WASHINGTON, June 27, 2013 /PRNewswire-USNewswire/ -- Foreign mining interests took a hit Wednesday as Mongolia's president was reelected, campaigning with a pledge to impose more controls on foreign mining investments.
The incumbent, Tsakhia Elbegdorj, is known as a "resource nationalist," proposing laws to give the country free shares in strategic mineral deposits, authority to change tax rates, and making it easier for Mongolia to take back leases.
Concern about these measures triggered a slump of 17 percent in foreign direct investment during 2012 and another 12 percent in the first quarter of 2013.
Mongolia's economy is heavily tied to copper and coal extraction. The country's $6 billion Oyu Tolgoi mine was scheduled to make its first shipments to China this month, but the government has told mine operator Rio Tinto to delay shipments pending settlement of a dispute over allocation of profits.
Elbegdorj's political party heads a parliamentary coalition that supports tighter controls on mining companies and a greater share of profits from resource developments.
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