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Mongolian prime minister ousted over cronyism allegations

Ulan Bator (AFP) - Mongolia's prime minister was voted out of office by parliament on Wednesday following accusations of cronyism and a worsening economic situation in the sprawling, resource-rich nation.

The opposition Mongolian People's Party had called last month for Norov Altankhuyag's removal as growth stumbled in the former economic success story and foreign investment slumped.

Factions from his own party, the Mongolian Democratic Party, also voiced concern at his leadership as political turmoil deepened.

At a special meeting of the legislature known as the Great Hural on Wednesday, 54.5 percent of parliamentarians backed Altankhuyag's dismissal, state broadcaster Mongolian National Public Radio and Television said on its website.

Some of his own lawmakers were among the 36 who voted for the sacking, said Xinhua, the official news agency of neighbouring China, which added that he had been criticised for "incompetence and cronyism and corruption".

Mongolia enjoyed world-beating growth in recent years -- peaking at 17.5 percent in 2011 -- on the back of a resources boom -- mainly coal, copper and iron ore.

But it slowed to 5.3 percent in the first half of this year, and the country also faces rising inflation and a falling currency.

"Mongolia is facing significant policy challenges at the moment, especially in economic policy," said Julian Dierkes, a Mongolia expert at the University of British Columbia.

"None of the current political shenanigans offer any significant hope that they will facilitate the making of tough decisions," he added in his blog.

Mongolia, for decades a tightly controlled Soviet satellite, shook off communism nearly a quarter of a century ago and has emerged as a vibrant parliamentary democracy.