February 2013
“…I found out that I had turned into a Cinderella when I saw the result of the drilling that morning…” wrote a journalist imagining how Robert Friedland must have felt when he discovered the Oyu Tolgoi mine. When asked what he would do with his find, Friedland’s response was, “There is no need to worry that the Oyu Tolgoi project will be sold to China. We are planning to work here long-term but I won’t deny the shares of the company might be sold to several different companies.”
Today, the Cinderella has gone home and Mongolia’s Oyu Tolgoi has a new bride. Her name is Rio Tinto and she is somewhat unaware of the many ups and downs that mark the years of working on the OTIA and is not as experienced as Friedland in dealing with Mongolians. The bride from a far country is having a hard time getting to grips with the Mongolian mind. She doesn’t understand what it is that the groom wants.
At first, Mongolia demanded to increase its current ownership of the project from 34 per cent to 51per cent. Making the demand in fall, 2011, more than ten MPs called this a “dowry”. The number of MPs favouring this demand rose to 20 after the election in 2012. The bride, however, would have none of it and said there could be no change in the agreement.
Soon after this, the groom’s side, that is the Mongolian Government, invited the bride for talks. This was in February 2013, and the groom’s side didn’t want to talk about increasing its share, but said that they proposed to change the very basis of the Agreement. At that time, not all Mongolians saw the OTIA in the same way. The President of Mongolia admitted this in an address to the State Great Khural and called for a consensus so that Mongolians could negotiate with unity of purpose.
Then emerged new and shining stars proclaiming their “victory” on TV. They were the so-called “OT heroes” who had been demanding that Mongolia must own more than 34 per cent. Their pitch was, “We have been criticising the OTIA for years and finally the State of Mongolia has seen our point.” As we look back, since the birth of the Cinderella in 2003, we have had several TV stars in succession. They appeared at different times but were united in making the same demand: Mongolia must own more of the project. Today Mongolians see the consequence of such pressure.
Four ministers who represent the Mongolian Government at the OT shareholders’ meeting have suggested better and more effective monitoring of the work of Rio Tinto if the “Agreement crisis” is to be resolved. Mongolians are yet to see any benefit from OT, so engrossed they have been in the patriotic fights to gain more than 34 per cent of shares. As the stalwart champions of this demand celebrate their triumph on all national TV channels, one wonders just what the triumph has been. Is this is a case of individual delusion or a deliberate con on the people?
We would like to remind these self-styled “heroes” of the President’s call for unity of purpose and adoption of a common national stand to enable Mongolia to negotiate with Rio Tinto with strength unimpaired by divisiveness. We need to discuss ways of increasing our revenue, not how to increase our shareholding. We have to devise methods of stricter monitoring of how the terms of the Agreement are implemented and to put in place a foolproof way of doing this. The real head of the household does not stay put in the ger, nitpicking with the bride on unimportant details, in ignorance of what’s going on in the spare ger. The goulash MP S.Ganbaatar refers to, needs first to be cooked, and only then can the father-in-law comment on the culinary skills of the bride – Rio Tinto.