Exclusive-Mongolia, US prepare to sign ‘Open Skies’ deal ahead of talks -official

By Trevor Hunnicutt

(Reuters) – The United States and Mongolia will announce plans to sign an “Open Skies” civil aviation agreement, a U.S. official said, as Vice President Kamala Harris and Mongolian Prime Minister L. Oyun-Erdene gather for discussions focused on Russia, China and economic development.

That meeting in Washington on Wednesday comes as the Biden administration aims to ease tensions with strategic competitor China and as its relations with Russia show no sign of thawing as the Ukraine war grinds on.

Surrounded by Russia in the north and China in the south, Mongolia has cultivated allies, such as Japan, South Korea and the United States, in a diplomatic strategy aimed at reinforcing its political independence, but its economy has continued to rely heavily on its two giant neighbors.

Washington has Open Skies civil aviation agreements with more than 130 countries. They grant airlines from both countries the right to operate in each other’s countries, liberalize airline regulation and impose safety and security standards.

The Open Skies deal between the U.S. and Mongolia will build on a memorandum of understanding for an air transport agreement between the nations that was agreed in January.

Mongolia’s national carrier MIAT Mongolian Airlines flies to Europe and Asia, but not the United States at present. Although passenger demand may not merit non-stop flights between Mongolian capital Ulaanbaatar and the U.S., the Open Skies deal would also provide easier options for cargo flights between the nations.

The new deal with Mongolia comes alongside new cultural exchange initiatives, as well as English-language training in Mongolia.

Each deal is meant to give the landlocked Asian country a Washington-backed alternative for economic development, where corruption has long deterred foreign investment.

Resource-rich Mongolia has extensive deposits of rare earth minerals and , which are critical materials in short supply as U.S. President Joe Biden looks to electrify the domestic auto market.

Mongolia has been in talks with Tesla (NASDAQ:) Chief Executive Elon Musk over possible investment and cooperation in the electric vehicle sector. Musk’s SpaceX has also been authorized to operate as an internet provider in the country.

“As Mongolia has been a democracy and friend for more than three decades, the vice president and the prime minister will underscore the importance of strong democratic institutions and rule of law,” the U.S. official said on condition of anonymity.

The discussions would cover the countries’ economic and commercial relationship, future cooperation in outer space, addressing the climate crisis and a range of regional and global issues including China and Russia, the official added.

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