In 2008, the GDP of Mongolia was USD5.3 billion. In the next decade, that could triple, a recent report on BBC said.

“That is realistic,” it quioted D Zorigt, Mongolia“s Minister for Mineral Resources and Energy, as saying. “We have world-class mines.” The development of the gold and copper mine at Oyu Tolgoi in the south Gobi region alone – without any of the other mining projects that are due to come on stream – will represent a huge increase in government revenues.

“Our first priorities will be education, health, housing and social welfare,” says the minister. “And we hope mining will drive a new wave of industrialization, so that we can increase the skill set of Mongolian people and manufacture modern products ourselves.”

Both main political parties pledged to distribute cash handouts of around USD1,000 to every Mongolian citizen based on mining revenues. Opposition MP S Oyun says the country cannot afford the pay-out. “I think this is a very irresponsible policy. It was an easy way to gain votes in the election because there is so much poverty in Mongolia. The main challenge is to create jobs and income and give a decent living to the people.”

Gsogbadrakh, a widower, came to Ulaanbaatar with his sons after losing 300 sheep, goats, cows and horses in the last dzud. They live in a ger on the edge of the city, but Gsogbadrakh has been unable to find regular employment, and has survived on social welfare and casual work in construction. He is not convinced mining will change his prospects and make Mongolia a wealthy country. “I”m doubtful about that. Of course, if we use our resources wisely it will benefit the country, but I”m not sure I really trust our politicians.”

But Zorigt defends the Government commitment to distributing the cash. “Election promises need to be kept. Otherwise in a young democracy like ours, people lose trust in the Government and political parties. And we are facing a significant economic downturn because of the global recession. So this should be seen as a way of enhancing consumption.”