The Mongolian Raw Materials Industry

Mongolia, which is only very sparsely populated with a total of around 3.4 million inhabitants, is one of the ten most resource-rich countries in the world. In the southern part of the country, the Gobi Desert, there are gigantic deposits of copper, silver, gold, coal, fluorspar, and other raw materials. Coal, copper, and gold are among the most important deposits and account for about 89% of Mongolia’s export economy and over 20% of the country’s gross domestic product. Accordingly, mining is now the most important industrial sector in the country from an economic point of view. But Mongolia also has molybdenum, tungsten, zinc, uranium, and rare earths elements, in the extraction of which China has so far had a monopoly. Without a secure supply of raw materials, especially in the field of rare earths, Germany threatens to lose competitiveness in important future technologies such as electromobility, digitization and the energy transition. With appropriate foresight, the government of the FRG had already passed its first raw materials strategy in 2010. Following this, Chancellor Dr. Angela Merkel signed a raw materials agreement during the first state visit to Mongolia by a German head of government on 13th October 2011. This was intended to secure access to rare earths elements for German industry. At the time this raw materials agreement was signed, the exploitation of the raw materials had only just begun and international mining groups were competing for the mining licenses and for the extraction of the raw materials. The present report provides an overview of mining activities in Mongolia ten years after the conclusion of the German-Mongolian Raw Materials Agreement.