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China's Xi reassures Mongolia over "independence, integrity"
by Staff Writers
Ulan Bator (AFP) Aug 22, 2014


Chinese President Xi Jinping told Mongolia Friday that Beijing respected its independence and integrity as he concluded a visit looking to forge closer ties with China's resource-rich but often suspicious neighbour.

Xi was speaking in the Mongolian capital Ulan Bator after the two countries signed a raft of trade deals and made a commitment to almost double trade to $10 billion by 2020.

"China respects Mongolian independence, integrity," Xi told the Mongolian parliament, the Great Hural, on the first visit to the country by a Chinese head of state in more than a decade, adding Beijing would maintain the policy "forever".

Mongolia has vast mineral reserves but is dwarfed economically by its giant neighbour -- by far its biggest customer -- and resource nationalism has become the major issue in Mongolian politics.

Beijing welcomes Mongolia to "board China's train of development", Xi added, according to Chinese state news agency Xinhua.

Bilateral trade soared to $6 billion in 2013 from just $324 million in 2002, and makes up more than half of Mongolia's total foreign trade, Xinhua said, and almost half the foreign enterprises registered in Mongolia are Chinese.

But in 2012 Ulan Bator tightened approval requirements for foreign companies seeking to do business in "strategic" sectors such as minerals -- measures which were seen as being aimed at China.

Mongolia's economy has rocketed in recent years -- it enjoyed world-beating growth of 17.5 percent in 2011, but coal prices and foreign investment have since fallen and expansion slowed to 5.3 percent in the first half of this year, figures last week showed.

Sumati Luvsandendev, head of the Sant Maral Foundation, a research and polling group, said Mongolia had traditionally been "rather suspicious" of China's involvement in its economy, as "influence follows investment".

But the newly-created middle classes have recognised that the country needs funds from its giant neighbour to maintain its development.

"The problem is we have quite limited resources of our own in terms of labour and intellectual resources, so to implement big projects we have difficulties due to our limits," he told AFP.

Xi told the parliament he was pleased almost 30 deals had been signed during his visit, including a joint declaration to upgrade ties to a "comprehensive strategic partnership".

China has also agreed to allow landlocked Mongolia to use its northern seaports, Xinhua said.

Jargalsaikhan Dambadarjaa, a Mongolian political commentator and television presenter, said his country recognised that many of the projects the two countries had agreed were "too big for Mongolia" to implement alone.

For decades a tightly controlled Soviet satellite, Mongolia shook off Communism nearly a quarter of a century ago and has emerged as a vibrant parliamentary democracy.

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