Baabar: Idiots never realize they are being scoffed and laughed at


2018-05-28 08:36 GMT+8

ZGM Daily presents the “patriotic speech” delivered by Batbayar Bat- Erdene, a.k.a Baabar, a distinguished former politician, analyst and columnist, at the Mongolia Economic Forum-2018.

“I am the key person, who managed the ever-important reform, made in Mongolia’s banking and financial sector with support from the Asian Development Bank back in 1998. At that time, all banks were state-owned, despite their title “commercial”, and all commercial banks going out of business due to bankruptcy in 1992- 1998 were simply merged to the largest commercial bank, the People’s Bank, bringing Mongolia’s banking system on the edge of disastrous financial crisis. So-called commercial banks, which were still the property of the state, already disbursed over USD 100 million non-performing loan, reaching the scope and magnitude that the “then incapable” country’s banking and financial system to be knocked down entirely.

With less than USD 1 billion GDP, foreign aid and loan accounting for 40 percent of the GDP and only USD 6 million currency reserve in 1996, this country needed to immediately fix the crisis system; otherwise we had to face the situation that entire country would go broke. All government-run banks had already established run-down and corrupt, but already disclosed and publicly known system, 10-15 percent of bribe for disbursement of loan, it had even reached the level to be considered ”normal benchmark”. However, everyone kept away from “reforms”, feared and kept aside, so someone needed to dare to commence the reform in the sector. That “brave” idiot happens to be me. Libeling, disfiguring and political revenge flooded the country, and I was on the brink of execution. But, thanks to the reform, banking and financial system became robust. Today, you get into a bank and tell “Lend me money, I will reward you with 15 percent of the loan amount” and see what would be the reaction.

We have a future to be one of the richest countries in the world

Since that time, I often tried to stay off Mongolian state, even away from the political parties and keep distance from them. As early as 1938, then Prime Minister Amar Anand warned, “State of Mongolia is malignant to its servants”. History of my country is dominated by biographies of people who made political decisions in compliance with their duty throughout the 20th century and first two decades of this century, then become a culpable for these decisions. 20 percent of all Prime Ministers were killed or passed away while being put under fetter. Leaders with good reputations or leaders who are already forgotten were the ones kept away from political decisions and silently tied with egos and self-cares.

As we have such bitter lesson from history, the situation will exacerbate in the future. Leaving out the country, if at the micro level, one within the family that is tasked to make decision remains silent and not making any decisions, it is the most destructive calamity for the family. Incorrect decision is acceptable because it gives an opportunity to fix it. Conversely, making no decisions at all is obviously the shortcut to extinction. In the vacuum environment where no decision is made wreak havoc finally aggravates, making a country and the family a ‘nice pray’ for someone looking for seekers of profit and chance. When insanity takes place, those inanes obtain personal benefits and profits. They could earn astronomic amount, but it is a drop in the ocean as opposed to damages inflicted to the public. No difference between bowing up a house trying to burn cockroaches and ruining a country trying to establish justice. Science proved that cockroaches are deleterious, conversely, those saying “justice” are, in many cases, often the fools forcing their judgement; that is where the difference is.

A tremendously huge copper deposit Oyu Tolgoi was discovered in Mongolia early this century, but it has quickly turned to be our main and the largest encumbrance and disaster. If Mongolians did not find it, or foreign geologists did not discover the deposit, it would have slept in peace under the earth’s crust without suffering anyone. Even if it was found, we would not have had the necessary money, technology and ability to use this deposit. The quarreling began after Oyu Tolgoi was discovered, but Mongolia’s total industrial throughput at that time was only USD 1 billion. Thanks to foreign investors, we have attracted USD 10 billion, the amount that we have never had. Mongolia is affluently rich in natural resources. We have multiple other “Oyu Tolgoi”. If we manage to use all these resources correctly and appropriately, we have a future to be one of the richest countries in the world. If we behave like a dog watching hay grass, not eating herself and not letting others eat, beggary will stick to us for good. Think about who will be interested in “vacuumizing” Mongolia, in terms of statehood and economy, so that it remains in solitude. Idiots never realize they are being scoffed and laughed at.

  • Making no decisions at all is obviously the shortcut to extinction.
  • Oyu Tolgoi allocates around USD 1 billion annually, which equals Mongolia's GDP before OT agreement.
  • If Oyu Tolgoi ceases, there will be no salary increase, not even salary whatsoever.

Vast and dominant majority of Mongolian citizens already obtained deeply rooted and unalienable comprehension that Oyu Tolgoi Agreement was made incorrectly, foreigners are robbing us blind, they steal all our wealth and do not even give back a penny, and that we are in head over heels in debt. In reality, Oyu Tolgoi LLC injected USD 7.7 billion into Mongolia through Mongolian banks in 2009- 2017. Out of this amount, USD 1.6 billion was paid as taxes and social insurances, directly to the State Budget. In addition, the VAT amount paid to national suppliers totals USD 517.8 million, cumulatively USD 2 billion so far. Pending USD 5.7 billion, Oyu Tolgoi made trades and deals with about 1700 Mongolian companies. About 14 thousand Mongolians work at Oyu Tolgoi today, with a minimum monthly salary of USD 1 thousand and the average salary stands at USD 3 thousand, topping the list of all sectors with 10 times higher average wages. Take into account that Oyu Tolgoi stagnated for two years between 2009 and 2017, the amount of money that Oyu Tolgoi leaves in Mongolia per year totals about USD 1 billion, this equals Mongolia’s entire GDP at pre-OT time.

That money injected into Mongolia also equals the salaries and pensions of 187 public servants and 398 thousand pensioners, respectively. Every month, USD 110-120 million is converted to MNT through Mongolian banks; this keeps the MNT rate stable as of today. These figures are not secret; just ask the banks as I did. As of today, doctors and medical personnel are demonstrating in the main square demanding pay raise. If Oyu Tolgoi ceases, there will be no salary increase, not even a salary whatsoever. I am expressing it by USD because the MNT rate is on heavy fluctuation. If you convert it to MNT, just multiply by 2500, the amount will easily exceed trillions. Remember, a trillion has 12 zeros in it. I obtained these figures from Ministry of Finance, Oyu Tolgoi and Mongolian banks. There were no discrepancies. Right now, about 300 inspectors are “swarming” over Oyu Tolgoi. They will likely present the same figures soon.

In terms of “wrong” agreement accusations, who have actually read the agreement and proved which provisions were wrong? As I assume, there is likely no one in Mongolia that have read at least half of the Investment Agreement, including myself. Reading is one thing, but how many Mongolians do we have among the 3 million population that have professional-level knowledge on the international agreement regimes, meanings and calculations, both from legal and economic perspectives?

As for being head over heels in debt, whose fault was it? Who made the decision to purchase 34 percent of a foreign company by loaning from them and pay back from future profits of copper sales? If I am not mistaken, government representatives confronting the company for agreement in 2008 had set and legally obliged 34 percent, as insisted on by the Parliament. Have you forgotten that many professionals warned that simply collecting taxes, without any debts and costs, would be much more viable and keep the country away from obligations? I agree that Oyu Tolgoi agreement is incorrect and badly made, but here is where the incorrect and bad things are. We, ourselves, made this incorrect and bad decisions. Oyu Tolgoi deposit and its wealth is the 100 percent property of Mongolia, no one denied and grabbed it. However, do we really understand that we acquired 34 percent of a foreign company working on the deposit on credit? If justice really existed, shouldn’t those people who pushed 34 percent and 51 percent, and threw this country into a giant pit of debt be in prison instead of them!?

No secret agreement was made in Dubai. Rather, it was a transparent plan to revive the underground construction and development, which stood still for two years, and further to operationalize the underground mine. If it was secret, it would not have been made in the world’s most open city Dubai. It would be more of a secret if it was made in a basement of an apartment in Ulaanbaatar with doors locked. Dubai, the most open city for business and finance was selected as a venue in order to revive Oyu Tolgoi, which stood on the brink of ups or downs because of the ‘rampant’ protest of our nation, and to globally announce that copper ores in two km depth will be mined with the most advanced technology, and to persuade and invite global companies to invest into this mine. This is the real truth.

Such patriotic information, which is biased, explicitly libeling and overturning the society with false news often come from government agencies first. People supported by the state, either mad or frivolous, and racketeers seeking for profit get into fights, unintentionally deceived by these word or intentionally to earn profit. I can name several high ranking government officials that got tender bids by threatening Oyu Tolgoi and other mining companies, and just robbed them without supplying the pledged. They are the ones that got the biggest of pies. Those poor guys protesting in the street only got to have a tiny piece of leftovers. Pitiful how the total amount of their profit would not even equal a drop of damage they inflict to Mongolian economy.

Ivanhoe Mines' goal was not to mine, but to play off the charts

There are companies that do not have good reputation worth taking care of and are engaged in swindling without being noticed by none. If not yet forgotten, some of you may remember some, including Ibex Molam, Jargalankhaan, the predecessor of Chinggis Khaan, American-Arabian Alan Parrot, the protector of Mongolian falcons, G-Time company and Sarah the Arm Strong. The society like ours, where insane mind prevails over sound mind, can become an ‘easy prey’ for swindlers. In 2011, Mongolian government deported Canadian Khan Resources.

It is said that the total investment of the company injected into Mongolia was about USD 12 million. When the company was neglected, they requested USD 20 million compensation for the losses. Unfortunately, there were no brave and idiotic ‘decision maker’ to deal with the company when they addressed to the international arbitration and claimed USD 400 million. After a long lasting trial, arbitration imposed USD 100 million penalty to Mongolian government. The Government delayed the payment, so the company threatened with another claim, in which the government finally started paying USD 70 million after begging the company. Many questions may arise, such as why the decision makers pushed the company to leave Mongolia from the outset or why did they not agree on USD 20 million and so on. Company was able to multiply its investment 6 times over, demonstrating that anyone can earn huge amount of money without doing nothing in this country with such weird government. We have been proving and calling that you can earn millions just by getting an investment approval and get kicked out of Mongolia. Currently, several foreign companies are waiting the right time, preparing their profit. It is worth praising that a junior company, which we call Ivanhoe "Mayonnaise" in Mongolian pronunciation, that work on securities exchange has discovered the Oyu Tolgoi deposit. However, the company is a professional in speculating the stock market. Its goal was not to extract copper through laborious efforts, but to trade its share in an international exchange by fluctuating its value. Patriots in the street assaulted the company's office, overturned the company’s vehicle and tried to set a fire, which caused the stock price to decline to USD 1.5 per share, then the shares were acquired in large amounts. Afterwards, the company grew to a world-class mining company and sat behind a negotiation table with the Government of Mongolia, and this time, the shares plummeted to USD 25 per share. During this period, share trading brought almost 20 times more profit. It is said that the company intentionally organized this fluctuation. Idiots never understand they are being scoffed and laughed at.

That is the characteristics of us, who were shepherds in the past, then became members of socialist labor brigades, and more recently, overturned socialist system and established democracy. Mongolia has turned into a society that can be knocked down and ruined, failing to work together and become friends. How do we save this system that has no progress but collapse and no engine but demolishers? Shall we stay worried about the collapse and get buried, or should we raze and build from the ashes once again? What do we do with the political system that is as same as an old building waiting for demolition? What solutions do we have now? I am starting to think that it might be the optimal solution to either close Oyu Tolgoi or keep it conserved until we come to understand the global rules. We managed to live happily with an economy worth only USD 1 billion and were thankful to political parties and government, without any quarrel and conflict just fifteen years ago; but now, we have a GDP of USD 12 billion and over 70 million livestock. Surely, we will not be dying from starvation with or without Oyu Tolgoi. We have many other “Oyu Tolgoi”s, but we need sanity to use them effectively and viably. If we keep being insane as-is, several generations will pass without using these wealth. What we miss more than money today is a strike that could give us a painful lesson and comprehension. Without this, our future will stay grim for years and generations. Idiots never notice they are being scoffed and laughed at.

A well-renowned Italian poet Dante Alighieri said, “The darkest places in hell are reserved for those who maintain their neutrality in times of moral crisis” several centuries ago. We see and understand the sins that drew this nation to extinction, but we remained silent. I am telling this on behalf of those sinners keeping quiet. I am a patriot. I have never announced this explicitly before and I did not beat my chest in fears that I might crack open it. I am saying these words because I love my country. Because, this is my existence, and this is a country that belongs to me - my country. I know very well that I am a part of my home country. That is why, I am a proud patriot as opposed to anyone beside me. 

GoGo Facebook Page

Go to top