OT report from Mongolia, Dale Choi
Origo Partners View
This development is expected and reinforces our position of cautious optimism regarding the Oyu Tolgoi Investment Agreement (OT IA) renegotiation issue and Mongolia’s stance on foreign investment based on our view that the Democratic Party’s leadership is predominantly moderate and understands the importance of foreign investment
Even more importantly, it appears that cross party consensus has been reached on the issue as the renegotiation proposition has failed at the voting of the State Structure Standing Committee
The Government position is that there will be an open and transparent Parliament hearing that will “once and for all” resolve the issue
Furthermore, there appears to be a Government statement of fairness and non-discrimination. The OT IA will be subject to the same review as is the case with all investment, stabilization and product sharing agreements
Event
Members of Parliament of Mongolia today voted on and approved the Action Plan of the Government for 2012-2016. 75.4% (43 MPs) out of 75 MPs present (attendance of 80.3%) voted to approve the plan
There was heated debate amongst MPs over the OT IA with some MPs proposing to include the renegotiation of the “unprofitable” agreement in the Government Action Plan, stressing that 25 MPs have signed the petition to renegotiate and “more will follow”
The Chairman of the State Structure Standing Committee A.Bakei has said that in order to include the renegotiation clause more than two thirds of MPs at the meeting of the committee should have voted for its inclusion and this did not happen
Deputy Speaker of the Parliament S.Bayartsogt has argued that the newly elected MPs are not yet fully informed, and old MPs are deliberately misrepresenting the issue. “All documentation from the time of the establishment of agreement will be provided to MPs. We need to look at the issue with the broad picture in mind and review in order to resolve”
Media sources have also reported that the Prime Minister of Mongolia has said, “there is a need to review Oyu Tolgoi issue. We should have a hearing on Oyu Tolgoi and resolve it once and for all, otherwise there will be standard established of fighting between so called patriots vs. so called non-patriots. Although Oyu Tolgoi is not named specifically, this issue is reflected in action plan of the Government - all investment and stabilization agreements not only in mining but energy sector even product sharing contracts will be subject to very detailed review.”
This development is expected and reinforces our position of cautious optimism regarding the Oyu Tolgoi Investment Agreement (OT IA) renegotiation issue and Mongolia’s stance on foreign investment based on our view that the Democratic Party’s leadership is predominantly moderate and understands the importance of foreign investment
Even more importantly, it appears that cross party consensus has been reached on the issue as the renegotiation proposition has failed at the voting of the State Structure Standing Committee
The Government position is that there will be an open and transparent Parliament hearing that will “once and for all” resolve the issue
Furthermore, there appears to be a Government statement of fairness and non-discrimination. The OT IA will be subject to the same review as is the case with all investment, stabilization and product sharing agreements
Event
Members of Parliament of Mongolia today voted on and approved the Action Plan of the Government for 2012-2016. 75.4% (43 MPs) out of 75 MPs present (attendance of 80.3%) voted to approve the plan
There was heated debate amongst MPs over the OT IA with some MPs proposing to include the renegotiation of the “unprofitable” agreement in the Government Action Plan, stressing that 25 MPs have signed the petition to renegotiate and “more will follow”
The Chairman of the State Structure Standing Committee A.Bakei has said that in order to include the renegotiation clause more than two thirds of MPs at the meeting of the committee should have voted for its inclusion and this did not happen
Deputy Speaker of the Parliament S.Bayartsogt has argued that the newly elected MPs are not yet fully informed, and old MPs are deliberately misrepresenting the issue. “All documentation from the time of the establishment of agreement will be provided to MPs. We need to look at the issue with the broad picture in mind and review in order to resolve”
Media sources have also reported that the Prime Minister of Mongolia has said, “there is a need to review Oyu Tolgoi issue. We should have a hearing on Oyu Tolgoi and resolve it once and for all, otherwise there will be standard established of fighting between so called patriots vs. so called non-patriots. Although Oyu Tolgoi is not named specifically, this issue is reflected in action plan of the Government - all investment and stabilization agreements not only in mining but energy sector even product sharing contracts will be subject to very detailed review.”
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