Mongolia welcomes foreign investments

Mongolia must diversify away from mining, but welcomes further international investment in its biggest coal project to shift reliance away from giant neighbours China and Russia, the country's president said on Thursday (June 21), a week ahead of elections.

Speaking in his office in Mongolia's Government House, Tsakhia Elbegdorj said his government would try to boost foreign investments in other sectors such as agriculture, food and tourism to reduce reliance on mining.

(SOUNDBITE) (English) MONGOLIAN PRESIDENT TSAKHIA ELBEGDORJ SAYING:

"This economic, our economic growth is actually coming from, mostly coming from, the mining investments, and mining profits. Because of that I think we have to think about very seriously to diversity our economic input. And I think Mongolian economy has mostly one-coloured economy. We would like to make this kind of rainbow economy."

Mongolia's $10 billion U.S. dollar economy is at the beginning of a mining boom and foreign investors have rushed in on hopes of cashing in on huge deposits of copper, gold, coal and uranium.

Elbegdorj said Mongolia is still open to foreign investments in the western block of the giant Tavan Tolgoi coal mine, but has not yet decided on whether to go alone on developing its prized asset.

(SOUNDBITE) (English) MONGOLIAN PRESIDENT TSAKHIA ELBEGDORJ SAYING:

"Balancing investment in Mongolia from investors is essential. It is in line of our foreign policy, it's in line with our national security. You know we have two big neighbours, and we need investments from a third neighbour. I think still the door is open for the negotiation with international investors, particularly in Tavan Tolgoi."

Talks with foreign groups to develop Tavan Tolgoi have hit a snag since July last year after the government withdrew a decision to hand mining rights to a consortium comprising China's Shenhua Group, U.S.-based Peabody and a Russian-Mongolian group headed by Russian Railways.