Identifier
Created
Classification
Origin
08ULAANBAATAR202
2008-05-01 09:14:00
CONFIDENTIAL
Embassy Ulaanbaatar
Cable title:  

JAPANESE EMBOFFS EXCHANGE VIEWS ON RECENT

Tags:  PREL PGOV ENRG KCOR ECON MG JP KN KS 
pdf how-to read a cable
VZCZCXRO2931
RR RUEHLMC
DE RUEHUM #0202/01 1220914
ZNY CCCCC ZZH
R 010914Z MAY 08
FM AMEMBASSY ULAANBAATAR
TO RUEHC/SECSTATE WASHDC 2118
INFO RUEHBJ/AMEMBASSY BEIJING 6124
RUEHMO/AMEMBASSY MOSCOW 2215
RUEHUL/AMEMBASSY SEOUL 3321
RUEHKO/AMEMBASSY TOKYO 2998
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEKJCS/SECDEF WASHINGTON DC
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUEHLMC/MILLENNIUM CHALLENGE CORP WASHINGTON DC
RHEHAAA/NSC WASHINGTON DC
C O N F I D E N T I A L SECTION 01 OF 03 ULAANBAATAR 000202 

SIPDIS

SIPDIS

STATE FOR EAP/CM, EAP/J, EAP/K AND INR/EAP

E.O. 12958: DECL: 05/01/2018
TAGS: PREL PGOV ENRG KCOR ECON MG JP KN KS
SUBJECT: JAPANESE EMBOFFS EXCHANGE VIEWS ON RECENT
MONGOLIAN TRENDS, BILATERAL RELATIONS

Classified By: Charge d'Affaires Brian L. Goldbeck for Reason 1.4 (d).

C O N F I D E N T I A L SECTION 01 OF 03 ULAANBAATAR 000202

SIPDIS

SIPDIS

STATE FOR EAP/CM, EAP/J, EAP/K AND INR/EAP

E.O. 12958: DECL: 05/01/2018
TAGS: PREL PGOV ENRG KCOR ECON MG JP KN KS
SUBJECT: JAPANESE EMBOFFS EXCHANGE VIEWS ON RECENT
MONGOLIAN TRENDS, BILATERAL RELATIONS

Classified By: Charge d'Affaires Brian L. Goldbeck for Reason 1.4 (d).


1. (C) SUMMARY: Japanese DCM Kobayashi met with the Charge on
May 1 for an exchange of views across the full array of
Mongolian domestic and bilateral issues. On Mongolia,s June
29 Parliamentary elections, Japan believes that the
post-election Parliament will look a lot like it does at
present. He and the Charge also discussed election
monitoring, and the Asia Pacific Democracy Partnership.
Regarding controversial mining legislation, Kobayashi said
that if, as expected, the Mongolian state takes a 51% stake
in key mining deposits, many Western mining companies as well
as Japanese firms will bow out, leaving the field to the
Chinese and Russians. Referring to reports that Mongolia
will turn to Russia for help building a nuclear power plant,
Kobayashi said Japan is encouraging Mongolia to first focus
on the development of its uranium resources, and only later
focus on setting up a nuclear power program.


2. (C) On talks with the DPRK, Kobayashi said Japan
appreciates Mongolian efforts to host more bilateral
normalization discussions between Japan and North Korea; he
said no such meeting has been scheduled. Kobayashi
reconfirmed that Japan was amenable to accepting Mongolia,s
offer to hold Six Party Talks Peace and Security Working
Group talks in Mongolia, once Russia, as the group,s chair,
sets a date. He said President Enkhbayar is considering a
visit to Pyongyang in or around October, provided the DPRK
will confirm a meeting for him with DPRK leader Kim Jong Il.
Regarding bilateral relations, he said Japan hopes next
year,s 60th anniversary of the battle of Khalkhin Gol, in
eastern Mongolia, will not turn into a &major event8 that
hurts bilateral ties. (In that 1939 tank battle, 45,000
Japanese were killed in combat with Russians and, to a lesser

extent, Mongolians.) He expressed concern that Russia is
trying to play up the anniversary in order to drive a wedge
between Mongolia and Japan. END SUMMARY.


3. (C) Japanese DCM Kobayashi invited the Charge and Econ/Pol
Chief to lunch May 1, following a lengthy hiatus, for an
update on recent trends in Mongolia. Japanese Poloff Yadomi
also attended.

PARLIAMENTARY ELECTIONS:
JAPAN EXPECTS NO MAJOR CHANGES
--------------


4. (C) On Mongolia,s June 29 Parliamentary elections, DCM
Kobayashi said Japan believes that the post-election
Parliament will look a lot like it does now. (Note: The
Mongolian People,s Revolutionary Party, or MPRP, holds 39
seats in the 76-seat Parliament and leads a three-party
coalition government. End Note.) He predicted it will be
difficult for Prime Minister Bayar to keep his good standing
among voters, because so many Mongolians are frustrated by
the skyrocketing prices for food and fuel. Kobayashi asked
about the USG,s plans for election monitoring in Mongolia;
we informed him that the Embassy will field a modest
election-monitoring program, sending a team or two of Emboffs
to key contested provinces and a few more teams to pivotal
capital districts, to observe and report on the June 29
balloting. We also discussed the Asia Pacific Democracy
Partnership (APDP). Kobayashi said it is likely that the
Japanese Embassy would be able to send a person, or persons,
to monitor elections in Mongolia, in the event that the APDP
were to decide to monitor the Mongolian elections.

ON MINING LEGISLATION
--------------


5. (C) Regarding controversial mining legislation that would
give the Mongolian state a 51% stake in &strategic8 mining
deposits, the Japanese DCM said he had repeatedly warned the
Mongolians. He said that if the state share is set at 51%,
many Western mining companies as well as Japanese firms would
be unwilling to take part, opening the door for participation
by Chinese and Russian mining companies. Ironically, he
said, the decision to embrace a 51% stake was aimed at
keeping the Chinese and Russians from playing a key role in
Mongolia,s most important deposits. Kobayashi accused
Mongolian Parliament members, and other senior officials, of

ULAANBAATA 00000202 002 OF 003


frequently failing to understand the mining situation. &We
have to talk with them like they are kindergarteners,8 he
said. He added that Japanese mining companies strongly
oppose the mining amendment proposals. The 51% is bad
enough, he said, but what really bothers the Japanese firms
are the odds that the GOM would also try to manage the
operations. He said he had trouble believing Mongolian
authorities, promises, based on past experiences, to give
foreign mining companies wide latitude in the management of
mineral extraction at strategic sites.

MONGOLIA,S NUCLEAR DEVELOPMENT
--------------


6. (C) Kobayashi noted PM Bayar,s recent visit to Moscow,
which produced a number of &deals,8 which he dismissed as
hollow and meaningless, as FM Oyun had described them when
she met with the Japanese Ambassador following the trip.
There had also been reports suggesting that Mongolia will
turn to Russia for assistance with the construction of a
nuclear power plant. He said Japan is encouraging Mongolia
to first focus on the development of its uranium resources,
and only later focus on setting up a nuclear power program.
&The Russians and French are very aggressive8 in pushing
their proposals at the Mongolians,8 he said, &but the
quality of their technology8 may be lacking. Kobayashi said
Russia has not developed a new nuclear power station in
perhaps 10 years. He said that Japan, conversely, has much
experience in recently setting up nuclear power stations and
currently operates more than 50 such stations. He noted
Japanese government funding for developing such projects
required that the products then be exported to Japan, which
was possible regarding uranium, which Japan will need for
decades to come, but not for coal and other minerals, which
are likely destined for China.

JAPAN-DPRK TALKS
--------------


7. (C) The Japanese DCM said Japan is comfortable with
Mongolian efforts to host more bilateral discussions between
Japan and North Korea. He made clear that although Japan
supports the idea of further discussions, no such talks have
been scheduled. Kobayashi said the DPRK is enthusiastic
about holding the meetings in Mongolia because Mongolia pays
their transportation and lodging costs. Kobayashi
reconfirmed that Japan was amenable to accepting Mongolia,s
offer to hold Six Party Talks Peace and Security Working
Group talks in Mongolia and was pleased to learn the USG also
supported this proposal, noting it,s up to Russia, as the
WG,s chair, to set a date. He understood that President
Enkhbayar is planning to visit Pyongyang in or around
October, but said the trip is jeopardized by the fact that a
meeting with Kim Jong Il has not been ensured. He noted that
this is a sore subject, given that previous Mongolian
Presidents who visited North Korea several years ago had been
unable to meet with the DPRK leader. Kobayashi said he
believed that the GOM is putting conditions on the trip, to
ensure an Enkhbayar-Kim meeting.

JAPAN-MONGOLIA RELATIONS: NO MAJOR VISITS;
WORRIES ABOUT WWII TANK BATTLE ANNIVERSARY
--------------


8. (C) Regarding bilateral relations, Kobayashi said that on
a recent visit to Japan, Mongolian Foreign Minister Oyun
invited Japan,s Foreign Minister to visit Mongolia. But the
DCM said he feels it is unlikely that the Japanese Foreign
Minister will make such a visit this year. Kobayashi
expressed concern that Russia is attempting to &make a big
deal8 out of next year,s 60th anniversary of the epic tank
battle of Khalkhin Gol, which took place in eastern Mongolia.
He said Russia is doing so in order to drive a wedge between
Mongolia and Japan. &Russia is concerned about Japan,s
relationship with Mongolia,8 Kobayashi said, adding that
Japan hopes that a major anniversary event will not occur,
and that relations between Japan and Mongolia relations will
not be harmed.


9. (U) In September or October, a large Japanese economic
delegation will come to Ulaanbaatar to attend the Trade and

ULAANBAATA 00000202 003 OF 003


Investment Promotion Council gathering, Kobayashi said. This
is the follow-up to a gathering in Japan last year.
GOLDBECK