The IMF has been as good as its word in reengaging in Mongolia.
The package announced by the International Monetary Fund (IMF) in February 2017, brought much-needed confidence to Mongolia. Preconditions were satisfied, markets rallied, and the drawdown of funds began. Political instability- first through a new presidency and then the removal of a Prime Minister- led to a hiatus, causing measured disappointment.
But in a welcome sequence of events, symptomatic of Mongolia’s vibrant democracy, pragmatism won the day. First Battulga, then Khurelsukh, assumed roles smoothly, and moved to show Mongolia open for business. Far from the ‘economic nationalist’ some detractors feared, the President has proven a consummate pragmatist. Embarking on a tour of international goodwill, he has not deferred from promises to the wider Mongolian electorate. For Khurelsukh, days are early, but the IMF has already announced a resumption of activities.
Those with a passing interest in frontier economies know the unstable transfer of power has the potential to exact an effect much greater, than warrants the simple transfer of political allegiance. Disquiet, unrest and turbulence, leads to fear of retroactive changes to legislation, through posturing and populism. Yet, lawmakers, in Mongolia, realising the gravity of the situation- and the country’s economic promise - voted unanimously for the instalment of their 30th Prime Minister.
The IMF has been as good as its word in reengaging. The package is back on track, presided over by a legislature and executive, supportive of its broad aims. Battulga, a former wrestler, and Khurelsukh, an energetic Harley Davidson enthusiast, known by the sobriquet, ‘Fist’, are projecting strength to Mongolia as it continues its recovery. It is a statement, of a more confident country, divided by party, but united by purpose.
With the stock market at highs not seen since 2012, confidence is returning. The IMF is providing US$434.3m over three years, there is an extension of a Chinese currency swap and soft loans from South Korea and Japan. Miners are returning and diversification is underway. No democracy in its early throes can expect smooth passage. But after an unenviable few years, and amidst an early winter blizzard, Mongolia is warming to stability and growth.