Mongolia Pitches Itself as a Data Centre Location at COP17, Citing Cold Winters and a ‘Data Embassy’ Law

Mongolia spent two weeks hosting a United Nations conference on land degradation. It also used the occasion to sell something else entirely.

Alongside the negotiations at COP17 in Ulaanbaatar, the Mongolian government pitched international investors on building data centres across its territory, Euronews reported from the conference.

The advantages presented were specific: low energy costs, savings of 40% on cooling because of Mongolia's harsh winters, and the fact that 98% of Mongolian land is state-owned, which simplifies construction.

Minister of Digital Development Chinbat Nomin set out a legal offer alongside the physical one.

"We have just proposed a so-called data law which guarantees data sovereignty," she said. "It basically turns data centre into a data embassy in which both data and connectivity, networking guarantee safety and security. So, we hope that this will be attractive to those who want to build data centres to serve the largest market, China, but still keep their data outside China."

The proposition

That final clause is the pitch in a sentence, and it is an unusual one.

Mongolia shares a long border with China and sits within reach of Chinese demand, but is not subject to Chinese data governance. For operators wanting proximity to the Chinese market without Chinese jurisdiction over their data, that combination has few alternatives.

The cooling argument is also more than marketing. Data centre operators across Asia are constrained by power availability and thermal load — Hong Kong's wholesale rates have risen sharply this year partly because vertical construction worsens power usage effectiveness, and regional capacity has been shifting toward markets with cheaper electricity. A climate that removes 40% of cooling demand addresses the largest non-computing cost in the business.

The context it was pitched in

The setting was a conference about land degradation, and the connection is not incidental.

Mongolia has nearly 77% of its land degraded, and its case at COP17 rested on needing finance for restoration. Deputy Prime Minister Togmid Dorjkhand, who chaired the ministerial session on finance, put the global shortfall bluntly: roughly $355 billion is needed annually for land preservation against about $70 billion available, leaving a gap near $280 billion.

The conference produced $1.3 billion in new and pipeline financing for land restoration and drought resilience across 23 countries on five continents, of which $644.5 million was identified as new finance and $216.4 million already confirmed. Dorjkhand estimated roughly $2.1 billion was on the table across government and private sessions.

Set against a $280 billion annual gap, that is a rounding error — which is why a host government with land to offer and a cooling advantage might reasonably pursue a second line of investment while the first is being negotiated.

Gim Huay Neo, a managing director at the World Economic Forum, framed the disparity directly: climate financing runs at roughly $2 trillion a year, the same as artificial intelligence, but less than 3% of it goes to land and water.

What to watch

The data law itself is the first thing to see. It has been proposed, not passed, and the sovereignty guarantees will determine whether the pitch is credible.

The second is power. Mongolia's electricity is cheap but its grid is small, and hyperscale facilities require reliability as much as price.

The third is whether anyone bites. Mongolia is landlocked, its connectivity runs through Russia and China, and latency to major markets is a question the cooling savings do not answer.