Return to Transcripts main page
Quest Means Business
Final Night In Ulaanbaatar; Biden Hosts Leaders Of Japan, South Korean And Camp David; South Korea, Japan And U.S. Discuss Economic Cooperation; Pushing Mongolian Aviation Into A New Era; Mongolia Supplies 40 Percent Of World's Cashmer. Aired 3-4p ET
Aired August 18, 2023 - 15:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:25]
RICHARD QUEST, CNN INTERNATIONAL HOST: We made it. We are outside at last. It's cold, it's chilly. I'll give you the temperature, but we are here once
again in Mongolia and under the night sky where we are QUEST MEANS BUSINESS coming to you from Ulaanbaatar.
The markets, have a look and see, they are trading. Flat is the way the Dow is moving at the moment. It is really doing almost nothing at all, bouncing
around the zero level. I'm not surprised.
It is late summer. There is a holiday weekend next weekend. This is what one would expect to see, but the Dow itself by the way, worst week since
March.
The events that we're looking at and we'll bring to your close attention.
The first ever trilateral Summit is taking place between the US, Japan and South Korea.
More military and intelligence cooperation is expected to be announced and we'll hear from the leaders in a press conference during the show.
From Mongolia to the US, direct and new open skies agreement. The MIAT chief executive, the airline is talking to us tonight about his plans.
And around 30 percent of the population here are still herders, nomads. Now, they have access to technology. How to balance traditional with
quality of life.
In Ulaanbaatar, it is already Friday -- it is Saturday, actually, but for you, it's Friday, it's August the 18th. I'm Richard Quest, this time change
difference, it is all very difficult, but even with that, I mean business.
Good evening.
It is our final day in Ulaanbaatar and we are glad to have you with us. It is 50 degrees Celsius, it's about nine or 10 degrees, so it is a little bit
cold outside, hence I've got the scarf on, and we bring you to an end a series of spectacular programs that we've got for you, exploring Mongolia's
culture tonight.
We'll be looking at that, and tourism as well, as well as looking at the challenges of corruption and governance and we will also tell you about
cashmere, which is very big here, one of their biggest exports and the throat singing. It's all to come.
First whilst we're in Mongolia, other Asian leaders are in Washington DC. The Japanese prime minister, Fumio Kishida, the South Korean president,
Yoon Suk Yeol and President Biden, they are all at Camp David, and they are hoping to usher in a new chapter.
They are set to speak during this hour at Camp David. It is the first trilateral summit. Japan and South Korea have a difficult history, of
course, putting that aside amid security challenges has been the goal of the meeting.
Ivan Watson is in Hong Kong and joins me.
Ivan, despite the difficult background. What is -- I mean, can we sum up the concern, the common challenge as China?
IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: It's one of them, certainly, and to underscore that, the Japanese Ministry of Defense
announced that it detected a flotilla of Chinese and Russian warships steaming in international waters to the southwest of Okinawa this week, and
expressed grave concern about that, said it was a show of force meant for Japan.
And that is the kind of thing the growing ties between Russia and China, even after Russia invaded Ukraine, these are some of the factors that have
contributed to South Korea and Japan, which both independently were very close US allies for generations to overcome their own historic grievances,
and to recognize that it's better to work together in a trilateral arrangement as the Americans have wanted for years than it is to kind of go
it alone, and that's what we're seeing happen right now.
Take a listen to what the Japanese prime minister had to say at the beginning of the meeting.
(BEGIN VIDEO CLIP)
FUMIO KISHIDA, JAPANESE PRIME MINISTER (through translator): President Yoon, I've been meeting you almost on a monthly basis since March of this
year. The fact that we, the three leaders have got together in this way, I believe, means that we are indeed making a new history.
(END VIDEO CLIP)
WATSON: But Richard, there is another factor here and some of this is personality driven.
[15:05:07]
The South Korean president, Yoon Suk Yeol, he has made a point of opening up to the Japanese, making compromises there to help this tightening of
relations work out. But, you know, the Japanese prime minister, latest polls show his government isn't particularly popular.
President Biden, the host of this meeting, he is having trouble in the polls and there are signs that the South Korean public, it still holds
grievances against Japan from decades of Japanese colonization, so there are questions, how do you make this last -- Richard.
QUEST: Right, but making it last, do they have an end goal? This idea of greater cooperation. But at the end of the day, the US has very strong
military obligations to both countries involved and I wonder what does the next iteration of a trilateral look like?
WATSON: That's what we're waiting to hear, and we have heard criticism of the growing ties here, coming of all places from Beijing, which has
frequently criticized what it describes as the establishment of clubs or cliques here in Asia, and that's the various alliances that the Biden
administration has worked on strengthening over the past couple of years.
"The Global Times" newspaper in China came out saying, going one step further, saying that they think that this trilateral arrangement is going
to be trying to set up some kind of new NATO in Asia.
I don't think we're going to hear about these three governments going that far, but certainly, developments and intelligence sharing among the three
powers and that could be very helpful given the fact that North Korea tends to fire rockets and missiles that threaten all three countries, almost on a
weekly basis.
QUEST: Ivan Watson in Hong Kong, when we hear what they have to say, we'll be back with you to help us understand that press conference, thank
you.
Here in Mongolia, the government has been beset by concerns about internal policies, particularly as it relates to corruption. Corruption issues are
very high on the agenda and will be in next year's election.
According to Transparency International's index, Mongolia ranks 116 out of 180 countries. There have been several scandals, one of which was the abuse
of an educational loan fund where most of the money seems to go to the elites, and missing export revenue from coal, which led to these
demonstrations on the streets of the capital, Ulaanbaatar.
With me is Munkhsoyol Baatarjav, is a member of the opposition HUN Party, working to fight corruption.
Thank you for joining us.
MUNKHSOYOL BAATARJAV, MEMBER, HUN PARTY: Thank you for inviting.
QUEST: The government have said to us, and we've heard on this program is that corruption -- fighting corruption is a key policy, but you think
they're not going far enough?
BAATARJAV: Yes. Not only me, not only our party, everybody. The public itself is not satisfied with the procedures and actions, which are taken by
the government and the Parliament currently because, you know, just recently the prime minister just announced it to fight the corruption for
coming year, but nothing happening in practical life. That's the point.
QUEST: So, we are expecting the US president to speak, so forgive me if I interrupt you when it happens.
BAATARJAV: Sure. Sure.
QUEST: But what would you like to see them do?
BAATARJAV: Yes. Just for example, as you said, the latest scandal on corruption is that exporting of coal and missing the amount of the money
and then people are demanding too high penalty for the involved, for example, politicians. But there is nothing happening, so at least, they
have to organize public hearings.
QUEST: Are you going to fight the next election? Which is next year on this issue?
BAATARJAV: Yes, yes. That's what will be one of our main agenda, and then, hopefully, the next election is the very important one, to fix this
problem.
QUEST: Okay. Under the new Constitution, it is very likely that there could be a coalition government.
BAATARJAV: Yes.
QUEST: Would you go into coalition to keep with the existing government? If the existing government turned to you and said, We'll do what you say,
come into coalition with us. We will be together in part, would you do it?
BAATARJAV: Yes. We never say never, so we would say maybe yes --
QUEST: So you would --
BAATARJAV: To fix this problem as well as to solve other main challenges.
[15:10:04]
QUEST: Last night, the speaker of the Parliament described -- talked about the importance of the democracy here, saying it was fragile, but it
was still robust. People -- this is what people wanted.
BAATARJAV: Mongolian society -- the people of Mongolia, they value the opposite and human rights and all those personal and property freedom --
rights and freedom.
So in order to keep our democracy, we shall have very good quality parliament, but in order to have very -- you know, quality of
parliamentary, elections should be fair enough, but if there is a corruption this high in this country, we cannot say we have very fair and
free election. That's the main point as well.
So hopefully, the public understood this current situation and then --
QUEST: But I think what I find encouraging is that at least the debate is taking place, at least people like you, can come on us and speak elsewhere
quite openly about this issue.
BAATARJAV: Yes, this is -- we need to have freedom of speech and freedom of express our opinion, but we need to have real practical actions that is,
you know, lacking in this country and we really need to see the results because we talk a lot, especially the politicians, newly elected members of
Parliament and prime ministers and presidents. They always committed promises --
QUEST: But you're a politician.
BAATARJAV: Promise, but never happens.
QUEST: You're a politician.
BAATARJAV: Yes. So we just demanded to have more actions and then to implement whatever they promise and whatever -- they should enforce the
existing legislations, and then, you know, not only foreign investors are not investing in Mongolia, also lot of investors are not investing in this
market due to this lack of confidence of not fighting with corruption -- against corruption.
QUEST: I'm very grateful for you for coming in. Thank you so much.
BAATARJAV: Thank you very much.
QUEST: Particularly, I need to make clear. It is freezing, well, it is not freezing, but it is cold.
BAATARJAV: Yes, it is cold.
QUEST: It's cold.
BAATARJAV: But I am Mongolian, so it is okay for me. I am used to it.
QUEST: You're used to cold weather.
BAATARJAV: Yes.
QUEST: Thank you very much indeed.
We are still waiting for the press conference, which is due to take place with the three leaders, the South Korean president, the Japanese prime
minister, and the US President. That's the scene at Camp David at the moment.
We were on a so-called two minute warning. That was about four minutes ago, which means it's going to happen anytime soon.
We will take a short break, of course, Sod's Law is as soon as we go to a break that this will take place, but don't worry, as soon as it takes
place, we will be there.
QUEST MEANS BUSINESS.
(COMMERCIAL BREAK)
QUEST: To Camp David immediately, where President Biden and the leaders of South Korea and Japan are about to give the results of their first
trilateral meeting.
JOE BIDEN, PRESIDENT OF THE UNITED STATES: Good afternoon, everyone, and welcome to Camp David.
If I seem like I'm happy, it's because I am.
(LAUGHTER)
BIDEN: This has been a great, great meeting.
Mr. President, Mr. Prime Minister, I -- we meet in this historic place to make a historic moment, and I believe that to be true. The -- this is a new
era in partnership between Japan, the Republic of Korea, and the United States -- our new Camp David trilat. That's what we have here.
[15:15:10]
And -- but before we dive into the progress we've made today -- if you excuse, we used to say in the Senate, "a point of personal privilege" -- I
want to start by expressing my appreciation for the contribution that your countries have made toward the relief following the devastating wildfires
in Hawaii. I want to thank you both on behalf of the American people.
I also want to note that my team is closely monitoring Hurricane Hilary, which is -- has the potential to bring significant rain and flooding to
southern California. FEMA has pre-positioned personnel and supplies in the region, and they're ready to respond as needed. I urge everyone -- everyone
in the path of this storm to take precautions and listen to the guidance from state and local officials.
And you've heard me say it before: The Republic of Korea and Japan are capable and indispensable allies.
Now, to the purpose of why we're here.
America's commitment to both countries is ironclad, and my personal commitment to bringing these three nations together was real from the very
beginning.
Since last summer, we've met on the margins of the NATO Summit in Spain, the ASEAN Summit in Cambodia, and the G7 Summit in Japan. Today, we've made
history with the first-ever standalone Summit between the leaders of our three countries, as well as our commitment to meet together on the leader
level annually and to have all of our relative Cabinet-member people meet on a regular basis for -- from this point on; not just this year, not next
year -- forever. That's the -- that's the intention.
And so, I want to recognize the important work that both of you have done and the political courage -- and I mean this sincerely -- the political
courage that you've both demonstrated to resolve difficult issues that would've stood in the way for a long time of a close relationship between
Japan and Korea and with the United States.
Your leadership, with the full support of the United States, has brought us here, because each of you understands that our world stands at an
inflection point -- a point where we're called to lead in new ways: to work together, to stand together. And today, I'm proud to say our nations are
answering that call.
First, we're elevating our trilateral defense collaboration to deliver in the Indo-Pacific region. That includes launching annual multidomain
military exercises, bringing our trilateral defense cooperation to an unprecedented levels.
We're doubling down on information sharing, including on the DPRK's missile launches and cyber activities, strengthening our ballistic missile defense
cooperation.
And, critically -- critically, we've all committed to swiftly consult with each other in response to threats to any one of our countries from whatever
source it occurs. That means we'll have a hotline to share information and coordinate our responses whenever there is a crisis in the region or
affecting any one of our countries.
And today, we've reaffirmed -- all reaffirmed our shared commitment to maintaining peace and stability in the Taiwan Strait and addressing
economic coercion.
We're going to continue to counter threats from the DPRK, including cryptocurrency money laundering to the tune of billions of dollars;
potential arms transfer in support of Russia's brutal war against Ukraine.
And together -- together, we're going to stand up for international law, freedom of navigation, and the peaceful resolution of disputes in the South
China Sea.
Second, we're expanding our economic cooperation to build an Indo-Pacific that is peaceful and prosperous.
Today, we've committed to launch a new -- what we call a "Supply Chain Early Warning System" -- excuse me, a Supply Chain Early Warning System
Pilot and -- which it will alert our nations to disruptions of certain products and materials, like critical minerals or batteries, so we can get
ahead of the issues as they appear with the experience -- that we've experienced in -- during the pandemic.
Excuse me, this is falling off. There you go.
And -- and building on the G7-led Partnership for Global Infrastructure and Investment, we're deepening cooperation between our development finance
institutions to mobilize more financing for quality infrastructure and secure communications technology to help low-income and middle-income
countries throughout the region take on the challenges that matter most to their people.
[15:20:11]
And finally, our partnership is about building a better future for our people. That's why we're deepening our cooperation on global health and
launching a trilateral expert exchange in support of the US Cancer Moonshot initiative. That's going to, I believe, change cancer as we know it.
It matters a great deal to me and to families all across our three countries. In the United States, we are revolutionizing the way we do
cancer research. And together, the three of us, I am confident we can harness our shared spirit of innovation and end cancer as we know it.
We're also launching a new collaboration between our National Laboratories and advance our science knowledge and technological capabilities together.
As we do, we'll work in lockstep to set the standards for safe, secure, and trustworthy emerging technology, including artificial intelligence, which a
lot of work has to be done on.
Let me close with this. Mr. President, Mr. Prime Minister, this is the first Summit I've hosted at Camp David as president. I can think of no more
fitting location to begin the next era -- our next era of cooperation -- a place that has long symbolized the power of new beginnings and new
possibilities.
In the months and years ahead, we're going to continue to seize those possibilities together -- unwavering in our unity and unmatched in our
resolve. This is not about a day, a week, or month. This is about decades and decades of relationships that we're building.
Mr. Prime Minister and Mr. President, I want to thank you for your leader, and I -- leadership -- and I say it again -- for your courage that brought
us together and I look forward to working with you both of you ahead.
Now I yield to -- who am I yielding to?
MODERATOR: Distinguished guests .
BIDEN: There you go.
MODERATOR: . the President of the Republic of Korea.
BIDEN: We needed the voice of God to tell us that.
(LAUGHTER)
YOON SUK YEOL, SOUTH KOREAN PRESIDENT (through translator): First of all, I'd like to thank President Biden for his warm hospitality. It is a great
pleasure to visit Camp David along with Prime Minister Kishida.
Camp David is a site that bears historical significance where important diplomatic decisions were made at critical junctures of modern history.
In order to respond to today's unprecedented poly-crises, the ties between our three countries, which are the most advanced liberal democracies in the
region and major economies leading advanced technology and scientific innovation, are more important than ever.
From this moment on, Camp David will be remembered as a historic place where the Republic of Korea, the United States, and Japan proclaimed that
we will bolster the rules-based international order and play key roles to enhance regional security and prosperity based on our shared values of
freedom, human rights, and rule of law.
Today, we, the three leaders, held the very first standalone trilateral Summit marking a new chapter in our trilateral cooperation. Today, we have
agreed on the Camp David principles that will function as the enduring guidelines for our trilateral cooperation. In addition, we have developed
the Spirit of Camp David, which is a document embodying the vision of our trilateral cooperation and ways to translate our will to cooperate into
action.
First of all, to facilitate the stable development of our trilateral cooperation, we have built the institutional basis for the trilateral
cooperation at multiple levels and sectors.
In addition to making our trilateral summit regular, we have agreed to have our governments' personnel at all levels -- including foreign ministers,
defense ministers, and national security advisors -- meet every year to closely coordinate our trilateral cooperation.
In particular, we, the three leaders, have agreed to establish a communication channel so we can swiftly coordinate and respond together in
case an urgent issue occurs in the region.
Furthermore, to bolster our trilateral strategic cooperation in the Indo- Pacific, our three countries will establish the ROK, US, Japan Indo-Pacific dialogue, which will discover new areas of cooperation.
Also, along with the economic security dialogue led by our three countries' NSCs, we have agreed to found a consultative body for development policy
coordination and also build cooperation frameworks in various sectors including global health and women empowerment.
[15:25:15]
We have also decided to hold our ROK, US, and Japan Global Leadership Youth Summit to strengthen ties between our future generations.
Second, we have agreed to step up our security cooperation to ensure our people's safety and peace in the region based on the now institutionalized
Cooperation Framework.
First of all, to this end, we have consulted on practical ways to cooperate, aimed at improving our joint response capabilities to North
Korea's nuclear and missile threats, which have become sophisticated more than ever.
The real-time sharing of DPRK missile warning data, which was agreed upon during the Phnom Penh Summit last November, will be activated within this
year, and this will make a significant progress in strengthening our three nations' capabilities to detect and track North Korea's missiles.
In countering the DPRK's nuclear and missile threats, we concurred the trilateral defense exercises were crucial. As such, annual plans will be
established for the ROK, US, Japan drills we committed to.
In the meantime, as North Korea funds its nuclear and missile programs by exploiting labor and human rights, efforts to monitor and stem such
activities will be redoubled. To deter the DPRK's illicit funding activities, a new trilateral working group on DPRK cyber activities will be
established.
Moreover, Korea, the US, and Japan, in their pursuit of Indo-Pacific strategies, oppose any unilateral attempts to change the status quo by
force.
Respect for sovereignty, territorial integrity, the peaceful settlement of disputes, among others, undergird a rules-based international order that we
resolve to safeguard by intensifying our collaboration.
As part of such endeavors, our three nations agreed to support ASEAN and Pacific Island countries with their maritime security capacity-building
efforts.
Furthermore, to help Ukrainians regain freedom and pursue reconstruction, we are determined to increase our three-way coordination.
Next, we, the three leaders, discussed how to work together to promote shared prosperity and future growth. First of all, in the field of economic
security directly linked to our national economies of the three countries, we will work to expand our strategic partnership.
To ensure global supply chain resilience and energy security, we pledged to bolster our trilateral cooperation. To manage global supply chain risks, an
early warning system will be established together.
In addition, we decided to broaden our collaboration in the field of cutting-edge technologies to secure future growth engines. Specifically, in
AI, quantum, bio, and next-generation telecommunications and space sectors, cooperation among our three countries will deliver powerful synergies.
Korea, the US, and Japan committed to have their national laboratories expand joint R&D and personnel exchanges, providing a cornerstone for the
three countries' leadership in science and technology innovation.
Moreover, for the sake of shared prosperity in the Asia Pacific, in line with the needs of ASEAN and Pacific Island countries, effective support
measures will be sought and implemented collectively.
Today, we, the three leaders, affirmed our commitment to the trilateral partnership towards a new era and possibilities thereof.
Grounded in the core values of freedom, human rights, and the rule of law, a strong alliance of values among Korea, the US, and Japan will help build
a world that's more peaceful and prosperous by serving as a sturdy foundation.
Mr. President, I thank you once again for your hospitality. Next time, I hope that we will be reunited in the Republic of Korea.
Thank you.
(APPLAUSE.)
MODERATOR: Distinguished guests, the Prime Minister of Japan.
BIDEN: President.
KISHIDA (through translator): Thank you. First of all, in Maui, Hawaii, wildfires caused devastating damage. I express my sympathy, and I really
pray for the peace of those who have lost their lives in order to offer support, a total of $2 million worth of support by our country has been
decided. And the -- for the relief for the affected people. And for the earliest recovery of the affected areas Japan will proactively do our
contribution.
Today, I have visited Camp David and the three of us have spent a truly meaningful time. I express my heartfelt gratitude to Joe for the kind
invitation. Together with Joe and President Yoon, this has been a precious opportunity for myself to further deepen the relationship of trust and
confidence for the first time ever instead of -- in the sidelines of multilateral conferences that we have held the trilateral summit on a
standalone basis.
Here at Camp David, numerous historical meetings have taken place. And it is a huge honor to have printed a fresh page in its history with this
meeting. The foundation of the trilateral collaboration are the solid, firm, bilateral relationships. The three of us have understood this more
than anyone else and have executed our understanding in practice. January - - in January this year, I visited the United States and later President Yoon visited Japan in March.
And then to the U.S. in April. And in May, I, myself travel to South Korea, and we have bolstered mutual relationship at the moment that a free and
open international order based on the rule of law is in crisis. Due to Russia's aggression of Ukraine, the international order is shaken from its
foundation. The unilateral attempt to change the status quo by force in the East and South China Seas are continuing and the nuclear and missile
threats of North Korea is only becoming ever larger under such circumstances to make other trilateral strategic collaboration a blossom
and bloom is only logical and almost inevitable and is required in this era.
The three of us here today declare our determination to pioneer with a new area of Japan, U.S. ROK partnership. How we will advance further
cooperation of our three countries going forward, I will discuss from three perspectives. Firstly, the coordination between the Japan, U.S. and the
U.S.-ROK alliances will be reinforced and trilateral security cooperation will be brought to a new height.
At this meeting, we agreed to hold the Japan, U.S. ROK multi-domain joint exercises on an annual basis. Furthermore, regarding the real-time sharing
of North Korea's missile warning information that we agreed last November, the initial steps have been implemented and an important first step has
been advised towards the launch of the mechanism by the end of the year.
We also agreed on the establishment of the working group on North Korea cyber activities considered to be the source of finance for nuclear and
missile development and on other matters.
The second point is the promotion of cooperation between the United States, Japan and South Korea and the expansion of their areas of cooperation.
Regarding The response to North Korea in addition to strengthening regional deterrence and response capabilities, the three countries agreed to
strengthen cooperation for the full implementation of sanctions and to work closely together in the U.N. Security Council where all three countries
will be members in 2024.
[15:35:30]
At the same time, we shared our recognition that the way is open for dialogue with North Korea. I then stated that the abduction issue is a
humanitarian issue with time constraints, and once again received the strong support of Joe and President Yoon for the immediate resolution of
this matter. We also agree to work together through the Indo-Pacific dialogue and the development and cooperation to realize a free and open
Indo-Pacific.
And in particular, to coordinate capacity building support in the domain of maritime security, particularly with regard to ASEAN and Pacific Island
countries. Furthermore, we agree to promote cooperation in the field of economic security, including critical and emerging technologies and supply
chain resilience. Third, developing a framework for trilateral cooperation.
This will create a foundation for continuous and stable enhancement of coordination among the three countries. After confirming that the three
countries will promote multi-layered cooperation at all levels, it was agreed that the trilateral summit meeting will be held at least once a
year.
And likewise, the ministers of foreign affairs, defense and national security advisors will each also meet at least once a year. And the
financial minister and the financial minister as well as the industry and commerce ministers will be meeting. We will consider the Camp David
principles issue today at a historic turning point for the international community to be a new compass for trilateral cooperation and will -- we
will vigorously implement the concrete cooperation.
QUEST: And there we are just going to pause away from the press conference of the three. The three leaders are basically giving their own
interpretation, but essentially repeating each other's -- the facts of what's been agreed, which is that the U.S., Japan and South Korea will meet
every year at various ministerial levels. And that summit level as they deepen their cooperation across a range of issues from commerce, trade,
military intelligence and the like.
And the significance perhaps of what we are seeing today is not the minutia and the detail of who's going where, when and what. But the fact that the
three of them -- and there's the handshake, the three of them were able to come together and make that agreement in the first place bearing in mind
some of the regional differences between them. This is a -- if you will, this is a cake where the ingredients have been mixed and now it has to
bake. We will take a break and after the break, more Mongolia.
(COMMERCIAL BREAK)
[15:41:49]
QUEST: Welcome back. Quest Means Mongolia when oil and butter this evening. The national airline of Mongolia, MIAT Mongolian Airlines is launching or
hopes to launch next year direct flights from here to the United States. On the back of the agreement, the open skies deal that was done during the
recent visit. Now it's likely to fly to the West Coast. San Francisco is possible but I think also Seattle is highly likely, if a deal was to be
done with one of our major carriers there.
It will use new 787 Dreamliners which the airline has just obtained and it will still have to get approval of course, from the authorities, the FAA.
The Open Skies Agreement was put together between the vice president of the U.S. Kamala Harris and the prime minister of Mongolia who met last month.
After -- also in the country was the Mongolian CEO. I spoke to the Chief Executive of MIAT Airlines.
And it was interesting because we needed to discuss the positioning of the airline in the region.
(BEGIN VIDEOTAPE)
MUNKHTAMIR BATBAYAR, CHIEF EXECUTIVE OFFICER, MIAT AIRLINES: Having a landlocked country, and we have a unique position represented the Mongolia
is bordered between the China and Russia. So, we have a very important role to, you know, play in the ongoing diplomacy all over the world.
QUEST: Except, as we know, aviation requires -- it's very expensive.
BATBAYAR: And it requires size. It requires scale. And that you don't have.
BATBAYAR: Well, I mean, comparing to the global airlines we are quite small. But in the other hand in Mongolia, we are the only national career
that is the member of IATA and we have been outed to (INAUDIBLE) and also authored in the air (INAUDIBLE) operation. We also have the maintenance
organization.
QUEST: Where are you going to grow? How are you going to grow?
BATBAYAR: Mongolia has only 3.3 million people which is, you know, very limited markets that we have been competing around the world. So, all the
key strategic for us to expand our network by having a partnership with the different airlines to make that connectivity around the world.
QUEST: You can end up with 1001 bilateral relations point to point.
BATBAYAR: Point to point, yes.
QUEST: And that will just get you point to point traffic.
BATBAYAR: Right.
QUEST: But you really want to get the beyond.
BATBAYAR: Beyond Go ships. Yes. It's what we are looking to have.
QUEST: And at some point, do you have to choose a preferred partner?
BATBAYAR: Well -- I mean, it's really hard to say that having a preferred partner will definitely depending on how they go into to really dependent
from airlines. But having a difficulty for us being in a landlocked country and trying to expand our network with the limited resources, I said, you
know, it would be much easier for us to have a various number of partnerships with the different airlines instead of having a preferred one.
[15:45:12]
QUEST: Would an alliance give you that range of code shares and beyond?
BATBAYAR: We are pursuing -- we are actively pursuing to get into the Oneworld Connect Program, which is the -- not actually lines but it is the
Connect Program where, you know, our -- one of those two main partnerships win which is one of the Qatar Pacific and Japan Airlines.
QUEST: So, you have nailed your colors. I mean, you know, you've nailed your colors to the mast. And I agree it's not mutually exclusive.
BATBAYAR: Of course.
QUEST: You can still do bilaterals with Turkish and whatever. But if you're going for Oneworld Connect, you're going to the Oneworld Alliance. Is there
a risk that you're going to try and dance with everybody?
BATBAYAR: I don't think so. Because, you know, just to give you example, you know, our neighbor, Russia has some conflict with Ukraine, the military
conflict with Ukraine, starting from last year since, you know, we are landlocked. We were supposed to fly with the Russia to get into the Europe.
But unfortunately, you know, our reinsurance is stuck with the coverage because of the conflict, fighting over, fighting with Russia.
But we do have a unique position between China and Russia, where we have a really strategic and friend in a partnership with them. But there is no way
out of that because it's our position. So, I think on the other hand, different airlines such as you know, Turkish, the big huge player of star
membership as understanding of how we are, where we are. I think that's the one of the key and we will definitely not to lose the partnership with
them.
QUEST: I feel that I'm listening to the airline equivalent of the national strategy of friends to everybody and the third neighbor.
BATBAYAR: Definitely yes. Definitely agree to like Mongolia is landlocked. We are greatly friend with our two neighbors. That's our unit position. And
as it stayed it is a Mongolia. I don't -- I'm not in the position to answer that actually. But in my opinion, personally, I think it will be friendly
with the alternatives. Because that's the diplomacy we have.
(END VIDEOTAPE)
QUEST: So you got the planes. You need the tourists now, we're going to fill them and come to Mongolia and that is now part of the government's
2050 strategy. Reviving tourism and growing it -- not only of course, from China, which is next door, but from highest spending elsewhere, the West.
But the numbers are very low in a sense. Last year, roughly 200 and 300,000 visitors half the pre pandemic.
But the country is now investing big to attract visitors. The new airport, which is actually excellent cost $650 million. There is a new museum
covering 2000 years of Mongolian history. Visa-free travel is available for many countries, and there will be direct flights that we've spoken about.
Damba Gantumur is the president of the Mongolian Tourism Association. Good evening, sir. Thank you.
DAMBA GANTUMUR, PRESIDENT, MONGOLIAN TOURISM ASSOCIATION: Thank you very much. Good evening.
QUEST: The reality is everybody wants more tourists. You are lucky in one sense since that you can build a tourism industry pretty much from scratch.
GANTUMUR: Correct. In tourism, we are always thinking about quality and quantity. In terms of Dubai, number of the tourists, for sure. It has to be
support the -- in general infrastructure and amenities for receiving the qualified tourists. But on the other hand, we are looking forward our
quality tourism is based on our own identity experience.
QUEST: All right. Define quality tourism, because this usually means high- spending Western tourists.
GANTUMUR: High-end tourists. Correct.
QUEST: High-end tourists.
GANTUMUR: Yes. But the high-end tourists has to be not all the based on the others. So it has to be mixture of the market segments.
QUEST: Right. So you end up with some gap students because when they get richer later, they'll come back again. That's a strategy that's worked
elsewhere, but you need airlift to start with.
GANTUMUR: Sure.
QUEST: You need another -- not another carrier, but you need your existing carrier to increase its range and deals. You need hotels, you need
infrastructure. Can you do that sustainably?
[15:50:03]
GANTUMUR: Yes. The key point is sustainability lift up all this of the needs, so the Mongolia, everybody knows by the main sources from the mining
industry. So, it's also -- tourism is seeing diversifying economy in terms of the contributed by the mining industry and other agricultures. And also,
we have to be special lending program, for example, Mongolian President is announcing to establish new capital city based on the -- our traditional
curriculum area. That would be also one of the strategies.
QUEST: The fear is, and I've seen it happen in other developing countries, the rush to tourism means that planning permissions get ignored, sewerage,
just build it, put the thing up. And don't worry about it. I've seen it in other countries again, and again and again.
GANTUMUR: That's true. And actually, the sustainability for the tourism development requires democratic good governance. If you're going to -- be
able to build a politically economically friendly environment, I am sure for this the market what reach into Mongolia is there.
QUEST: Look, if you want to increase your tourists, it's really pretty straightforward. You've got China next door, lower the entry. Basically,
you could have large numbers of Chinese tourists, on tour buses going round. And you get your numbers.
GANTUMUR: Yes. Well, this is with this some regulatory options. What we have is not only the visa free for all of the countries, but also current
capacity by the number of the destinations.
QUEST: Give me the top three things that a visitor needs to do.
GANTUMUR: Amenity, amenities share resists.
QUEST: No, no, if I'm -- if I'm visiting -- if I'm visiting Mongolia, what are the three places I must go to? What are the three things I must see?
GANTUMUR: You have to go up to the (INAUDIBLE) the Karakoram. And should traveled Mongolia and West Mongolia where the nomads are living together
with wildlife. And of course, the GOBI is one of the biggest brand of Mongolia, not all the tourism and other industries, cashmere, et cetera.
QUEST: Cashmere.
GANTUMUR: Yes, sure. This is a come from the goat and camel. So that's the landscape place of the GOBI Desert.
QUEST: I'm being slightly disingenuous here, because we're going to be talking about Cashmere in just a minute. The significance, it's as if
Mongolia has now said we recognize the tourism importance. Would you agree?
GANTUMUR: It is hoping to recognize it by the -- our own identity. That's the main advantage for the tourism.
QUEST: Sir, it's been lovely to have you with us. Thank you very much indeed.
GANTUMUR: Thank you very much.
QUEST: Your industry will grow. I've no doubt that the tourism industry --
GANTUMUR: It is welcome to Mongolia.
QUEST: And in many cases, actually, in many case, the message has to be come here before it's too late. And everyone else gets it. Good to see you,
sir. Thank you very much.
GANTUMUR: Thank you. Thank you.
QUEST: As we continue, we just talked about Cashmere in just a second. We just mentioned Cashmere which is a specialty here in Mongolia. In fact,
this rather find scarf is a good example of it keeping me warm. We have the CEO of GOBI Cashmere who will be with me in a moment. And another big part
of Mongolian culture is throat singing. Tonight, we have a famous performer who joins us next to show us the art, the beauty, the delight of throat
singing. Here's the taste.
(BEGIN VIDEO CLIP)
(END VIDEO CLIP)
(COMMERCIAL BREAK)
[15:56:47]
QUEST: Mongolia, we're just talking about the cashmere production. 40 percent. 40 percent of the world's supply, cashmere, all comes from this
country. It's one of the country's top exports. If you look at it, it's 10,000 metric tons of the stuff in 2021. Now it's interesting because if
you're looking at value chain, it's well behind obviously mining, but the global demand is expected to rise and it's going to continue to.
So cashmere could be worth more than $4 billion. The chief grand strategy officer of GOBI Cashmere, Amarsaikhan -- I'm not even going to try because
-- you'll forgive me, sir, is with me. GOBI Cashmere is one of the major retailers and manufacturers here. In fact, one of the scarves. This
cashmere, I've always heard it being very fragile and it will last. Is that true?
AMARSAIKHAN BAATARSAIKHAN, CHIEF GROWTH AND STRATEGY OFFICER, GOBI CASHMERE: No, I think that is one of the most -- biggest misconceptions of
cashmere is that though cashmere may be difficult to take care of with proper education on how the cashmere is actually made with proper
information. I think cashmere over the next few years will be something that worldwide people have access to, in terms of use as well as to take
care of.
QUEST: Right. Now the stuff that you had and I visited your store earlier, the stuff that you have here in the country, how much of it is sold
locally? Where do you see your growth market in terms of exports?
BAATARSAIKHAN: That's a very good question. Mongolia, as mentioned, has had access to cashmere over the last hundreds of years. And that is why we see
that it's very important for us to share this resource to the rest of the world, that we don't want this to be -- cashmere to be local and for people
to come to Mongolia to have access to it, which is why we as a country as a company, GOBI is going global to make sure more people -- more and more
people have access to cashmere every day no matter where they are in the world.
QUEST: Now -- but can -- is it a sort of export you can put on a plane or does it have to go out to China?
BAATARSAIKHAN: No, it can absolutely whatever transportation method we have, whether it's flew cargo or whether it's through a truck to the rest
of the world, mainly to Europe, North America as well, as well as other parts of Asia.
QUEST: The designer -- this is a rather splendid piece by the way. I didn't see that. And the -- who's buying it? Who's your main customer? Is it
tourists? Is it locals? Is it people here? Who actually is buying all this stuff?
BAATARSAIKHAN: It's 50/50. So, yearly on average we -- 50 percent is bought locally and 50 percent apart from COVID times are bought by tourists.
QUEST: Right. And the growth I presume was of course on both sides of that scale. What are the products could you do with cashmere?
BAATARSAIKHAN: Cashmere similar to other textiles such as cotton, silk, is very open to a variety of different product which is why in Mongolia and
for our company we're able to manufacture everything from sweaters to suits to coats to -- as you can see here, shawls to even today, cashmere sneakers
and shoes.
[16:00:12]
QUEST: Yes. I saw those. I was a bit worried about those. Well, because if the rain comes in, what happens then?
BAATARSAIKHAN: Well, you just have to make sure you take good care of it. I think similarly to sneaker cultures, you want to make sure that you don't
want --
QUEST: Sneaker culture. What is sneaker culture?
BAATARSAIKHAN: I think we all have an appreciation for our clothes and for everything that we put on our body because that is a representation of us.
And similar to that extent, you would care for yourself to the extent that you would care for your cashmere.
QUEST: That's very kind of you -- very kind of you for joining me, sir. Grateful to you. Thank you very much.
BAATARSAIKHAN: Pleasure.
QUEST: I have to say it is very warm. But now I've just got to make sure I look after it properly (INAUDIBLE) before anybody asks, paid the price
before anybody -- I can -- thank you very much. Good to see you, sir. Cashmere is part of the culture here. Along with the nomadic lifestyle in a
country with rich history, great efforts been made to maintain the culture whilst adapting to modern ways of life.
After all, why should only some of us have the benefits of technology? But if you put it all together, you have to question whether cultural nomadic
life can survive in this country. So, I went off to visit the nomadic festival which celebrates that way of life, including solar panels for
cellphones.
(BEGIN VIDEOTAPE)
QUEST: How much of all of this is real, and how much of it is traditional? And how many people actually live this sort of life today?
NOMIN CHINBAT, MONGOLIAN CULTURE MINISTER: Mongolia has this incredibly rich culture, heritage. That's our pastry. So, you eat the pastry with the
urum, which is clotted cream.
QUEST: Oh.
CHINBAT: Try it. It's an incredible, it's fresh and new. They do it every day in the morning.
QUEST: Hmm.
CHINBAT: That's good, right?
QUEST: Of course, you can have a group of people that will do traditional dancing. And this is how they used to do this, that and the other. But how
do you actually preserve a way of life, which is contrary to sort of modern way of life?
CHINBAT: Of course, it's a challenge for us, not just for Mongolia for the world. However, no matter cultural festivals like, this is really to show
our culture to the world and share the culture to the world. That in return, preserve and protect our culture. But when it comes to cultural
life itself, we always had the nomadic lifestyle, ourselves. And then it's part of our life today. It's a living tradition that is going on and I
think it will continue to go on along generations to go.
QUEST: I was looking at the herdsman and they're doing all the traditional ceremonies of handling the cheese and tasting the milk and then outcomes
the phone because obviously, they're still living a modern life. But how long can that sort of way of life moving 100 kilometers four times a year,
putting up a ger, taking down a ger. When there are modern agricultural ways of livestock and things that eventually will overtake it.
CHINBAT: I think as long as we are trying to preserve it, and then trying to make sure that we promote that culture, it will continue going on. I
understand there is a challenges of modern world and the fact that the new technology will make other people life easier. But if we bring those
technology to them and then being able to live comfortably where they are, and then being able to raise the herd the way they are, I think they'd be
able to continue live their life as it was before.
So, they're making felt. The felt we use for our gers. So this is actually making it more tougher. Do you want to try it? So, it's flattening the
wall.
QUEST: Yes.
CHINBAT: And then its' a process of doing the felt itself.
QUEST: How many people are still doing this?
CHINBAT: Oh, we still have heard their families do this. This is how you build the culture. How You build your community.
(END VIDEOTAPE)
[16:05:33]
QUEST: The nomadic lifestyle and the cultural ways of the country. One of the most important aspects and you heard some of it in that report, but
it's true throat singing, which is very big here in Mongolia. And there's no bigger star in that than Batzorig Vaanchig. His YouTube videos have
gained tens of millions of views. He's toured North America and he's performed at the U.N. headquarters.
I am delighted that he is joining us here tonight to give us an example of his singing, his artistry. And so, it's my great pleasure. Batzorig
Vaanchig is here to perform. Sir?
(COMMERCIAL BREAK)
[16:11:09]
QUEST: Tonight's profitable moment from Ulaanbaatar. Now, it's been a real treat and a privilege to be here. And tonight, of course, normally, we will
be doing summer Fridays elsewhere. But it's a nice summer Friday to be doing it from Mongolia. And the truth is that what we've seen and what
we've hoped to bring to you, is not only the difficulties that this country faces being sandwiched between the bear and the dragon.
You've heard us say that a million times tonight, but also the great opportunities that is here. The Democrat -- the Democratic ways the
institutions, the way of life, the culture, all of which are being preserved and being preserved well. The issue, of course, is what comes
next. Because as the geopolitical situation worsens, and Mongolia starts to feel the pressure. How far can this country turn to its third neighbors for
support?
What will it look like for Mongolia, if they actually manage to pull this off? For the time being though, it's been a real treat and a pleasure to be
here. And that's QUEST MEANS BUSINESS for this Friday night. I'm Richard Quest in Ulaanbaatar. Whatever you're up to in the hours ahead, I hope it's
profitable. I'll be back in New York with you on Monday.
(COMMERCIAL BREAK)
END
