A third of the population lives in the capital, while around forty percent of the country's workforce herds livestock in the extensive pasturelands. However, the centuries-old nomadic lifestyle is coming under pressure from climate change and urbanisation.
Mongolia also lacks infrastructure, so challenges remain in railing oil to China as exports would need to compete with other commodities and passenger trains for capacity. Accessing an oil pipeline from Russia to China is an option, but Russian producers like Rosneft have first refusal.
Formed by Garrison in 2010, Wolf is now regarded as the biggest oil tenement holder in Mongolia with more than 80,000 square kilometers.
China’s increasing economic might, and the growing presence of Chinese businessmen and workers in Mongolia – some of whom inevitably start up relationships with Mongolian women – has led to a surge of anti-Chinese sentiment in the country in recent years, particularly among young, unemployed men.
Ulan Bator is home to three ultra-nationalist groups claiming a combined membership of several thousand — a not insignificant number in a country of just 3 million people. They have adopted Nazi paraphernalia and dogma, and are vehemently anti-Chinese. One group, Blue Mongolia, has admitted to shaving the heads of local women found sleeping with Chinese men.
A peaceful revolution in 1990 brought democracy and hope to Mongolia. But the Democratic Union that toppled the MPRP in the 1996 election was plagued by infighting. And when it came to corruption, says Clyde Goulden, a consultant in Mongolia, "the democratic coalition didn't seem to have boundaries."
Here, first-world profits are colliding with third-world problems. A series of flock-devastating winters and the lure of mining riches have attracted thousands of herders from the grasslands. They live on the city’s outskirts in crowded yurt slums some locals refer to as Mongolia’s favelas. Unemployment is rampant there; electricity and drinkable water are not.
Mongolians today “want to be both cosmopolitans with BlackBerrys and ancient warriors who believe in shamans and worship Genghis Khan,” says Bumochir Dulam, a young Cambridge-educated professor of social sciences, as we sit in his airy office in Ulan Bator, windows shut against the spring dust storm outside. “It’s an impossible combination. How can you be both?”
Driving the polls was the question of how best to divide the proceeds of this natural-resource wealth among Mongolia’s 3 million citizens. After all, 30% of Mongolians live under the poverty line, even as foreign investors jockey for the untapped riches hidden below the vast steppe. Can Mongolia, which boasted an astronomic 17.3% growth in 2011, avoid the kind of natural-resource curse that has foiled countries like Nigeria?
Today, the promise of prosperity in Mongolia comes from the earth beneath the grass, where foreign mining companies are about to start digging into massive deposits of gold, copper, and coal. But for many people here, the country’s true wealth still lies in its endless grasslands.
Many Mongolians are nomadic yak and goat herders; hundreds of thousands of them have recently abandoned that lifestyle in the face of murderous winters and moved into slums around the capital Ulaanbataar. One third of the population lives below the poverty line. Yet Gucci, Prada, and Burberry, among other luxury brands, suffer no shortage of customers at their recently opened flagship stores.