Calling the recent
suspension of 254 gold mining licenses “a bombshell on the international mining
industry”, Mongolian Views says in its Website
that Mongolians consider the ground sacred and are reluctant to dig, fearing it
may upset the balance of nature. Living close to nature also, as many
Mongolians do, means they have an in-built awareness of the environment and are
highly sensitive to damaging or polluting the land. Proposed golf courses for
example, a lucrative form of investment in nearby China, are banned in Mongolia
due to concerns over the use of fertilizers and weed killers.

The license issue may
have serious repercussions if it spreads beyond gold. Several international
mining companies have recently established operations in Mongolia and have gone
on to IPOs in Hong Kong and Canada. The government says it will release a full
list of companies affected. Analysts warn of the dangers of investing too much
in emerging countries such as Mongolia due to the dangers of government U-turns
over investment policies.