Following
Parliament giving its formal consent to discuss the draft policy on
Tavantolgoi, both party groups in Parliament decided at their regular Monday
meeting to review the draft thoroughly.

However,
Parliament’s does not have an important role in the issue as it is only
expected to approve the main directive principles of a general nature. Also,
the time for a recess is coming close. It will be the Government which is to
select the investors and prepare the terms of the final agreement. MPs will of
course try to influence those decisions.

The
Government will take some time to make the selection. The draft of the final
agreement will then be submitted to Parliament for approval. We can only hope
all this will not take the six years spent on Oyutolgoi.

The
selection of the investor will surely become the biggest issue. The Government
will select one or two investors. It is saying that it would be better if the
investors apply as a consortium, joining forces with Mongolian companies.
Previously the Government said 7-8 investors would be fine. Now it favors one
or two. Experts back this decision because it will not divide the coal mine into
too many parts, but the selection of the operator might very well cause
problems.

A
study by Open Society Forum of the present draft Tavantolgoi agreement finds
that the VAT and customs rates will be fixed. How beneficial this will be
depends on what the rates are. The study also reveals that Erdenes MGL will be
the monitoring entity. This may lead to a conflict of interest. What if
something like the oil spill disaster is to happen because of cost cutting
efforts? Nothing is as yet clear about the amount of advance payment to be
demanded and the amount of investment needed.

It
is clear that the Government means to do most of the work, using Parliament to
give it the authority to take decisions. True, this happened with Oyutolgoi
also but that issue was discussed, examined, and debated for six years. This
time, too much is left unknown, including the identity of the investors and the
terms under which they will work. The Government’s priority is to work fast,
but will it work wisely? Haste has often led to waste.