May 24, 2009 / 6:14 AM / 10 years ago

UPDATE 2-Polls close in Mongolia with mining wealth in sight

* Country hopes to avoid unrest following polls

* Smooth elections important to quick approval of mine deal

* Voters hope for way out of poverty and better education

By Jason Subler

ULAN BATOR, May 24 (Reuters) - Mongolians voted on Sunday in a presidential election they hope will bring the stability needed to allow the country to tap more of its vast mineral wealth.

Polls closed at 10 p.m. (1400 GMT), but a result in the tight race between incumbent Nambariin Enkhbayar of the ruling Mongolian People’s Revolutionary Party (MPRP) and opposition Democratic Party (DP) candidate Tsakhiagiin Elbegdorj is unlikely until early on Monday at the soonest.

The young democracy is hoping to avoid a repeat of the rioting that followed last year’s disputed parliamentary elections, which killed five and paralysed policymaking for weeks.

Any such outcome could further postpone approval of a draft investment agreement on developing the pivotal Oyu Tolgoi copper and gold project, hampering the government’s efforts to use its deposits of copper, gold, uranium, lead, zinc, and coal to help pull its nearly 3 million people out of poverty.

The General Election Committee, hoping to avoid unrest, urged the media not to report unconfirmed allegations of fraud.

“The media and television are showing comments from ordinary people and there are many different things being said about fraud and cheating, information that is not confirmed,” committee head Namsraijaviin Luvsanjav told a news briefing.

Nearly 65 percent of registered voters had cast their ballots by 9 p.m., the committee said, suggesting turnout could be significantly lower than the roughly 80 percent in past polls.

Mongolia, wedged between Russia and China, has been hit hard by falling mineral prices. The election pits Enkhbayar’s pledge to beef up the rule of law against Elbegdorj’s promises of change and fighting corruption.

A win by Elbegdorj could complicate policymaking on mining, given his track record of anti-foreign and populist inclinations, analysts say.

LOW TURNOUT MAY HELP INCUMBENT

Exit polls are banned, but relatively low turnout could work in favour of the incumbent, said Luvsandendev Sumati, director of the Sant Maral Foundation, a polling and survey group.

“What might change the election outcome is only feet,” Sumati said. “The MPRP and their candidates were always better organised so their supporters are voting in an organised manner. But Democratic Party supporters, they are rather those who think, ‘Well, should I go or not?’”

Voters turned out in droves in the capital, many dressed in traditional long silk cloaks known as deels, in a sign of their respect for the largely ceremonial head of state and symbol of national unity.

“The most important thing the new president needs to do is develop the country, to pull us out of poverty,” said Davaadorjiin Suvdaa, a 56-year-old retired worker.

In the country’s vast windswept grasslands, many nomadic herders traveled dozens of kilometres (miles) on horseback and motorbike to the nearest polling stations.

“Stability is the most important thing to me,” said Sandagyn Bayarmaa, 46, who lives with her husband in a traditional felt tent and herds goats and sheep like much of the population.

The countryside is the base of support for the MPRP, the reincarnation of the party that ran Mongolia as a Soviet satellite through much of the last century, while Elbegdorj draws largely on urban voters.

Mongolia, whose empire under Genghis Khan once extended as far west as Hungary, must now decide on what terms it can accept working with foreign miners.

Negotiations over the $3 billion Oyu Tolgoi project, set to be developed by Ivanhoe Mines (IVN.TO) and Rio Tinto (RIO.AX) (RIO.L), have dragged on for years.

Sealing the deal quickly is increasingly important if Mongolia hopes to realise its ambitions of becoming a mining powerhouse and take advantage of the next upturn in commodity prices, analysts say. [ID:nHKG333638] (For a related FACTBOX see [ID:nPEK80147]) (Additional reporting by Reuters Television and Jargal Byambasuren; editing by Andrew Roche)

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