ULAN BATOR, Mongolia — As a basis for an international alliance, a common first letter might not seem as natural as a common language, religion, or geography. But Mongolia needs all the friends it can get.
After all, it's not easy being a landlocked country with global ambitions. This land of a -- widely spaced -- 2.8 million people is undergoing one of the world's great economic booms, recording annual double-digit growth rates over the last two years, thanks largely to a mining windfall.
As fine a circumstance as that may be, it crystallizes the fact that a single economic partner wields tremendous influence over domestic affairs. The Chinese dragon has coiled its tail around Mongolia, accounting for more than 80 percent of Mongolia's exports. Additionally, to the north is Russia, an old but complicated friend with motives of its own. Mongolia imports near all its oil and petroleum from Russia over a domestic railway network still controlled by the Federal Agency for Railway Transport in Moscow -- more than 3,000 miles away.
You can't blame Mongolia for looking farther afield. As the country begins to monetize the trillions of dollars in mineral wealth beneath its soil, the stakes have risen. How can Mongolia leverage the mineral boom while safeguarding against the undue influence of its hungry superpower neighbors? Mongolian leaders are fixated on the limits of their geographical position, China and Russia's stranglehold on trade, and a desire to make lasting economic strides.
Purevsuren Lundeg, the foreign-policy advisor to Mongolian President Tsakhiagiin Elbegdorj, was brooding over this displeasure one day last August when across his desk came a news release issued by Silk Road Management, an Ulan Bator-based investment company specializing in public equities, money markets, and bonds in out-of-the-way markets. The notice announced the creation of something called the M3 Fund, "the first ever investment fund to be focused on Myanmar, Mongolia and Mozambique, three resource-rich countries which we term as M3." The news release noted that the countries have more in common than the letter M. All three are undergoing post-socialist democratic reforms. Each is experiencing a natural resources boom that will extend for decades. And most importantly, each borders at least one of the BRICS countries (in the cases of Mongolia and Myanmar, two), which are hungry for control of these natural resources. Alisher Ali, Silk Road's managing partner, told me that he thinks, "All three nations will be among the top five fastest-growing economies in the next decade." Mongolia's superheated economy already ranks No. 4.
Purevsuren's interest was piqued. It was the first time he had thought of these three countries in a single grouping, and Mongolia is eager to form new political and economic alliances. "We want to have less dependence on our two neighbors," Purevsuren told me. Could Mongolia, Mozambique, and Myanmar cooperate to the benefit of each individual country, massaging diplomatic, social, and economic growing pains?
This was the beginning of Ulan Bator's attempts to form the M3 cluster, a fledgling political alliance. The goal, vaguely sketched, is to join these three countries in a loose confederation of information, exchange, and advice, with groupings such as the G-20 and the Arab League serving as models. Mongolia is attempting to construct a union of allies that can protect it against the ravenous economies of its BRICS neighbors. "We're looking at the similarities, to bring to the forefront what we have in common and coordinate common goals and interests," Purevsuren says. "This idea is brand-new. Mongolia is going to show leadership on this."