Large-scale, anti-government street demonstrations swelled in downtown Ulaanbaatar this week as hundreds of people gathered to voice anger over a range of issues from new taxes to smog. The protests have been mostly peaceful, but the crowd sizes indicate welling discontent with the ruling party.

Daytime temperatures were as low as minus-20 Celsius as protesters braved the bitter cold to wave banners and signs lambasting Prime Minister Oyun-Erdene Luvsannamsrai for not doing enough to tackle economic and social problems. The crowds at the weekend were estimated at around 2,000 people. The Freedom Coalition Party, an opposition party, organised the event, although other interests joined in. The US Embassy issued a warning to its citizens to avoid crowds and demonstrations. 

Strong economic growth of more than 5% isn’t enough to stop people from taking to the streets to demand change. Many say there is a deteriorating standard of living, partly due to persistently high inflation.

A common cause of dissent this winter has been air pollution. It has reached toxic levels in the capital, mainly due to the burning of coal by city residents in unplanned neighbourhoods, known as “ger” districts. But other complaints have surfaced, with protesters angry about everything from high auto insurance fees and vehicle registration costs to Ulaanbaatar’s notorious traffic jams. 

“With inflation at 9% in December, alongside soaring utility prices, high taxes, and air pollution, the economic backdrop is tense,” said Amar Adiya, a political commentator and editor-in-chief of Mongolia Weekly, a business intelligence newsletter.

“The recent hike in auto insurance fees, though shelved later, appears to have been the final catalyst. Beyond these immediate concerns, there's a broader demand for tackling corruption, lowering taxes and addressing poverty and unemployment,” said Amar.

Anger over the vehicle taxes comes from a government attempt to reduce Ulaanbaatar traffic. Authorities are attempting to get cars off the road by making them too expensive to drive. For example, motorists driving cars with engines over 4,000cc must now pay an annual fee of 250,000 tughrik ($73).

The protests come just six months after Oyun-Erdene and his Mongolian People’s Party (MPP) won a third straight election, although this time around the results were closer than in the previous two contests and the ruling party lost its super-majority control in Parliament.

Since the elections, the new government has promised a dizzying array of infrastructure projects. They include a copper smelter, the country’s first oil refinery, power plants and a dam. Ulaanbaatar citizens have been pledged a multilane freeway through the city and a subway line. And in a recent address, Oyun-Erdene promised to raise per capita GDP to $10,000, up from the current level of $7,500.

But most of the projects could take years to complete and patience is already running thin for some in the capital, home to around half of Mongolia’s 3.5mn people. Protesters on Sukhbaatar Square this week appeared more concerned with immediate challenges, including the rising cost of food. During the weekend protest, some left the square to block a key intersection before being moved along by police without incident.

“The scale and persistence of these protests indicate a significant public outcry,” said Amar.

Oyungerel Tsedevdamaa, the leader of the Civic Unity Party, said discontent has been building in recent months, fuelled by hiked tariffs for electricity and other city services like waste collection fees.

“Many thousands of families who dismantled their [coal-fired] ovens and stoves in order to help combat air pollution are now in the most difficult position,” Oyungerel said. “Families with electric heating systems are paying at least three times more in electricity bills than last winter.”

Some analysts speculate that the cost hikes are tied to the election cycle. With enough seats to rule until 2028, the government has some time to push ahead with unpopular decisions now, well ahead of the next polls. 

“There is no parliamentary opposition to stop the government as the cabinet keeps introducing their future tax increase ideas,” said Oyungerel. “These punishing proposals make living impossibly hard.”

Online reactions to the demonstrations have been mixed. Some have supported the calls for a government resignation, while others are willing to give ministers time to make good on promises. There is also no shortage of online sceptics who say that both the ruling party and opposition parties have been paying people to protest. 

Oyun-Erdene has weighed in, suggesting his political opponents are financing the demonstrations to undermine infrastructure projects. In a report by Sonin.mn, Oyun-Erdene said the opposition is primarily vested interests in coal trucking opposed to a cross-border railway with China. 

Altangerel Oyunsaikhan, the Minister of Justice and Internal Affairs, announced he was opening an investigation into reports of payments made to protesters, UBN News reported.

The Freedom Coalition Party initially said the demonstrations would continue for 10 days but on January 15 it posted to social media that they would continue indefinitely and that a general strike would be held on January 20. State-run Montsame News Agency reported that protesters sent letters to 33 members of parliament calling on them to hold a vote of no confidence.

Oyun-Erdene has made attempts to pacify the public anger over rising costs and taxes. Last month he announced a cash handout of 350,000 tughrik ($102) for all citizens, paid for by a coal mining dividend programme. This olive branch to the public wasn’t enough to stop people from demonstrating against his government.

Protests of this size have not been seen in Ulaanbaatar since a wave of anti-corruption rallies in 2022 against a “coal mafia”. At the time, the public protested after revelations that state employees had been engaged in a longstanding, massive coal theft scheme, causing public losses in the billions. Subsequent economic reforms led to increased transparency in the way coal contracts are made with Chinese buyers.