With temperatures generally hovering below freezing for nine months of the year, Mongolia is one of the planet’s coldest countries. The average temperature in Ulaanbaatar is -2.9°C, making it the coldest capital in the world, and the extreme climate represents a major challenge for tourism operators.
Seasonality
According to most local players, more than 75% of overall tourist arrivals in the country occur during the warm season, which stretches from June to September most years. The long off season strains local operators, many of which struggle to maintain their workforce over the winter and, in some cases, have trouble breaking even. In an effort to overcome this issue, a handful of private operators have worked to develop the off-peak market, establishing new annual festivals and other attractions that take place during the winter. The Golden Eagle Festival, for example, takes place every winter in Bayan-Ulgii, Mongolia’s westernmost province (aimag). The event is jointly organised by the Bayan-Ulgii governor’s office, the Mongolian Eagle Hunters’ Association and some tour operators, the latter of which offer package tours to the event. Provided the move to attract more tourists during the harsh winter months is successful, the local tourism industry faces a number of additional challenges. The national transport network – which relies heavily on road transport – is in poor shape, and is particularly hard to navigate during the long, dark winters, when snow and ice pile up rapidly on remote roads. Additionally, while the number of overall visitor arrivals to Mongolia has jumped considerably in recent years, competition from new tour operators has also increased substantially over the same period. Finally, while local operators traditionally provided full-service, inclusive tours in Mongolia – allowing them to make money on all aspects of a trip – increasingly the country is attracting a rising percentage of independent travellers, which is considered to be a far less lucrative demographic. The country’s private tourism industry, in conjunction with the government, is working to address these issues.
A lack of reliable data makes it hard to calculate the drop in visitor arrivals during the winter months. Officially, the government considers any person who enters Mongolia on a tourist visa and stays for at least a day to be a tourist, despite the fact that many itinerant workers – particularly from China – enter in this way, skewing the data significantly.
On Ice
That said, according to most local players it is hard to overestimate the impact of Mongolia’s long, cold winters on the tourism industry. According to a UN Conference on Trade and Development (UNCTAD) report published in November 2012, from September through June most of the country’s tour operators shed all but their core staff members. This has major implications for employment in the country. According to World Travel and Tourism Council data, in 2012 the tourism sector was responsible for employing around 50,000 people, or some 5.1% of the country’s overall workforce. Based on the UNCTAD report, however, during the September-June period the industry retains just 5-10% of the total workforce employed during the busy summer months.
The lack of sustained, long-term employment opportunities in the sector has had a negative impact on the quality and sustainability of the workforce, with many of the country’s best and most highly trained tourism employees seeking employment in more reliable or lucrative sectors. “The inflow of tourists and, consequently, revenues, is extremely seasonal,” said G. Damba, the chairman of the Sustainable Tourism Development Centre, a local organisation. “This has had a negative impact on all aspects of the industry, including the quality of the local workforce.”
Related Challenges
The lack of consistent year-round revenues and high levels of competition have limited the ability of many local firms to grow beyond a relatively small size. Consequently, the local sector has limited capacity to handle large groups of tourists, in particular. “I am not sure the local tourism industry is prepared for a big bump in visitor numbers,” Damba told OBG. At the same time, operators revenues are expected to drop in the coming years, as a result of both rising levels of price competition throughout the market and a jump in the number of independent travellers (as opposed to package tourists) visiting the country. “In the past most of the incoming tourists booked full-service package deals,” D. Altanbagana, the executive director of local tourism operator Active Adventure Tours Mongolia, told OBG. “In recent years, however, a steadily increasing percentage of our business has been from independent travellers, most of whom go on the internet to book each individual component of their visit.”
The highly seasonal market has also resulted in an annual drop in the number of flights to and from Mongolia during the winter months, as many airlines switch to a skeleton schedule as temperatures – and passenger numbers – begin to fall in September.
In addition to the decline in international connectivity during the winter months, inclement weather regularly has a negative impact on domestic transport links too. Mongolia’s road network, for example, remains relatively underdeveloped outside Ulaanbaatar and a handful of other regional urban centres.
Improving Access
During the winter months some remote parts of the country are completely inaccessible by modern forms of transport. The government is in the midst of a project to expand and upgrade the national road network, and is in the early stages of a plan to build a new airport, which has the potential to attract new carriers and increase the number of flights landing during the off season (see Transport chapter). “The quality of transport infrastructure here is very low,” said U. Batbayar, the managing director of Battour Travel Agency and the governing board member of the Mongolia National Tourism Organisation, an industry association. “With this in mind, it is hard to attract many tourists, particularly during the winter months, when there are fewer flights and getting around the country is very challenging.”
Boosting The Numbers
Both the private sector and the government are working to attract more tourists in the winter months. Over the past decade private tour operators have worked with regional governments to organise a number of winter festivals, for example. Khovsgol Ice Festival, which was set up by Active Adventure Tours Mongolia in conjunction with the Lake Khovsgol National Park Rangers and other local authorities, has been running since 2000. The festival is held annually in March in Mongolia’s northernmost aimag, which shares a border with Siberia, and features events including speed and distance skating on frozen Lake Khovsgol, ice wrestling, dog- and horse-drawn sleigh rides, and cultural events put on by the Tsaatan people, a group of nomadic reindeer herders that live in the area. While the festival has benefitted from increasing exposure in recent years, it remains a relatively small-scale event. In 2013, for example, just 35 foreign tourists booked tour packages to the festival through Active Adventure Tours Mongolia, which is a record high for the company.
Other winter festivals that have attracted foreign visitors in recent years include the Golden Eagle Festival and the Thousand Camels Festival in the southern Gobi desert. The Golden Eagle Festival is centred on a small community of ethnic Kazakh eagle hunters in western Mongolia, and features displays of hunting eagles, traditional Kazakh dress, horse racing, archery and buzkashi, a traditional Central Asian polo-like game that involves opposing teams on horseback aiming to propel a dried, decapitated goat carcass into opposing goals. The Thousand Camels Festival, meanwhile, takes place early in the year on an annual basis in the remote southern Gobi desert, near the Chinese border. The festival was developed by the private sector in conjunction with local nomadic camel herders, who use the event to raise awareness about Mongolia’s declining Bactrian camel population.
Government Backing
Until recently none of these winter festivals received government support, financial or otherwise. Yet in March 2013 the government announced that it planned to provide financing for a handful of the most developed winter festivals, including those listed above, for the first time. Some of these events will also be included on a new tourist calendar the government began producing in 2013. The state’s new commitment to Mongolia’s winter festivals bodes well for the tourist industry as a whole.
A number of tour operators have been expanding their business during the winter by providing booking and other services to outbound Mongolian tourists. “One important thing operators can do to boost their off-season business is build domestic demand for tourism products,” said B. Indraa, the director of the governing board of the Mongolia National Tourism Organisation, an industry association. “This means catering both to Mongolians looking to travel within Mongolia, and to families that want to travel to Southern Europe or elsewhere in Asia, for example.”
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