DIVISIONS WIDENING WITHIN RULING MONGOLIAN

C O N F I D E N T I A L SECTION 01 OF 02 ULAANBAATAR 000472

SIPDIS

SIPDIS

STATE DEPT FOR EAP/CM

E.O. 12958: DECL: 08/20/2017
TAGS: PREL PGOV ECON MG
SUBJECT: DIVISIONS WIDENING WITHIN RULING MONGOLIAN
PEOPLE'S REVOLUTIONARY PARTY

REF: ULAANBAATAR 425

Classified By: Ambassador Mark Minton for Reason 1.4 (d).


1. (C) SUMMARY: Seven weeks after Mongolia's coalition
government easily survived a no-confidence vote, divisions
appear to be widening within the coalition-leading
Mongolian People's Revolutionary Party (MPRP). Many MPRP
Parliamentarians acknowledge that their party's popularity
is waning, and that party reformists have forced a change
in the party's charter to allow for a second MPRP Congress
within a four-year period. One is planned for September,
and reformists say they will use it push for sweeping
changes,
including to the party's name, ideology, structure and
bylaws. At the annual MPRP conference from August 4-6,
reformists took aim at Prime Minister and party chief
Enkhbold, urging that the party's top position and the
prime ministership be held by different people. (A
decision on that will likely be made at September's
Congress.) Some MPRP stalwarts downplay the talk of
deepening fissures within the party, saying differences
have been exaggerated by the opposition Democratic Party
and that debate is not only healthy but democratic. But
others in the MPRP concede that the party has an image
problem and could lose the June 2008 election. That said,
it would be a mistake to start writing off the MPRP, which
has proven, if anything, its survival skills. END SUMMARY.


2. (C) Divisions within the MPRP, the largest and senior
player in the four-party ruling coalition, appear to be
widening, and MPRP reformists are calling for key changes
in the way the former communist party operates. Vice Speaker
and MPRP Caucus Head D. Idevkhten told E/P Chief on August 15
that reformists had pushed through changes to the party
charter,
enabling the MPRP Congress to be held up to two times in
every four-year period, rather than once. He said a party
Congress is planned for September, adding that reformists
will use the occasion to press the MPRP to change its name
and ideology. Another influential MPRP Parliamentarian,
Zandanshatar, head of the party's youth wing, told us on
August 9 that participants in the MPRP's annual party
conference, held August 4-6, identified five points for
possible change: the party's name, ideology, program,
conduct and bylaws. Zandanshatar said younger MPRP members
are demanding a greater say in how the party is run, and
are critical of the low level of participation by ordinary
citizens in the political process.

NAME OF THE GAME
--------------


3. (C) Idevkhten said the name-change idea is nothing new
and that members have long argued that the "Revolutionary"
in Mongolian People's Revolutionary Party moniker is out of
step
with an organization that now likens itself to Britain's
Labor Party or Germany's Social Democrats. Zandanshatar
said other names being considered include the "Labor Party,"
the "Mongolian Democratic Development Party" and the
"Socially
Oriented Democratic Party." Another MPRP heavyweight,
former Foreign Minister Munkh-Orgil, who heads the
Parliament's Legislative Standing Committee, told us on
August 10 that some MPRP members want to change the party's
name now, while others favor after the June 2008 election
or in 2009. Others, he said, oppose any name change.

OTHER PARTIES: MPRP IN TROUBLE...
--------------


4. (C) Key members of other parties feel that the MPRP has
stumbled and is approaching the run-up to elections from a
position of weakness. Erdenebaatar, Secretary of the
Motherland Party and Environment Minister, told us on
August 13 that he is "certain" that the MPRP will not win a
majority of Parliamentary seats in the next election. The
head of the Citizens' Will party, Oyun, told us on August
13 that if the election were held today, the opposition
Democratic Party would win, due to broad public frustration

ULAANBAATA 00000472 002 OF 002


over MPRP governance. People's Party chief Gundalai told
us on August 8 that the MPRP is corrupt to the core, with
key officials accepting "donations" from business tycoons
who are then able to somehow avoid paying income taxes.
Democratic Party (DP) MP Sairaan told us on August 9 that
the MPRP has a major image problem and is unpopular, and
that if the DP "doesn't make any big mistakes, I think
we'll come to power in the next election."

... BUT MPRP SAYS CRITICS MISS THE POINT
--------------


5. (C) Many MPRP Parliamentarians concede that their party
has made its share of recent missteps but say it remains
the powerhouse of Mongolian politics. Said Munkh-Orgil,
the Standing Committee Chief: "We've made some mistakes in
terms of personnel choices and policy priorities, but I'm
convinced that if we can show our true self to voters, we
can do well in June 2008... That said, we suffer from an
image problem, and I wouldn't rule out the possibility of
us being defeated." Zandanshatar, the MPRP youth leader,
said Mongolia's young people are not happy with the status
quo. He said the MPRP is looking at ways to change how it
operates, adding that reformists within the party are
"trying to reduce the role of one or two senior decision
makers, so that younger MPRP members get more of a say, in
matters such as nominating candidates." Idevhkten, the
Vice Speaker of Parliament, said all the talk that the MPRP
is divided misses the point. "The fact that we have
differences, and address those differences, shows that the
MPRP is undergoing healthy change, becoming more democratic
and transparent. What the DP says about the MPRP
collapsing is not true. We were Mongolia's first party in
1921 and we will be around for a long time to come."

COMMENT
--------------


6. (C) The emotionally charged issue of development of the
Oyu Tolgoi copper/gold deposit (reftel) has hurt the MPRP's
popularity. Various NGOs and opposition elements have
whipped up nationalist anger over what they view as a
lopsided deal that sells the Mongolian people short. Some
DP members who have mining interests with foreigners have
been quick to echo the populist critics to score points
against the MPRP. Lawmakers' failure to make a decision on
the investment agreement between the GOM and Ivanhoe/Rio
Tinto has pleased almost no one - not the deal's critics,
who want it scrapped, nor its supporters, who have little
hope that a vote on the agreement will occur this session.


7. (C) Of the three main factions within the MPRP, the
party reformists, led by Education Minister Enkhtuvshin,
appear to be gaining ground, mainly at the expense of the
faction linked with President Enkhbayar. (The other faction
is affiliated with PM Enkhbold, a wealthy businessman.)
That the MPRP rank and file accepted the reformists' demand
for a secondary Party Congress suggests that many in the
MPRP recognize that the party is currently out of favor,
and that without major changes, the June 2008 election
might not go their way. However, it would be a mistake to
start writing off the MPRP, which remains the country's
largest and most powerful party, has all the powers of
incumbency, and is backed by most of the openly partisan
civil servants. We note as well that the MPRP has suffered
weak popularity before only to surge again at election
time, using party discipline and its advantages as incumbent
to prevail.
MINTON