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Presenting on the ‘Diverse Economies of Megaprojects’ at 13th Annual Mongolia Development Forum

LaurenBonilla24 April 2017

 

On Thursday, April 6, we (Rebekah Plueckhahn and Lauren Bonilla) participated in the 13th annual Mongolia Development Forum, held at the headquarters of the European Bank for Reconstruction and Development (EBRD) in London.  The forum was co-organized by the Ministry of Foreign Affairs, Mongolian Embassy in the UK, Mongolian Association in the UK, Tsahim Urtuu Holboo, Mongolian Business Database, and Council of Mongolians Abroad.  The theme of the day was ‘Opportunities in Mongolia’, which addressed three key topics: Business in Mongolia, Challenges and Opportunities; Social and Legal Issues; and Mega-Projects.

 

Bataa

Bataa Tserenbat, the event organizer, introduces the mission and history of the Mongolian Development Forum to a packed auditorium.

 

Bayar

Bayar Sanjaa, the former Prime Minister of Mongolia and current Ambassador of Mongolia to the UK, gives a welcome address.


We jointly presented in the Mega-Projects session given our respective areas of research on the effects of economic fluctuations in Ulaanbaatar (Rebekah) and the mining industry (Lauren). Although these topics are quite different from each other in many respects, we have discovered in the course of our research that our findings yield many similarities.  We have observed how urban development and the large-scale mine development could both be considered mega-projects in the sense that they promise to be transformational in nature.  They also involve long time horizons in their development and require large amounts of capital investment.  Moreover, while much attention is given to the role of more formal institutions, stakeholders, markets, and policies in influencing the development trajectories of largescale urban and mine projects, our research has shown that a diversity of actors, processes, and practices exist within, help to shape, and are produced from a mega-project.

Presentation

\Bek and Lauren

 

Lauren’s talk discussed a feature of the Tavan Tolgoi coal complex that has long been a source of debate and controversy: the multiplicity of companies that own and operate sections of the deposit located in Tsogttsetsii, Omnogobi province.  In recent years there has been debate about consolidating the ownership of the Tavan Tolgoi deposit so that it is governed by one company instead of the current situation where there are three companies running mine projects in close proximity to each other: MMC/Energy Resources (a publically traded company listed on the Hong Kong stock-exchange), Erdenes Tavan Tolgoi (a state-owned company), and Tavan Tolgoi JSC (a company owned by both the local province and private shareholders).  While this diversity of ownership has presented a number of governance challenges, Lauren talked about how it has also been a blessing to some degree in the current period of economic crisis.  Since the mining companies are differentially exposed to coal markets and operate according to various financing streams and shareholder interests, they have pursued divergent forms of extractive activity in response to the slowdown of the coal economy.  Locally, this has meant that once-booming Tsogttsetsii has avoided facing a singular bust at Tavan Tolgoi.  Instead, small stores, taxi and trucking services, car repair shops, and trade activities, among other businesses, have been able to survive amid the slowdown, even though many have suffered from crushing indebtedness, bankruptcy and capital loss.

Lauren thus stressed the importance of diversification within a mega-project as a means to reduce exposure to market fluctuations, especially in a volatile industry like mining.  She also drew attention to how diverse economic activities always exist around mega-projects, often in unanticipated ways.  She presented an example of a scene she witnessed in April 2016 where a herding household traveled over 100 kilometers to Tsogttsetsii from another district in order to recruit temporarily unemployed mine engineers and professionals from Energy Resources to comb their large herd of goats for cashmere.  In addition to benefiting the herders, the work gave the mine workers something to do instead of sitting idly at home waiting for Energy Resources to resume its operations.

Rebekah opened her presentation by encouraging the audience to think about Ulaanbaatar city as a type of ‘mega-project.’ While different to other types of mega-projects with a more singular aim, she took several key points that apply to mega-projects more generally and applied them to different aspects of Ulaanbaatar. She described this as a useful way to look at the types of transformative visions and diverse economies that the city gives rise to. The first point was how Ulaanbaatar at different planning stages, during socialism, and in the diverse postsocialist environment, has formed a political power center and a locus for economic activity. In the postsocialist environment, the Ulaanbaatar 2020 Master Plan and Development Approaches for 2030, like other plans for different mega-projects, presents  visions for various types of transformations.

Rebekah went on to discuss how urban development in Ulaanbaatar is extremely sensitive to wider economic fluctuations, where the city, like other mega-projects elsewhere, is always partially completed. She emphasized how re-/development projects have long consisted of numerous diverse economic connections. This has meant that the recent economic downturn has affected vast amounts of people throughout the city. In conclusion, Rebekah discussed the economies of land access and land use that shape Ulaanbaatar, especially in the ger areas surrounding the city core. She described these diverse economies as two-fold: the economy of land access, as well as the numerous small business and livelihood opportunities that living on land can afford. She emphasized how influential these urban residents are in shaping Ulaanbaatar as a city, and the importance of incorporating these existing diverse economies in future urban development plans.

The Q&A at the end was very lively. Rebekah was asked about how traffic and air pollution can be mitigated in Ulaanbaatar, to which she emphasized the different plans and efforts currently being discussed by state agencies and development organizations in Ulaanbaatar. Lauren was asked about what Mongolia should do to quickly address the current economic crisis, to which she cautioned against anything that promises a fast fix and discussed how the Emerging Subjects project conceptualizes crisis as a space that can allow for the emergence of new possibilities.

Megaprojects

The ‘Mega-Projects’ panel. From left to right: L. Dulamzul, Rebekah Pleuckhahn, Lauren Bonilla, B. Maral, and A. Gantuya.

 

Related to this latter point, audience members showed great appreciation for the all-female makeup of our panel.  As one Mongolian from the Ministry of Finance mentioned during the reception, mega-projects are typically a highly masculine arena.  Had the panel been organized five years ago during Mongolia’s so-called boomtime, it likely would have been formed by men in suits talking about statistics, investment opportunities, and big infrastructure projects.  Instead, our panel was very much about new ways of looking at and doing things, from our talk on diverse economies to Maral Bayaraa’s presentation about the application of innovative remote sensing technologies and Gantuya Ariunsan’s analysis of strategies to interpret future coal market prices.  If our panel is an example of an opening that Mongolia’s economic crisis affords, then there are indeed opportunities arising to be hopeful about.

The Mongolian Ministry of Foreign Affairs presents awards to forum panelists.

 

All photos © of Ganzorig Ulaankhuu.

Acknowledgements: We thank Bataa Tserenbat for expertly organizing the event, Zula Luvsandorj for chairing our amazing all-women panel, and Ganzorig Ulaankhuu for taking photos at the event and sharing them with us.

 

 

Resisting closure: The political dynamism of an unfinished tower in Ulaanbaatar

Guest Contributor10 October 2016

 

This posted was written by Alex Hayden Skinner.  Alex has been conducting research on Ulaanbaatar since 2010.  He is presently researching within the Niisleliin Oron Suutsnii Korporatsi (HOCK) and consulting on certain components of their projects.   

 

Ulaanbaatar’s skyline is littered with carcasses. The mining-driven surge in the Mongolian national economy, which saw world-beating GDP grow at 17.5% during 2011, was brought to an abrupt end in 2012. Precipitated by a sustained downward trend in copper and coal pricing and exacerbated by unstable relations between policy-makers and a nascent internationally-financed mining sector, foreign investment plunged. Lower budgetary revenues created a severe deficit and domestic banks faced liquidity challenges. Despite policy attempts to prop the construction sector and sustain internal growth, the city became has become littered with incomplete structures, unable to find buyers or access affordable completion financing. These phantoms of the future, lurching skyward from the urban substrate, stand in various states of completion – some as concrete skeletons, others clad with pristine facades, awaiting the internal organs that will make them viable homes or offices.

Among these, within the very heart of the capital’s central business district, the concrete shell of a one such commercial and residential building emerges amidst a cluster of ornately decorated three-level apartment buildings. The squat, L-shaped apartment block that partially encircles the new tower was erected during the 1940s to house employees of the Ministry of Social Defence and the Ministry of Animal Husbandry. Built under the auspices of the State Construction Trust, these were among the earliest residential units to be built in Ulaanbaatar, pre-dating GIPROGOR’s (the oldest Russian planning institute, established in 1929 to furnish the theoretical and methodological principles and practices of socialist settlement and more recently associated with master planning of the Sochi 2014 Winter Olympic site) first twenty-year Master Plan for the Ulaanbaatar, which would see the nascent capital grow into a worker’s city, patterned after those across the former Soviet Union.

 

Image 1

The former residences of the Ministry of Social Defence and the Ministry of Animal Husbandry. Photograph circa 1950. Source: Archives of the Master Planning Agency of Capital City, Mongolia, published in: Natsagdorj, N. (2014). Construction History of Ulaanbaatar City. Master Planning Agency of Capital City, Ulaanbaatar.

 

This residential block is situated next to what is now the Prime Ministerial residence – itself the former residence of Communist leader Kh. Choibalsan. The building itself is differentiated from nearby master-planned residential blocks by elegant mosaic-work motifs, which adorn its street-facing facades. These were updated after the democratic revolution to depict elements of national culture (although they are frequently obscured by an advertising billboard erected by the flight-ticketing agency now resident in the ground-level space below).

Following the democratic revolution, immovable private property ownership was wrought into a new constitutional framework and secured under legal provisions passed between 1992 and 1997. Street-facing ground-level apartments across the city were rapidly repurposed into retail spaces, later being haphazardly extended outwards onto surrounding public areas and sidewalks. The block in question underwent such a transformation, becoming desirable city centre commercial space. In 2016 these hosted street-front apartments house travel bureaus, legal firms, bars and cafes.

 

Image 3

Image 4

Satellite imagery of the site from Google Earth, taken in 2004 and 2016, showing densification and transformation of the central business district of Ulaanbaatar. In the centre of the image on the right is the tower that is the subject of this paper.  Google, Map Data: 2016.

 

It is amidst such transformations that the new tower – the co-subject of this piece – was planned. The walled-in courtyard at the rear of the residential block also hosted a small administrative building. As privatisation of state assets was underway in earnest, this was transferred to private ownership and the space attached to this structure was walled off. Between 2004-2005 the existing administrative building was demolished. The land then sat fallow for six years before construction was financed and initiated. Concrete began to be poured in the winter of 2012 and by the end of 2013 a skeletal tower of concrete pillars and floor-plates rose 26 levels into the city skyline, dwarfing its diminutive hosts. The structure remains incomplete to this day.

Image 6

The former residences of the Ministry of Social Defence and the Ministry of Animal Husbandry (tan, three level buildings in the centre of the image), from behind which a new yet incomplete commercial tower sits vacant, nestled in a courtyard that was a significant spatial manifestation of socialist-era social structures.  Source: Alex H. Skinner, 2016.

 

This new structure represents an irruption of form associated with commerce and private property amidst a material manifestation of the structuring structures of socialist socio-political life. In this case, spatial irruption is overlaid by a temporal one; by transformational vectors that are elsewhere commonly referenced under rubrics of post-socialism, late-modernity, transitional-economics and global-capital. The carcass of the new tower, as it protrudes from one of Ulaanbaatar’s most intensive sites of socialism, nevertheless stands nascent and irresolute vis-a-vis any idealisation of the functioning of neoliberal economics of land and finance. As completion was postponed again and again, questions began to be raised among a community of developers and residents of the area concerning legitimacy of land allocations and permitting, as well as impact upon the city’s cultural heritage. Whilst nobody could diagnose the cause of the delay with any certainty, rumours and conjecture highlighted how the historically socialist associations of this site are the other side of the same coin of the building’s commercial value.

There is a sense in which this new structure can be viewed as operationalising potential within emerging regimes of value only through the productive decay of pre-existing political and social systems. From and with the disrupted spaces of socialist political history, and the incomplete realisation of capital value, a new array of forms continues to emerge. Can we therefore think in terms whereby what is diminishing, incomplete or “decaying” is “indistinguishable from the wholesome remainder” (Negarestani, 2010: 382)?

 

Image 2

 

Image 5

The site of the residences of the Ministry of Social Defence and the Ministry of Animal Husbandry circa 1950 and 2016. Top photo source: Archives of the master Planning Agency of Capital City, Mongolia, published in: Natsagdorj, N. (2014). Construction History of Ulaanbaatar City. Master Planning Agency of Capital City, Ulaanbaatar. Bottom photo: Alex H. Skinner, 2016.

 

To summarise Negarastani (2010) on the helical calculus of decay, the decaying entity, idea or political form is dispossessed of the resolution of becoming entirely past, entirely other, but also cannot continue to exist wholesomely. Decay, freed of its quotidian resonance with negation and disgust, therefore becomes analytically useful as a means of indexing transformations from intensity (limitrophic identity) to extensity (becoming other than an ideal form), just as fixing of forms through prototyping have been used anthropologically to trace movement from extensity to intensity.[1]

As the gross politico-material forms of socialism productively decay and are taken up amidst stalled machinations of global capitalism and within the swimming potentialities of an emerging structure, this new tower (along with other material manifestations of resistance to closure), broadcasts generative and vital ontological scrambling across the urban landscape. Such a dynamic process moves beyond the idea that unintended outcomes and uncertainty are necessarily the core-effects of transformation. It does so by exploring a differential transformation of forms rather than transformation in an uneasy engagement of ideal forms. This activity has been at the core of an anthropological unpacking of meta-narratives of transition.

 

[1] See Negarestani (2010) for further discussion on extensity and intensity.

 

References:

Negarestani, R.  (2010). Undercover Softness: An Introduction to the Architecture and Politics of Decay. In Collapse Volume VI. Robin Mackay ed. 379-430. Urbanomic, Falmouth, U.K.

 

 

 

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