“Economic crisis”, “financial pressure”, and “Who is to blame?” seem to be on everyone’s lips.

The people of Mongolia are feeling the struggle of the country’s crawling economy. Businesses aren’t able to pay their workers on time, small shops and cafes all over the city are closing their doors, herders and farmers don’t have cash to start planting or to take care of their animals, banks are frantic about bad loans, and everyone’s tightening their belts.

Mongolia’s foreign debts, which were estimated to be 11.6 billion USD in 2012, skyrocketed to 21.7 billion USD in 2015. This includes the Chinggis Bonds (1.5 billion USD) and Samurai Bonds (30 billion JPY, or approximately 274 million USD) issued under former Prime Minister N.Altankhuyag.

N.Altankhuyag caused quite a sensation when he said that there was a conspiracy being led by President Ts.Elbegdorj to jeopardize the economy and consolidate power.

“There is a crisis of justice looming over us,” said N.Altankhuyag.

“By making it look like the state of Mongolia is weak, the rule of conspirators is gaining power. Those who are not true to their nation, those who have insatiable greed, are shamelessly using the powers of the state for their own personal interests. They are suppressing the desire of Mongolians to live in Mongolia prosperously, screwing up the state by overthrowing it, scaring away wealth creators, and using the threat of imprisonment instead of justice to spread fear and openly steal from businesses and [mining] license holders,” the former Prime Minister said at a press conference last week.

He claimed that the Democratic Party is being attacked by conspirators.

“This state of conspiracy is deliberately attacking the credibility of the Democratic Party. The accomplishments and works of the Democratic Party are being made to look bad, and efforts to sabotage and make it look like the Democratic Party can’t run the state are being organized. During all this, the opposition party, the Mongolian People’s Party is staying quiet, silently satisfied. Don’t forget this.”

N.Altankhuyag said that the conspirators are led by President Ts.Elbegdorj. “I have no choice today but to name one of the heads of the conspiracy. Though everyone knows this, they dare not speak out… Because they fear persecution. This person is President Ts.Elbegdorj, who came to power by saying ‘let’s be honest’,” N.Altankhuyag said. “No doubt they will place blame and act as if they are working against corruption and appeal to the public. Though me and my associates might be in danger, I’m not afraid.”

Some observers and media believe that N.Altankhuyag’s statement is politically motivated and that he hopes to shift the blame for the debt he put Mongolia in.

Not all debt is bad. If used wisely or invested well, loans can serve as much needed fuel for the engine of the economy. But when a nation’s debt burden reaches a certain point, it is sure to take a toll on everyone.

Right now, it seems that things are rough all around, but the worst is yet to come. No matter who wins the elections, Mongolia will have to pay approximately two billion USD in debt repayment next year, including 900 million USD in debt belonging to the private sector.

Mongolia currently devotes around six to seven percent of its state budget revenue to debt repayment. Economists believe that this number will grow as high as 25 percent of the state’s budget revenue. To add salt to the wound, the country’s foreign debt has been accrued in foreign currency, which means that at the current rate by which the value of the MNT is plummeting, there will be more pressure when Mongolia’s government bond repayments are due in 2017, 2018, 2022, and 2023.

While the payment due dates of these debts are looming over the nation, the state continues to ignore demands for a report on bond related matters. The government has never made the details of its bond expenditure public. As the parliamentary and provincial elections approach, the debt issue that the next government will have to address is being shunted to the side.

With no intelligible plan to address this issue as of yet, it seems almost certain that Mongolia is heading down the same road that Greece and Argentina travelled. A series of higher interest rate loans for paying off previous debts which end in default, and eventually lead to an economic crash; is this what awaits Mongolia? Or will Mongolia have to give another nation a mine or two to pay off its foreign debt?

Politicians say the bonds were used to build factories, finance housing, build roads and railways, and improve infrastructure to bring foreign investors to the nation. The fruits of these endeavours are not ripe, but the burden of debt is already in sight. With no tangible plan for repaying the government bonds and a lack of clarity being exhibited by the leaders of Mongolia, I feel that the nation is knowingly marching off a cliff.