Poisoned Vodka Continues to Plague Mongolia

UNCLAS SECTION 01 OF 02 ULAANBAATAR 000013

SIPDIS

SENSITIVE

SIPDIS

STATE FOR EAP/CM and EAP/EX
BANGKOK FOR USAID RDMA

E.O. 12958: N/A
TAGS: ECON SOCI PGOV CASC MG
SUBJECT: Poisoned Vodka Continues to Plague Mongolia

Ref: Ulaanbaatar 006

SENSITIVE BUT UNCLASSIFIED - NOT FOR INTERNET DISTRIBUTION.


1. (SBU) As of January 9, 2008, the death toll from the New Year's
holiday episode (reftel) has risen from 11 to 14 people and over 70
remain hospitalized out of the 130-plus persons affected by drinking
methanol-tainted vodkas produced by "Aziin Chono" or Asian Wolf (AW)
Company. Six local policemen from the affected city of Baganuur,
who have worked on this case, were hospitalized after reportedly
being poisoned by methanol spirits condensation while destroying
confiscated vodka bottles. The official ban on the sale of all
alcohol remains in effect until January 20, although the ban on beer
was lifted yesterday. In an ironic but predictable twist, the dearth
of available alcohol has led to a drop in the crime rate, declining
to half or one-third the usual rate compared to the same period last
year, according to Mongolia's General Police Department. (Note:
Fender-benders and dealing with inebriated persons are listed as
"crimes" in Mongolia, which help explain the reduced crime rate.

Fake Vodkas, Some Dangerous, Remain On Sale
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2. (SBU) Police have announced that some 1,000 bottles of vodkas
made from methanol spirits remained unaccounted for with a police
search of family homes in the affected city of Baganuur turning up
only eight bottles. According to officials, AW Company bottled 40
methanol-containing spirits under the respected vodka brand "Black
Chinggis" but police have so far only located four of them (Note:
Cheap AW vodkas are sometimes re-labeled and re-sold under
different, pricier labels for greater profit).

Complaints about GOM Alcohol Sales Ban Grow
--------------


3. (SBU) Manufactures, distributors, and bar-owners are howling
complaints about the extended ban on alcohol sales. Many cafes,
bars, and karaoke clubs have either closed for the duration or
severally curtailed hours because they cannot sell alcohol, the
mainstay of their businesses. Anecdotes of quiet streets empty of
cars as well as the absence of drunks have become more common.
Alcohol distributors and manufactures have yet to feel a pinch in
their bottom line, but opine that they can see no reason for the
across-the-board ban on all alcohol sales - including all spirits
from all sources foreign and domestic -- when the problem is
localized with a single manufacturer whose products have been
largely removed from the market.


4. (SBU) One obviously frustrated executive of a major Mongolian
vodka producer told Econoff that the ban was actually
counter-productive as it has only led to increased sales of
home-made (read "dangerous") moonshine-like spirits to meet the high
demand for alcohol. One press report stated that Mongolians consume
24 liters of vodka per person every year. The reality, according to
local experts, may be closer to 17 liters per capita. MCS Group, for
example, which claims 50% of the vodka market in Mongolia, sells 24
million bottles of vodka each year, about 8.5 bottles per person.

COMMENT: GOM Acting Out of Abundance of Caution
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5. (SBU) The GOM's response is typical for public health crises.
The GOM treats such events just as it treats outbreaks of new
diseases in Mongolia. The approach is to shut down everything for
an indeterminate or longish period of time until the problem is
understood and perceived by authorities to be under control. For
example, in the summer of 1996, the GOM banned all transport in and
out Ulaanbaatar because of a cholera outbreak. In 2003 severely
limited access into Mongolia and buildings to combat SARS. In both
cases the blanket approaches defied professional advice from
health-care professionals, and imposed strains on daily life far in
excess of any prevention benefits obtained. In both instances, the

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general populace endured with few complaints, but it took complaints
from a severely impacted populace and business community to budge
officials into accepting a less panicky reality.


6. (SBU) The current situation mirrors the past in all respects.
The GOM's excessive, knee-jerk approach has impacted Mongolian life
at all levels -- employment is down because of bar closures, public
and private revenues are declining because sales are down, and at
this point businesses and the affected individuals are beginning to
complain more and more vociferously. As with past cases, the GOM is
beginning to calm down and listen. MCS Group, the brewer of Tiger
Beer in Mongolia, reports that the GOM is allowing it and other
manufactures to distribute and sell beer again, because the GOM
accepts that beer is not a problem, although this point was clear
within a couple of days of the initial episode of vodka methanol
poisoning. However, MCS looks forward to January 20, when it can
sell its vodka again. Although loathe to discuss specifics, MCS
notes that Mongolia's vodka trade is very competitive and margins
are tight; and so, any reduction of volume can impact firms such as
MCS greatly. END COMMENT.


Goldbeck