Insights and Analysis

In Mongolia: A New Prime Minister Sweeps in Largely Unnoticed

November 7, 2007

By William Foerderer Infante

Mongolia will soon have a new Prime Minister. The implications are profound and could signal a changing political climate — one that is more stable and secure. This would bode well for trade, and for investment, particularly in the largely-untapped minerals sector where tens of billions of dollars in gold, copper, coal and other resources remain underground. If the new government can break the logjam that has obstructed development of the minerals sector, then billions of dollars in investment could flow, creating tens of thousands of jobs for Mongolians whose per capita income hovers just barely above $1,000 per year. Oddly, the leadership change has escaped the western press.

On October 26th, during the 25th Congress of the Mongolian People’s Revolutionary Party (MPRP), Member of Parliament (MP) Mr. S.Bayar was elected party chairman. This is an important position, and the election would be consequential at any time. But this year it was significant, because the MPRP delegates also voted that the Party Chair would serve as Prime Minister. The decision to name Mr. Bayar party chair thus unseated current Prime Minister Enkhbold and signaled that a Cabinet shakeup is potentially on the way.

Mr. S. Bayar, who had previously served as MPRP Secretary General, was elected by 57 percent of the MPRP – equivalent to 377 of the 666 delegates at the Congress. This majority represents a faction within the MPRP, which is aligned with President Enkhbayar and has become increasingly vocal in accusing Cabinet Members, Parliamentarians, and other senior officials of corruption, abuse of power, and overall irresponsibility. Soon-to-be “former” Prime Minister M.Enkhbold received 289 votes and will continue to hold his Parliamentary seat.

S. Bayar is likely to assume his new position next week, when he should also announce and seek Parliamentary approval for his new government. Mr. Bayar has hinted that 50- 60 percent of his Cabinet will be drawn from current Members of Parliament, which is to say that Mr. Bayar will likely remove Ministers who have been plagued by scandal over the past year or are from a rival faction.

Mr. Bayar and the Enkhbayar faction of the MPRP seemingly choreographed the leadership change as a prelude to the June 2008 Parliamentary elections, which the incoming Prime Minister has pledged to win. The calculus may, however, be considerably more complex. Although Mr. S. Bayar and the Enkhbayar faction certainly want to occupy the Prime Minister’s office following the 2008 election, they also want to keep the keys to the Presidency, which will be up for grabs in 2009. The Presidency may be the real prize that was secured by Mr. Bayar’s election as party chairman.

The orderly, but unexpected, change in leadership could accelerate reforms that will drive economic growth and shine a brighter light on governance, accountability and transparency.

Mr. Bayar is respected and untarnished by allegations of wrongdoing or corruption. President Enkhbayar has pledged his support for efforts to combat corruption, and is advised by ardent proponents of good governance, including Presidential Legal Advisor Mr. Zumberalham, who championed drafting of the 2006 Anti-corruption Law. The President has also been pragmatic and not polemical in his position on mining sector development; he seems committed to fostering investment and job growth.

William S. Infante is The Asia Foundation’s Country Representative in Mongolia.

Related locations: Mongolia


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