Mongolia’s economy is destined to be DOOMED.

An illusion of freedom. True freedom is not THAT!

1. Vast land with too low population density.
   
   The population density of Mongolia is one of the lowest in the world, at around 2 people per square kilometer. This means there are, on average, only two people living in every square kilometer of land. That means a sparse population means a smaller pool of available workers, making it difficult for businesses to find the skilled labor they need. Low population density often results in high infrastructure costs per capita. It becomes less economically viable to build and maintain roads, railways, communication networks, and other essential infrastructure across vast, sparsely populated areas. This can limit access to markets and resources, hindering economic activity. In sparsely populated areas, transporting goods and people over long distances can be expensive. This can increase production costs for businesses and limit consumer access to goods and services, further hindering economic development. Basically it does not bring economical prosper. Not easily. For example:
   Ulaanbaatar has approximately 800km of paved roads, which translates to roughly 0.5 meters of road per resident. The rest of the country has a network of about appx. 8,000km, meaning there are 5 meters of road per resident in rural areas. To maintain this vast rural road network, one might expect rural residents to pay significantly more taxes than urban residents. However, this is not the case. In fact, residents of Ulaanbaatar contribute to the maintenance of roads they may never use, highlighting a disparity in the distribution of infrastructure costs. This raises questions about fairness and equity in infrastructure funding, as urban residents are effectively subsidizing road maintenance in rural areas, despite not directly benefiting from it.
2. Small-Scale mines(SSM) have no impact to local economy.
   While SSM may provide income for some individuals, its overall contribution to the national economy is limited. The sector often operates informally, leading to tax evasion and a lack of revenue for public services and infrastructure development. SSM can exacerbate social conflicts and inequality. Disputes over land and resources can arise, leading to community tensions and even violence. Furthermore, the economic benefits of SSM often accrue to a small group of individuals, leaving the majority of the community with little or no improvement in their living standards. SSM often focuses on short-term gains without considering the long-term sustainability of resources. This can lead to depletion of valuable minerals and hinder future economic development potential. This explains why certain individuals in Mongolia are significantly richer than the majority of the population, despite the national poor economic condition.
   For example:
   Mongolian roads are full of fancy SUVs and plot lands in downtown areas belong to handful of people that related to politicians.
3. Nomadic livestock industry has no profit at all without a systematic farming.
   Despite boasting over 80 million livestock, the Mongolian livestock industry grapples with a myriad of challenges that hinder its success. The harsh and unpredictable climate, characterized by extreme temperatures and Zud (severe winters), makes livestock highly vulnerable, leading to high mortality rates and inconsistent production. Overgrazing, fueled by the large livestock population and unsustainable practices, has severely degraded the land, reducing pasture quality and exacerbating vulnerability to harsh weather conditions. Additionally, limited infrastructure and transportation networks restrict access to markets, while the lack of value-added processing diminishes potential economic gains. Inadequate government support, including research, extension services, and veterinary care, further hinders the adoption of modern and sustainable practices. The escalating impacts of climate change, such as rising temperatures and more frequent droughts, amplify these existing challenges, posing a significant threat to the long-term viability of the industry. This complex interplay of environmental, economic, and infrastructural factors collectively contribute to the underperformance of the Mongolian livestock industry, despite its vast animal numbers. Unless they convert traditional nomadic herding into industralized farming, it is just impossible to get profit from it. Even maintaining the traditional nomadic herding costs billions!
4. Nomads don’t really contribute to the economy
   From an economic perspective, the nomadic lifestyle in Mongolia poses challenges due to its low productivity, limited economic contribution, and environmental impact through overgrazing and resource depletion. The dispersed nature of nomadic communities also strains public services and infrastructure, while their limited integration into the formal economy reduces tax revenue and hinders economic diversification. Additionally, their vulnerability to economic shocks like droughts and price fluctuations necessitates government support, diverting resources from potentially higher-yielding development pathways. The nomadic lifestyle can perpetuate social inequalities and limit human capital development, further hindering economic growth. In Mongolia, over 1 million traditional herders, known as nomads, play a vital role in preserving cultural heritage and contributing to the livestock sector. However, their traditional lifestyle often clashes with the demands of a modern economy. Their daily focus on survival and subsistence, coupled with inconsistent income streams and limited engagement in formal markets and services, hinders their ability to make a substantial impact on the national economy. While their work is undoubtedly valuable, their self-sufficient lifestyle and reliance on traditional practices present challenges for integrating them fully into the modern economic landscape. Pay no tax, then there is no place for you in the society. Sad but true.
5. Populist politicians, they are just plague
   Populist leaders and policies, while initially appealing, often lead to negative economic consequences. Their short-term focus, disregard for expertise, and protectionist tendencies can trigger economic instability, trade wars, and institutional damage. This, coupled with a focus on redistribution over growth and a tendency to make unrealistic promises, can hinder long-term economic development and lead to social unrest. While addressing popular grievances, populist approaches ultimately undermine sustainable economic growth and stability. For instance, in Mongolia, populist rhetoric often targets the nomadic herder population, romanticizing their traditional lifestyle while overlooking the economic challenges they pose. While nomads are an important part of Mongolian culture, their reliance on subsistence farming and limited integration into the formal economy can hinder broader economic development. Populist policies may offer short-term benefits to herders, such as subsidies or relaxed regulations, but fail to address the underlying structural issues that prevent their full participation in the modern economy. This can perpetuate a cycle of dependency and hinder the development of a more diversified and resilient economy.
6. China and Russia
   Mongolia’s economic growth faces significant challenges due to its economic dependence on China and Russia. Its heavy reliance on exports to China, especially for minerals, makes it vulnerable to fluctuations in demand and pricing, hindering diversification efforts. Furthermore, Mongolia’s accumulated debt to both countries limits its financial flexibility and investment capacity. Despite geographical proximity, accessing the vast Chinese and Russian markets remains difficult due to trade barriers and inadequate infrastructure. Mongolia’s landlocked position makes it dependent on its neighbors for access to ports, with insufficient railways and roads further hindering trade. The country’s reliance on Russia for energy also poses a vulnerability to price fluctuations and potential supply disruptions. Moreover, China and Russia often prioritize their own interests in exploiting Mongolia’s mineral resources, leading to unfavorable contracts and limited value addition within the country. Additionally, their competition for investment can crowd out smaller Mongolian firms. Mongolia’s strategic location between these two powers also presents geopolitical constraints, making it challenging to pursue independent economic policies. While Mongolia is actively seeking to diversify its economic partnerships, overcoming these challenges remains a priority for its sustainable economic growth.

Conclusion
In the end Mongolia has a long way(literally hunderds of years) to become developed country like Sweden, Norway, Finland, Switzerland, Hungary etc. These above mentioned reasons are basically major issues that prevents Mongolian economy growth. In order to solve those issues we might need a century, if everything goes according to plan. So instead listening populist promises, as a system we need to look at the problems from broader POV. Modern Mongolia needs modern solutions.