Publication / 11 February 2015

Mongolia's natural resources: burdening or benefiting democracy?

The European Commission and EU member states, including the Netherlands, concluded partnership agreements and other economic treaties related to trade, investment and taxation with the former Sovjet republics. In these countries, the socialist system has been rapidly replaced by rather extreme capitalist models. An oligarchy of a few rich ‘businessmen – bureaucrats’ has been established in Russia and other former Soviet countries, and large-scale investments in energy and extractives have come to erode the foundations of democracy, as these large energy and mining companies have close relationships with the political sphere.
To truly support democratization, the EBRD and other public banks should divert 
their investments in developing countries from centralized, large energy infrastructure and export-oriented extractive industries towards the support for more democratic, sustainable and small-scale production systems as well as more democratic, effective and controllable distribution networks.

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