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US-China Influence Rivalry Moves Into Beijing's Backyard

FILE - Mongolia's President Ukhnaagiin Khurelsukh salutes after delivering a speech in Ulaanbaatar, June 9, 2021.
FILE - Mongolia's President Ukhnaagiin Khurelsukh salutes after delivering a speech in Ulaanbaatar, June 9, 2021.

As China spreads its influence across Asia with its Belt and Road infrastructure projects, the United States is striking back with a major development project right in China's backyard: Mongolia.

U.S. Ambassador Michael Klecheski and Mongolian President Ukhnaagiin Khurelsukh presided last month over the groundbreaking ceremony for a U.S.-funded water purification plant program. The $93 million program is part of a $350-million grant aimed at addressing a growing water shortage in the rapidly expanding Mongolian capital, Ulaanbaatar.

"Today marks a new chapter in the United States' partnership with the people of Mongolia," said Alexia Latortue, deputy chief of the U.S. Millennium Challenge Corporation, or MCC, the U.S. government agency providing the funding.

"Once operational, this purification plant will help … provide the critical water resources needed to support the everyday wellness and economic growth of Mongolians," she told ceremony participants.

Ties to US

Sandwiched between America's two largest geopolitical rivals, China and Russia, Mongolia might seem an unlikely target for U.S. diplomatic and economic outreach.

But, Klecheski told VOA in a telephone interview, decades of educational exchanges have laid the groundwork for warm relations between the two countries.

"A lot of people in [Mongolia's] government are educated in the United States," he said, adding that "the prime minister is a Harvard University alumnus." About one-third of Mongolia's parliament is composed of U.S. alumni, according to the State Department's account.

“This is a young country. There’s a great deal of interest in the United States, in our system and in learning English!” Klecheski said.

And there is more to the relationship than personal ties, according to Sodontogos Erdenetsogt, the Mongolian government official in charge of MCC projects in the country.

"I love working with the Americans because of their adherence to rules, their abiding by the system. That's the beauty of the Americans," she said by telephone from Ulaanbaatar.

She said she is impressed by her American counterparts' loyalty to their "values," including "transparency, accountability, responsibility, objectivity and the goodwill of the American people to help others."

Sodontogos said Mongolia's goal "is to abide by the same values" as the Americans, even though there are differences, such as in the handling of human relationships. "But these differences will never undermine our strong collaboration."

U.S. Ambassador Michael Klecheski is seen at the groundbreaking for a water purification system to ensure Ulaanbaatar has enough water to support Mongolia’s growing population, industries, and needs, Aug. 20, 2021. (Twitter @USAmbMongolia)
U.S. Ambassador Michael Klecheski is seen at the groundbreaking for a water purification system to ensure Ulaanbaatar has enough water to support Mongolia’s growing population, industries, and needs, Aug. 20, 2021. (Twitter @USAmbMongolia)

Support through grants

Another sweetener for the Mongolians is that the MCC project — unlike many Chinese infrastructure projects, which leave countries with varying degrees of debt — will be paid for entirely by the U.S., with some contribution from the Mongolian government.

"The U.S. government is supporting Mongolia's economic growth, using grant financing, when possible," Klecheski said at the groundbreaking, "because we believe that growing democracies benefit from programs that do not lead to too much debt."

Sodontogos said that for a developing country such as Mongolia, aid in the form of a grant is "very, very valuable."

The water project is a big deal for Ulaanbaatar, which faces a burgeoning water crisis as its population explodes. The city now accounts for almost half of the country's roughly 3.3 million people.

When completed, the project is expected to increase the city's water supply by 65%, making up the bulk of a larger plan to increase the supply by 80%. [[]]

"Because it is water, everybody cares — because water is our main source of life," Sodontogos said. "Mongolian people are very much aware of this program. They support, they're grateful, they're willing to work with the U.S. government to successfully implement it,"

But for Klecheski, there is no less satisfaction in smaller projects, such as the groundbreaking ceremony he attended two weeks ago for a U.S.-funded kindergarten in Ulaangom, 1,290 kilometers (800 miles) west of the capital. It will be the eighth such U.S.-funded kindergarten to date.

"We are honored to have the opportunity to work with our Mongolian partners to provide safe and comfortable education environments for school-age children in Mongolia, one school at a time," read a statement on the website of the U.S. Embassy in Ulaanbaatar. The U.S. Army Corps of Engineers is supervising the construction to ensure the highest quality, the statement adds.

U.S. and Mongolian armed forces have also forged close ties in recent years, including in the training of Mongolia's peacekeeping force and the latter’s contribution in U.S. and NATO efforts in Afghanistan over the past two decades.

U.S. and Mongolia entered into a strategic partnership in July 2019 during a meeting between then-Mongolian President Khaltmaa Battulga and President Donald Trump in Washington. In a sign of continued U.S. commitment, Wendy Sherman, Deputy Secretary of State in the Biden administration, visited Mongolia in July this year as part of an East Asia tour that also included Japan and South Korea and a last-minute stop in China.

Klecheski says the U.S. values the fact that Mongolia is the first country in Asia that has made the successful transition from a communist-led country to a free, democratic nation following the fall of the Soviet empire. "Obviously Mongolia is in an important part of the world," he said.

Nevertheless, Klecheski told VOA, the United States has much to do if it hopes to compete for economic influence with China, which receives 90% of Mongolia's exports — mainly minerals — and provides one-third of its imports. Russia also plays a major role in Mongolia's energy sector.

"Let's just say the embassy is very much anxious to see the expansion of cooperation in more areas," Klecheski said.

Americans don't know a lot about Mongolia, he acknowledged, and the market of 3 million people may be too small for some businesses. But, he said, Mongolia's mining and agricultural industries, IT sector, and other areas offer great potential for American investment.

Mongolia's people take pride in a heritage that dates back to the 13th-century conquests of Genghis Khan (Chinggis Khan), Klecheski said, but there is also "a strong sense of modernity here." He said he has observed a strong desire to "integrate with the world."