Landlocked between Siberia and China's own Mongolian provinces, Mongolia rises from the semiarid Gobi Desert to mountainous steppe. The traditionally nomadic Mongols were first unified by Genghis Khan in 1206. "Outer" Mongolia achieved independence from China as a communist state in 1924 and was officially aligned with the USSR from 1936. In 1990, it abandoned communist rule and widespread poverty ensued. Particularly harsh winters in 1999–2001 devastated the rural economy.

Khalkh Mongols, who adhere to Tibetan Buddhism, are the main ethnic group. Although economic pressures keep many people near urban centers, most remain nomadic. One-third live in Ulan Bator. Turkic Kazakhs in the west form the largest minority, but emigration to Kazakhstan since 1990 has reduced their numbers. Tensions exist with the Chinese and Russian minorities.

Strengths

Copper and cashmere. Largely untapped coal and oil reserves. Traditional and efficient rural economy.

Weaknesses

Harsh winters ravaged livestock between 1999 and 2001. Decaying infrastructure. Rising poverty.

The end of communism and the advent of democracy in 1990 revolutionized Mongolian politics. The shock of economic reform led many Mongolians regret the lost certainties of the communist era. In 1992 the democrats lost power to the renamed communists (MPRP), but their failure to revive the economy swung the pendulum back in favor of a democratic coalition in 1996. An uneasy cohabitation between President Natsagyn Bagabandi of the MPRP, who took office in 1997, and an MNDP-led government existed from 1998 until the sweeping MPRP election victory in 2000.

Under communism, Mongolia's vast mineral resources were barely exploited, and prospecting has only recently begun. A uranium mining joint venture with Russia has been established. Mongolia is rich in oil, with sufficient reserves to meet future domestic needs. In 1999 an oil extraction agreement was signed with China.

Shortages of drugs and equipment have renewed interest in traditional Mongolian herbal medicine. As well as the state-run system, some Buddhist monasteries provide health care.

Education is modeled on the former Soviet system. The majority of teachers are women on low salaries. Private-sector schools emphasizing Mongol culture are beginning to open.

Economic liberalization has fueled great disparities in wealth. An estimated 40% of the population now live below the poverty line; the poorest cannot even afford to buy bread. Starvation threatened after the severe winters of 1999–2001.

In the 17th century, the Manchus took control of Mongolia. It stayed in Chinese hands until 1911.

• 1919 China reoccupies Mongolia.
• 1924 Independent communist state.
• 1989–1990 Prodemocracy protests; communist election defeat.
• 1992 Former communists, renamed MPRP, returned to power.
• 1996 Democratic Union coalition wins general election.
• 1997 MPRP wins presidency.
• 1999–2001 Severe winters.
• 2000 Landslide electoral victory for MPRP.