Updated July 1, 2019
Mongolia
Overview
known as Khaan Quest. Khaan Quest 2019, the 17th such
Mongolia is a landlocked nation of 3 million people
event, focused on peacekeeping and stability operations and
between Russia and the People’s Republic of China (PRC).
involved 900 MAF personnel, 220 U.S. military personnel,
It has been viewed as a democratic success story both
and participants from 29 other countries including China.
among former Soviet satellite states and in Asia. In 1989,
democratic activists staged protests against communist rule
In April 2019, the United States and Mongolia held bilateral
and formed the Mongolian Democratic Union. The
consultations in the Mongolian capital of Ulaanbaatar, the
Mongolian People’s Revolutionary Party (MPRP), which
first such dialogue held under the auspices of the U.S.-
had ruled the country since 1921, allowed multiparty
Mongolia Expanded Comprehensive Partnership
elections in 1990 and relinquished power in 1996, when a
established in 2018. The two sides discussed regional
Democratic Party (DP)-led coalition of opposition forces
security matters, issues related to Mongolia’s economic
won nationwide elections.
development, and bilateral cooperation on aviation and
mining safety.
Mongolia’s foreign relations are driven by a desire to
preserve its autonomy by balancing relations between major
In April 2019, the Mongolia Third Neighbor Act, “To
partners, including the United States, China, and Russia,
promote United States-Mongolia trade by authorizing duty-
and also Japan and South Korea. Its economy is supported
free treatment for certain imports from Mongolia,” was
by extensive mineral resources, but growth remains uneven,
introduced in the House (H.R. 2219) and Senate (S. 1188).
driven by fluctuations in mineral and petroleum prices.
Figure 1. Mongolia at a Glance
U.S.-Mongolia Relations
The United States established diplomatic relations with
Mongolia in 1987, and Mongolian leaders describe the
United States as Mongolia’s most important “third
neighbor”—countries that do not border Mongolia but have
close relations with it. Polling indicates Mongolian
perceptions of the United States are largely positive.
Mongolia’s relations with its former patron Russia remain
close, and many Mongolians regard Russia with some
affection. At the same time, they remain wary of China,
their largest economic partner. Mongolia’s official relations
with China largely have been amicable, with the exception
of periods of tension and pressure from Beijing following
visits to Mongolia, a traditionally Tibetan Buddhist country,
by the Dalai Lama, the exiled Tibetan spiritual leader whom
Sources: Central Intel igence Agency, The World Factbook, 2018. Map
the PRC government asserts aims to split Tibet from China.
created by CRS, 2018.
Mongolians participate in programs of the Open World
The U.S. government views Mongolia as an “emerging
Leadership Center, a U.S. congressional agency whose
partner” and as a country with which it may cooperate to
mission is to introduce rising leaders of 17 Eurasian
achieve a “shared vision of rules-based order in the Indo-
countries to U.S. governing and free market systems.
Pacific.” The Department of State’s Congressional Budget
Mongolia’s legislature is one of 21 parliaments worldwide
Justification for Foreign Operations, FY2019, states, “The
that have partnered with the U.S. House Democracy
primary goals of U.S. assistance to Mongolia are to ensure
Partnership, a bipartisan commission of the U.S. House of
the United States remains a preferred partner over
Representatives that works to “strengthen democratic
geographical neighbors Russia and China and to give
institutions by assisting legislatures in emerging
Mongolia greater latitude to chart an independent foreign
democracies.”
and security policy.”
The United States and Mongolia both are members of the
Mongolia participates in United Nations global
Association of Southeast Asian Nations Regional Forum
peacekeeping operations and has over 1,000 peacekeepers
(ARF). Mongolia is one of nine NATO “partner” nations,
deployed in Africa. Mongolia sent troops to Iraq from 2003
along with Japan and South Korea in East Asia. Mongolia
to 2008 and currently has over 200 troops in Afghanistan
also is a member of the Governing Council of the
supporting Coalition operations. U.S. Indo-Pacific
Community of Democracies, established in 2000 to support
Command and the Mongolian Armed Forces (MAF) hold
democratic transitions worldwide.
an annual multinational peacekeeping exercise in Mongolia
https://crsreports.congress.gov
Mongolia
U.S. Foreign Assistance
Consolidation of Presidential Power
In recent years, U.S. foreign assistance to Mongolia largely
Some observers are concerned about what they view as
has consisted of security assistance. Under the Department
President Battulga’s attempts to consolidate power. In April
of State’s Congressional Budget Justification for Foreign
2019, the Mongolian legislature passed legislation that
Operations, FY2020, Mongolia would receive assistance for
expanded the authority of the President. Based upon this
strengthening its democracy, promoting enterprise-driven
new law, Battulga dismissed the Prosecutor General, who
economic growth, and expanding its economic base. In
had been investigating dozens of Members of Parliament on
FY2018, Mongolia received $4.73 million in U.S. foreign
allegations of corruption, and the Chief Justice of the
assistance, which included the following:
Supreme Court. Members of Battulga’s own party in the
legislature opposed the law as unconstitutional.
Foreign Military Financing (FMF): $2.6 million to
bolster peacekeeping and other capabilities of the MAF.
Economics
The economy is recovering from a slump that began in
Nonproliferation, Antiterrorism, Demining, and
2013 due to falling commodities prices, government
Related Programs (NADR): $0.20 million to address
mismanagement and unsustainable expansionary policies,
weapons proliferation threats along Mongolia’s borders.
and a drop in foreign investment. In 2017, Mongolia and
the International Monetary Fund (IMF) reached agreement
International Military Education and Training
on a program of fiscal reforms and a $5.5 billion bail-out
(IMET): $1.93 million to familiarize MAF personnel
package that includes support from the IMF, the Asian
with U.S. military doctrine and values, build capacity,
Development Bank, Japan, Korea, China, and other donors.
and develop military-to-military relationships.
Exports, which are primarily commodities, account for 40%
The Peace Corps is active in Mongolia with 99 volunteers
of Mongolia’s GDP. China buys over 85% of Mongolian
involved in English language and health education. A
exports, while Russia supplies Mongolia with 90% of its
USAID-supported Leaders Advancing Democracy (LEAD)
energy (refined oil). Mongolia’s trade with China, with
Mongolia program brings young Mongolians to the United
which it has a trade surplus, totaled $6.3 billion in 2017.
States to learn about how to engage in civic action.
Leading Mongolian exports to China include coal, copper
and other ores, crude oil, and unprocessed cashmere.
The U.S.-funded Millennium Challenge Corporation
Mongolia produces over a third of the world’s raw
(MCC) carried out an initial five-year (2008-2013), $285
cashmere, most of which is exported to China and turned
million compact or aid package in Mongolia, focused on
into garments by Chinese manufacturers. As Mongolia has
property rights, vocational education, health, road
developed economically, Ulaanbaatar has become one of
infrastructure, and energy and the environment. In July
the world’s cities with the highest levels of air pollution,
2018, the MCC launched a second, $350 million compact in
fueled by coal-heated dwellings (gers or yurts), coal-fired
Mongolia, which focuses on providing a sustainable water
power plants, and automotive exhaust.
supply to Ulaanbaatar.
U.S. trade with Mongolia shrank during Mongolia’s
Politics
economic downturn, from $707 million in 2012 to $66.5
Mongolia’s political system is “semi-presidential,” with a
million in 2016; it rebounded to $131 million in 2018. This
parliament and Prime Minister as well as a popularly
decrease in large part reflected a dramatic drop in
elected President. The Mongolian Prime Minister is the
Mongolian imports of U.S. vehicles, machinery, and
head of government with primary responsibility for
aircraft. Mongolia’s exports to the United States, of which
executive ministries, while the President plays a primary
the largest items are minerals, knit apparel, and art and
role in foreign policy, chairs the National Security Council,
antiques, were valued at $10.1 million in 2018. Mongolia is
and serves as the Commander in Chief of the armed forces.
a beneficiary of the U.S. Generalized System of Preferences
(GSP) program. Eligible products include tungsten, one of
Since 1990, Mongolia has alternated between coalitions led
Mongolia’s top export items to the United States; certain
by the MPRP (now MPP) and Democratic Union (now
handmade or handicraft textile products; and some non-
dominated by the Democratic Party). In 2016, the MPP won
apparel items that use cashmere or furs. Cashmere sweaters
a large majority of seats in the 76-member unicameral
are excluded.
legislature, the State Great Khural, gaining 39 seats in the
election while the ruling Democratic Party lost 25 seats, in
The Mongolian government has entered into agreements
part because many voters blamed the DP for an economic
with China and Russia to jointly develop roads, railways,
slump that began in 2013 under its rule. The MPP now
and power grids that link the three countries. Plans include
holds 64 seats while the DP has seven. Prime Minister
a Mongolia-China-Russia economic corridor and free trade
Ukhnaagiin Khürelsükh of the MPP was elected by the
zones on both borders. Mongolia and China envision
Great Khural in October 2017. The President, Khaltmaagiin
integrating Mongolia’s road and development plans with
Battulga, who is affiliated with the Democratic Party, was
China’s Belt and Road Initiative.
elected in July 2017 by a 55%-45% margin. New elections
are due in 2020 (parliamentary) and 2021 (presidential).
Thomas Lum, Specialist in Asian Affairs
Ben Dolven, Specialist in Asian Affairs
IF10926
https://crsreports.congress.gov
Mongolia
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https://crsreports.congress.gov | IF10926 · VERSION 4 · UPDATED