Iran has been steadily increasing its ties with Mongolia and 2010 was a year of increased Iranian overtures toward Ulaanbaatar. In another manifestation of how democratic Mongolia and Iran are looking towards substantially developing their economic ties, in early December 2010, it was announced that a new Mongolian-Iranian joint venture entitled Bayan Meat, Ltd., had signed a sheep meat export contract with Mongolia’s largest meat slaughterhouse, Mahimpex of Ulaanbaatar. Mahimpex is owned by Jenco, whose wealthy President, Khaltmaa Battulga, has been the Mongolian Minister for Road, Transport, Construction and Urban Development of Mongolia since 2008. In January 2010 (http://sonin.mn/?p=54167, January 8, 2010) an Iranian direct charter plane flew out 75 metric tons of Halal-slaughtered lamb from the western Mongolian city of Khovd per agreement with Baruun Mongol International in the country’s west, which has been exporting fresh lamb and mutton carcasses to Iran since 2007. The President of Mongolia’s Meat Association, M. Lhachinbaltai, revealed Mongolia’s target 2010 volume to Iran from the two slaughterhouses was 2,000 tons (http://news.mn, November 13, 2010). In per capita livestock ownership, Mongolia ranks first in the world with over 35 million head of livestock, including 15.8 million sheep, the bulk of which are not exported.
During 2010, Iran had been exploring its options for Mongolian raw uranium. On October 19, 2010, the Mongolian President Ts. Elbegdorj received the newly accredited Iranian Ambassador Mehdi Safari, former Deputy Foreign Minister, who took up his strategic post in Beijing in the summer of 2010 as part of Iran’s plan to shore up Chinese support for its controversial nuclear program (October 19, 2010, politics.news.mn/content/35058.shtml). It may not have been a coincidence that Safari made his first appearance in Ulaanbaatar less than one week after France and Mongolia signed a cooperation agreement in the nuclear energy field, covering uranium exploration and exploitation by Areva, the French nuclear power company. Areva, which has been expanding its presence from Kazakhstan into Asia, has been cooperating with Japan’s Mitsubishi Corporation since December 2009 on uranium exploration licenses on more than 14,000 square kilometers in Mongolia’s Dornogobi and Sukhbaatar provinces.
Strong interest by foreign investors in Mongolia’s uranium deposits has been a feature of the past year. In June 2010, during Chinese Premier Wen Jiabao’s visit to Mongolia, the Director-General of the Mongolian Nuclear Energy Agency signed a MOU on Radioactive Minerals and Nuclear Power Cooperation with the General Manager of China’s leading uranium development and nuclear fuel company, China National Nuclear Corporation (CNNC), which in 2009 bought out a Canadian company’s Mongolian uranium investment. In January 2010, India and Mongolia renewed their agreement on civil nuclear cooperation and began considering how India would start uranium mining in Mongolia. Other recent market entries were the US company Mongolia Forward and the Canadian company Uranium One Inc. This interest has come on the heels of 2007-2008 Russian protocols with Mongolia on cooperation in the production of Mongolian uranium.
Iran and Mongolia trace their modern political relationship to 1971 when diplomatic relations were first established between the Shah’s Government and then communist Mongolia. Two years later, Mongol leader Yu Tsedenbal paid a state visit to Tehran, which was followed in 1976 by an Iranian prime ministerial visit to Ulaanbaatar to sign economic, trade and science agreements. In the Islamic Republic era, Iranian contact was maintained via its embassy in Beijing and since 1997 from Moscow. Mongolian ambassadors in Prague beginning in 1973 were accredited to Tehran, but after Mongolia’s democratic revolution, accreditation moved to Belgrade in 1991, Beijing in 1995, and finally to Moscow in 1997.
Since 1990, the economic relationship has been relatively minor for both countries. In that year Iran hosted a Mongolian delegation of experts from Mongol Gazriin Tos (Mongolian Oil Ltd) and later the Iranians helped to draft the first Mongolian law on petroleum. Additional ambassadorial level discussions on petroleum took place in 2002 in Ulaanbaatar. The Shanghai Cooperation Organization (SCO) has facilitated meetings among defense and security experts of these two permanent observer nations, but Mongolia’s reluctance to join the SCO as a full member, has been utilized as a rationale for Russia and China to prevent Iran from entering.
Some level of personal rapport has been established between Mongolian and Iranian leaders at international forums. In 2003 the two presidents met in a Malaysian conference, and that same year Mongolia contributed 1,000 woolen blankets after the Iranian earthquake. At the 2009 Non-Aligned Summit in Havana then Mongolian President N. Enkhbayar met with Iranian President Mahmoud Ahmadinejad to reportedly discuss their nations’ historical ties and the Hazara minority people. Hazara are Shiite Turko-Mongols in Afghanistan that have been repressed by the Taliban and the Afghan majority Sunni population. Continuous war and brutalities resulted in Hazara migration to Iran as well as to Pakistan; however, Hazaras in Iran accuse the Iranians of maltreatment. For the last 20 years Hazara elements have appealed for Mongolian sanctuary and support to prevent Iranian forced repatriation to Afghanistan. Mongolia responds cautiously on this issue, because its balance of power strategy in Eurasia, based on its “Third Neighbor” concept, sees expanding ties to Iran as one partial counterweight to China’s economic monopolization.
Mongolian Defense Minister, Luvsanvandan Bold, will make an important visit to Washington this month to meet with Pentagon officials including US Secretary of Defense Robert Gates. Although it is unclear if Iranian-Mongolian relations will be on the agenda, it may come up in bilateral discussions on how to deepen cooperation on the terrorism issue. It would be in US interests, as well as Mongolian, to find other ways to utilize Mongolian meat products to counter growing Iranian penetration of this key sector. Around five years ago, there was some discussion by an USAID agricultural expert of encouraging Mongolian meat sales into Afghanistan, which often suffers from meat-shortages, but this concept still has not been realized. Whether it is meat or uranium, the US policymakers should do more than passively monitor Iranian courting of Mongolian resources and instead try to facilitate its economic ties with other states to offset Iranian inroads into this strategically important country.