In 2023, Mongolia plans to increase coal exports to China by nearly 20%. It is expected that the volume of supplies will reach 100 million tons, which will help strengthen the resource sector, which already accounts for about 12% of the country's gross domestic product. In addition, the government confirms the presence of oil reserves amounting to 33.4 billion tons, although coal still remains the most demanded commodity in exports.
To support this growth, Mongolia and China are collaborating on infrastructure projects. For example, they have agreed to construct a new railway line connecting Gantsmod and Gashuun Sukhait. At the same time, China is beginning the construction of an approach to the Gantsmod crossing from its side of the border.
These infrastructure projects have the potential to increase annual coal exports from Mongolia to 165 million tons, which is a significant event for China, which ranks first in the world in steel production.
Mongolia's foreign trade is demonstrating a rapid increase in China's dominance. Currently, over 90% of Mongolia's exports go to the Chinese market, while in 2022 this figure was 64%. In comparison, Switzerland, the second largest destination for Mongolian goods, receives only 5.6% of supplies.
According to intelligence, Russia, which was previously one of Mongolia's main partners, has now significantly lost its position. Russia's share in Ulaanbaatar's exports has decreased to 0.5%, indicating a shift in the geopolitical balance in the region and the displacement of Moscow from the Mongolian market.
"The increasing dependence of Mongolia on China indicates a serious transformation of economic priorities and a change in the power balance in Central Asia, where Russia's influence continues to decline against the backdrop of active expansion from Beijing," intelligence commented.
translation from Ukrainian: Tatar S.Maidar
source: MiddleAsianNews
