African Hotel Boom Bringing in New Investment and Creating Jobs

By David SouthDevelopment Challenges, South-South Solutions


Africa is experiencing a boom not seen for decades. The IMF forecasts economic growth in sub-Saharan Africa of 6 per cent in 2014, compared to global growth of 3.6 per cent.

And this boom is getting an additional jolt of support from the world’s multinational hotel chains. January 2014 saw Africa’s largest hotel chain bought by global giant Marriott ( For decades major global multinationals shied away from Africa, but today they are battling to get a place in Africa’s fast-growing economies and to serve the growing middle classes.

Marriott is leading the way by investing US $1.5 billion in 25 new hotels equalling 5,000 rooms. To boost capacity further, Marriott is taking over South Africa’s Protea group ( and its 116 African hotels.

“We have 25 Marriott brand hotels under construction in seven countries in Africa that will come on stream over the next four years,” Alex Kyriakidis, the chain’s president for the Middle East and Africa, told Bloomberg (

The new hotels “are going to bring us into Benin, Gabon, Ghana, Ethiopia and Mauritius. With our existing hotels plus those in the pipeline and those Protea operates today, we will be in 16 countries in Africa by 2017.”

Bloomberg calls what Africa is experiencing the “fastest pace of hotel development in the world”.
“Our mission here is to grow, grow, grow,” according to Kyriakidis.

Meanwhile, a further boost is coming from the US $5 billion Angolan sovereign wealth fund, Fundo Soberano de Angola ( It will be investing in hotels and commercial infrastructure in sub-Saharan Africa, according to Bloomberg. This could include 50 sub-Saharan African hotels in the next three years.

“We believe there’s a lot of investment interest in Africa,” said Chairman Jose Filomeno dos Santos. “It has a lot of mineral potential, almost a commodity hub. We believe this interest will remain there for the coming years.”

Little thought is given to the role hotels play in development, yet they are a critical development tool for any country wishing to move up the economic ladder. As the quality of hotels improves, they tend to become key gathering and meeting places. Conferences and seminars can act as catalysts for change, attracting people from around the world. When quality hotels are in place, then the top-drawer global conferences will come to town, in turn bringing new tourist income for local businesses.

Anyone who has stayed in a hotel in Africa knows that standards are variable: the pool with dirty water, the power cuts, the food hygiene standards that might not match what people are used to at home. This is what international hotel chains can change. Not only do they demand the highest standards in their own establishments, they also push up standards at local competitors, as all of them battle for the attention of visitors.

Africa has been overlooked by the large global hotel chains and brands since the end of the colonial period in the 1960s and 70s. Africa was considered too poor, too chaotic, too dangerous and too much hard work for it to be worth the effort.

But now the tune has changed. With Africa’s population over a billion, and many of the continent’s economies experiencing rapid growth while also urbanizing, conditions are fortuitous for the hotel trade.

The situation has changed in the last decade, for a variety of reasons: debt relief, a rise in commodity prices, expanding trade and investment with China and the global South, and a growing middle class — all slowing the growth of poverty. Africa is still notorious for under-investment in infrastructure and has a long way to go to catch up to the fast-moving economies of Asia. But greater optimism is leading to greater real investment. And the world’s large hotel brands are the latest to join in the rush to Africa.

Large chains including Four Seasons, Ritz-Carlton, Hyatt and Kempinski hope to open 300 new hotels in Africa over the next five years. The number of hotel beds is set to increase by 30 per cent by 2018.

Four Seasons Safari Lodge Serengeti in Tanzania ( is the first investment in Africa by the Canadian brand. Four Seasons is known for its luxury, upmarket city hotels and has kept with this tradition by building the largest and most luxurious safari lodge ever built in Africa.

This is having a knock-on effect on African hotel operators. The surge in investment is giving these local operators the right incentives to create African brands and to raise their game.

Nairobi in Kenya has become something of a test market for high-end boutique hotels. Already a city benefiting from its status as an international development hub, home to many agencies including the UN Environment Programme’s sprawling and verdant headquarters (, it has also become a corporate headquarters for Africa and has a large U.S. presence ( This means lots of people coming to the city to do business and attend events, creating a market for better quality accommodation.

The Kenyan-owned, 156-room Sankara Nairobi Hotel ( boasts of having the best wine list in Africa and claims to be a five-star hotel. It also capitalizes on being close to the international airport and the UN’s Nairobi headquarters.

“There’s an appetite for something local that’s different and, for the first time, there’s the confidence and funding to bankroll new developments,” said Sankara Hotel Group director Rohan Patel to Wallpaper Magazine. “Africans don’t want a theme-park African hotel, with prints of ‘the big five’ on the wall. That’s condescending. Nor do they want a New York-style hotel. They’ve probably been to New York. They want modern, connected Africa.”

Elsewhere in Nairobi, the Kenyan-owned Tribe Hotel ( is looking to expand to meet growing market demand.

“The market for new, authentic, yet modern African hotels is growing,” manager Michael Flint, who previously ran New York’s Ritz-Carlton, told Wallpaper.

“We’ve been so successful here we are building a new 187-room hotel in Nairobi. We’ve taken over a boutique hotel called Westhouse ( And we’re looking to expand further, with properties at the airport and on the coast. Who knows what will be next? Tribe will be a mini empire.”

In Rwanda’s capital Kigali, the Rwanda Marriott has ambitious plans. Rwanda was ripped apart by ethnic genocide in the 1990s that killed an estimated 500,000 to 1 million people ( Now, the country’s economy is booming and its hotels are getting an upgrade.

The Akilah Institute for Women ( in Kigali has been helping in training women for the hotel sector. They sent trainees to Dubai and Doha to learn how to do hotel service the Marriott way.

Starwood (, a competitor to Marriott, is hoping to grow its African hotel investment by 30 per cent as well. It will be done through the Sheraton, Aloft, Le Meridien, St Regis and Four Points brands. The first St Regis has already opened in Mauritius.

Neil George, Starwood’s head of African development, believes “Africa is the final frontier. It’s adventurous.

“I would rather arrive in Kinshasa and work out how to do a hotel there than do it in Frankfurt,” he told Wallpaper.

The Hyatt ( brand is now running the Hyatt Kilimanjaro Hotel in Dar es Salaam (, Tanzania. Peter Norman, Hyatt’s African head, is working on opening a Park Hyatt in Zanzibar ( and another Hyatt Regency ( will open in Arusha and a further 140-room Hyatt in Senegal (

The 200-room Villa Rosa Kempinski in Nairobi (, boasting an outdoor heated pool, and the Olare Mara Kempinski ( luxury camp in the Maasai Mara will also be joined by projects in Ghana and Equatorial Guinea.

Kempinski also has properties in Chad and the Congo, has bought the Hotel des Mille Collines ( in Kigali and aims to operate 20 hotels across sub-Saharan Africa.

British entrepreneur Richard Branson has the Mahali Mzuri in the Maasai Mara and it is seen as a stylish role model for other hotels. The local landowners and herdsmen have been included in the business, benefiting from the hotel and helping to preserve the local ecosystem.

EasyHotel (, a low budget hotelier, is also rapidly expanding across southern Africa.

Published: May 2014


1) offers a unique service that provides an easy-to-use, specific recruitment website for vacancies in the world’s best hotels and cruise ships. Website:

2) South African hotel jobs: HotelJobs South Africa is an industry specific job website for the hotel, hospitality and catering industry. Website:

3) Hotel Staff Africa: Many hotel jobs across Africa. Website:

4) Hotel Career: Many hotel jobs for the Middle East and Africa. Website:

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP’s South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South’s innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator. 

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Ambitious Schemes Hope to Advance Economic Development

By David SouthDevelopment Challenges, South-South Solutions


Sometimes it takes a bold, fresh start to speed up economic and human development goals. Taking a large-scale approach has been used around the world, either establishing new trade zones or even a new city.

Two recent examples in Nigeria and Afghanistan are attempting to speed economic development in their respective countries, with both receiving help from experienced Asian practitioners of rapid economic development.

The role models for this approach are the so-called “Asian Tigers”: they include Taiwan, Hong Kong, Singapore and South Korea. They are admired because each country rose from extreme poverty to become some of the Earth’s richest nations. Importantly, what they did stands as proof that extreme poverty can be escaped from; people can become much wealthier in just a decade or two.

The pioneer of using trade zones to speed development is the Asian city state of Singapore ( years ago it was one of Asia’s poorest countries. With its port ( it had a way to turn things around but it also realized in the early 1960s it could not just compete by having cheap labour, something that was plentiful across the developing world ( It needed unique technical skills that could not be found elsewhere.

The country was unable to create products and services that it could export and compete in global markets because of a lack of skills, the Government determined. Authorities employed a mix of measures to make the country attractive to foreign companies to boost skills. These included fair enforcement of local laws, tax incentives and upgraded infrastructure, much of it paid for with an infrastructure tax, rather than borrowing. With the influx of new thinking and high-quality skills, new technologies and new ways of doing things, in time, a culture of innovation became hardwired into the way things were done in Singapore.

Beginning in 1961 with the Jurong Industrial Estate (, the Singapore government set aside land to develop the economy by attracting international businesses and boosting its existing port facilities. It also established the Economic Development Board (EDB) in 1961 and the Singapore Tourism Promotion Board (STPB) in 1964.

By creating favorable conditions for international businesses to come in and operate, Singapore quickly developed to become one of Asia’s wealthiest trading and manufacturing centres.

This is a strategy China successfully implemented in the 1980s and 1990s and in turn generated the largest and quickest population shift out of poverty in human history, turning the country into an economic powerhouse.

The secrets to making this strategy work include understanding what modern infrastructure requirements are necessary for international businesses. These days, this means speedy and generous bandwidth for the Internet, modern airports, roads, security, and quality housing and food.

One of the biggest contemporary challenges is competition. Whereas Singapore was a pioneer in its day, now, many countries across the global South are pursuing this strategy to spur growth. An international company has many options to consider, and will more than likely gravitate towards the country that makes the best offer with the least risk.

Trade zones are places ripe with opportunity for innovators. New places tend to be seeking the latest in information and communication technologies, the latest in transportation options, modern housing and office facilities. All of these changes require innovators with fresh thinking to make them work. It is also often easier to introduce new ways of doing things to places that are not coping with legacy infrastructure and old habits and ways.

Billing itself as a “new model city,” the Lekki Free Zone Lagos, Nigeria ( in West Africa is trying to bring a fresh start to the city and the region. It is a joint partnership between investors from China and Nigeria.

Its goal is to better connect regional markets to the global economy. The free trade zone hopes to remove barriers to growth and to attract international investment, becoming the top destination for inward investment in Africa. The project is being run by the Lagos State Government but funded with private capital investment.

Nigeria has been looking into Free Zones since 1982, as it sought additional ways to earn income apart from oil exports. The Export Processing Zone Act 63 was passed in 1992 and the Calabar Export Processing Zone was eventually set up in 1999 ( Since then, a slew of Free Zones have been set up, or are in the works.

The Lekki Free Zone is envisioned as a high-tech zone that will eventually lead to the creation of 2 million jobs. The Zone’s investors are targeting businesses working in oil and gas, petrochemicals, electronics, light and heavy equipment, machinery and automobiles, pharmaceuticals, textiles, shopping and banking and financial services.

Lagos State is home to 21 million people, and the current city of Lagos is on course to become the third-largest megacity in the world. Officials claim the area has an economic growth rate of 16.8 per cent per year.

The 16,500 hectare Lekki Free Zone, to the southeast of the city, is divided into two parts: an industrial zone and a residential zone. The residential zone will include apartments and villas, shopping malls and plazas, hospitals and clinics, schools and research and development centres and a hotel, tour and recreational centres, golf courses, gyms and water sports facilities.

Located on the southern coast of Nigeria with connections to the Atlantic Ocean and the Gulf of Guinea, the Lekki Free Zone says it will give companies access to the largest consumer market in Africa, with a potential reach of 500 million people.

The companies will also be able to draw on Nigeria’s natural resources, including oil, natural gas, timber, rubber, cocoa, Arabic gum and sesame seeds as examples.

Another new beginning is being sought in war-torn Afghanistan, which is working on building a new city close to the capital, Kabul.

Kabul New City started construction in 2013 and is planned to be a city of canals, parks and villas. It will be home to 1.5 million people, cost US $33 billion and take 15 years to complete. It is being partly funded by Japan.

It is a very ambitious scheme for a country that has been mired in conflict for decades. It is hoped the initial seed capital invested by Japan will attract other investors to fully fund the project. Japan got the project going with a commitment to contribute US $106 million between 2009 and 2015.

The site of Kabul New City is 19 kilometres from the existing Kabul, near the Bagram airbase used by NATO forces in the country.

Foreign military forces are looking to leave Afghanistan in 2014 and the new city offers a fresh start for the country after years of conflict.

Located in an area surrounded by the Marko mountains, it is in “one of the safest areas of Afghanistan,” Abdul Habib Zadran, Chief Financial Officer of the Dehsabz-Barikab City Development Authority (, the agency in charge of the project, told The Sunday Times.

The project could be a significant leap ahead in modernization from the current conditions in Kabul, where the streets are in poor condition and buildings in disrepair. Kabul was originally built for 800,000 people, according to The Sunday Times, but now has over 4 million residents. Projections forecast the city growing to 6.5 million people by 2025. Kabul will experience extreme pressure to handle this growing population and find the resources to serve it.

The homes would receive electricity from solar panels and renewable energy sources. Kabul New City will need to tackle the problem of access to enough water to service the growing new city’s population. Plans are afoot to provide water from rivers north of the city.

The master plan for the new city has been designed by Zahra Breshna (, an Afghan-German company which has also built the new Kabul Bank headquarters. The company calls the project “a new beginning for Kabul.”

Published: May 2013


1) Tianjin Eco-city: The Sino-Singapore Tianjin Eco-city’s vision is to be a thriving city which is socially harmonious, environmentally-friendly and resource-efficient.

2) Songdo International Business District: Songdo International Business District (IBD) is home to the UN’s Green Climate Fund and is a smart city located in the Republic of Korea built to the highest green building standards. Website:

3) Singapore: An island and islets in the heart of Southeast Asia, between Malaysia and Indonesia. Website:

4) Djibouti Free Zone: Djibouti Free Zone was created with one primary goal in mind – to bring about a sea-change in the way Africa thinks and does business. No red tape, ruthless efficiency and genuinely exhaustive services – in essence, we offer the ideal conditions for trade and commerce to flourish in. Website:

5) Cisco Smart + Connected Cities: Cisco Smart+Connected Communities solutions use intelligent networking capabilities to bring together people, services, community assets, and information to help community leaders address these world challenges. Website:

6) IBM Smarter Cities: Smarter cities drive sustainable economic growth and prosperity for their citizens. Their leaders have the tools to analyze data for better decisions, anticipate problems to resolve them proactively and coordinate resources to operate effectively. Website:

7) Southern Innovator Magazine Issue 4: Cities and Urbanization. Website:

Southern Innovator logo

London Edit

31 July 2013

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP’s South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South’s innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator. 

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Global South Eco-cities Show How the Future Can Be

By David SouthDevelopment Challenges, South-South Solutions


The world is currently undergoing a high-stress transition on a scale not seen since the great industrial revolution that swept Europe in the 19th and 20th centuries. Today’s urban and industrial transition involves many more people and is taking place on a greater proportion of the planet. With rapid urbanization comes a demand for middle class lifestyles, with their high-energy usage and high consumption of raw materials.

This is stretching the planet’s resources to breaking point. And as many have pointed out, if the world’s population is to continue past today’s 7 billion to reach 9 billion and beyond, new ways of living are urgently required. Radical thinking will be necessary to match the contradictory goals of raising global living standards for the world’s poor with pressured resources and environmental conditions.

But there are innovative projects already under development to build a new generation of 21st-century cities that use less energy while offering their inhabitants a modern, high quality of life. Two examples are in China and the Middle East.

Both projects are seen as a way to earn income and establish viable business models to build the eco-cities of the future. Each project is seeking to develop the expertise and intellectual capacity to build functioning eco-cities elsewhere. In the case of the Masdar City project in the United Arab Emirates, international businesses are being encouraged to set up in Masdar City and to develop technologies that can be sold to other countries and cities – in short, to create a green technology hub akin to California’s hi-technology hub ‘Silicon Valley’. Masdar City is also being built in stages as investors are found to help with funding. Both projects hope to prove there is money to be made in being green and sustainable.

The Tianjin Eco-city ( project is a joint venture between China and Singapore to build a 30 square kilometre city to house 350,000 residents.

Tianjin ( is a large industrial city southeast of China’s capital, Beijing. It is a place that wears the effects of its industrial expansion on the outside. Air pollution is significant and the city has a grimy layer of soot on most outdoor infrastructure.

China has received a fair bit of criticism for its polluted cities as the country has rapidly modernized in the past two decades. This sprint to be one of the world’s top economic powers has come at a cost to the environment. In this respect, China is not unusual or alone. Industrialization can be brutal and polluting, as Europe found out during its earlier industrial revolution.

But China is recognizing this can’t go on forever and is already piloting many initiatives to forge a more sustainable future and bring development and high living standards back in line with what the environment can handle.

Sino-Singapore Tianjin Eco-city is the second large-scale collaboration between the Chinese government and Singapore. The first was the Suzhou Industrial Park ( Tianjin project came up in 2007 as both countries contemplated the challenges of rapid urbanization and sustainable development.

The project’s vision, according to its website, is to be “a thriving city which is socially harmonious, environmentally-friendly and resource-efficient – a model for sustainable development.”

The philosophy behind the project is to find a way of living that is in harmony, with the environment, society and the economy. It is also about creating something that could be replicated elsewhere and be scaled up to a larger size.

The city is being built 40 kilometres from Tianjin centre and 150 kilometres from Beijing. It is located in the Tianjin Binhai New Area, considered one of the fastest growing places in China.

Construction is well underway and can be followed on the project’s website ( It will be completed in 2020.

This year, the commercial street was completed and is ready for residents to move in.

Residents will be encouraged to avoid motorized transport and to either use public transport or people-powered transport such as bicycles and walking.

An eco-valley runs down the centre of the city and is meant to be a place for pedestrians and cyclists to enjoy.

The basic building block of the Eco-city – its version of a city block – is called the Eco Cell. Each Eco Cell measures 400 metres by 400 metres, a comfortable walking distance. Four Eco Cells make a neighbourhood. Several Eco Neighbourhoods make an Eco District and there are four Eco Districts in the Eco-city. It is a structure with two ideas in mind: to keep development always on a walkable, human scale and also to provide a formula for scaling up the size of the Eco-city as the number of residents increases.

It is a logical approach and seeks to address one of the most common problems with conventional cities: sprawling and unmanageable growth that quickly loses sight of human need.

Agreement was also reached on the standards that should be achieved for a wide variety of criteria, from air and water quality to vegetation, green building standards, and how much public space there should be per person.

An ambitious project in the United Arab Emirates is trying to become both the world’s top centre for eco cities and a living research centre for renewable energy. Masdar City ( planned to be a city for 40,000 people. It is billed as a high-density, pedestrian-friendly development where current and future renewable energy and clean technologies will be “marketed, researched, developed, tested and implemented.”

The city hopes to become home to hundreds of businesses, a research university and technology clusters.

This version of an eco-city is being built in three layers in the desert, 17 kilometres from the Emirati capital Abu Dhabi. The goal is to make a city with zero carbon emissions, powered entirely by renewable energy. It is an ambitious goal but there are examples in the world of cities that use significant renewable energy for their power, such as Reykjavik, Iceland in Northern Europe, which draws much of its energy from renewables and geothermal sources.

Masdar City is designed by world-famous British architect Norman Foster ( and will be 6.5 square kilometres in size.

The design is highly innovative. The city will be erected on 6 metre high stilts to increase air circulation and reduce the heat coming from the desert floor. The city will be built on three levels or decks, to make a complete separation between transport and residential and public spaces.

The lowest deck will have a transportation system based on Personal Rapid Transport Pods. These look like insect eyes and are automated, controlled by touch screens, using magnetic sensors for propulsion. On top of this transport network will be the pedestrian streets, with businesses, shops and homes. No vehicles will be allowed there, and people will only be able to use bicycles or Segway ( people movers to get around. An overhead light railway system will run through the city centre, all the way to Abu Dhabi City.

“By layering the city, we can make the transport system super-efficient and the street level a much better experience,” Gerard Evenden, senior partner at Foster + Partners, told The Sunday Times. “There will be no car pollution, it will be safer and have more open spaces. Nobody has attempted anything like this.”

Masdar City is being built in stages as funding comes, with the goal of completion by 2016. It hopes to achieve its aspiration to be the most technologically advanced and environmentally friendly city in the world. As for water supplies in the desert, there is a plan: dew collected in the night and morning and a solar-powered desalination plant turning salt water into drinking water.

Electricity will come from a variety of sources. Solar panels will be on every roof and double as shade on alleyways. Non-organic waste will be recycled, while organic waste will be turned into fuel for power plants. Dirty water will be cleaned and then used to irrigate green spaces. Because of the design, the planners hope the city will just use a quarter of the energy of a conventional city.

To keep the city smart and the project on top of developments in renewable energy, the Masdar Institute of Science and Technology ( will specialize in renewable energy technology.

The cost for the city was pegged at US $22 billion in 2009.

The chief executive of Masdar – Abu Dhabi’s renewable-energy company – is Sultan Al Jaber. He sees the city as a beacon to show the way for the rest of the Emirate to convert from a highly inefficient consumer of energy to a pioneer in green technology.

“The problem with the renewable-energy industry is that it is too fragmented,” he told The Sunday Times. “This is where the idea for Masdar City came from. We said, ‘Let’s bring it all together within the same boundaries, like the Silicon Valley model (in California, USA).’”

The project needs to gather much of its funding as it progresses. The United Nations’ Clean Development Mechanism ( is helping with financing. Companies can earn carbon credits if they help fund a low-carbon scheme in the global South. The sultan is ambitious and sees this as a “blueprint for the cities of the future.” It has been able to bring on board General Electric (GE) and the Massachusetts Institute of Technology (MIT) to sponsor the university.

It is possible to visit Masdar City and take a tour ( and it is also possible to view online what has been built so far (


1) Center for Innovation, Testing and Evaluation (CITE): Located in Texas, USA, CITE is a fully functioning city with no residents to test new technologies before they are rolled out in real cities. Website:

2) Digital Cities of the Future: In Digital Cities, people will arrive just in time for their public transportation as exact information is provided to their device. The Citizen-Centric Cities (CCC) is a new paradigm, allowing governments and municipalities to introduce new policies. Website:

3) Eco-city Administrative Committee: Website:

4) Sino-Singapore Tianjin Eco-city, Investment and Development Co., Ltd. Website:

5) ‘The Future Build’ initiative, a new green building materials portal from Masdar City. Website:

6) UNHABITAT: The United Nations Human Settlements Programme is the UN agency mandated to promote socially and environmentally sustainable towns and cities with the goal of providing adequate shelter for all. Website:

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UNDP In Mongolia: The Guide | 1997 – 1999

Editor: David South

Researcher and Writer: Jill Lawless

Publisher: UNDP Mongolia Communications Office

Published: Between 1997 and 1999

Background: This is the original text from the brochure UNDP in Mongolia: The Guide first published in 1997. It, for the first time, provided a rolling update on what the United Nations was doing in Mongolia, offering key contacts and data to help advance human development in the country. It introduced transparency to the UN’s work in the country and made it easier to hold programme and project staff to account.

Mongolia – Population

With an area of more than 1.5 million square kilometres and a population of 2.38 million as of October 1997, Mongolia has a population density of only 1.5 people per square kilometre, one of the lowest in the world. The country has a relatively low growth rate of 1.6 per cent (1995), down from 2.5 per cent in 1989. At this rate, Mongolia’s population will reach 2.5 million by the year 2000.

Despite the popular image of Mongolians as nomadic herders, it is an increasingly urbanized country – 51.9 per cent of the population is urban, 48.1 per cent rural. More than one quarter of Mongolians live in the capital city, Ulaanbaatar. The other major urban centres are Darhan (pop. 90,000) and Erdenet (pop. 65,000 ).

The country is divided into 21 aimags (provinces), plus the autonomous capital region. The aimags are:

In the centre: Tuv, Uvurhangai, Arhangai

In the north: Bulgan, Selenge, Hovsgul, Zavhan, Darhan-Uul, Orhon

In the east: Hentii, Dornod, Suhbaatar

In the west: Hovd, Uvs, Bayan-Olgii, Gov-Altai

In the south: Dundgov, Dornogov, Omnogov, Bayanhongor, Gobisumber

The People:

About 86 per cent of the country’s population are Kalkh Mongols. Another 7 per cent are Turkic in origin, mostly Kazakhs living in the western aimags of Bayan-Olgii and Hovd. The rest belong to a wide variety of ethnic groups, including the Buryat, Dariganga, Bayad, Zakchin and Uriankhai. Mongolia’s smallest ethnic group is the Tsaatan, about 200 of whom live as reindeer herders in the far north of the country. 

During the communist period, Mongolia was home to tens of thousands of Russians. Few remain. 

More than 4 million Mongols live outside Mongolia, in Russia and the Chinese province of Inner Mongolia.

Human Development:

– Mongolia’s per capita GDP is U.S. $359 (1995). But this fails to take into account the cashless subsistence and barter economy widespread in rural areas.

– Poverty, though widespread, is difficult to tabulate. 1996 government figures put the poverty rate at 19.2 per cent – 19.8 per cent for rural areas, 18.7 for urban areas. But State Statistical Office figures for October 1997 indicate 36.8 per cent of urban residents and 27.5 per cent of rural Mongolians live below the poverty line. 

– Omnogov, Gobisumber, Hovsgol, Ovorhangai and Bayanhongor are the aimags with the highest poverty rates.

– The average monthly household income in September 1997 was 58,516.7 tugrugs (U.S. $73). Average expenditure was 58,124.8 tugrugs. In 1995, 48 per cent of household expenditure went on food. In poor households, the figure was 64 per cent.

Social Data:

Life expectancy: 63.8 years (1995)

Infant mortality rate: 40 per 1000 

Under five mortality rate: 56.4 per 1000 

Maternal mortality rate: 185.2 per 100,000 (1995)

One-year-old immunization rate: tuberculosis 94.4 per cent, measles 85.2 per cent (1995)

Access to safe drinking water: rural 89.9 per cent, urban 46.1 per cent (1995)

Access to sanitation: 74 per cent (1995)

Adult literacy rate:

 men 97.5 per cent,

 women 96.3 per cent 

Primary school net enrollment: 93.4 per cent

Secondary school net enrollment: 56.9 per cent 

Physicians: 26 per 10,000

Hospital beds: 9.9 per 1000

Daily calorie intake: 2278.2

Data 1996 unless otherwise indicated. Sources: State Statistical Office, Human Development Report Mongolia 1997

Mongolia – Economy

An Economy in Transition:

After 70 years of centrally planned economy, Mongolia is embracing free-market principles with a vengeance. Economic liberalization began under the Mongolian People’s Revolutionary Party government in the early 1990s. The Democratic Coalition government, elected in June 1996, has vowed sweeping economic changes, including  privatization of state assets, liberalization of trade and promotion of foreign investment.

The foreign investment law now encourages foreign investment in the form of share purchases, joint ventures and wholly foreign-owned concerns. Mining companies are given significant tax holidays. In May, 1997 parliament abolished customs duties expect on alcohol, tobacco and oil products.

All of this has been a shock to Mongolia and Mongolians. The country’s GDP shrank by a third in the early 1990s, though it has slowly recovered since. Inflation topped 300 per cent in 1993, but was brought down to below 50 per cent by 1997. The tugrug fell from 40 to U.S. $1 in 1991 to 800 to the dollar in 1997. Unemployment officially stands at 6.5 per cent – unofficial estimates are much higher.

The government’s ambitious privatization scheme has stalled; manufacturing and exports are down; imports are up. Adding to the problems is the fact that world prices for Mongolia’s major export items – copper and cashmere – have fallen.

The state retains at least 50 per cent ownership of the nation’s flagship enterprises, including the national airline, MIAT, the Gobi cashmere company and the power stations.

Mongolia has a resource-based economy, exporting mostly raw materials and importing mostly processed goods. The top exports are mineral products, textiles, base minerals, hides, skins and furs and animals and animal products. The major imports include petroleum products, industrial equipment and consumer goods.

Mongolia’s major trading partners are its two neighbours, China and Russia, though Korea and Japan are becoming more important – and the number-one export destination is Switzerland. 

Sidebar: The rural economy

Half of Mongolia’s population is rural, and herding remains the backbone of the Mongolian economy. Agriculture accounts for 30 per cent of the nation’s GDP. The number of herding households grew during the economic turmoil of the early 1990s, and now stands at more than 170,000; there are 30 million head of livestock in Mongolia. Herders produce meat, skins and furs; more and more herders are investing in cashmere goats, a substantial money-earner. 

Cultivation of crops, on the other hand, is limited. Before 1990, Mongolia was self-sufficient in cereals and even exported to the Soviet Union. But the sector suffered badly in the early 1990s. The 1997 harvest was 239,000 tonnes, 56 per cent of 1991-95 levels and only 40 per cent of pre-1990 harvests. Mongolia must now import 40 per cent of its cereal needs, a factor that contributes to a vulnerable food-security situation. Cultivation of vegetables is up, but remains minor – only 31,000 tonnes in 1997.

Sidebar: Rich in resources

Mongolia is resource-rich. This vast territory contains 15 per cent of the world’s supply of fluorspar and significant deposits of copper, molybdenum, iron, phosphates, tin, nickel, zinc, tungsten and gold, as well as at least 100 billion tonnes of coal.

Copper is the nation’s number one export. 

Minerals account for more than a third of Mongolia’s GDP and earn half of its hard currency. Gold production is increasing.

Mongolia also contains significant reserves of oil, which could transform the economy. But infrastructure and transportation limitations mean that commercial extraction is limited. The completion of a pipeline to China could change all this.

Economic Data:

Exchange rate: $1 = Tg 808 (Nov 1997)

GDP: Tg 185.5 billion (1996)

GDP per capita: Tg 228,605 (1996)

Inflation: 325 per cent (1992), 53 per cent (1996)

State budget expenditure: Tg 203.6 billion (Jan-Oct 1997)

State budget revenue: Tg 176 billion (Jan-Oct 1997)

Foreign aid (1991-97): U.S. 478 million

Official external debt: Tg 522 billion (Oct 97)

Industrial output: Tg 270.6 billion (Jan-Oct 97)

Exports: $334.2 million (Jan-Oct 97)

Imports: $343.3 million (Jan-Oct 97)

Workforce: employed: 791,800, unemployed 65,700 (Oct 97)

Source: State Statistical Office 

Mongolia – Politics

Seven decades of communist rule in Mongolia began to crumble in 1990, when the collapse of the old Eastern Bloc brought the first pro-democracy demonstrations. The ruling Mongolian People’s Revolutionary Party, which had already initiated a Mongolian version of glasnost, permitted the nation’s first multiparty elections in July, 1990. 

Superior organization helped the MPRP win both the 1990 and 1992 elections (taking 71 of 76 parliamentary seats in the latter), but reform picked up speed. In 1992, the country adopted a new Constitution that enshrined human rights, private ownership and a state structure based on separation of power between legislative and judicial branches.

In the June 1996 election, major opposition groups united to form the Democratic Coalition, made up of the National Democratic Party, the Social Democratic Party, the Believers’ Party and the Green Party. Somewhat to its own surprise, the Coalition won a healthy 50 of 76 seats in the State Ikh Hural, or parliament. The composition of the Hural is now: National Democrats 35, Social Democrats 15, MPRP 25, Mongolian Traditional United Party 1.

In addition to their economic reforms, the Democrats have carried out radical restructuring of government, slashing the number of Ministries from 14 to 9.

The government has a healthy majority, but tensions sometimes emerge between the coalition partners. Mongolia’s transition to democracy has been remarkably peaceful, and the young democracy is robust – there are now more than 20 political parties in the country. 

But economic hardship has caused resentments. In the 1997 Presidential election, voters elected N. Bagabandi, the candidate of the MPRP. In the fall of 1997, the government had to face demonstrations from students and pensioners and an opposition campaign that led to a confidence vote in parliament — a vote the government easily survived. 

Political structure:

Mongolia has a parliamentary system of government, with a 76-seat legislature called the State Ikh Hural. The President, directly elected for a four-year term, is second in authority to the legislature, but he appoints judges and has the power of veto (which can be overturned by a 2/3 vote in parliament).


1911 collapse of Manchu Qing Dynasty; Mongolia declares its independence

1919 China invades Mongolia

1921 with Soviet help, Mongolia gains final independence from China

1924 Mongolian People’s Republic declared

1990 pro-democracy protests; Constitution amended; first multiparty elections

1992 second multiparty elections; new Constitution adopted

1996 Democratic Coalition elected as Mongolia’s first non-communist government, headed by Prime Minister Enkhsaikhan

1997 N. Bagabandi from the MPRP elected President

Voter turnout: 

1996 elections: 92.2 per cent

1996 local Hural: 64.0 per cent

1997 presidential: 85.1 per cent

Mongolia – Society and Culture

Mongolia has a unique and durable traditional culture, centred around the herding lifestyle. Herders remain semi-nomadic, moving their animals with the seasons as they have for centuries

Many urban Mongolians retain strong links to the land, both literal and sentimental, and the country’s performing and visual arts often celebrate the landscape and the animals — especially horses — that are central to Mongolian life. Mongolia has several distinctive musical instruments and styles, including the morin khuur (horsehead fiddle), the long song (urtyn duu) and the throat-singing style known as khoomi.

After seven decades of communism, Mongolians are once again celebrating their traditional culture, and embracing the image and legacy of the most famous Mongolian of all time – Chinggis Khan, who in the 13th century initiated the Mongol Empire, the greatest land empire the world has ever known. He gives his name to everything from a brand of vodka to a luxury hotel, and centres for academic Chinggis research have been set up.

In sports, Mongolians favour the “three manly sports” — wrestling, archery and horse racing — that form the core of the annual festival known as Naadam. Mongolian wrestlers have won a number of medals at international competitions and are even entering the field of Japanese Sumo.

The 1990s have seen a flowering of freedom of expression. Mongolia has an extraordinary 525 newspapers and a wide range of magazines, while the first private radio and television stations have been established. 


Mongolians have been Buddhists since the 16th century, when the Mongolian king, Altan Khan, was converted by Tibetan lamas. In the pre-revolutionary period, Mongolia was ruled by a series of Living Buddhas, or Jebtzun Damba. The eighth, and last, Jebtzun Damba was removed after the communist takeover.

Traditionally, monasteries were centres both of learning and of power. It’s estimated Mongolia had 100,000 monks, or lamas, in 1921 — one third of the male population. In the 1930s, this power became the focus of a ruthless series of purges that reached a climax in 1937. Most of the country’s monasteries were destroyed, and as many as 17,000 monks were killed.

Today, Mongolia is once again embracing its Buddhist heritage. Monasteries are being restored, and are once again crowded with worshippers. The Dalai Lama is an enormously popular figure and has visited the country several times.

For many Mongolians, Buddhism is flavoured with traces of Shamanism, an even more ancient spirituality.

Mongolia also has a significant Muslim community — about 6 per cent of the population. These are mostly ethnic Kazakhs living in the far west of the country. The opening-up of the country has led to an influx of Christian missionaries, and this remains a source of some tension and debate.

A Young Country:

Mongolia is a remarkably young country — more than 60 per cent of the population is below the age of 30, and 40 per cent of Mongolians are younger than 16. This young generation, with its embrace of Western styles and ideas, is changing the complexion of the country. Western pop music and North American sports like basketball have a huge following among Mongolia’s youth. So, too, do homegrown artists like the pop groups Nikiton and Spike and the singer Saraa. 

Social Data:

Television sets: 6.2 per 100 (1995)

Newspapers: 2 per 100 (1995)

Number of telephones: 82,800

Marriage: 10.9 per 1000 over 18

Divorce: 0.7 per 1000 over 18

Number of pensioners: 287,200

Crimes reported: 20,454 (Jan-Oct 97)

As percentage of same period in 1996: 114.4 per cent

Data 1996 unless indicated. Sources: State Statistical Office, Human Development Report Mongolia 1997

More from Jill Lawless:

Read a story by Jill in The Guardian (9 June 1999): Letter from Mongolia | Herding instinct 

Read a World Health Organization (WHO) report on substance abuse and alcohol consumption (WHO Global Status Report on Alcohol 2004) citing Jill here: 

Further Reading:

Modern Mongolia: From Khans to Commissars to Capitalists

The Mongolian Economy: A Manual of Applied Economics for a Country in Transition

The transition to a market economy: Mongolia 1990-1998

Wild East: Travels in the New Mongolia

This work is licensed under a Creative Commons Attribution 4.0 International License.


© David South Consulting 2018