March 17, 2008
ON
OCTOBER, 2008
PRIME MINISTER
SANJ BAYAR OF MONGOLIA
RECEIVES THE NOBEL PEACE PRIZE |
|
This honor was probably totally unexpected.
It took several days for the world press to intellectualize
the honor which was delivered to the Mongolian people.
The events actually were quite in order. In late March,
early April, the Mongolian government submitted its so-called
Finance Plan to develop its gold reserves. The agreement
basically ascertained that the control interests of the
project will remain in Mongol hands. The government divided
up the economic interests, 39 percent to itself and 61
percent to the so-called Ivanhoe Group which consists
of Ivanhoe, Rio Tinto and Entree Gold.
What was unexpected was the recommendation that they utilize
the international stock markets for the benefit of both
the Mongolian people at an early stage and rationalize
the capital expenditures of the Ivanhoe Group.
An international investment company formed a corporation
capitalized at about $45 nillion and agreed to float a
billion dollars immediately, which is to be funded by
the first delivery of gold from the mining venture. Furthermore,
it was agreed that at the earliest moment the Ivanhoe
Group would raise between $3-4 billion from the newly
formed international company called Mongolia-Gold. The
sum raised by the Ivanhoe Group is used, of course, for
the capital expenditures of the venture.
Thus, the first $5 million is dedicated to the Mongolian
people, $1 billion to be used in the early funding of
the building of the infrastructure, and the other $4 billion
for financing the project. As far as the interests in
securities are concerned, the Mongolians receive the A
shares for 39 percent and the Ivanhoe Group the B shares.
It was also agreed that effort is to be made immediately
to raise $200 million interim financing, which is to be
repaid with the first billion dollars raised in London.
The $200 million is dedicated for the initial expenses.
$100 million is dedicated to the Mongolian people.
The plan is to set off the first well-financed development
of two and a half million people who have been somewhat
mishandled by history, being between the Soviet Union
and China after the Second World War, and to some extent
outside civilization for all its existence. The plan has
also authorized an international study as to how to spend
the first billion dollars, how to establish banking lines
and draw up priorities in making the country a consumer
society.
These events occupied the headlines in Mongolia. It hit
the financial press obviously in the Western world, and
when Mongolian Gold went public in September, 2008 in
London, the price of gold has gone from $1,000
to $1,300
on the London markets. Prior to the final conference,
which took place ceremoniously in the Parliament building
in Mongolia, the reserves were upvalued from 32 million
to 45 million ounces. At a price of $1,300,
this represented $55
billion, by far the largest gold company in the world.
By October 4, a great many commercial projects were underway.
The Mongolian people were initially issued $50, a grant
from the government. Subsequently with the private financing
of $100 million, an additional $150 was handed over to
get commercial activities and consumer activities going.
And with the public offering of which the country benefited,
close to one billion dollars in various industrial programs
began to change the total feature of this country.
All in all, 2008 was a great year for the Western stock
markets where Rio Tinto, Ivanhoe and Entree Gold were
listed, and it was a great year for the Mongolian people.
And there is no question it was a great year for the international
travels of the various companies' executives. But it was
also a very great year for the Prime Minister, his cabinet
and parliamentarians who sometimes negotiated all night,
all day, on this vital project which is perhaps unmatched
in the Far East, and in many respects is unmatched in
the commercial history of modern civilization.
The Nobel Prize was a surprise. Almost every opinion maker
in the world considered the Mongolian negotiations and
the process as a success of international political and
commercial negotiations. It wasn't always orderly, but
the actual process, the outcome, was an orderly process
which put the whole Mongolian gold reserves into a positive
limelight in the service of investors and consumers and
the country together in the proper perspective. By October
4, 2008, Mongolia has lit up the front pages. The stocks
have run up in London and New York and Toronto, and the
Mongolian stock market began to move.
I myself, who acted as an unofficial advisor to the Prime
Minister of Mongolia, recommended that the Johannesburg
stock exchange be invited to improve, supervise and expand
the scope of the Mongolian stock exchange. This step,
which was accepted by both parties, was a positive contribution
of international cooperation. Mongolian gold in London
became one of the darlings of the stock market, and several
new companies, utilizing Mongolian minerals, were also
traded in Mongolia and in Johannesburg as well.
The Nobel Prize hit the international press. Quite frankly,
it hit the Prime Minister's cabinet and the Prime Minister's
family, and first there were question marks, first there
was curiosity, until an article appeared in the New York
Times by Dr. Henry Kissinger, who put the situation into
perspective.
Dr. Kissinger, who himself received the Nobel Prize because
of Vietnam, or rather ended the war in Vietnam, together
with Lu Doc To, the North Vietnamese negotiator, is of
course a historian. His thesis was Metternick and the
Congress of Vienna. Dr. Kissinger pointed out the subsequent
political development, singled Mongolia out among the
young nations of the Far East after the Second World War.
Look at Korea, North and South, in 1949 and 1950. Look
at Vietnam starting with the so-called liberation movement
from the French before 1954. Look at Taiwan, which was
created from a war between the Nationalist Chinese and
the Communist Chinese. Look at Kuwait whose oil assets
were the subject of a number of wars in the last part
of the 20th century and Cuba!! Yes, Cuba.
The Nobel Prize in Dr. Kissinger's opinion was given to
Mongolia because it bypassed any of the these horror stories.
It was given to the Prime Minister because he negotiated
in such a way that when the negotiations ended, which
were not easy to come by, there was a peaceful country
dedicated to exploiting its uranium, copper, gold and
coal reserves and engaged the country in an economic path
that could lead to a model.
No person in the second half of the 20th century has been
engaged in more negotiations, more blood baths and more
tragedy than the former Secretary of State. The Nobel
Prize, according to Dr. Kissinger, was handed to the Mongolian
Prime Minister because a very complicated economic interest
which could have blown up into a political tragedy, which
could blow up into a destructive economic decade of in-fighting
and international lawsuits. They have been peacefully
resolved and peacefully put into the past of popular growth
for its own people, the Mongolians.
Dr. Kissinger pointed out something which perhaps nobody,
certainly not the negotiators, not the parliamentarians,
not the international journalists who followed the Mongolians,
nobody has pointed out in the 21st century that the world
needs commodities, the world needs to develop every country's
commodities. But what the world needs is basically peace
in the producing countries, prosperity in the producing
countries, peace among the international bankers, peace
for the developing companies.
I was born in 1938. I, of course, don't remember, but
I had many times and I have the movie at home, one of
the most honorable British politicians who wanted to have
the same peace for his own country and to the world that
Prime Minister Sanj Bayar wanted for Mongolia. Mr. Chamberlain
did say what the world always wanted to hear,
Mr. Sanj Bayar, the Prime Minister of
Mongolia, received the Nobel Prize for that reason. He
created
