Prime Minister Sanjaa Bayar resigns for health reasons

Prime Minister Sanjaa Bayar submitted his letter of resignation to the Chairman of the State Great Hural (parliament) on October 26. Bayar had previously announced he intended to resign for health reasons. The Mongolian Peoples Revolutionary Party (MPRP), the senior partner in the parliamentary coalition with the Democratic Party, will pick a successor. MPRP spokespersons told reporters that the coalition was expected to remain intact. 

The MPRP holds 46 out of 76 seats in the unicameral State Great Hural (SGH) and would be able to name a new Prime Minister from the MPRP on its own initiative, without the concurrence of the Democratic Party. However, sources say the leaders of the Democratic Party are likely to be consulted on the choice of a successor, if only because President Ts. Elbegdorj (Democratic Party), elected in May for a four-year term, has the constitutional authority to vet proposed MPRP nominees for prime minister and cabinet positions.   

Bayar has been universally praised for his deft and forceful leadership as prime minister since 2007, steering the long-delayed Investment Agreement on the Oyu Tolgoi (OT) copper-gold mining project to completion, repealing the Windfall Profits tax that discouraged mining investment, defusing tensions after the 2008 parliamentary elections, and guiding the nation during the global recession. Bayar has previously been treated overseas for liver problems due to what news media say is a hepatitis C infection and was hospitalized again recently in Ulaanbaatar.

No changes are expected in the Oyu Tolgoi agreement as the result of Bayar’s resignation and MPRP spokesmen told reporters no major changes in national policy will occur because of any change in leadership. Still ahead for Bayar’s successor and the government are decisions on the huge Tavan Tolgoi coal fields, for which eight companies and consortia have reportedly been short-listed.

Foreign investors are also looking to the Mongolian Government for signals about provisions in the recently enacted Nuclear Energy Law that require uranium license holders to hand over up to 51% of their property to the government without any compensation. This proposed uncompensated seizure of assets has provoked a storm of criticism from various Mongolian government officials and the leadership of the domestic Mongolian mining industry, including the Mongolian National Mining Association (MNMA). Foreign investors are closely watching developments.