Transitioning: Mongolia in the 1990s

When Mongolia is mentioned, often images of ancient cavalry and open spaces is imagined. After the power of Ghengis Khan marching across the steppes, along with certain descendants, eventually liquidated over time, Mongolia has settled itself in an open area rubbing against Russia and China. Through the centuries they’ve had to politic their way through survival between these two intense powers, particularly over the last few centuries. Both China and Russia didn’t so much as vie for Mongolian favor as the British and the Russians had over Afghanistan during the 1800s, rather Russia and China sought to steal Mongolian favor directly from the Mongolians in a powerful tug of war of which the Russians won.

Mongolia, as large as it is, has a relatively small population at just over three million people. To put it in perspective, this is a near equivalent to Puerto Rico in population whereas Mongolia has nearly the size of Alaska, or 2.25 Texas’. For Europeans, Mongolia would be the largest country in Europe, if we choose to exclude Russia, besting Ukraine by nearly 300 km. This large nation is dwarfed between behemoths on either side which have sapped its resources over the centuries although its landscape hasn’t permitted for much growth due to its traditional nomadic culture, delaying the benefits that a sedentary base can bring.

Mongolia in the early 1920s was largely ruled by the lamas which shared a lot of similarities with those in Tibet. This vision had seemed old and outdated, at least that’s the efforts that socialist revolutionaries attempted to bring to the fold when the Soviets began to infiltrate the Mongolian countryside.1 While the Soviets were attempting to round up remnants of the White Army, crushing the resurgence of Polish or Ukrainian independence, they were also making political incursions into Mongolia. No border country was safe from the threat of Communism. The lines were drawn in Mongolia between traditionalists and the lamas and those who sought change or were funded by the newly formed Soviet Union.

Unfortunately, Mongolia was setting itself up for a century of being held back by a foreign power. Kaplonski states it succinctly when writing, “Rather, it was part of the ongoing attempt to contain the exceptional within the ordinary, to perform sovereignty through the application of legal procedures.”2 While it can be argued there wasn’t anything particularly exceptional about Mongolia, aside from their ancient history, the influence of the Soviets and the destructive economic and political structure they carried with them would do nothing to bring Mongolia into the 20th century.

As the Soviet structure took hold, Mongolia mirrored the events in the Soviet Union. Between September 1937 and 24 July 1938, the amount of lamas in monasteries dropped by a staggering 82,641. This left 562 lamas left in the country.3 The monasteries which were left behind were turned into storehouses or used for artillery practice which is often reminiscent of other beliefs who fear a heritage or tradition.

It can be assumed that the Mongolians leaned so heavily on the Soviets because the Chinese were a consistent, constant threat. While Mongolia was able to hold onto some of its identity, the strict nature of Communism and the Soviets stripped Mongolia of nearly everything else. The Soviets, even under Gorbachev, were taking 2.5-3 million animals from Mongolia at roughly 5 times the market price in the Soviet Union.4 Aside from renewable resources like animals, the Soviets had also stripped Mongolia of its non-renewable resources in much the same way considering uranium, gold, silver among other precious metals. It should be noted that the Soviets sought the best lambs in the herds which went to meat processing in Choibalsang and were sent to Russia and Bulgaria.5 Culling the herds in this way, by taking the best at young ages only weakened the herds over time.6 Naturally, it can be easy to blame the Soviets entirely but it was still up to the Mongolian government to permit and allow these deals to go through. While there likely would’ve been retaliation in some form if Mongolia hadn’t complied, most likely political, economic or even personal, such as seizing bank accounts, a person or a group of people with strong belief and morals wouldn’t have allowed their country to have been raped repeatedly for decades.

While communal farming was a catastrophic failure not only in the Soviet Union, China, Vietnam and essentially anywhere it has been attempted on a nation-wide scale, Mongolia attempted its own form when it came to its animals. The government sought to give the herders direct routes based on seasonal changes and within certain districts. Organized into production brigades these negdels, or collectives, these herdsmen then had quotas to fulfill.7 Therefore, the natural nomadic way of life, of going wherever the grass was greener, was being halted. Routes were directed and oversight consumed the pastureland.

But the Mongolians knew they were being pressured to live within a more strict society. Becker teased that the Soviets called Mongolia the 16th Republic and they treated it like a colony. In an interview with a Mongolian, the man replied, “‘They told us we lived in a Socialist paradise,’ the worker said bitterly. ‘But the Soviets dumped their obsolete equipment on us, and every one of them lorded it over us as experts – even the Russian truck drivers were experts – who got paid three times more.'”8 It wouldn’t get any better over the years as by 1959 the Mongolians then were forced to grow their own grain. Becker notes that due to Mongolia’s policies that pastoralism was nearly impossible and nearly half of the Mongolian population by necessity had moved into the capital or other urban centers.9 While the Communists sought the effort to proclaim they were modernizing Mongolia, in fact, all they had done was hand over its autonomy to the Soviet Union as they self-destructed their country all on their own.

By the time of Mongolian freedom, or when the Soviet yoke had evaporated, Mongolia was directionless. Immediately they sought to reach toward a market economy without any knowledge of how to do so, or even what one was. Within the early 1990s a new constitution had been struck, privatization had been introduced, and a stock market was created.10 However, these advances toward what was perceived to be a more open and competitive market had the opposite effect. For, rather than selling what had once been state-owned, the government had simply given away its businesses and properties. This led to those who received such things to not care as much. There wasn’t effort put into obtaining the product and therefore, in the eyes of the receiver, seemed worthless. In addition, vouchers were handed out of which most of the Mongolians immediately sold at a 70% discount11 because the Soviet support had cratered as it no longer existed and the Mongolian bureaucrats had no idea on how to turn a nation from a Communist one to one that carried the banner of the free market. Nothing was gained by this effort. This error should’ve been predictable as Mongolia didn’t have a history of a nation-wide open economy, it had been run by people who believed in either bureaucracy or major government involvement and anyone who may have had an original or creative thought had likely been expunged during the Communist era.

As a result of these alterations, poverty ran rampant throughout Mongolia. The economy had failed because its leaders hadn’t provided a pathway toward a free-market economy. As a result, the people often returned to barter trade which was a route commonly used in the American Midwest during the Great Depression. Smuggling and self-preservation of growing ones own crops or food became important. Inflation further devalued the money so much that US dollars became more common than the Mongolian currency.12 Between 1990 and 1992 the real wages were halved and were cut by another third by 1993 which caused a quarter of the population to tumble below the poverty line.13 These problems were exacerbated because the Soviets were no longer there to help and this forced oil and gasoline prices to rise which raised the costs of everything; as an aside, the government needed to cut important programs such as education.14 The government’s attempts to modernize the country into a free-market economy was wholly a failure because they didn’t have the foresight to plan and chose instead to rush forward without knowing what they were trying to do.

It should be noted as well, as written in Mongolia in the 20th Century cites, that there were two entities that had been created over the years. As many moved into the city and became one type of people, those who remained outside of the city in much more rural areas, became an entirely different people.

The early 1990s also saw disputes erupt between Mongolia and the newly formed Russia over debt repayments. In spite of this, each Mongolian leader through much of the 1990s avowed that relations with Russia was the most paramount as they still saw China as a serious threat in part because they were, considering their continued occupation of Inner Mongolia. This was in part because, as Yuri Kruchkin stated in 1991, “[I]t will take some time for the West to realize the threat, hidden in growing dislike by the Chinese of reforms in Mongolia and their attempts to impose economic influence over this country. Russia knows better… Like Mongolia, Russia is doomed to have China as its neighbor and will act cautiously.” Attention was further given to Russia as the Cyrillic alphabet had made its way into Mongolian schools during the Communist era and knowing Russian was seen as forward-looking.15 The influence of Russia would be difficult to ignore while the history Mongolia had shared with China, especially the recent history considering border disputes all the way up until the 1960s, has caused some elements of distrust to seep into their now, mostly stable, relationship.

Cutting back to the importance of the economy, particularly when it came to Mongolia gutting much of its education program, young people were much of the Mongolian population. In the 1990s, the average age of the average Mongolian was 18.16 A population which is mostly filled with children is nearly impossible to run and further explains the difficulties the Mongolian nation had through the 1990s. As Mongolia In Transition correctly noted, the bureaucrats in the city didn’t understand the countryside. They had a distorted view of what nomadism was and of the world beyond the city limits.17 To get a deeper idea of nomadism and the rural country, its best to cite Mongolia in Transition in detail:

No single pasture has any value because it cannot be grazed continuously. Thus, there is usually no extreme competition or conflict over resources. In feudal times title to territories historically belonged to a tribe, not a chief or prince with individual property in land. The common practice was that a noble administered the territory by allottting land usage rights to different families. This resulted in noble families having no outright ownership but direct use of the best pastures. They could also exact services and tribute from non-noble families for usage of poorer pasture. In the communist era, the party exerted some control over the land. Presently [in the 1990s], the Mongolian government’s new land law maintains the tradition of grazing land belonging to the state and unavailable for purchase.18

Some of these policies would be relaxed by 1995 and 1996 as the Mongolian government permitted the private ownership and sale of land while foreigners could lease it. While steps were being taken to advance the country, they were still held back by a middling bureaucracy who were so separated from their people that they seemed to understand almost none of them or their problems.

The 1990s were a difficult time for Mongolia but even moreso for its people. Traveler Becker noted the hard times when he noted, “Cash has little value. Everything was in such short supply that even armed with dollars there was almost nothing available in Ulan Bator other than a strong drink.

“Petrol was as scarce as food. To save aviation fuel, a truck had even pulled our plane on to the runway. When we arrived at the provincial centre, Mohron, its petrol supplies had virtually run out leaving the whole region bereft of power. We spent days trying to buy some, shuffling from office to office and clutching a gift hidden in a bag just in case it came in handy.”19

When riding along with a Russian man, Becker was having a conversation with a Russian: ‘You say it was the Russians who did this – no, no, it was not us, it was the Soviets,’ he replied with a cynical smile.

“‘We are a very quiet and obedient people. We followed the Russians in everything. We thought they would help us,’ he said slowly.

“‘I don’t even know what it was like before. We were taught there was just feudalism, and rich and poor people. I can’t say what kind of justice there was before but my father was a herdsman who could not read or write. Some time after 1944, they arrested him and said he was a counter-revolutionary plotting to overthrow Soviet power. Even now I don’t really know what they accused him of but he was sent to prison for ten years. He came back as an invalid after six years, his ribs broken by a tree which fell on him.’ His voice trailed off again. He picked up a handful of the blue forget-me-nots which grew in profusion on the grass around us.

“‘Now we even don’t trust each other. How can the young respect the old? In the old days no one under thirty was even allowed to drink or smoke. A young man was not allowed to pass in front of an older man out of respect. Or if a young man wanted to join us, he would sit further away and wait to be invited. People venerated the old. Nowadays there is no morality – that is why there is this violence now,’ he said and for an instant looked into my eyes with an expression of infinite sadness.”20 This last line is rather telling when we consider that most of the nation at this point was only 18 years old.

The Mongolian economy was understandably weak. Before the initiation of Communism and the rigid system it installed, Mongolia was largely ignored by the Soviets and before 1921, Mongolia was largely an agrarian country. By the time of the early 1990s, Mongolia needed to industrialize and create not only a new economic system, but a new economy on which it ought to be built. No more could it be entirely reliant on foreign powers; while some funds would naturally be given, Mongolia could hardly lean as heavily on the world as they had on the Soviet Union.

These lacking developments before the early 1900s coupled with the crippling Communist economy meant that the Mongolian economy was heavily reliant on precious metals and agriculture. By 1991 Mongolia’s total exports were nearly 3.5 times less than that of Papua New Guinea.21 Due in part to their enclosed system and high reliance on the Soviet Union and other Communist countries, Mongolia had little incentive to invent or invite ingenuity into the country. And once the Soviet structure crumbled, Mongolia was left behind. Their position was made even worse because they weren’t politically important outside of the occasional Chinese-Soviet spat.

Medication was one punishing aspect of Mongolia’s lack of development. It was items such as these which further hampered Mongolia’s sufficiency in the 1990s. Mongolia had to import nearly all of its drugs and pharmaceuticals.22 It was during this time in the early 1990s that such things as infant mortality rates began to rise which wasn’t going to help the troubled Mongolian nation.

Aside from the lack of technology, their over-reliance on foreigners and not understanding the economic structure they were trying to build up without having the infrastructure to do so, corruption ran rampant throughout the Mongolian capital. Bureaucrats were rarely if ever punished for committing high crimes, receiving bribes and laundering cash to the detriment of the few millions of people. Since there was relatively little change within the government style, the same tactics of corruption transferred into the supposed new system where powerful people protected one another and where merit hardly mattered. Indeed, Rossabi cites, “…[a] grandson of Sükhbaatar, ‘Mongolia’s George Washington.’ More shocking still was the negotiation of an agreement in April 1993 with IBEX Group, a mysterious American corporation. This ninety-nine-year contract, signed by Vice Premier Choyjilsürengiin Purevdorj, provided IBEX with an extraordinary monopoly on extraction of mineral resources, telecommunications, tourism, and cashmere. Any domestic or foreign entity seeking to invest in these fields would require IBEX’s permission.”23 The agreement was ultimately canceled citing threats to national security but everything would’ve gone through if it hadn’t been but for two dissidents in government. Since it was only two, we can safely assume that the corruption ran deep.

Corruption ran all the way up to the very top levels of government and continued to do so. Foreign aid, loose money, and the light euphemism of “misappropriated funds” were common phrases that ran through the corrupt lines of the Mongolian government. While revolution is not a dinner party, a revolution is not a revolution unless the system and the corrupt people in place have been completely and utterly removed from all forms of power.

While the scope of this project focuses primarily on the 1990s, Mongolia finally began to invest in itself properly but was stunted by its infrastructure. By the mid 1990s SOCO International had discovered oil but as of 2001 only 73,000 barrels had been extracted in a year.24 It is troubling that such a nation so reliant on basic resources was still reliant on foreign energy as of 2004. Those resources it did have access to such as gold, had been sold out to foreign interests and the untapped uranium reserves had their extraction stunted due to the nomads and their disputes with the government over land. But enough of these sales could be reasoned through corruption as in 1999, Prime Minister Janlavyn Narantsatsralt had been accused of giving away copper in Erdenet to Zarubezhtsvetmet, a private company, for virtually nothing.25 There is some confusion due to various accusations of what the price actually was however, the end result was Janlavyn resigning.

As is to be expected, these instances needlessly battered the economy. And what often accompanies poverty is alcoholism, prostitution and other troubles such as drug use and battered wives. Rossibi mentions that, “According to one survey, 52 percent of Mongolian males were heavy drinkers, and the police annually picked up and transported 100,000 inebriated individuals to sobering-up or drying out stations… Unemployment and poverty also resulted in increases in the crime rate. The total number of offenses rose from 9,060 in 1990 to 24,653 in 1997, and it fell only slightly, to 23,370, in 2001. Cases of attempted murder and manslaughter tripled, and the number of thefts quadrupled, rising to about 40 percent of all criminal offenses.”26 The amount of alcoholics, especially considering the population of the nation, is an incredible number. We must also consider that the 52% cited is related only to those who may have admitted to it or had been found out and it doesn’t note the possible many closet-drinkers that were undoubtedly not included. While surveys can at times accommodate for lies or demographics, it could be assumed that the number may be more than the 52% cited.

Mentioned before, prostitution also grew in the capital city of Ulaanbaatar. While many of the Mongolian men and military were part of the problem in funding this industry, what was perhaps more influential was the opening of Mongolia for the first time in decades to outsiders and foreign investors. But every part of Mongolia was suffering. The 1990s were an especially bleak decade ruled by corruption and optioned ignorance of the definition of a free market economy.

Mongolia is as alone as it looks on the map. If any Mongolians are outside of Mongolia, its only because they were separated by Chinese involvement decades before. Even their involvement with Russia isn’t nearly as influential as it once was and their connections with Kazakhstan is only of note because there are so many Kazakhs which live and do business in Mongolia. What may have brought the countries closer was that these Kazakhs had traveled from Mongolia to Kazakhstan only to find the same troubles before most of them had returned back to Mongolia by the late 1990s. Mongolia, in spite of being landlocked in Asia, is truly an island unto itself.

Mongolia’s involvement over the centuries has been relegated largely internal with occasional bouts of working with either the Chinese or the Russians in order to fight for its sovereignty. However, after nearly 80 years under Communist and Soviet rule Mongolia has been stripped of much of its heritage. While there are some remnants of what once had been, the destruction of the lamas and monasteries, which had once made up so much of what Mongolia had been, its possible to see how some aspects of Mongolia have been permanently lost. Still, such things would happen during modernization and will continue to occur as Mongolia continues to open itself up to the outside world. How much remains of Mongolia, how much they will manage to save and cobble together will remain entirely up to the Mongolians. At this pace, Mongolia must decide and discover its future. Only 100 years ago it had been a backward pastoral land and a mere 30 years old it had been a backwards, corrupt communist society thieving from its people. The 1990s were an obviously growing stage that many former Soviet Republics fought through but Mongolia was in a unique position considering its location and lack of industrialization. Mongolia is one of the few nations that has been thrust into and through many eras and into the modern world in short time. It should take them some time to find their bearings but given their somewhat newly born nation, near limitless land and looking over the cusp of a global world and market, Mongolia does have the chance to seize the reigns and regain its important status within Asia.

Works Cited

1 Kaplonski, Christopher. The Lama Question: Violence, Sovereignty, and Exception in Early Socialist Mongolia 26

2 ibid. 40

3 ibid. 42

4 Bulag, Uradyn Erden. Nationalism and Hybridity in Mongolia by Uradyn E. Bulag 55

5 ibid. 55

6 ibid. 56

7 Kotkin, Stephen, and Bruce A. Elleman, editors. Mongolia in the Twentieth Century: Landlocked Cosmopolitan 225

8 Becker, Jasper. The Lost Country: Mongolia Revealed 49

9 ibid. 100

10 Griffin, Keith, editor. Poverty and the Transition To A Market Economy in Mongolia 10

11 ibid. 12-13

12 ibid. 18

13 Kotkin, Stephen, and Bruce A. Elleman, editors. Mongolia in the Twentieth Century: Landlocked Cosmopolitan 226

14 ibid. 226

15 ibid. 256

16 Bruun, Ole, and Ole Odgaard, editors. Mongolia in Transition 27

17 ibid. 91-2

18 ibid. 94-5

19 Becker, Jasper. The Lost Country: Mongolia Revealed 156

20 ibid. 295

21 Asian Development Bank. Mongolia: A Centrally Planned Economy in Transition. 64

22 ibid. 124

23 Rossabi, Morris. Modern Mongolia:From Khans to Commissars to Capitalists 60-1

24 ibid. 86

25 ibid. 95

26 ibid. 147


Asian Development Bank. Mongolia: A Centrally Planned Economy in Transition. Publ. for the Asian Development Bank by Oxford Univ. Press, 1992.

Becker, Jasper. The Lost Country: Mongolia Revealed. Sceptre, 1993.

Bruun, Ole, and Ole Odgaard, editors. Mongolia in Transition. Curzon Press, 1996.

Bulag, Uradyn Erden. Nationalism and Hybridity in Mongolia. Clarendon Press, 1998.

Griffin, Keith, editor. Poverty and the Transition To A Market Economy in Mongolia. Macmillan, 1995.

Kaplonski, Christopher. The Lama Question: Violence, Sovereignty, and Exception in Early Socialist Mongolia. University of Hawai’i Press, 2014.

Kotkin, Stephen, and Bruce A. Elleman, editors. Mongolia in the Twentieth Century: Landlocked Cosmopolitan. Routledge, Taylor & Francis Group, 2015.

Rossabi, Morris. Modern Mongolia:From Khans to Commissars to Capitalists. Univ. of California Press, 2009.