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Could Mining Threaten Mongolia’s Tourism Potential?

Pearly Jacob* - IPS/EurasiaNet

ULAANBAATAR, Mar 30 2012 (IPS) - Twenty years ago, when a Dutch cyclist named Rik Idema first passed through Mongolia on a round-the-world biking trip, the country struck him as the most pristine place he’d ever seen.

Captivated by the steppe’s stark beauty, Idema later returned to explore the country with a Mongolian friend, Tseren Enebish. They started Tseren Tours together in 1994 and eventually married. Yet while business is thriving, the couple worries about Mongolia’s future as a tourist destination.

“The nomadic culture and vast unspoiled nature is what draws visitors,” said Enebish. “Mining could change that.”

In recent years, mining has eclipsed tourism as an engine for growth in Mongolia.

“Traditionally, (agriculture) was always tourism’s main competitor, but now it’s mining,” Indraa Bold, the director of the Mongolian National Tourism Organization (MNTO), a lobbying organisation, told

In 2004, tourism accounted for 13.4 percent of the country’s GDP, according to data from the U.N. World Tourism Organization. Though the government says tourism still accounts for approximately 10 percent of Mongolia’s GDP, that number is falling. The mining sector’s portion of GDP, meanwhile, is about 30 percent and rising, according to Resource Investment Capital, a consultancy based in Ulaanbaatar.

“Regardless of how well the tourism sector performs, from now on any growth will always be overshadowed by mining,” Bold said.

According to Bold, mining companies have acquired land-use rights in several places of historic interest including the Bichigt Khad Valley, which is celebrated for its petroglyphs, the Darkhad Valley, famous for its shamans and stunning landscape, and areas around the sacred meditation sites of Danzanravjaa, a famous early 19th-century lama and poet, in East Gobi.

“It’s sad to see the landscape and culture in many areas of Mongolia are irreversibly changing because of mining. There’s no escaping the fact,” she said.

The question that Bold and others ask is why can’t Mongolia – a country roughly the size of Western Europe but with only three million people – continue to enjoy strong growth in both the tourism and mining sectors?

Industry insiders say competition for human resources has had a significant impact on tourism.

“We take young unskilled workers, equip them with necessary language and management skills, and just as they become competent, they leave for better paying mining jobs. Frankly, it hurts,” said Enebish, who has seen five of her best employees leave Tseren Tours for mining jobs.

Hospitality and transport services are also increasingly catering to mining interests.

“It costs more to fly (from Ulaanbaatar, Mongolia’s capital) to the Oyu Tolgoi (copper-gold mine) site than to Beijing. The demand is not only driving up local fares, but airlines are also too busy to service other parts of the country,” said Bold.

The recent openings of world-class hotels by global chains like Hyatt and Radisson in Ulaanbaatar doesn’t help the industry either. “Everything is clustered in Ulaanbaatar and you can’t say it’s benefitting the countryside – the rest of Mongolia – in any way.”

One thing that skews tourism data is the fact that many foreigners traveling to Mongolia, ostensibly to pursue business opportunities, enter the country on tourist visas. Government figures state 457,514 tourists arrived in the country in 2011; 43 percent were Chinese.

Most arriving Chinese are entrepreneurs, said Stephen Kreppel, director of the Mongolian National Marketing Coordination Office (MNMCO) under the Ministry of Foreign Affairs.

“Most of these travelers are here with business interests. Actual leisure tourists number just about 90,000,” Kreppel told Kreppel questions government policies that encourage mass tourism by building huge tourist complexes and entertainment facilities.

He believes the distortion of actual tourist numbers is encouraging flawed policies. “The role of tourism in Mongolia should be to redistribute wealth into the countryside,” he said.

Some tourism operators contend that mining projects have no influence on tourism. “These are localised projects, built away from everything else, where there is no tourism happening. What’s the fuss about?” said Zanjan Fromer, founder of Ger to Ger Foundation, which offers community-based tours among nomads (“ger” is the Mongolian word for yurt).

“The area affected by mining is miniscule compared to the total landmass,” agreed Kreppel from the MNMCO, though he fears mining- driven inflation will make Mongolia an increasingly expensive destination, and the “Minegolia” image could hurt the country’s brand among potential tourists.

Others like Gantemur Damba from Sustainable Tourism Development Center, a local non-governmental organisation, are taking a wait-and- see approach.

“Mongolia is big enough (for both mining and tourism) at the moment, but with land-protection laws still weak, this can be easily reversed,” said Damba. “What Mongolia requires is clear zoning policies where mining can develop and where locals have the right to retain land-use rights to preserve their (nomadic) heritage – the real tourism product of Mongolia.”

*Editor’s note: Pearly Jacob is a freelance journalist based in Ulaanbaatar.

*This story originally appeared on

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