Ulaanbaatar: The main opposition Mongolian People`s Party (MPP) swept back to power in landslide parliamentary elections, results from Mongolia`s election committee showed on Thursday, after campaigning dominated by concern over slowing economic growth.
The transformation of the former Soviet bloc state since a peaceful revolution in 1990 has been a big draw for foreign investors eyeing its rich mineral resources, unleashing a boom from 2010 to 2012.
But an abrupt economic slowdown since 2012 has stirred controversy over the role of global mining firms such as Rio Tinto, which last month finally approved a $5.3-billion extension plan for the Oyu Tolgoi copper mine.
The MPP`s victory will likely be a greeted as a tailwind for the economy and international miners, as the party`s success in attracting investors when it last held power, from 2008-2012, led to the country being nicknamed "Mine-golia".
The MPP, which has governed for most years since the revolution, won an 85 percent majority of 65 seats in the 76-member parliament, taking back power from the Democratic Party, an unnamed official from Mongolia`s general election committee told a press briefing.
The ruling Democratic Party won nine seats in Wednesday`s vote, down from 37. Prime Minister Chimed Saikhanbileg, and the parliament`s chairman, Zandaakhuu Enkhbold, were among those kicked out of their seats.
"The Mongolian People`s Party`s landslide win shows the public assigning clear blame for the country`s economic woes to the outgoing Democratic Party government," John Marrett, an analyst at The Economist Intelligence Unit, said in an emailed statement.
A late change of election rules hindered independents and small parties during the short 18-day campaign period.
One seat went to the Mongolian People`s Revolutionary Party (MPRP), and one to an independent, popular folk singer Samand Javkhlan, who has taken up environmental causes.
RISING DEBT, MINING REVENUE SHORTFALLS
A vast country with just three million people, best known as the birthplace of Mongol emperor Genghis Khan, Mongolia had struggled in recent years to adapt to a downturn in fortunes.
Demand for coal and copper from giant neighbour China and weak commodities prices have hit Mongolia hard.
The IMF forecasts economic growth of 0.4 percent this year, compared with 17.5 percent in 2011, the year before the Democratic Party took power.
Since 2012, Mongolia has borrowed billions of dollars in sovereign debt. In March, rating agency Moody`s gave it a negative outlook, citing the rising debt burden, a projected widening of budgetary imbalances and mining revenue shortfalls.
The MPP has criticised the Democrats` economic management and the borrowing spree, promising to reassess spending and tighten fiscal management.
Mongolian bonds jumped on the election results. The $500 million sovereign bonds due 2021 surged 3 points to 105.25/106 cents on the dollar, and the $500 million bonds from Trade Development Bank due 2020 rose 2.25 points to 97.75/98.75.
More than half of Mongolia`s people are under 30 and grew up in the post-Soviet period of rapid change in the land-locked democracy squeezed between autocratic China and Russia.
Begi, 22, gathered with other young voters outside the MPP`s headquarters at around 2 a.m. to revel in their party`s victory.
"I`ve been waiting for this for a long time. I couldn't believe the Democratic Party because they really ruined our country," he said.