Mongolian election up close

Julian Dierkes is one of Canada’s foremost authorities on Mongolia.

An assistant professor in Asian studies at the University of British Columbia (UBC), Dierkes recently landed in Germany after serving as an election monitor in the Mongolian election.

Speaking via telephone from Germany, Dierkes says while there were some administrative irregularities, there was no evidence of systematic fraud in the election. A key reason why this election didn’t meet with the violence of parliamentary elections held last year.

It was only last summer that riots broke out after the incumbent president Nambaryn Enkhbayar’s MPRP party won a majority of seats in parliament.

Tsakhiagiin Elbegdorj, the winner of the presidential election and member of the MPRPs main rival, the Democratic Party (DP), was said to have given a speech after the loss that played a part in inciting the riots.

Despite the closeness of the presidential race, there was no debate from the losing Enkbayar over the results.

But how did Elbegdorj pull it out a victory when polls leading into the election had Enkbayar escaping with a narrow win?

Dierkes says for once Elbegdorj had the unified support of his DP party.

Where in the past the MPRP was unified in its support for Enkbayar and the DP was weakened by in-fighting, this time the roles were reversed.

It was Elbegdorj that enjoyed not only the support of his party, but also the support of the independent members of parliament.

Tellingly, the prime minister of the country, Sanjaa Bayar, a member of the MPRP, was rumoured to favour Elbegdorj.

While the reasons for this aren’t entirely clear, the word on the streets of Ulaanbaatar was that Bayar was eager to rid parliament of Elbegdorj’s maverick spirit and the best way to do so was to elevate him out of parliament and into the President’s office.

The peacefulness of the handing over of the presidential office bodes well in the country’s efforts to regain its reputation.

“One big advantage Mongolia has had is that in international relations it can say ‘look around at our neighbours, we’re doing the best’…and compared to Central Asia they are doing quite well,” Dierkes says. “The riot was a bit of a blip and they were eager to demonstrate stability to investors.”

But investor reaction to the election was confused. Shares of miners in the country suffered heavy losses after Elbegdorj was declared the victor.

A strange phenomenon considering that in the 1990s the DP party carved out a reputation for itself as being the more business friendly of the two main parties.

“But Elbegdorj has and independent streak and a bit of an in-it-for-himself streak,” Dierkes says, and pointed to his speeches after his election loss last year as an indicator of that.

Overall though, Dierkes says given that both Enkbayar and Elbedorj agreed in a televised debate on the Thursday before the election that an investment agreement between Ivanhoe Mines (IVN-T, IVN-N) and the government needed to get signed fast.

“The fact that Ivanhoe’s stock tanked, that doesn’t make much sense to me,” he says.

Much has been made of the presidential position in Mongolia being more of a ceremonial position. But Dierkes explains that while it is difficult for the president to directly guide parliament, he can rule in a passive aggressive way.

That is because of his presidential veto. The president can continually veto any bill proposals from parliament essentially sinking the government into a quagmire.

As a check on this, however, the president’s veto can be over ridden by a two thirds majority in parliament. But while the MPRP has a clear majority in parliament it isn’t two thirds, so any veto from Elbegdorj should be safe provided he maintains the support of his party and the independents.

As for the investment agreement, Dierkes contends that it isn’t the details of the agreement that is slowing down its approval, but more the grandstanding of individual members of parliament. Standing up and demanding that certain points be included in the agreement has been an easy way for politicians to grab headlines in the country.

But Dierkes points out that because the parliamentary elections were just last year, and were for four year terms, there should be more than enough time for all members to voice their concerns and still get the agreement passed.

“Long term,” Dierkes says, “I’m still confident the agreement will happen.”

As for Ivanhoe’s president and chief executive, John Macken’s contention that the fallout from the global economic crisis would push the country towards a quick resolution of the agreement, Dierkes is somewhat ambivalent.

“There is a sense now that the economic hurting is happening very actively,” he says. “There are half constructed buildings throughout the capital that are not being worked on and the sense of crisis is relatively real. To what extent that will hasten the agreement, I’m not entirely sure.”