Mongolia named motorbike enthusiast Ukhnaagiin Khurelsukh, a former deputy prime minister with a macho image, as its new prime minister on October 4.
Khurelsukh, 49, is known for posing shirtless, Vladimir Putin-style, with a hunting gun, and also for the nickname "Fist", which he earned after punching another member of parliament in 2012. Video of the incident went viral. Analysts say a lot of the electorate like Khurelsukh's projection of himself as a tough upholder of the law.
The new PM started his career in the military - he holds the title of colonel, although his service only lasted a year from 1989-90 – and joined parliament in 2000 as a member of the Mongolian People's Party (MPP), which currently has a big majority in parliament.
In a speech following his appointment, Khurelsukh pledged to "improve people's lives, declare discipline and rules, fight corruption and punish those who are irresponsible," Reuters reported. He added: "My cabinet... will declare justice again... don't come to me with illegal acts as well as my cabinet members and don't pressure us to act illegally."
Khurelsukh's appointment follows the dismissal of the Jargaltulgyn Erdenebat government in early September following a vote in parliament. The prime minister and his government were forced out after allegations were raised of incompetence and corruption in relation to the awarding of government contracts worth MNT800bn ($330mn) to companies linked to three government members.
Erdenebat, in office only since 2016, also faces accusations that prior to the July presidential election runoff he distributed millions of dollars to families with children in an effort to win votes for his party’s candidate, who lost to populist business tycoon and ex-judo champion Khaltmaa Battulga of the Democratic Party.
The MPP leadership has also been castigated for refusing to punish senior representatives who allegedly had roles in a $25mn conspiracy to sell government positions. That claimed conspiracy has been cited as one of the main reasons that cost the MPP the presidency.
Mongolia has a long track record of dissolving governments before the end of their term - all governments bar one, under ex-Prime Minister Nambaryn Enkhbayar, have been dismissed in this manner. As many as 15 prime ministers have led governments in Mongolia since the peaceful democratic revolution of 1992.
The appointment of the new prime minister is welcome news for Mongolia’s $5.5bn IMF bailout. The International Monetary Fund (IMF) has been delaying the disbursing of bailout funds to the country while awaiting the formation of the new government.
The IMF’s funds under a $434mn Extended Fund Facility are part of a larger $5.5bn IMF-led bailout deal secured by Mongolia in February after a slump in commodity prices hit the mining-dependent country’s economic growth, while government overspending and disputes with investors made matters worse. The first flow of funds from the facility securing three years of credit were expected to amount to around $40mn.
The bailout package arranged with the IMF at the helm also includes soft loans from Japan and South Korea as well as an extended currency swap agreement with the People's Bank of China. Analysts said that lenders would no doubt be seeking assurances that under the new prime minister and his cabinet there will be no radical departure from previously set government policies.
From 2011 to 2016, Mongolian growth fell from 17% to 1% as the landlocked country of 3mn struggled to attract foreign investment in an environment of plunging commodity prices and disputes with Rio Tinto over the expansion of Oyu Tolgoi copper and gold mine. Mongolia’s economy improved under Erdenebat’s government, growing 5.3% y/y in the first half of 2017 on the back of spiked demand for Mongolian coal in China. That was partly down to the banning of North Korean coal exports in response to Pyongyang’s nuclear weapons and missile testing.