Populist candidate Battulga Khaltmaa has won Mongolia's first ever run-off vote to clinch the country's presidency, putting international investors on notice after the local businessman pledged to grant greater state control over Mongolian coal mining.
The General Election Commission in Ulaan Bataar announced on July 8 that Battulga had won 50.6% of votes cast in the second round run-off. Battulga beat parliamentary speaker and initial favourite Miyeegombo Enkhbold of the ruling Mongolian People's Party. Mongolians returned to the polls after the first round vote on June 26 failed to give one candidate an outright majority.
"Mongolia has won," Battulga, a former transport minister, said after the result was announced. "I will start work straight away to resolve the economic difficulties and make Mongolians debt-free as I promised," he added.
The Democratic Party candidate has repeatedly called for the Mongolian state to regain greater control over the country’s natural resource wealth in a bid to improve living standards nationwide. "The government should hire experts and take control of everything," he said while campaigning earlier this year.
Amongst Mongolia's most valuable mining assets is the state-owned Tavan Tolgoi coal mine in the Gobi desert, which has already been plagued by political interference from the Mongolian government. In 2011, a deal between US coal giant Peabody and Chinese Shenhua was blocked by the Mongolian Security Council over fears that the agreement would grant too much influence over Mongolian mining. In 2016, the Mongolian parliament, which is controlled by Mongolian People's Party, scuppered a deal for Tavan Tolgoi involving a consortium of Shenhua, Hong Kong-listed Mongolian Mining and Japan's Sumitomo.
The Mongolian tugrik was last year's worst performing currency worldwide. Since 2011, the country’s economy has been rocked by low commodity prices and a slowdown in demand for coal and other resources in China. The country's debt pile has since risen and now includes a US$5.5 billion bailout from the International Monetary Fund (IMF), which was agreed last year.
Battulga's inauguration as president could also signal a change to Mongolia's relationship with its southern neighbour China, which the president-elect has viewed with suspicion. “We are very concerned about that,” said a Chinese foreign ministry spokesperson earlier this week, referring to Battulga’s “irresponsible” remarks made against China on the campaign trail. He has vowed to build new railways to Russia and develop mineral processing facilities in Mongolia to diversify exports away from China.