Posted July 25, 2001 by Layton Croft

President Carter, Financier Soros Meet with Mongolia Staff

Country: Mongolia

Topics: Economic Development, Agriculture

Billionaire financier and philanthropist George Soros and former United States President and philanthropist Jimmy Carter paid separate but simultaneous visits to Umnugovi province in the heart of Mongolia’s Gobi desert on September 8 and 9.

Although the respective visits were brief, each man and their entourages met with senior staff from the Gobi Regional Economic Growth Initiative and discussed the project’s work and impact in areas of organised cashmere marketing and goat breed improvement, as well as in rural media enterprise and information systems development.

Indeed, after nearly three years of operations in Mongolia and in Umnugovi, the Gobi Initiative has the reputation locally and nationally as a key player in supporting rural development. When world leaders come to the Gobi, they talk to the Gobi Initiative.

Financed by USAID and managed by Mercy Corps in partnership with Land O’Lakes and Pact, the Gobi Initiative is a five-year programme dedicated to working with herder and commercial entrepreneurs as well as with other policy-making and information leaders to stimulate private sector-led economic development in Mongolia’s southern Gobi region.

The Gobi is characterized by large numbers of sheep, camels and goats, the most destructive of Mongolia’s livestock, of unprecedented numbers of herders, unprecedented rates of overgrazing and desertification, and the least densely populated territory in the country. Indeed, the challenges to private sector development are great, and yet through targeted interventions implemented in collaboration with local enterprises, associations, government and other donors or development projects, the Gobi Initiative’s successes to date have been significant.

Carter, who was raised on a farm, said he felt right at home talking to herders about their livelihoods and prospects for growing their animal husbandry businesses, especially through producing and marketing cashmere. He said that herders he spoke with are focusing on producing fewer high quality goats instead of more lower quality goats, despite growing demand in recent years among Chinese buyers for high volumes of any quality fiber.

Carter was surprised by this, but was told by the astute nomads that as they have come to view themselves as businessmen, their animals as assets, and their labour, fodder, and time as key inputs, their views regarding short- and long-term business planning have changed dramatically. One example is that many herders now work in groups to cut costs and boost productivity. Another is the trend among herders to reduce herd size and focus on the quality of those products with the greatest potential market value. Herders keep financial and livestock records, and are more aware of and able to respond to key market signals in productive, and profitable, ways. When asked why and how these changes among Gobi herders is happening, Carter heard a list of reasons, led by “Gobi Initiative.”

Carter was joined by Mongolian Prime Minister N. Enkhbayar, Executive Director of the Carter Centre John Hardman, and millionaire equity investor Richard Blum, who is Honorary Mongolian Consul to San Fransisco and husband of California Senator Dianne Feinstein. Blum and Carter were especially interested in the Gobi Initiative’s recent Cashmere Market Days events and goat breed improvement strategies.

Posted July 23, 2001 by Layton Croft

Oasis in the Gobi Desert

Country: Mongolia

Topics: Economic Development, Agriculture

[Editor's note: This story was prepared by Layton Croft, Programme Director for Information Systems with the Gobi Regional Economic Growth Initiative. Other stories he has written about the positive impact partnerships and information have played in Mongolia’s rural development.]

Mongolia’s southern region, the Gobi, is the country’s least densely populated, and characterized by rugged, semi-desert terrain and a harsh, dry climate. But amidst this arid vastness dominated by goats, camels and nomadic herders, an informational oasis thrives.

Gobi Wave Information Centre is rural Mongolia’s first independent regional media enterprise. Registered as an NGO, Gobi Wave’s status as financially and editorially independent of the state is remarkable given seven-decades of communist control and censorship. And though a national Free Press Law was passed in 1999, Gobi Wave is one of very few rural media to follow it.

Today more than 300,000 listeners in five Gobi provinces, mostly herders, regularly tune in to Gobi Wave’s news and information broadcasts. They ration precious radio batteries to get practical and educational weather, market price, animal husbandry management, and government policy information. These programmes are made possible by the Gobi Regional Economic Growth Initiative, whose relationship with Gobi Wave is one of many partnerships that have contributed its success, and promise.

The Gobi Initiative is a five-year rural economic development project funded by USAID and managed by Mercy Corps in partnership with Land O’Lakes and Pact. Shortly after launching operations in early 1999, the Gobi Initiative was approached by a group of Gobi journalists eager to create an independent, financially sustainable media enterprise. Their aim was to provide herders and other Gobi people with critical information, to give them tools to improve their lives in social and economic ways. Since an informational needs assessment indicated that business and economic information was a top priority for Gobi people, the Gobi Initiative pledged skills training and technical assistance support.

These journalists realized that strong, mutually beneficial relationships with local and international institutions would be critical to their success. After creating Gobi Wave, they built on the skills, knowledge and confidence gained from their partnership with the Gobi Initiative. They approached local NGOs, businesses and local government interested in working together. They solicited paid programming and advertising contracts. They successfully lobbied local government for private office space. They won a grant from the Soros Foundation for a state-of-the art FM station to complement their regional broadcasts. They established a rural network of more than 50 volunteer and commissioned stringers and marketing agents across the Gobi.

The true nature of the Gobi Initiative/Gobi Wave partnership is illustrated by the fact that as each entity accomplishes its goals and satisfies its clients, the other benefits. For instance, as the Gobi Initiative contributes to more profitable and productive herder and rural businesses, Gobi Wave has a larger listener and client base. Likewise, as Gobi Wave constantly provides programming rural listeners use to improve their lives, Gobi Initiative development objectives are further realized.

The real power of this partnership, however, is its ability to breed other productive partnerships. Last year, the Gobi Initiative led a coalition of five international and domestic organisations to apply for a professional journalism expert from the Knight Foundation. In late June, 2001, Corey Flintoff of National Public Radio, an experienced rural radio trainer and now Knight Fellow, arrived in Mongolia for six months. The Knight Foundation selected such a distinguished expert for the job because of the nature of the coalition’s application, which was submitted by the Gobi Initiative, Soros Foundation, UNESCO, Press Institute, and Globe International. And though these five organisations have unique goals and development mandates, they chose to build on their common vision of improved rural radio journalism serving Mongolians with little access to useful news and information. In the end, they opted to work together, and their partnership resulted in acquiring needed technical expertise, for free.

While in Mongolia, Flintoff will spend considerable time and energy working closely with Gobi Wave. Meanwhile, Gobi Wave has continued the ricochet trend of building new partnerships from existing ones by establishing a nascent Rural Radio Association among several other rural, regional radio stations across Mongolia. Indeed, the Gobi Initiative/Gobi Wave partnership has resulted in impact beyond their respective mandates and geographical scopes, proving the procreative power of true partnership.

And it seems likely that those partnerships which have fueled Gobi Wave, and which brought Flintoff to Mongolia, will continue to flourish and strengthen institutional and inter-organisational capacity beyond the Gobi, and beyond the life of projects like the Gobi Initiative.

Posted July 5, 2001

Harbinger of Prosperity in the Gobi Region

Country: Mongolia

Topics: Economic Development, Agriculture

In May-June 2001, Mercy Corps held two rural development events -"Cashmere Market Days" - in Dalanzadgad and Altai City. The events, sponsored by the USAID-funded Gobi Regional Economic Growth Initiative, were organised to bring herders and processors together to sell and buy large volumes of high quality cashmere at competitive market prices and to facilitate the establishment of long-term business relationships.

The Cashmere Market Days were an unprecedented commercial success. More than 2,000 herders and 14 cashmere processing companies attended the two events. Nearly 150 tons of cashmere was sold, generating £2 million in revenue for participating herders.

During the events, herders received higher than market prices as processing companies were eager to purchase large amounts of pre-evaluated cashmere. For processing companies, being able to deal directly with herders and procure vast quantities of value-added cashmere in a single location presented significant cost advantages.

Virtually all business at the Cashmere Market Days was conducted in cash, representing a positive departure from in-kind and barter trade that dominates the rural economy in Mongolia. The hard currency earned by the herders will stimulate local economies and further the development of the Gobi region.

About the size of Alaska, Mongolia is home to 2.5 million people. Cashmere is one of the country's most important exports. Mongolia provides approximately 30 percent of the world's cashmere. Since the collapse of the Soviet Union in 1991, Mongolia has slowly embraced free market reforms. For cashmere herders and processors, the transition to an open economy has created both opportunities and headaches.

To help herders and cashmere processors take full advantage of the economic opportunities being created by market-led reforms, Mercy Corps launched the USAID-funded Gobi Regional Economic Growth Initiative ("Gobi Initiative"). Mercy Corps is focusing its programme in the Gobi region of Mongolia because of its cashmere, food processing and animal herding activities offer significant potential for rural economic growth.

In addition to creating an environment conducive for business activity, Mercy Corps also utilized the Cashmere Market Days to enhance the development of the cashmere sector. Mercy Corps organised contests during the events to reinforce the concept that higher quality cashmere has a premium value in the market. Four prizes were awarded at each event to the herders supplying cashmere in the following categories: highest commercial value, cleanest cashmere, finest fiber quality, and most consistent grade of fiber. In addition, Mercy Corps provided training and information outreach activities during the events. Herders were encouraged to attend clinics and workshops covering activities such as cashmere classing and pasture and water management.

The outcome from the two events strongly indicates that organised rural marketing activities are feasible and welcomed in rural Mongolia. To duplicate and expand the scope of such events in future years will be the next challenge for Mercy Corps.

Posted December 24, 2000

Mercy Corps To Help Rural Mongolians With $4.4 Million Program

Country: Mongolia

Topics: Agriculture, Economic Development

Mercy Corps has been selected by the Government of Mongolia to receive and sell 40,000 metric tons of wheat donated by the US Department of Agriculture. The proceeds, estimated at £3 million, will be used to support agricultural, economic and infrastructure initiatives throughout rural Mongolia. A portion of the funds will be used by Mercy Corps to help herders affected by last year’s devastating zud to rebuild their animal herds and take steps to prevent such devastating losses again. Zud is a Mongolian term for a severe drought followed by a particularly harsh winter. Last year’s zud resulted in the loss of an estimated two million head of livestock - a resource that forms the foundation of Mongolia’s economy and rural cultural identity. In response to the zud, Mercy Corps launched a nationwide six-week-long radio programme called Zud Watch that provided information about relief efforts. Mercy Corps also provided direct humanitarian aid.

“Mercy Corps is pleased to work with the Governments of the United States and Mongolia to carry out this important programme,” states Mercy Corps’ Mongolia Country Director, Stephen Vance. “This programme marks an important step for the Government of Mongolia as it is the first time a private agency will be responsible for receiving and selling donated food commodities. And, with Mercy Corps management, there will be total transparency and accountability of all transactions, which has not been the case in the past. This will ensure that the programmes to be supported by the sale of the wheat will make a great deal of difference in the lives and livelihoods of thousands of rural Mongolians, most of whom are below the poverty line.”

The Programme’s main initiatives are:

• Supporting the privatization of land, livestock breeding operations, seed production facilities and farm implement services;
• Improving the livelihood of herders and farmers by enhancing their ability to market products to urban centers by improving transportation infrastructure; and
• Restoring the livelihood of herders who lost their livestock in the 1999-2000 winter disaster through an integrated livestock restocking, water management, rangeland management and training programme.

The commodities are expected to arrive in Mongolia within the next several weeks.

Mercy Corps has worked in Mongolia since January 1999 implementing a five-year programme funded by the U.S. Agency for International Development. The programme, known as the Gobi Regional Economic Growth Initiative, assists the people of the Gobi region to achieve market-led economic growth and development. The agency currently operates in four Gobi provinces in the areas of enterprise development, rural financial services, agriculture development and market infrastructure.

Posted May 23, 2000

Mercy Corps Artist Visits New York

Country: Mongolia

New Yorkers have the rare opportunity to see and learn the art of Mongolian felt craft at the American Museum of Natural History this week. Felt craft designer Byambaa Jambal has come from Mongolia to demonstrate her art through presentations and workshops from May 19 to 28. Mercy Corps' Gobi Regional Economic Growth Initiative ("Gobi Initiative") arranged her participation at the invitation of the Festival of Mongolia.

Felt is such an important part of Mongolian society that Mongols have been known as "the people who live in felt tents" since the 12th Century when they conquered most of the known world. Genghis Khan was able to take vast areas because of his military’s might and their astonishing mobility. One reason for that mobility was that they lived in gers (rhymes with "dares"), the traditional round felt tent that can be constructed within an hour.

Many Mongols still live in gers, including almost half of the 650,000 people living in the capital city of Ulaanbaatar. Gers work in Mongolia because nomadic herders can easily transport them and the layers of thick felt protect against the sub-arctic cold. In Mongolia, temperatures of 40°F below and lower are not uncommon. Felt has many uses besides gers, including boots, carpets, saddlebags, bags for carrying newborn animals, and crafts and toys.

Through the Gobi Initiative's felt craft training workshops in southern Mongolia, Byambaa Jambal helps women and men hone their skills to provide needed income for their families. One such workshop in South Gobi province assisted underemployed women to nearly double their monthly income by selling their crafts to tourists.

The Gobi Initiative assists the people in the Gobi region of southern Mongolia to achieve market-led economic growth and development as the country strives to reach its potential in the global marketplaces. The five-year project began activities in Mongolia in February 1999. It is funded by the US Agency for International Development, and managed by Mercy Corps in partnership with Associates in Rural Development, Pact and Land O’Lakes.

Posted April 5, 2000

Credit Institution Launched in Mongolia

Country: Mongolia

Topics: Economic Development

Goviin Ekhlel, a new non-bank financial institution offering credit to qualified borrowers in the Gobi region, had its official opening ceremony last Friday at the Chinggis Khaan Hotel in Ulaanbaator, the capital of Mongolia.

Goviin Ekhlel is wholly owned by Mercy Corps. Start-up funding was provided by USAID and the US Embassy in Mongolia. Mercy Corps board member Phyllis Dobyns attended the opening event.

Headquartered in Ulaanbaator, with branch offices to be opened soon in Umnugovi and Mandalgovi, Goviin Ekhlel will help meet the working capital and fixed assets needs of creditworthy businesses in the Gobi aimag centers. Goviin Ekhlel will further assist borrowers by making learning a part of the lending process.

"Our aim is to be an example of a transparent, fair and efficient business that serves the needs of our clients," says Christopher Suzuki the Chief Executive Officer of Goviin Ekhlel. "We want to develop long term relationships with our borrowers so that we can assist them in growing their business. If first-time borrowers successfully repay their loans, they may be eligible for further and larger credit amounts with more flexible interest rates and repayment terms. We will also be tailoring financial products that are consistent with the needs of borrowers and the marketplace."

Goviin Ekhlel is looking for registered small- to medium-sized businesses in aimag centers engaged in trade, service delivery, light manufacturing and the processing of agricultural products. All borrowers are required to attend a marketing meeting, submit a complete loan application and show that the borrower resides and conducts its principal business activities in the aimag centre.

Mercy Corps has been working in Mongolia since February 1999. The agency is implementing the five-year Gobi Regional Economic Growth Initiative with funding from the US Agency for International Development. In partnership with Associates in Rural Development, Inc., Pact and Land O' Lakes, Mercy Corps’ programme assists the people of Mongolia's Gobi region to accelerate and sustain market-led economic growth and development.

Mercy Corps is also addressing emergency needs resulting from severe weather conditions and the loss of more than 1.5 million livestock in Mongolia this winter.

Posted February 25, 2000 by Jennifer L. Butz

In the Mongolian Zud—A Witness to Winter's Wrath

Country: Mongolia

Depending upon where you live, words like earthquake, tornado, or crop freeze can strike fear or bring feelings of helplessness. In Mongolia, that word is zud—a combination of blizzard and bitter cold, preceded by drought.

Right now, Mongolia is experiencing one of the worst zud in living memory. Yesterday I was driving back from Uvurhangai. It was hard to remember that just six months ago the animals along the way looked well-fed and hearty. Today their carcasses line the road side, now fodder for the scavengers of the Steppe. Sometimes the animals appeared to have simply dropped in their tracks. Other carcasses tell a more desperate story -- one of human or animal struggle to survive.

As we drove east, we spotted two young men bent over the body of a large steer. They were stripping its hide, as many of the horses and cattle had been that lay near the road. The elder of the two brothers said that he had spent the night riding his motorcycle in search of the remnants of his herd. The ride had been bitter cold, as the temperatures at night still hover around -26C. His cheeks were frost-bitten and he was concerned that he had to expend the fuel for his motorcycle, but his horses were simply too weak to make the ride. He estimates that two-thirds of his modest herd had already died. He had only found 10 animals still alive. He isn't certain how many will make it through the two remaining months of winter. His brother told us that another family that lives close to theirs has lost nearly all of their 100 large animals. As he worked his knife over the frozen remains, he said that he hoped someone would buy the skin so that they could buy more petrol for the bike and continue to track their ever-shrinking herd.

Other stories were to be seen, although no survivors told these tales. One carcass of a cow lay in a heap, already partially scavenged. Yet, when we drew closer to it, we could see that two small goats had crawled into the cavity of the animal seeking protection. Unfortunately, even they did not survive. It was pitiful, to see how closely they had snuggled up to the larger body, hoping to find the only break from the northern wind that the surrounding area offered. A little further on, a frozen heap of six skinned horses had been dumped in a ditch, their legs and heads twisting into a macabre sculpture.

The traffic on the only east-west road tells the story, too. As we drove west on Sunday out from Ulaanbaatar, we shared the roads with huge trucks of baled hay. The hay rose easily to 30 feet from the truck bed, and each engine had a double load. These trucks were about the only other vehicles headed west. As we neared Arvaiheer, the aimag centre of Uvurhangai, we saw a caravan of 10 or more trucks from Zavhan aimag in the north. Each truck held the remaining goods of families who were trying to leave the zud behind.

In the centre part of the country, in the Steppe-lands, it is mostly the larger animals, horses and cows, that are dying. Many herders have ceased buying fodder, saying that they will wait for the weak ones to die off and rebuild their stock—if any—come springtime. In the Gobi, where a year-long drought left little vegetation and bitter storms have covered the entire desert white, the die-off is alarming. Entire regions have been devastated. Families have either lost their entire herd, and or most of their assets in a desperate attempt to buy fodder to keep the living alive. Television pictures show emergency aid fodder being delivered to animals who are so exhausted that they are hardly able to eat.

Not everyone was caught unaware by this zud. In Arvaiheer, one young herder told a Gobi Initiative staffer that his family had predicted a severe winter. After all, it is a folk truism that a hot, dry summer brings a cold, snowy winter. His family slaughtered its two stud goats, hoping that the does would have a higher survival rate if they did not lamb this year. This herder figured that if he guessed right, he would come out ahead with a stronger herd. If he guessed wrong, he risked missing a full production cycle.

But many other herders also predicted a severe winter and did not make any changes in their usual animal husbandry. In a country where wealth is counted by animal hooves, its hard to criticize the drive to breed ever larger herds. Many foreign organisations—and a few pastureland managers from Mongolia—have been issuing cautions about the limits of the carrying capacity of the land. These organisations were advocating culling programmes and strengthening herd quality.

Mother nature has stepped in in a big way this time. And the results will echo through Mongolia for several years as meat supplies decline, prices at the markets rise, cashmere production plummets, and government funds are used to sustain a rural population already living a marginal existence. Nearly one million animals have died. Winter and the even harsher Mongolian spring will claim more victims before summer rains come. The natural inclination is to send hay, send clothes, send food—and there are many countries, organisations and individuals that are stepping up.

But a long-term solution is needed. One that includes not only seeing to the immediate needs of rural families, but also rebuilding the herds, educating herders about animal quality and strengthening their understanding of the markets they supply. The equation of more animals means more wealth needs to be challenged and changed.

It is a contest between Mother nature and Mongolian nature. And I'm not going to bet on a winner just yet.