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Mongolia: Ulaanbaatar Wrestles with Dutch Disease Dilemma

Despite a booming mining economy, Mongolia's manufacturing lies in ruins. (Photo: Pearly Jacob)

Ochir Damchaa chuckles as he drives his second-hand Toyota sedan through the alleyways of Nalaikh, a ramshackle town 35 kilometers east of Ulaanbaatar: “There’re just two kinds of jobs here: drive a taxi, or dig coal.”

Nalaikh was once a major Soviet-era industrial hub, and the site of Mongolia’s first mine. Today, though, the town is littered with ruins of former factories, such as Mongolia’s only glassworks. Residents continue to work as freelance miners on the grounds of the former state-owned coalmine. But jobs are scarce in Nalaikh, as in every other small town across Mongolia.

Despite rapid, mining-driven economic growth, Mongolia is experiencing persistent unemployment, a widening income gap, and a 30 percent poverty rate. The country’s leaders are now promising to diversify the economy, aiming to create jobs that push more people above the poverty line.

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Pearly Jacob is a freelance journalist based in Ulaanbaatar.

Mongolia: Ulaanbaatar Wrestles with Dutch Disease Dilemma

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