As the Soviet regime faltered in the early 1980s, Mongolia came under the leadership of Jambyn Batmonkh, a decentraliser heartened by the Soviet reforms under Mikhail Gorbachev. Batmonkh instigated a cautious attempt at perestroika and glasnost in 1986. By 1989 full diplomatic relations were established with China. The unravelling of the Soviet Union resulted in decolonisation by default. Few in Mongolia were ready for the speed of the collapse or prepared to seize the moment.

In March 1990, large pro-democracy protests erupted in the square in front of the parliament building in Ulaanbaatar and hunger strikes were held. Things then happened quickly: Batmonkh lost power; new political parties sprang up; and hunger strikes and protests continued. In May the government amended the constitution to permit multiparty elections but, ironically, rural areas voted overwhelmingly to stay under the protective shelter of the communist party. The communist party was forced into making concessions that snowballed into the election of the Mongolian Democratic Coalition on 30 June 1996, ending 75 years of unbroken communist rule.

Recent History
Over the next few years, successive Mongolian governments pursued Western-style policies of reform and privatisation and courted foreign investment, but the gap between rich and poor has widened, exacerbated by corruption that reaches the highest levels of government. A couple of particularly harsh winters in 2000 and 2001 impacted badly on the nomadic Mongolian way of life and forced many nomads to re-locate to the cities where they have joined the ranks of the urban poor. Yet Mongolian democracy has proven itself remarkably viable, free and fair. In the last Parliamentary election, in 2004 neither the Democrats nor the former communist MPRP won an outright majority and were forced into a power sharing agreement. Street protests are increasingly common in the capital, and hunger strikers – often condemning rampant corruption – take up positions in Sukhbaatar Square. Meanwhile, forays into the world of international diplomacy saw a visit from the Dalai Lama in 2002 bitterly condemned by China and 300 troops sent to Iraq in 2003 as part of a peacekeeping force.

all info taken from www.lonelyplanet.com