By Graham Earnshaw, Reuters

ULAN BATOR, May 17, Reuter – The isolated central Asian country of Mongolia is beginning to peer out cautiously towards the West, but it is also being careful to stress that its relationship with Moscow remains top priority.

This has already been a landmark year for Mongolia, which became the world’s second communist nation in 1921 and has been dominated by the Soviet Union ever since.

In January, Ulan Bator established diplomatic relations with Washington, and this month United Nations Secretary-General Javier Peres de Cuellar is paying the first-ever visit by a U.N. chief to Mongolia.

Later this month, Mongolia’s Foreign Minister Mangalyn Dugersuren will visit Japan and Australia, the first trip by a Mongolian foreign minister to either country.

And in mid-to-late June, a delegation from China’s National People’s Congress headed by congress standing committee vice-chairman Peng Chong will visit Mongolia, diplomats here told Reuters.

It will be the most senior Chinese delegation to visit Mongolia in a quarter of a century.

Diplomats said there was little doubt about where the inspiration for Mongolia’s new-found interest in looking beyond the Soviet bloc had come from.

“The great catalyst for change has been (Soviet leader Mikhail) Gorbachev,” said one diplomat.

Mongolia’s links with the West at present are few and far between, and it remains very much a closed, sparsely-populated buffer state between China and the Soviet Union. Some facts:

— About 97 per cent of its total foreign trade is conducted with Soviet bloc countries.

— The only western countries with embassies in Ulan Bator are Britain and Japan.

— It has been a member of the United Nations since 1961 but takes virtually no part in the activities of any U.N. agency.

— It has transport links with only two countries — the Soviet Union and China.

Diplomats say the establishment of diplomatic relations with the United States in particular could help to prize Mongolia out of its isolation, but no one sees its close links with Moscow being loosened.

The Russians are very high profile here. There are an estimated 60,000 Soviet troops in Mongolia along with perhaps 20-30,000 specialists and their families.

There is a statue of the late Soviet leader Joseph Stalin in Ulan Bator, and the Soviet embassy in central Ulan Bator, one of the tallest buildings in the city, was descibed by one western diplomat in Peking as “the viceroy’s residence.”

But others point out Mongolia has done well from the Soviet connection — Moscow and its allies have poured huge amounts of aid into Mongolia in recent decades, giving Mongolians a surprisingly high standard of living by Asian standards.

Not all Mongolians are happy at living under Moscow’s shadow. Foreign residents I spoke to, including a Russian and an East European, said there was much hostility amongst Mongolians towards the tens of thousands of Russians in their country.

But as one diplomat pointed out: “Given its position, Mongolia has only two foregn policy options — alliance with the Soviet Union or with China. At least the Soviet link has brought them into the modern world faster than China could have done.”

Mongolian officials are naturally unhappy with the view of Mongolia as a pawn of the Soviet Union.

“We are an independent state … but we have coordinated foreign policies, just like the western countries,” senior Foreign Ministry official J. Enkhsaihan told Reuters.

Vice-Foreign Minister Khumbagiin Olzvoy also emphasised that the recent moves by Mongolia towards building more links with the West do not indicate a shift in direction.

“It is the foreign policy principle of our country that we first develop political and economic relations with socialist community countries,” he said in an interview.

“A second important principle is to develop and strengthen relations with newly-emerged liberated countries, and we also give very high priority to the principle of peaceful co-existence with different socio-economic systems,” he added.

That may be so, but a sign of the times is that diplomats say Mongolia is now eager to expand the number of its officials who speak the English language.

“It has finally dawned on them that English is a very useful language in the international arena and that they cannot get by solely on Russian,” said one diplomat. REUTER