Mongolia's 'Third Neighbor' Foreign Policy

Beyond Russia and China, third neighbor countries play a crucial role in Mongolia

H.E. Baasanjav Ganbold, Ambassador of Mongolia to the Republic of Korea

SEOUL, June 18, 2013 – In Part 4 of Asia Society Korea Center’s 2013 Ambassador Series, H.E. Baasanjav Ganbold, Ambassador of Mongolia to the Republic of Korea, gave a lecture called Mongolia's 'Third Neighbor' Foreign Policy: The Concept and Evolution.

While Russia and China are the giant neighbors that Mongolia shared borders with, the idea of a third neighbor refers to countries other than Russia and China that Mongolia has built relationships with. The term ‘third neighbor’ was first mentioned by U.S. Secretary of State James Baker during a meeting with Mongolian leaders during his visit in August 1990. “[Baker] said that referring to the U.S. as a third neighbor,” Ambassador Ganbold said. “That was a rhetorical gesture to support Mongolia’s first move toward democracy.” The concept of third neighbors was picked up by Mongolian policymakers and eventually became formalized in its foreign policy and legislation.

Balancing its relations with Russia and China on one hand with relations with other major countries is not an easy task for Mongolia, but it is a familiar one. “In the mid 1920s, the new Mongolian government sent dozens of students to study in Germany,” Ambassador Ganbold said. “That reflected the age old sentiment of Mongolia, to look beyond our two neighbors.” Mongolia’s decision to adopt Buddhism from India over Chinese Confucianism and Russian Slavic religions also reflected its consciousness of looking broadly in geopolitics.

Ambassador Ganbold described the first stage of Mongolia’s third neighbor policy as a success. In the early 1990s, when Mongolia began political reforms, the support of the U.S., United Nations, and other Western countries was crucial to its transition to a liberal democracy. These third neighbors’ expertise in drafting legislation about the electoral system helped establish the foundation of Mongolia’s political system. The third neighbor policy was also an economic success. Donor countries helped Mongolia overcome its hardships after the sudden end of Soviet investment and subsidies, guiding the country to transition to a market economy.

As the scope of the third neighbor policy expanded, it began to include more bilateral and multilateral political partnerships. Mongolia became a member of the World Trade Organization (WTO) in 1997; the ASEAN Regional Forum in 1998; and the Organization for Security and Co-operation in Europe (OSCE) in 2012. “Mongolia’s military is very small, but it’s transformed very well with the help of U.S. and U.N. institution to become an active member of international peacekeeping campaigns.” Ambassador Ganbold said. “This helped to increase Mongolia’s international profile and is also part of our efforts to implement this third neighbor policy.”

As the scope of this policy expanded and evolved, it also faced challenges. The term ‘third neighbor’ was frequently used by American leaders such as George W. Bush in recognition of Mongolia’s successful liberal democratic reforms and efforts to join the coalition against terrorism. However, this caused a misperception that Mongolia sought to promote the U.S. agenda, causing some mistrust with its close neighbors Russia and China. “This kind of mindset both inside and outside Mongolia created some problems, but now it’s all right,” Ambassador Ganbold said. “Our two neighbors support [this policy] because the very foundation of it is balancing each of our partner countries’ interests.”

“We proudly call India our third neighbor,” Ambassador Ganbold said. “Turkey and South Korea also fall into this category.” In addition to being Mongolia’s biggest trading partner, South Korea is also home to 26,000 Mongolians working and studying in the country. About 100,000 Mongolians live and work abroad, with most of them currently in third neighbor countries and regions including the U.S., Europe, Australia, and Japan. Ambassador Ganbold described this situation as an important source of cultural relations and cooperative projects.

Economically, Mongolia seeks to integrate its economy with regional economies. In 2012, Mongolia started official talks with Japan to establish their first Economic Partnership Agreement (EPA). While Russia and China have a large impact on the Mongolian economy, Ambassador Ganbold emphasized that Mongolia’s booming mineral sector presents an opportunity to attract greater economic interest from its third neighbor countries. “We hope that this will be a good chance for us to forge a full sense of the third neighbor strategy, economically, with opportunities in the mining sector,” Ambassador Ganbold said.

Ambassador Ganbold spoke of the mining corporation Rio Tinto’s copper mine project in Mongolia as a strategically important project. “Next week, the project will export its first products abroad,” Ambassador Ganbold said. He highlighted the importance of third neighbors, particularly in their role of bringing financial capital, high technology, and much-needed eco-friendly strategies and management to Mongolia.

“We talk a lot about the processing industries in Mongolia,” Ambassador Ganbold said. “We need more processing factories in Mongolia with high technology so we can export finished products, not just raw products.” He went on to discuss how in the fine act of balancing interests in international cooperation, Mongolia seeks opportunities where economic interests match. “When the interests of potential investors don’t match, it’s difficult to move ahead on projects,” Ambassador Ganbold said. “When the interests match, Mongolia can be a good partner.”