This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

For Mongolia, China's Too Close For Comfort

Coal country is where Mongolia's balancing act is put to the test. Chinese demand for copper and especially coal has propelled the Mongolian economy to one of the world's fastest growing, making some wealthy and driving down poverty in a still poor country, and China wants a larger share of the resources.

Tsogttsetsii, the county seat closest to Mongolia Mining Corporation's coal mine and the planned railroad, bursts with activity. A new airport and apartment complexes rise out of the empty, tawny Gobi. Trucks full of coking coal veer off a company-built paved road to the Chinese border to avoid potholes, crushing tufts of grasses herds of camel and goats feed on.

On the Mongolian side of the border squat a few blocky concrete buildings for guards. Across the fence, the Chinese city sprawls and gleams, tangible reminders of how much richer Mongolia might be if fully open to China. "There are more buildings. There's more construction. It's more developed. The landscape is nicer," said Dizaibadiin Luvsandorj, a gaunt former Buddhist monk-turned-coal hauler who makes the trip every week or so. Still, he doesn't like to stay on the Chinese side, he said, because "food is expensive."

Nowhere else does China's footprint loom so large yet seem so faint. Even in totalitarian, hermetic North Korea, Chinese road-building crews string banners of Chinese characters along the construction sites.

In Cambodia, where trade with China has nearly doubled from 10 percent of GDP in 2006 to 19 percent in 2011, and Chinese investments run from rubber plantations to telecommunications, the government has done Beijing's bidding. It sent back ethnic Uighurs seeking asylum. This July, it squelched an attempt by Southeast Asian allies to use an annual forum to pillory Beijing for its expansive claims to disputed South China Sea islands.

China's presence became so intrusive in Myanmar, also known as Burma, that it incited a backlash. A military-led government counted on China for investment and diplomatic protection during two decades of Western sanctions. Trade with China hovered around 10 percent of GDP, not including widespread smuggling. Chinese companies have been so busily extracting timber, gems, oil and gas that locals complain "China is using Burma as a supermarket." In the city of Mandalay, a real estate rush by Chinese has priced locals out of the market. Alarmed by the onslaught and the outcry, the government moved away from Beijing last year, taking steps toward democracy.

3 of 7

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG

Markets

DOW 17,678.23 -40.31 -0.23%
S&P 500 2,056.15 -4.90 -0.24%
NASDAQ 4,863.3620 -13.1570 -0.27%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs