Sept. 27 - Mongolia plans to give every citizen shares in the company that owns the Tavan Tolgoi coking coal mine, when it launches its international IPO early next year. Toshi Maeda reports.
Nearly half the population of Mongolia, once the land of Genghis Khan, are nomadic herders. But mining is about to change their lives. Mongolia's Tavan Tolgoi mine holds the world's biggest coal deposit, and the government plans to give every Mongolian a piece of it. When mine owner Erdenes Tavan Tolgoi launches its international IPO early next year, Mongolians will receive shares as well. 53-year-old herder Bayandalai Lhaasuren and his family herd livestock across the country's vast grasslands, as their ancestors have done for hundreds of years. But he and his wife, who still live in traditional tents, are not clear about how they will receive and use their capital stocks. (SOUNDBITE) (Mongolian) 53-YEAR-OLD HERDER BAYANDALAI LHAASUREN SAYING: "I know that 576 shares, or something like that, will be given to every herder. I read in the newspaper that this is already approved. I think it's good, but I don't know how to receive dividends from shares." Mongolian Prime Minister Sukhbaatar Batbold is promising the shares to the people, ahead of next year's election. (SOUNDBITE) (English) MONGOLIAN PRIME MINISTER SUKHBAATAR BATBOLD SAYING: "People should have certain rights to get certain participation or value and benefit from this mining development, so we are quite committed and focused to give, to distribute these stocks and shares to the people of Mongolia prior to the election." Mining in Mongolia has boomed in recent years, thanks largely to Chinese demand for resources. Mongolian officials say shares given to each citizen could be worth around $300 U.S. dollars - a substantial amount in a country where the average GDP per capita is roughly five times that amount. Now, to cope with the coming wave of herders-turned-traders, Mongolia's tiny stock exchange - the world's second smallest after Laos -- is gearing up for a massive investor education effort. Bill Gorman, president of the Mongolian Stock Exchange, has high ambitions. (SOUNDBITE) (English) PRESIDENT OF MONGOLIAN STOCK EXCHANGE BILL GORMAN SAYING: "Essentially, what we want to do is make Mongolia the most investment-literate nation in the world. That's a little hard when you consider most people haven't got a clue what a stock is. This is new to them. They don't know what the government has given them, so the challenge is to deliver to them enough understanding that they can make sensible decisions about their holdings" The IPO could raise up to 15 billion dollars - a vast sum for one of the poorest countries in Asia. Mongolian officials say ten percent of shares are reserved for Mongolian citizens. Toshi Maeda, Reuters.