Abstract
Mongolia is the sixth most aid-dependent country in the world measured as a percentage of gross national income (WB 2003: 160–1), with Japan as the largest bilateral donor. The World Bank, Asia Development Bank, IMF and UNDP all have resident missions in the capital Ulaanbaatar. What is it that enables Mongolia to attract so much aid, even from some of the Nordic countries? The country has a small population of 2.5 million people inhabiting an area four times that of Japan and three times that of Sweden. It has a severe climate, with little precipitation; with its high altitudes and inland location, it has a prolonged winter. Three quarters of the country’s territory consist of grasslands, the remainder being either desert or mountainous. The rate of poverty is high, but this alone does not explain the presence of many donors. The strategic location of Mongolia, sandwiched between China and Russia, is another important factor. That Mongolia is a democracy with a good human rights record, that aid management functions reasonably well and that foreign consultants are well received by the Mongolians are other explanatory factors.