China slaps new fees on Mongolian exporters amid Dalai Lama row

The Dalai Lama.
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A major border crossing between China and Mongolia has imposed new fees on commodity shipments between the two countries, amid a diplomatic row sparked by the visit to Ulaanbaatar of the Tibetan spiritual leader the Dalai Lama last week.

The Dalai Lama is cherished as a spiritual leader in predominantly Buddhist Mongolia, but China regards him as a dangerous separatist and warned the visit could damage bilateral relations.

The crossing at Gashuun Sukhait is used to export copper from the giant Oyu Tolgoi mine run by Rio Tinto, as well as coal from the Tavan Tolgoi mine, which China's state-owned Shenhua Group is currently in the running to develop.

The crossing in the Chinese region of Inner Mongolia would charge vehicles a transit fee of 10 yuan ($1.45) each time they pass through the border, and would also impose an additional charge of 8 yuan per tonne for any goods they are delivering, according to a notice issued by local authorities and published by the Mongolian Mining Journal on Wednesday.

For precious metals and copper concentrate worth more than 10,000 yuan per tonne, exporters would be charged 0.2 percent of the total value of the cargo, the notice said, adding that the new charges would come into effect on Dec 1.

Dale Choi, an independent mining analyst in Ulaanbaatar, said 900 trucks pass through Gashuun Sukhait every day, adding that around 133,000 tonnes of copper concentrate is delivered into China every month via the crossing.

Local government officials contacted by Reuters on Thursday could not confirm the veracity of the announcement, but a senior industry representative in Ulaanbaatar who is familiar with the matter said the new charges were now in effect.

Chinese Foreign Ministry spokesman Geng Shuang did not confirm whether or not the new border fees were connected to the Dalai Lama's visit, saying that he was unaware of the situation.

"As for the Dalai Lama's visit to Mongolia, China has expressed its position many times," he said at the ministry's regular press briefing on Thursday.

The Dalai Lama fled Tibet after an abortive uprising against Chinese rule in 1959. Beijing regards him as a "splittist", though he says he merely seeks genuine autonomy for his Himalayan homeland, which Communist Chinese troops "peacefully liberated" in 1950.

Geng said in a statement last month that Mongolia needed to "adopt effective measures to eliminate the negative effects of the Dalai Lama's visit".

The diplomatic repercussions could hit Mongolia hard, with the crisis-hit government desperate to boost economic ties with its powerful southern neighbor and use Chinese investment and know how to kickstart key mining and infrastructure projects.

China has already postponed a Nov. 28 meeting between the two sides, Mongolian government spokesman G. Otgonbayar said via Twitter last week.

Mongolian government officials are due to hold talks on Friday with international partners, including the International Monetary Fund and the Development Bank of China, to discuss Mongolia's currency and balance of payments crisis.

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