Elon Musk’s SpaceX to Launch Internet Service in Mongolia

by | 7. Jul 2023 - 13:02 | Economy

The move could be a precursor to future investments in the Asian country by Musk such as opening a Tesla branch there.  

The Mongolian government has approved two licenses for American aerospace and satellite communications company SpaceX to operate as an internet provider using low-orbit satellites, according to Reuters which cites government officials. Formal cooperation between SpaceX and Mongolia began in February during the 2023 Mobile World Congress in Barcelona. The American company will now provide rural areas of the landlocked Asian country with high-speed internet access.

SpaceX as the Forerunner of Tesla?

This move could be a precursor to more investments in the landlocked Asian country by billionaire Elon Musk. In a digital meeting with Mongolia’s Prime Minister Luvsannamsrain Oyun-Erdene in June, Musk stated the possibility of opening up a Tesla branch in the country wedged between China and Russia. The two also discussed possible cooperation on critical minerals, among other things, despite Tesla voicing intentions to abandon the use of rare earths in its electric vehicles earlier this year.

In the government statement announcing the approval of SpaceX’s venture, the Mongolian Minister for Digital Development and Communications Uchral Nyam-Osor explicitly stated that the satellites will provide miners with internet and information in addition to herders and farmers. The Asian country has vast amounts of critical minerals including rare earths and is increasingly gaining recognition internationally as a possible competitor to industry leader China, despite the two countries cooperating closely in the sector. The People’s Republic dominates the global market of rare earths, especially in the processing and other downstream production steps. Earlier this year, Beijing declared to consider export bans of rare earth technologies in response to Western export controls on advanced chips. On Monday, China’s latest announcement to restrict gallium- and germanium-related products made waves among industry officials. For quite some time, Western countries are seeking alternative sources of critical minerals and are trying to tap other countries with large raw material deposits.

Mongolia’s Deputy Prime Minister recognizes the possibility to become an alternative as well, however, the country requires time and foreign support. To capitalize on the possible hedge to China, the U.S. signed a Memorandum of Understanding to cooperate on critical minerals and supply chain infrastructure with The Government of Mongolia just last month.

Photo: iStock/Sundry Photography

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