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The Prime Minister of Mongolia resigned after losing a vote with confidence, in the midst of public anger in the face of the sumptuous spending of his son, fueling political uncertainty in a central Asian economy with a vast mineral wealth.
Luvsannamsrain Oyun-Erdene, the reformist educated at Harvard who has directed Mongolia since 2021, only obtained 44 of the 64 votes he needed by the legislators during a vote held in the early hours of Tuesday. Oyun-Erdene called on vote last week in the middle of his party’s divisions and that demonstrations broke out on his son’s luxury lifestyle.
His Mongolian people party, which has been in a coalition government with two other parties since the elections a year ago, should try to form a government in the coming days.
Political disorders leave a lot in play to Mongoliawho emerged from a single -fee political system under socialist control in the 1990s and only expanded by Parliament last year.
Oyun-Erdene has long sought investments in Western mining groups to exploit the vast deposits of the country of copper, uranium and other critical minerals, support that could also give a Ulaanaatar stamp against Beijing and Moscow.
He directed a plan to make the poverty rate in the country of 3.5 million people to 15% by the end of the decade. Sub-wound this effort was hopes of direct foreign direct investment in the extraction and treatment of resources, targeting $ 50 billion GDP by 2030From $ 15 billion in 2022.
However, the calls for the resignation of Oyun-Erdene have increased in recent weeks when hundreds of younger Mongols went to the capital’s Sükhbaatar square after a message on social networks seemed to show that his son was sumptuously spending his partner. The position, reported by local media, seems to have since been removed from social media.
Gifts included a Black Dior handbag, SMEG devices and a Miu Miu jacket, depending on the photos presented on Ikon.MN, a local information site.
The demonstrations seem to have triggered a split between rival camps in the fragile coalition of the government, including between the Prime Minister and Khurelsukh Ukhnaa, the president.
Speaking before the vote in the Parliament of Mongolia, Oyun-Erdene sought to defend his file in the face of the intensification of “political attacks” and the “convergence of major, visible and hidden interests”.
He underlined recent economic achievements, including the increase in export and GDP income as well as a series of mega-projects, including an investment agreement of $ 1.6 billion with the Orano group in France to develop a uranium mine.
However, Oyun-Erdene noted that he had brought “insufficient attention to social and internal political questions”. At the end of 2022, demonstrations broke out on corruption in the coal sector.
Oyun-Erdene had defended the expansion of the Oyu Tolgoi mine of Rio Tinto in southern Mongolia.
The costs exceeded Oyu Tolgoi, one of the largest copper mines in the world. The mining company and the Mongolian government have also disagreed on the residual tax. This month, the Mongolian government has filed a new prosecution in the United Kingdom alleging corruption. The company said it “strongly rejects” such allegations.
The plans of Oyun-Erdene for economic growth, coupled with the progress of his government in debt repayments and reforms in the energy sector, had supported the hopes of investors from a period of economic stability and governance suited in Mongolia.
The Fitch Credit Agency, in September, improved the long -term ratings of long -term currencies to B Plus with a stable perspective. At the time, Fitch noted that the country provided for real GDP growth at around 6% in the two years to 2026 due to the expansion of the mining sector and “solid” activity in other parts of the economy.
Bayanjargal Byambasaikhan, vice-president and president of the Mongolian affairs council and clean energy investor, said that if many fixed assets were “well underway”, the next government had a complete plate of challenges in the midst of fears of high inflation and a reduction in export income.
“Coalition policy is never easy,” he said. “Mongolia is an endeavor democracy, so political change is something that investors should expect during decision -making.”
The Prime Minister’s office did not immediately comment.