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The ‘coal theft’ case: Corruption and reform of Mongolia’s strategic minerals governance

Allegations of corruption in Mongolia’s coal trade with China in late 2022 sparked public protests – and highlighted critical shortcomings in the management of the minerals sector. While the government took action to improve policies, enforcement is insufficient and there is a lack of coordination among the different agencies that exercise investigative and prosecutorial powers. Parliamentary elections in 2024 may be an opportune moment for reformers to address these gaps.

27 February 2024
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The ‘coal theft’ case: Corruption and reform of Mongolia’s strategic minerals governance

Main points

  • Coal is a strategic commodity for Mongolia and an important source of revenue. More than 80% of Mongolian foreign trade comes from coal and other minerals.
  • In 2022, allegations surfaced that coal was being illegally transported across the Chinese border. High-ranking politicians and influential business leaders were implicated and the loss to the Mongolian economy was as high as US$11 billion, by some estimates.
  • The allegations drew public protests and media coverage in Mongolia and abroad, and the issue became politicised. The case highlighted critical institutional shortcomings in the management of the minerals sector.
  • The designation of the coal deposit as of ‘strategic importance’ enabled information to be withheld, undermining transparency. The use of offtake contracts allowed coal to be undervalued.
  • The lack of transportation and accessible border facilities, as well as COVID-19-related restrictions, presented opportunities for railways and customs officials, as well as border militias to demand bribes.
  • Prompted by this and other prominent corruption cases, the state amended criminal laws in December 2022, and has taken measures to address corruption in strategic minerals and across the economy.
  • A parliamentary hearing and investigation were announced but have been delayed. Eight criminal cases were launched and five have been decided. The former CEO of the state-owned coal company and 11 others were charged with money laundering.
  • Mongolia has laws and institutions to tackle corruption, but they are insufficiently enforced and operationalised. There is scope to do more to address identified gaps.

Cite this publication

Dashpurev, B.; (2024) The ‘coal theft’ case: Corruption and reform of Mongolia’s strategic minerals governance. Bergen: U4 Anti-Corruption Resource Centre, Chr. Michelsen Institute (U4 Brief 2024:4)

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About the author

Bayar Dashpurev

Bayar Dashpurev is a Ph.D. Candidate at the Max Planck Institute for Social Anthropology. He was formerly a lecturer at the School of Law, National University of Mongolia and the German-Mongolian Institute for Resources and Technology, respectively. He has worked as a litigator in both administrative courts and the constitutional court of Mongolia including cases and disputes concerning rights to healthy environment and mineral resources.


All views in this text are the author(s)’, and may differ from the U4 partner agencies’ policies.

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