China’s COVID-19 policy has severely affected Mongolia’s economy as it is “disproportionally dependent on its biggest foreign trade partner Beijing”, said a Canada-based think tank. As the world enters the third year of the COVID-19 pandemic, Mongolia’s economy has been improving since April last year as businesses have been re-opening, but China has kept its border sealed under its no-COVID policy, said Canada-based think tank, International Forum for Rights and Security (IFFRAS).

Coal trucks hauled from Mongolia through Inner Mongolia’s Ganqimaodu border port have nose-dived after fresh COVID-19 cases were reported in the region. The number of daily coal trucks from Mongolia to Ganqimaodu fell below 100 on 7 December, 2021, down from 300 per day in the week ended 3 December.

In January 2022, trade balance deficit decreased by USD 226.5 million from previous month. Trade with China reached USD 520.4 million in January 2022, which is accounting 47.5 percent of the total trade turnover. Bituminous coal and copper concentrates accounted for 36.6 percent and 48.1 percent of total exports to China.

China has implemented a strict and extreme policy that includes strict lockdowns, mass testing and mandatory quarantine in state facilities. Mongolia is also suffering because of China’s COVID policy. China is also the biggest investor in Mongolia. Since Mongolia became part of BRI, investments by China has increased even more and China has also granted loans. Trade is one aspect of China and Mongolia’s relationship.