ULAN BATOR, Tuesday 31 August 2010 (AFP) - Bat -- a softly-spoken, smartly dressed 24-year-old Mongolian educated in Moscow -- points to the screen saver on his mobile phone with pride. It's a picture of the skull of a German SS officer.

Bat is the somewhat unlikely face of Dayar Mongol, one of three registered ultra-nationalist groups in Mongolia which sometimes take their cue from neo-Nazi outfits in Europe.

Enemy number one for the xenophobic organisations is the landlocked country's neighbour to the south -- China.

"We have 50 trained fighters whose job is to hunt down Chinese living in Mongolia and some Mongolians who have Chinese fathers," Bat said in an interview in the capital Ulan Bator.

"We reject their blood and their culture." Members of his group had assaulted Chinese nationals, he said.

Mongolia, a former Soviet satellite state wedged between China and Russia, has struggled to develop its economy since turning to capitalism two decades ago, and remains one of the poorest nations in Asia.

Its rich deposits of copper, gold, uranium, silver and oil have caught the eye of foreign investors, sparking hopes for a brighter future, but members of groups such as Dayar Mongol reject any outside economic or cultural influence.

"We can't just give Mongolia to the Chinese people. We are protecting it from them," said Bat, who claims to have 300 active members in his group, which he revived in 2005 after it had lain dormant for several years.

Bat says Dayar Mongol also targets Mongolian women who have sex with Chinese men by shaving their heads, and sometimes tattooing their foreheads -- in an eerie parallel to the numbers tattooed on Jewish prisoners at Auschwitz.

The crimes of such groups have not gone unnoticed abroad -- the US State Department has warned travellers about an "increased number of xenophobic attacks against foreign nationals" since the spring of 2010.

"Nationalist groups frequently mistake Asian-Americans for ethnic Chinese or Koreans and may attack without warning or provocation," it says on its website.

Two Chinese nationals have been killed in Ulan Bator this year, police have said, adding that the murder of a Mongolian by a Chinese citizen outside the capital was the "reason that ultra-nationalist group have become more active".

Franck Bille, who is doing research at Cambridge University on Mongolian attitudes towards China, said the xenophobia can be traced back to the country's past under Moscow's thumb.

"These anti-Chinese sentiments are a direct product of the Socialist period," he told AFP. "Russians regularly used the 'threat of China' to ensure the Mongols' allegiance."

When the Soviet Union crumbled and Mongolia began its transition to becoming a market economy, the country's traditionally nomadic society fell apart, leaving poor social services and education, and growing social disparities.

While Moscow is still perceived in a favourable light -- both Russian President Dmitry Medvedev and Prime Minister Vladimir Putin visited Mongolia last year -- Beijing has come in for public scorn.

"Increased Chinese influence in Mongolia in mining and construction has mainly contributed to a rise in nationalist sentiments," said Shurkhuu Dorj, of the Institute of International Studies at the Mongolian Academy of Sciences.

Some Mongolians, also mindful of China's 200-year rule over Ulan Bator under the Manchu dynasty, are worried about China's wider ambitions, even if funding from Beijing could bring on a new age of prosperity, experts say.

"Clearly, they don't want the country to be an economic suburb of Beijing," Graeme Hancock, an expert on the mining industry for the World Bank, told AFP.

"They also want to be making their own decisions, not at the whim of foreign jurisdiction."

Dorj said while he believes the groups had hundreds, not thousands, of members, they still represent a real threat.

"Their vigilante actions against law-breaking outsiders, mainly Chinese, could meet broad support in the country," Dorj said.

"There is a serious danger."