Speculation has been rife as to where the reclusive North Korean dictator, Kim Jong Un, and the US President, Donald J Trump will meet. Geneva? Too far. Singapore? Too Western. Beijing? Too sensitive. Ultimately, it’s too early to call, but Ulaanbaatar has been revealed by a South Korean diplomat to have made the short list.
The Kim dynasty love to travel by personal train, and Mongolia offers neutral ground within easy reach. Here we consider four effects this could have on the economic recovery:
1. It puts Mongolia back on the map
The sad reality of the economic downturn was to turn journalists off Mongolia. The sexiness of 17% growth gave way to gripes of mismanagement and consternation at the end of the commodity ‘super cycle’. It was as if all but a few hardy souls, stopped covering the country. So, as economic growth has returned, few seem to have noticed. A Kim-Trump summit, would focus the eyes of the world on Ulaanbaatar. Yes, the unfolding nuclear saga will take center stage, but through its coverage, Mongolia could gain some much needed attention. Combined with a raft of encouraging policies from government, it could help stimulate investment.
2. It reminds diplomats of its geostrategic importance
In UB it’s understood Mongolia has a unique position as a bridge between two super powers. A country that since independence has managed to maintain the support of the West, but not lose sight of its regional allies. Yes, the relationship with China has always been fraught, but there’s been a real warming of relations under the careful stewardship of Xi Jingping and President Battulga. The very fact UB has emerged as a potential candidate for a summit, underscores the emerging diplomatic role it could fulfil. Diplomacy and economics are often supportive traits, the norms of the former, leading to the development of the latter. It’s a highly unusual sequence of events, and one Mongolia would be wise to capitalize on.
3. It asserts its position as a ‘Belt and Road’ country
The ‘One Belt, One Road’ (OBOR) initiative of President Xi could involve a trillion dollars of investment. The cacophony of voices at conferences and in the media, maintain its potential role in an emerging world order. But the scope of its aspirations mean not all countries are treated equally by its plans. Those that delay and procrastinate, may be overlooked in favor of other more proactive partners. Mongolia must do all in its power to ensure it is front and center in the delivery of the project. By facilitating one of the most significant diplomatic gatherings in half a century, it sends a message it can act as a bridge between different visions of the world. This helps open the economy to the broadest possible range of international partners.
4. It provides businessmen with a captive audience
A diplomatic gathering of this scale, will bring not only journalists but industrialists and policy makers to Ulaanbaatar. Side conferences will be convened. Bars will be full. Even, the North Korean-run Pyongyang restaurant will bustle with bystanders to the summit. This will be a gathering on an almost unprecedented scale. Mongolia has an active, and growing business community, well versed in selling its potential. Whether in cashmere or oil, mining or dairy products, this multinational gathering will present opportunities for Mongolia’s varied industrial base.
Whether Kim and Trump come to UB remains to be seen. The summit may not even happen. Short of reliving the recent gathering on the demilitarized zone, few obvious venues present themselves. Diplomats could not have imagined the recent thawing in relations, nor the role Mongolia could play. If it is given the opportunity, it will enable to highlight its very noticeable recent progress.
At APIP, we’re readying ourselves for a very busy summer 2018. We’ve now completed the Olympic, continue presales on the Circus, and have a series of consultancy instructions. If you want to hear more about our services, why not book a meeting with one of our team? In the meantime, enjoy our latest quarterly economic update and the sunshine.