Japan and Mongolia will begin negotiations on the fast-growing nation’s first bilateral free-trade agreement.
Prime Minister Yoshihiko Noda and his Mongolian counterpart, Sukhbaatar Batbold, also agreed Monday that the two countries will boost cooperation in the development of natural resources and infrastructure, according to a joint announcement released after they met in Tokyo.
Mongolia, whose economy grew 17.3 percent in 2011, has no FTAs with other countries. Japan is keen on working more closely with Mongolia because the fast-growing country has abundant natural resources, including coal, copper, uranium and rare earth minerals.
Batbold, on a six-day visit to Japan that started Saturday, told Noda that Mongolia will ensure Japanese companies’ participation in developing the Tavan Tolgoi coal mine in the south Gobi desert, one of the world’s largest deposits of high-quality coal, the announcement said.
Batbold told reporters that his meeting with Noda was “very fruitful for the strategic partnership” between the two countries, achieving an important “first step” in promoting bilateral trade and investment.
In 2010, Japan’s exports to Mongolia, mainly cars and other industrial products, amounted to ¥13.97 billion, while its imports from the resource-rich country stood at only ¥2.09 billion.
Japan and Mongolia this year mark the 40th anniversary of the establishment of diplomatic ties.
The government believes that Mongolia, bordered by Russia to the north and China to the south, is also increasingly vital in terms of diplomatic and security policies.
The two countries had aimed to enter FTA talks a year ago, but efforts stalled as the administration led by Noda’s predecessor, Naoto Kan, was thrown into turmoil after the Great East Japan Earthquake.
Japan, one of Mongolia’s major donors, said it will provide a total of about ¥2.74 billion in aid to help the emerging country’s development.