Young professionals in Mongolia perform the bulk of the work in many organizations and institutions, including in the mining sector. In government bureaucracies, young professionals are often the first to draft policy documents, thereby contributing to the foundation of policy discussions and changes. Given that the median age in Mongolia is 28 years, this should not be surprising. Yet despite their numbers and contributions to the economy, young professionals are often referred to as inexperienced and less knowledgeable and have limited access to professional development opportunities.
To address this, the Canadian International Resources and Development Institute (CIRDI) teamed up with its Mongolian partners – the country office of the Natural Resources Governance Institute (NRGI) and the Ministry of Mining and Heavy Industry of Mongolia – to devote a five-day resource governance workshop in June 2017 to young professionals working within government, the mining industry and civil society on natural resource policy issues.
The workshop took place in Mongolia, as the Mongolian context provides rich resource governance case studies. In recent history, mining became Mongolia’s key industrial sector through three main developmental stages: 1) Soviet assistance and a centralized economy (1924-1990); 2) the political and economic transition of the 1990s to a free market economy; 3) a full commodity boom and bust cycle in the early 2000s. These shifts are also reflected in the changing educational opportunities of policy makers and professionals within the mining sector. For example, many of the older generation received their education in communist bloc countries in the 1970s and 1980s, whereas those of the younger generation now attend universities in OECD countries, as well as Russia and China, thus exposing them to diverse educational and training approaches.
According to their educational backgrounds, Mongolia’s young professionals can be divided into three groups. The first group includes those who obtain their undergraduate and graduate education abroad, ranging from OECD member countries to China and Russia. While their education provides them with excellent technical knowledge and exposure to leading international practices, this cohort often lacks an in-depth understanding of the Mongolian context. The second group consists of those who graduated from domestic universities and colleges. While this cohort may have limited exposure to global or regional expertise and standards, they develop a sound understanding of the local context, with many acquiring hands-on experience in the Mongolian mining sector. The last group includes those with educational opportunities both in Mongolia and abroad. This group generally has a more comprehensive perspective of the Mongolian mining sector than the other groups.
Given this range of educational experience and knowledge, young professionals would benefit from peer-to-peer learning opportunities, as these would allow them to learn from each other, test the applicability of their knowledge and, most importantly, critically analyze past policies together.
Senior policymakers and resource governance experts could use such events to pass on their experience to future leaders and policymakers. This kind of dialogue, exchange and networking builds capacity and facilitates stronger decision-making. Yet in Mongolia there are limited forums and training opportunities for young professionals. This directly impacts the institutional capacity of the resource sector because these young people are the ‘gatekeepers’ of the quality, continuity, and stability of mining policies, and are the future of the sector.
For its workshop, the CIRDI team and its local partners defined “young professional” as someone under 35 years of age, with at least one year of experience working in a mining-related job in the government, industry or civil society. The team selected 15 Mongolian participants (five each from the government, industry, and civil society), four from the Kyrgyz Republic, and one from Afghanistan. The workshop was designed to be hands-on and participatory, with a focus on experiential learning. This departure from the academically oriented discussions of CIRDI’s previous workshops in this series was based on participant feedback.
This workshop was the third and final one in a series organized by CIRDI and focused on natural resource governance and international peer-to-peer learning among newly democratized countries with resource-based economies.
The previous workshops were held in Mongolia (May 2016) and the Kyrgyz Republic (November 2016), and included mine site visits for select participants to Oyu Tolgoi in Mongolia, and Kumtor in the Kyrgyz Republic. These first workshops were organized in collaboration with the International Cooperation Fund of the Ministry of Foreign Affairs of Mongolia, which had spearheaded this initiative.
The Abandoned Mine of Nalaikh – Looking Back to the Future
This final workshop started with a first-hand examination of what happens in the absence of a formal mine closure policy. Established in 1922, Nalaikh was Mongolia’s first-ever large-scale coalmine. By mid-century, the mining activity in Nalaikh had contributed to good infrastructure, including railroads, roads, and electric grids in the surrounding area, as well as bustling urban settlements. During the industrial mining boom of the 1970s and 1980s, Nalaikh was known for its mining experts, produced both through the mine itself and an
adjacent vocational school. Yet the mine was abandoned in 1995 due to a deadly explosion, which killed over 20 people in 1990 and, more importantly, the withdrawal ofSoviet subsides following the collapse of the USSR. No mine closure plan was ever implemented. Since then illegal small-scale mining activity has transformed Nalaikh into one of the world’s deadliest underground coal mine sites, with 20 to 25 deaths recorded annually.
This illegal mining activity has also had devastating impacts on the surrounding environment, creating socio-economic risks for Nalaikh’s communities. Many blame the lack of a closure policy for the region’s fate.
Workshop participants learned this history, as well as how the local government is currently addressing the socio-economic and environmental challenges associated with the mine, through a panel facilitated by the Nalaikh District’s Governor’s Office. Ultimately the local government is seeking to formalize the illegal mining activity in order to increase health and safety standards for the miners, as well as to increase tax revenues for the government. One of the main challenges here is coordinating this effort with the national government, which is responsible for the relevant legislation. In the meantime, the local authorities are also investigating alternative income generating activities for the miners. One such idea is to transform Nalaikh’s old infrastructure into a mining museum in order to preserve and recognize Nalaikh’s role in transforming Mongolia into an industrialized, mining-dependent country.
Following this panel, workshop participants received a guided tour of the abandoned mine from Mongolia’s Mining Rescue Unit, which is based in Nalaikh. Participants witnessed the decaying buildings of the once successful mine, surrounded by artisanal mining pits and holes. With two-thirds of the coal deposits remaining unexploited, Nalaikh remains an attractive income generation opportunity. According to the Nalaikh District’s Governor’s Office, 1086 people worked illegally in the mine in 2016, particularly in the winter months when coal consumption increases. In visiting Nalaikh, workshop participants witnessed firsthand the importance of preparing and implementing a comprehensive mine closure plan, as the consequences of not doing so were all too evident.
Mongolian Coal Mines – Two Ownership Models
After Nalaikh, it was time to visit two operational coalmines – the state-owned Erdenes Tavan Tolgoi Ltd., and the privately owned Energy Resources LLC. Both mines are located in Tavan Tolgoi, one of the world’s largest coking coal deposits. Participants were prepared for these site visits through a presentation, which highlighted the history, governance structures, and challenges and opportunities of state-owned enterprise in Mongolia. The back-to-back visits of these mines allowed participants to see how two different ownership models had been realized at the same mineral deposit. Erdenes Tavan Tolgoi, a state-run enterprise, contracts operating companies to extract and export the ore, with limited resources dedicated to corporate social responsibility, contributing to the local economy, and building up infrastructure. In contrast, the privately owned Energy Resources conveyed a more integrated mining operation, including a thermal power plant, roads, housing complex, water treatment facility, and coking-coal processing facility.
The tours not only conveyed the scale of these mining activities, but also allowed the workshop participants to engage with people working at the mines.
Through the guides and staff made available to our group, participants learned about the key challenges faced by these large-scale mining operations, including the environmental and social impacts they need to manage.
One such challenge, for example, is the transportation of coal to China. Thousands of overhaul trucks from three different mines regularly transport the coal at high speeds the 250 kilometers to the Chinese border. There they queue for over 50 to 60 kilometers day and night to unload coking coal at the Chinese receiving station. This has major environmental impacts in the region, creating health challenges for those living in the Tsogt-Tsetsii soum centre, particularly from the dust and exhaust.
Interactive Learning: Oyu Tolgoi Community Benefit Agreement Exercise
To tie all the learning together, the final day of the workshop was devoted to an interactive exercise on community benefit agreements (CBAs) designed and facilitated by Eric Werker, a professor at Simon Fraser University’s Beedie School of Business, and Dalaibuyan Byambajav, a Mongolian researcher and expert on sustainability challenges in the resource sector in emerging economies. The day started with Dr. Werker introducing the recent community engagement process between the Tk’emlups Indian Band, the Skeetchestn Band and New Gold’s New Afton Mine Project, which is located near Kamloops, Canada.
Canada has over 30 years of experience in enacting CBAs, with many of these agreements meeting their objectives in relation to delivering benefits. This case study therefore allowed participants to consider the CBA process in an experienced resource-based, developed democracy.
Participants were then provided with background information on a fictional case, which was based on an actual CBA between Oyu Tolgoi and the Umnugobi Province. In this scenario, a large copper mine was entering into discussions with a local community in order to establish its operations. Participants were divided into three role-playing groups, with each participant assigned the role of a different interest group – the mining company, government, and local authority. Within these roles, participants had to negotiate and reach a community benefit agreement. Through this exercise, participants directly experienced the complexity of working through a scenario where multiple stakeholder interests needed to be taken into consideration. Discussions were heated as participants actively engaged with each other, correcting each other’s assumptions while passionately defending the interests of their stakeholder group. After each negotiation stage, the groups presented the status of their agreement, and identified the opportunities and challenges they faced. Dr. Byambajav provided immediate feedback on their presentations, grounding his comments in the actual negotiation process that had taken place between Rio Tinto, the Government of Mongolia, and the local community.
To conclude the exercise, a roundtable was held with representatives who had participated in the actual negotiations of the Oyu Tolgoi CBA. This included Sh. Baigalmaa, the General Manager for Social Performance and Regional Development of Oyu Tolgoi LLC, who had represented Rio Tinto, and J. Sukh-Erdene, who represented the local community as a provincial government official. The Director of the Gobi Oyu Development Support Fund, S. Erdenebat, was also present to discuss the work of his organization, which was founded as a direct outcome of the agreement. Finally, Ganzorig Ochirbat, a representative of the Umnugobi provincial government, outlined the government’s developmental vision for the province, including how natural resources would be integrated into its future.
Following these presentations, a multitude of hands shot up to ask questions of this panel, demonstrating an eagerness on the part of the young professionals to learn and understand the work of these seasoned professionals.
Peer-to-peer learning was a major focus of this workshop. Not only was it important for the 15 Mongolian participants to engage with each other, but also with the five international participants.
Discussing the Mongolian, Kyrgyz and Afghan experience in resource governance, as well the Canadian experience in CBAs, was central to moving discussions beyond a national focus to include leading international practices and standards.
The dialogue and debate that ensued among the workshop cohort still continues to this day, two months later, through an online platform where participants have shared the follow-up reports they drafted for their organizations on what they had learned, as well as other relevant material and information.
The workshop also increased participants’ access to case studies and information relevant to natural resource governance. Mongolia is rife with learning opportunities beyond those addressed by this workshop. Many past policy decisions in Mongolia – the Windfall Profit Tax, the Law with the Long Name, decisions related to artisanal and small-scale mining, and so forth – can provide critical learning opportunities for young professionals. Familiarity with past policy decisions and their implementation will contribute to an informed workforce, leading to strengthened institutions. Learning about these past examples can also increase the access of young professionals to consultants and experienced government, industry and community representatives through the sharing of real life experience. This not only fosters intergenerational learning across stakeholders, but can also increase the confidence of the young professionals to engage with their superiors. This is also true for mine site visits – many young professionals working in natural resource governance have never visited a mine site and witnessed firsthand the implications of their work. When framed correctly, mine site visits can offer new perspectives on their work, allowing once again for more informed decision-making.
Strengthening governance institutions is at the heart of many development programs. Young professionals form the bulk of the workforce of these institutions in developing countries and need to be systematically targeted with capacity-enhancing workshops. Such opportunities will ensure that they become informed, confident decision-makers who can guide their countries towards sustainable and equitable development.
It is the authors’ hope that more such learning opportunities will be made available to Mongolia’s young professionals in the future.
 The statistics was provided by the Mine Rescue Unit of the Mongolian National Emergency Management Agency as well as the Municipal Authority of the Nalaikh District.
This article is reprinted with permission from the Mongolian Mining Journal (The Mongolian Mining Journal, August 2017, pp. 90-93).
Mendee Jargalsaikhan, UBC PhD candidate
Marie-Luise Ermisch, PhD, Program Manager, CIRDI
Published September 13, 2017