. From bird calls, Hannah Darrah’s sound design swerved into something more like speaking in tongues. The musical recordings that followed were spiky, eerie: compositions by Gyorgy Kurtag, Morton Feldman and Iannis Xenakis, and drums and shamanic voices from Mongolia.
The suggestion of daemonic forces was the work’s most compelling aspect. Ms. Zendora’s choreography was occasionally representational — bird-wing arms, twirling hands descending like falling leaves — but more often, her images were abstract. The preponderance of slow, deliberate motion and sustained poses established a meditative mood, and when bursts of speed ruptured it, the sudden change could startle and disturb like a spirit visitation.
Each seasonal section was preceded by a haiku (written and recited by Yuko Otomo), and Ms. Zendora’s aesthetic was clearly influenced by spare Japanese forms, like Butoh. This approach puts considerable weight on the potency of each image, and neither in design nor in execution were Ms. Zendora’s continuously convincing. The mature performers came closest: Marie Baker-Lee, who has been with the company for 23 years; Craig Hoke Zarah, new to the troupe but with dance experience extending back to the 1970s.
The lizardlike presence of Mr. Zarah in the “Spring” and “Autumn” segments gave the work its greatest intensity. In other spots, the spareness felt merely thin, and alternation between the sedate and the rapid gradually lost its power to shock. When Ms. Zendora popped up in a slatted mask (by Ralph Lee) for the final section, “With Lunar Eye,” her arrival came as a surprise, but nothing she did matched the force of that mask or of the Mongolian ritual music she was borrowing. The costume was right; the spirit was missing.
North Korea’s best hope(0)
SEOUL, South Korea — I escaped from North Korea in 2007. Two years later, I arrived in Mongolia, along with my mother and five other people. Armed with knives and prepared to kill ourselves, we begged the soldiers who caught us not to send us back to our native country.
Like a lot of North Korean refugees, I would like to visit a reformed North Korea one day. I have hope for such a place because while the international community debates how to help North Koreans, change is happening — from within. To paraphrase Lenin, things have to get worse before they get better.
In the last decades of the 20th century, North Korea’s economy went from bad to worse, hitting rock bottom during the famines of the 1990s. To survive, North Koreans began to engage in private market activity, which today accounts for as much as 80 percent of family income. The public distribution system that has provided North Koreans with rations since the 1950s can’t compete with the spontaneous order of the market.
There are many changes going on, and it is my generation — often called the Jangmadang, or “Black Market Generation” — that will make changes permanent.
North Korea’s Black Market Generation has three main characteristics. The first is that it has no devotion to the Kim dynasty. Kim Il Sung founded the country in 1948 and ruled it with an iron fist until his death in July 1994. Born in 1993, I was brainwashed to glorify him and his economic system of “juche,” or national self-reliance — but I have no memory of him. There are some in my generation who profess admiration for him and his progeny, but they just don’t want to lose their “loyal” status under North Korea’s government-imposed “songbun” caste system. They are concerned about themselves, not the Kim dynasty.
The second characteristic: Our Black Market Generation has had wide access to outside media and information. The private market has provided more than food and clothing — it has also provided TVs, bootleg South Korean movies and K-pop videos, USBs and DVDs. As a girl in North Korea, I saw “Titanic,” “Cinderella,” “Pretty Woman” and “Snow White” — not to mention WWE wrestling.
As American philosopher Eric Hoffer wrote: “It is not actual suffering but a taste of better things which excites people to revolt.” North Koreans who have grown up watching such entertainments as I did and know they are not as dangerous as the regime has claimed for decades will be unlikely to enforce censorship once they are in positions of influence.
Already, seeing movies and music videos from South Korea has inspired many North Korean youngsters to talk openly about wanting to live there. Of course, they will eventually recognize that not all South Koreans live like those they see on screen — but they will find that even lower-class South Koreans live better than most North Koreans.
Non-government organizations and others who have managed to get information and movies into North Korea should be proud of themselves: They have had an impact.
The third characteristic of the Black Market Generation: We are capitalistic and individualistic. We grew up with markets; we have experienced buying and selling. I recall regularly going shopping with my mother.
This development of markets is important because it undermines the “songbun” of North Korea. With the government in charge of social classifications and food distribution, it has always determined who could acquire wealth and who would starve. The private market removes that from government control. Members of the Black Market Generation want to be as wealthy as the people they see in foreign movies.
Based on reports I have heard from refugees who have recently escaped to South Korea, the late Kim Il Sung would not recognize his country’s economy today. Politically, the regime still cracks down on dissent and issues meaningless edicts about the evils of capitalism. But it must know: Juche has died, and markets are on the rise.
The Black Market Generation of North Koreans will be the one to change the country’s society. We know both halves of Korea well. We can lead change from the bottom up.
If I ever return to a reformed North Korea, I will be thrilled to meet my peers as we attempt to bring wealth and freedom to people who were forced into poverty by the Kim family dynasty.
Yeon-mi Park is a media fellow at the Freedom Factory think tank in Seoul (firstname.lastname@example.org). She wrote this for The Washington Post with Casey Lartigue Jr., her co-host on “Casey and Yeon-mi Show,” a podcast about North Korean issues.
U.S.-North Korea Teams Talk in Mongolia(0)
It has been confirmed that delegations from the U.S. and North Korea met in the Mongolian capital, Ulaanbaatar, on Friday last week.
North Korea’s Six-Party Talks representative, Vice-Foreign Minister Ri Yong Ho informed journalists waiting at an airport in Beijing earlier today that he had been involved in meetings with a team of U.S. experts. The three-person team is said by third parties to have included veterans Robert Carlin and Joel Wit.
However, is unclear what progress was made through the track 1.5 meetings, which the U.S. government has kept at arms’ length. The administration of President Barack Obama cleaves to a line whereby Pyongyang is required to move on denuclearization prior to further talks, which the North Korean authorities are unprepared to accept.
N. Korea, Japan to meet in Sweden with focus on abductees(0)
Stockholm (AFP) – North Korea and Japan are expected to discuss the fate of Japanese nationals kidnapped decades ago by Pyongyang as their envoys meet for three days of talks in Stockholm from Monday.
The meeting in the Swedish capital takes place after the two countries held their first official talks in 16 months in China in March, speaking on a range of issues including the abduction issue and North Korea’s nuclear weapons programme.
The Japanese side is expected to tell the North Koreans that it is willing to lift some economic sanctions imposed on the hermit state if it is convinced that Pyongyang is making a serious effort to investigate what happened to abductees still unaccounted for, Kyodo News said, citing unnamed sources.
“I don’t think it represents any reconciliation between the two sides, but there is a meeting of interests and both would get something off it if there was a deal done,” said Hazel Smith, an expert on Korean politics at the University of Central Lancashire.
“For Japan, it would mean a political success for the government, and for North Korea it could mean, they hope, the possibility of increased trade.”
While relations with South Korea remain testy, Pyongyang’s approach to its dealings with Japan appears to have softened in recent months, especially on the emotive issue of abductions.
In March, North Korea allowed the daughter of a Japanese woman who was kidnapped in the 1970s and later died to travel to Mongolia to meet her grandparents, who had flown in from Japan.
“It’s a sign that the North Koreans are prepared to do pretty much anything in order to get a deal with the Japanese, because they feel it’s achievable,” said Smith, indicating that it could mark the first step towards a wider thawing of tensions.
North Korea outraged Japan when it admitted more than a decade ago that it had kidnapped 13 Japanese in the 1970s and 1980s to train its spies in Japanese language and customs.
Five of the abductees were allowed to return to Japan but Pyongyang has insisted, without producing solid evidence, that the eight others are dead.
“Needless to say, the abduction issue is one of the nation’s biggest concerns,” Japanese Foreign Minister Fumio Kishida said last week when announcing the Stockholm meeting. “We would like to draw their positive response.”
At the Stockholm talks, Japan will be represented by Junichi Ihara, the director general of the foreign ministry’s Asian and Oceanian Affairs Bureau, while North Korea?s delegation will be led by Song Il Ho, the ambassador for talks to normalise relations with Japan, according to Japanese media.
– Why Sweden? –
One of the most remarkable features of the upcoming talks is the Scandinavian venue, as bilateral talks have so far tended to take place in Asia, and China in particular.
Observers said the decision not to meet in China could reflect the ongoing tension between Tokyo and Beijing, especially over territorial issues in the East China Sea, but Japanese media suggested Pyongyang might also want to try a new venue.
“North Korea apparently wants to have in-depth talks in a place away from China at a time when its relations with China are strained,” an unnamed Japanese official told the Mainichi Daily News.
Sweden is considered a neutral country by both sides, said observers. It has had diplomatic relations with North Korea since 1973, and represents the interests of US citizens in North Korea in the absence of diplomatic ties between Washington and Pyongyang.
During the March meeting, the Japanese side protested against the communist state’s launch of ballistic missiles and its threat to conduct more nuclear tests.
Japan may reiterate this in Stockholm, but it is unlikely to make any progress, since North Korea prefers to deal with the United States on this issue, according to analysts.
Pyongyang for its part renewed its demand that Tokyo compensate Koreans for their suffering during Japan’s 1910-1945 colonial rule over the Korean peninsula.
Formal ties with Japan could bring huge economic benefits to the impoverished state, while stability in the East Asian region as a whole would also benefit, according to Smith.
“There is still potential for hot conflict in the region, so in the broad scheme of things it’s positive that these two protagonists are actually talking to each other,” she said.
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