NewsWire

Issue 758 –  25 November 2022

BCM NewsWire provides short summaries of news collected from around the world. Each article is kept to a maximum of 150 words for brevity, but click on the link next to “Source” to read the full article.

Economy

• GDP expands by 3.7 pct in first 3 quarters
• Tapan Mishra: Global crises affecting Mongolian society and the economy as a whole
• Mortgage repayment continues from January 1
• Transformative Solutions and Green Finance in China and Mongolia
• Photo Essay: Protecting Mongolia’s Blue Pearl
• 19.9 million livestock to be put into economic turnover this year
• Government decision targeting Erdenes Tavan Tolgoi - Editorial
• D.Zulgerel: People’s lifestyle leads to arthritis - Interview
• Coal is our only fragile hope for the next year - Editorial

• China expects Mongolian president's visit to elevate ties: foreign ministry
• Mongolia awards Order of Genghis Khan to foreigner for first time
• Land bill to allow citizens to own land through digital exchange
• Mongolia’s Second National Voluntary Review on the SDGs Implementation kicks off
• Former President Elbegdorj Tsakhia on Mongolia’s Democracy and Security - Editorial
• MNB World Sightline: Interview with H.E. Ms. Axelle Nicaise, EU Ambassador to Mongolia - Video
• Most public educational institutions’ land ‘looted’ - Editorial
• Can Mongolia Resist Russia? - Editorial

Business

• Rio to pursue Turquoise bid after ending talks with minority shareholders
• Climate tech start-up URECA closes USD 1.5 mil pre-seed round, allows 'virtually anyone' to trade carbon offsets
• Tatsuya Hamada, Chairman of the Board of Mobicom Corporation was awarded as "The Outstanding Leader in Asia"
• Golomt Bank starts its primary market trading
• Message from FRC Chairman
• Elixir Energy says gas is flowing at its Nomgon coal bed methane pilot project in Mongolia
• Silver Elephant Mining’s Mega Coal advances coal sales to China
• Erdene Expands High-Grade Mineralization at Dark Horse Prospect, Generates New Targets
• TMK’s got a bead on its future coal seam gas exploration in Mongolia
• Public park to be established through public-private partnership
• City Council revokes Naran Trade’s construction permit for apartment building

Global and Regional Trends

• China widens market share in EVs, dozen other high-tech fields
• COP27 Reaches Breakthrough Agreement on New “Loss and Damage” Fund for Vulnerable Countries
• China’s Covid cases hit record as dissent grows over tough restrictions
• Russian weekly consumer prices continue to rise in November
• Copper gains on China's property support, softer dollar
• Gold firms as Fed signals slowdown in rate hikes
• Platinum deficit expected in 2023 after bumper surpluses, WPIC says
• Singapore’s economy expands 4.1 pct in Q3 2022
• U.S. says G7 should soon unveil price cap level on Russian oil, adjust regularly

• BCM Quarterly Report for Q3'22
• BCM submits policy paper
• The BCM appoints Raphaël Goué as official BCM representative in Europe
• SDG Investor Mapping project survey - Identifying business cases for investment opportunities
• UNICEF: Guidance for employers on flexible work arrangements and other good workplace practices in the context of Covid-19
• UNICEF: Call for actions of the private sector to reduce children’s exposure to air pollution in UB
• BCM Guideline for Companies to Combat Air Pollution
• Member-to-member special offers & benefits

Economic Indicators

• Inflation
• Central Bank Policy Rate
• Sovereign Credit Rating
• Currency Rates

ECONOMY

GDP EXPANDS BY 3.7 PCT IN FIRST 3 QUARTERS

By production approach, Mongolia`s Gross Domestic Product (GDP) totaled MNT 35.2 trillion (over 10.3 billion U.S. dollars) in January- September period, which increased by MNT 5.3 trillion (17.7%) from the same period of the previous year.
GDP at 2015 constant price was MNT 20.3 trillion, which is increased by MNT 730.0 billion (3.7%) compared to the same period of the previous year.
The National Statistics Office reported that GDP at 2015 constant prices decreased by 6.7% in the first nine months of 2020, but increased by 3.7% in the first nine months of 2021 and 2022. In the third quarter of 2022, seasonally adjusted GDP at constant 2015 prices increased by 1.0% compared to the previous quarter.
The increase was mainly attributed to significant growth of the agricultural and mining sectors, Erdene-Ochir Myagmarkhand, a senior expert of the NSO said in a statement. 

Source: Montsame

TAPAN MISHRA: GLOBAL CRISES AFFECTING MONGOLIAN SOCIETY AND THE ECONOMY AS A WHOLE

The United Nations Resident Coordinator Office, the United Nations Development Programme, and the Ministry of Economy and Development of Mongolia jointly organized the “Socio-Economic Impact of Global Crises in Mongolia” seminar at Novotel Hotel on November 21, 2022.
It was raised during the seminar that the global shocks to commodity prices, food, energy, and financial markets are making Mongolians more vulnerable, especially at a time when the country is all set to mobilize its New Revival Policy. 
The geopolitical issue involving Russia and Ukraine, according to the United Nations Resident Coordinator in Mongolia, Tapan Mishra, has a severe impact on Mongolia's economy by driving up the cost of food and consumer products. The availability of goods such as bread, vegetable oil, and gas has an impact on vulnerable populations, particularly single women and families with three or more children, in addition to price increases.

Source: Montsame

MORTGAGE REPAYMENT CONTINUES FROM JANUARY 1

D.Togtokhsuren, Head of the MPP Group in the Parliament, made a report.
- Mortgage repayments were deferred for two years according to the Law on Pandemic. According to this, citizens would start paying their mortgages from January 1, 2023. But the working group of the Parliament said that it is studying the possibility of delaying mortgage payments until July 2023. The working group of the Government and the Parliament discussed and decided to continue the repayment of mortgage loans normally from next year.
Deferring repayment of the mortgage loan is having a negative impact on next loans. Therefore, the Parliament approved to make mortgage payments starting from January 1, 2023 when it approved the Monetary Law.

Source: GoGo News

TRANSFORMATIVE SOLUTIONS AND GREEN FINANCE IN CHINA AND MONGOLIA

We examine and compare three Asian Development Bank (ADB) projects in two member countries of the Central Asia Regional Economic Cooperation: one in the People’s Republic of China (PRC) and two in Mongolia that relate to sustainable green development and use innovative financial mechanisms, and behavior-changing nudges. We provide comparative analyses and aim to demonstrate effective, innovative, and sustainable green finance and green transformation approaches in these two countries to address these pressures.
In Mongolia, ADB and the Government of Mongolia have developed two large-scale transformative projects using integrated design and innovative green financing mechanisms to leverage private sector investment: (i) Aimags and Soums Green Regional Development Investment Program, which aims to promote green urban–rural linkages, green agribusiness development, natural capital, rangeland regeneration, and soil carbon sequestration through the (ii) Ulaanbaatar Green Affordable Housing and Resilient Urban Renewal Project, which aims to transform Ulaanbaatar’s vulnerable and substandard peri-urban areas into low-carbon, resilient eco-districts that provide access to green affordable housing.

Source: ADB

PHOTO ESSAY: PROTECTING MONGOLIA’S BLUE PEARL

Khuvsgul Lake is part of the Khuvsgul Lake National Park in northern Mongolia. The park encompasses a vast expanse of stunning snow-capped mountains and forests surrounding Khuvsgul Lake. Known as Mongolia’s Blue Pearl and revered locally, the lake’s deep blue waters are almost pristine. Khuvsgul Lake is the largest freshwater lake in Mongolia. It is a critical water source for local and downstream communities. The lake supports unique fish and other aquatic animals, and the surrounding forests support important populations of plants, mammals, and birds. The park is also an international UNESCO Biosphere Reserve.
Small rural communities (less than 7,000 people) live in the park. People have lived here for centuries, long before the park was established. Livestock herding is the main livelihood activity to produce meat, dairy, and leather products. Poverty rates in the park are among the highest in Mongolia, and poverty-stricken households account for most residents in some settlements.

Source: ADB
See also: Permanent working group for the protection of Khuvsgul Lake held meeting

19.9 MILLION LIVESTOCK TO BE PUT INTO ECONOMIC TURNOVER THIS YEAR

Kh.Bolorchuluun, the Minister of Food, Agriculture and Light Industry, reported “This year, 71.2 million livestock counted at 188.6 million households nationwide, and it equals to 122.5 million livestock by transferring to sheep counting. And there is an advance calculation that 19.9 million of them will be put into economic turnover.
As of November 17, 2022, 2.9 thousand tons of horse meat, 3.4 thousand tons of raw sheep and goat meat, totaling 6.3 thousand tons of meat were exported. At the same time, as of November 10, 2022, a loan of 46.0 billion MNT was granted to four meat processing enterprises through the KHAN Bank and the Trade and Development Bank with the purpose of reserving spring meat for the urban population. In addition, MNT 1.1 billion has been budgeted for reserving 2.5 thousand tons of meat according to information from the provinces.

Source: GoGo News

GOVERNMENT DECISION TARGETING ERDENES TAVAN TOLGOI - EDITORIAL

That there is a balance of payments crisis is evident from the imposition on 26th October  of a  six-month special regime by JSC Erdenes Tavantolgoi. This was unexpected. The company’s director-general, B. Gankhuyag was dismissed from his post and an investigation into the group’s alleged stealing from coal exports that Prime Minister L.Oyun-Erdene mentioned last spring, has been launched. The government believes that the special regime imposed by Government Decree No. 362 of 2022 will help increase the flow of foreign currency into Mongolia. The government states that the core business, management, organization, and balance of payment of Erdenes Tavantolgoi JSC will be improved, and revenues increased. The Ministry of Finance will be in charge for this work.
Journalist Ts.Elbegsaihan describes in his article how Mongolia’s balance of payments crisis is developing for the third time. In any case, D. Amarbayasgalan, Chief Cabinet Secretary, has clearly expressed his position that all the offtake contracts of Erdenes Tavantolgoi JSC will be made public.

Source: Mongolian Mining Journal

D.ZULGEREL: PEOPLE’S LIFESTYLE LEADS TO ARTHRITIS - INTERVIEW

In the following interview, Head of Department of Rheumatology of the Mongolian National University of Medical Sciences and consultant doctor of the Mongolia-Japan Teaching Hospital Dr. D.Zulgerel delved into the causes, treatment and prevention of inflammatory joint diseases that are common among Mongolians. In particular, osteoarthritis is common and the number of people undergoing joint replacement surgery is high in our country.
Inflammatory joint diseases are common among Mongolians. What is the reason for this?
Rheumatology is a very broad field. Osteoarthritis is the most common disease among people. This includes knee arthritis. The primary cause of this disease is aging. Mostly middle-aged and older people suffer from the disease. However, it mainly occurs in young people after an accident or injury. The disease is also related to heredity. Another major factor, especially the main reason for the recent increase, is people’s lifestyle.

Source: The UB Post

COAL IS OUR ONLY FRAGILE HOPE FOR THE NEXT YEAR - EDITORIAL

The ruling party is arguing internally about “who will own the coal”. Anyone who understands politics realises that the winner of this “war” will not be Mongolia, but some government official or group with self-interest. That the winning side will continue to steal coal is as certain as ever. Xi Jinping, “leader” of the global trade war and chief author of the Wolf Warrior (Xi Defangs the Wolf Warrior) policy, will surely retain his seat while our leaders pursue petty interests by waging an internal “coal war”. That the powerful policies of a neighboring country are defined in “wolf warrior” terms is evidently obvious from the ongoing trade war. As soon as Mr Xi was re-elected as President of China, he made the statement, “We will continue our zero-COVID policy”. It became clear that the trade war would also continue. The Oyun-Erdene government should therefore pay attention to Mr. Xi’s statement and calculate its next foreign policy moves…

Source: Mongolian Mining Journal

POLITICS

CHINA EXPECTS MONGOLIAN PRESIDENT'S VISIT TO ELEVATE TIES: FOREIGN MINISTRY

China looks forward to taking the upcoming visit of Mongolian President Ukhnaa Khurelsukh as an opportunity to deepen strategic mutual trust and practical cooperation with Mongolia, according to a Chinese foreign ministry spokesperson.
At the invitation of Chinese President Xi Jinping, President Khurelsukh will pay a state visit to China from Nov. 27 to 28, it was announced on Tuesday.
"China looks forward to working with Mongolia to take this visit as an opportunity to deepen our strategic mutual trust and practical cooperation and set an example in neighborly relations to elevate China-Mongolia relations to a new height," said Zhao Lijian, the spokesperson, at a press briefing.
During the visit, the two presidents will hold formal talks, and jointly witness the signing of cooperation documents, Zhao said.
Premier Li Keqiang, and Li Zhanshu, chairman of the Standing Committee of the National People's Congress, will meet with President Khurelsukh respectively, he said.

Source: Xinhua, Montsame, GlobalTimes.cn
See also: Chinese, Mongolian transport ministers aim to deepen infrastructure cooperation

MONGOLIA AWARDS ORDER OF GENGHIS KHAN TO FOREIGNER FOR FIRST TIME

Mongolian President Ukhnaa Khurelsukh conferred Thursday the Order of Genghis Khan, the country's highest state award, to American author Jack Weatherford for his contribution to the studies of Genghis Khan.
Weatherford, who is well known for his book released in 2004, Genghis Khan and the Making of the Modern World, became the first foreigner who received this order. He once served as a professor of anthropology at Macalester College in Minnesota.
In addition, the president conferred the Order of Genghis Khan to Dechingungaa Dorjgotov, academician and leading researcher at the Institute of Geography and Geoecology of the Mongolian Academy of Sciences, who has laid the foundation of the field of soil science in Mongolia on a scientific basis and made a great contribution to the development of the field.
In previous years, the order was presented to only one person, but this year it was given to two people for the first time.

Source: Xinhua
See also: Jack Weatherford: This is the century that Mongolia can help the world move closer to the dream of Chinggis Khaan

LAND BILL TO ALLOW CITIZENS TO OWN LAND THROUGH DIGITAL EXCHANGE

During its plenary session on November 17, Parliament reviewed the draft revision of the Land Law and other corresponding bills.
Since its enactment in 2003, the Land Law has been amended 32 times. More than 60 laws and about 200 land regulations regulate land relations, which create duplications, gaps and conflicts in the legal framework. Therefore, bill initiators believe that there is a need to create a unified legal framework to regulate land relations.
In accordance with the bill, new land allocation will be planned in line with long, medium and short-term policy documents for Mongolia’s development. Line ministries, agencies and citizens will be able to submit their comments and recommendations on land management planning documents.
The draft revision stipulates that inter-sectoral coordination will be ensured through integrated land planning and registration. The bill will protect the legal rights of citizens and legal entities with land ownership rights and permits granted by the state.

Source: The UB Post

MONGOLIA’S SECOND NATIONAL VOLUNTARY REVIEW ON THE SDGS IMPLEMENTATION KICKS OFF

Today, the Government of Mongolia, represented by the Ministry of Economic Development (MED) and the United Nations in Mongolia launched the Second National Voluntary Review (VNR) on the implementation of the Sustainable Development Goals in Mongolia.
Batjargal Khandav, the State Secretary of the MED, who is the chairperson of the multistakeholder working group for VNR preparation stressed that effective policies and decisions can be achieved for effective implementation of SDGs in Mongolia only with a broad representation and involvement of all relevant stakeholders.
Ensuring to bring the voices of all key players, including the Government, civil society, academia, and the private sector, this initiation workshop laid the groundwork for the rigorous process of the elaboration of the VNR, as elaborated in the roadmap below:
This review aims to assess and present national progress made in implementing the 2030 Agenda at the UN’s High-level Political Forum on Sustainable Development in July 2023.

Source: UN Mongolia

FORMER PRESIDENT ELBEGDORJ TSAKHIA ON MONGOLIA’S DEMOCRACY AND SECURITY - EDITORIAL

Elbegdorj Tsakhia is a giant in Mongolia’s democratic history. He helped lead the 1990 democratic revolution and co-drafted the resulting constitution that made Mongolia a democracy. A leader of the Democratic Party, he also served as Mongolia’s prime minster from 2004 to 2006 and president from 2009 to 2017.
While he no longer holds office, Elbegdorj has been active over the last five years, most recently making headlines for denouncing Russia’s invasion of Ukraine. And in October 2022 he became the latest member of The Elders, a group of global leaders founded by Nelson Mandela to advance peace, justice, and human rights.
In a written interview, The Diplomat’s Bolor Lkhaajav asked Elbegdorj for his thoughts on the current direction of Mongolia’s democracy and the uneasy security situation in Northeast Asia.

Source: The Diplomat

MNB WORLD SIGHTLINE: INTERVIEW WITH H.E. MS. AXELLE NICAISE, EU AMBASSADOR TO MONGOLIA - VIDEO

MNB World's Interview with Ms. Axelle Nicaise, EU Ambassador to Mongolia.
MNB World is the international broadcast service of Mongolian National Broadcaster, providing the latest information and a wide variety of programming on Mongolia.

Source: MNB World

MOST PUBLIC EDUCATIONAL INSTITUTIONS’ LAND ‘LOOTED’ - EDITORIAL

Minister of Education and Science L.Enkh-Amgalan made a shocking announcement last week at the State Palace, claiming that “70 to 80 percent of the land of state-owned schools and kindergartens have been stolen”. In other words, most of the land owned by educational institutions has been transferred to others, laying ground for misuse.
Land traders are “occupying” every vacant space around state-owned schools and kindergartens. The minister’s choice of the word, “stolen”, seems to be logically flawed. It would be more appropriate to say that these lands were “looted” in an organized manner. 
This year, specialists from the Investment Department of the Ministry of Education and Science and the Department of Education conducted a nationwide land survey. They found that in the last seven years, 15.19 hectares of land of state-owned schools and kindergartens have “disappeared”.

Source: The UB Post

CAN MONGOLIA RESIST RUSSIA? - EDITORIAL

Repercussions of the Russian invasion of Ukraine were a major topic of conversation during my visit to Mongolia this August. I had arrived with a sense of frustration that the MPP government wouldn’t publicly take a stance to defend Ukraine, but was persuaded through several conversations to see Mongolia’s abstention on UN resolutions as a version of sticking their neck out as far as they feel they can.
I wrote an article for Foreign Policy on this general geopolitical challenge that Mongolia is facing. I found much of my conclusions confirmed by conversations in Ulaanbaatar in November.
This is the question I would like to ask here today: how was Mongolia able to resist Russian pressure in 2009 and what can we conclude about the current situation from understanding that example?
One of my conversations produced a very graphic version of what Mongolia’s geopolitical position is and feels like.

Source: Mongolia Focus

BUSINESS

RIO TO PURSUE TURQUOISE BID AFTER ENDING TALKS WITH MINORITY SHAREHOLDERS

Rio Tinto Ltd said on Friday it would plough ahead with a $3.3 billion bid to buy the 49% of Canada's Turquoise Hill Resources that it does not already own, after it ended separate talks with dissenting minority shareholders.
The Anglo-Australian miner is seeking to simplify its management of the giant Oyu Tolgoi copper mine in Mongolia that it operates, but shares ownership through Turquoise Hill and the Mongolian government.
Rio needs two-thirds of voting Turquoise Hill shareholders to back its bid, including its own 51% stake, and a simple majority of the rest of the voting shareholders.
It has raised its offer for Turquoise Hill twice to C$43, but that has failed to satisfy Pentwater Capital and SailingStone Capital, two of its biggest minority shareholders, which own stakes of 15.2% and 2.2%, respectively.

Source: Reuters

CLIMATE TECH START-UP URECA CLOSES USD 1.5 MIL PRE-SEED ROUND, ALLOWS 'VIRTUALLY ANYONE' TO TRADE CARBON OFFSETS

Singapore-headquartered climate tech start-up URECA has closed a pre-seed funding round from undisclosed investors at US$1.5 million ($2.05 million).
The round exceeded the company’s original target of US$1 million, says URECA in a Nov 22 press release.
Originating from Mongolia and based in Singapore, URECA has built a marketplace platform that allows “virtually anyone” to trade high-quality carbon offsets. The latest funding will be used to scale URECA’s operations across Southeast Asia and to accelerate the launch of its marketplace, planned for early-2023.
On the hardware front, URECA’s digital MRV (measurement, reporting and verification) technology consists of three components: a tamper-proof smart-meter, a verification system and a blockchain-based trading platform, which were designed and built in collaboration with the Mongolian University of Science and Technology.
This will enable individual households and SMEs to produce and sell carbon offsets, says the company.

Source: The Edge Singapore

TATSUYA HAMADA, CHAIRMAN OF THE BOARD OF MOBICOM CORPORATION WAS AWARDED AS "THE OUTSTANDING LEADER IN ASIA"

We are sharing the remarkable news that Tatsuya Hamada, the Chairman of the Board of Mobicom Corporation has been awarded as "The Outstanding Leader in Asia" from Asia Corporate Excellence & Sustainability Awards (ACES), which honors the leaders and companies that have made high contributions to Asia based on their leadership and sustainability.  
This year the ACES Awards ceremony was held on 18^th of November in Kuala Lumpur, Malaysia, presenting awards to 23 most inspiring leaders, businesses, corporations and brands, in total. 
The ACES Awards have been organized by MORS Group, which implements research and development programs to ensure sustainable growth in Asia, since 2014. The winners are selected based on the high criteria which makes the award more respected year by year. 
“The Outstanding Leader in Asia" award is presented to individuals, who made great impact and special contribution to the growth and development of their companies and have set an excellent role model for the society, bringing practical changes to their countries. 

Source: Mobicom Corporation

GOLOMT BANK STARTS ITS PRIMARY MARKET TRADING

• the number of products and services on the stock market will increase;
• the activities of the company will be transparent and open;
• business activities will expand. It is the basis for long-term growth and development. Policymakers agree that one of the ways to achieve sustainable and accessible growth is to increase the number of companies open to the public or to increase the number of companies that issue new IPOs because of the high benefits that cover the entire economy, from the capital market to the labor market. On the other hand, the capital market, including the stock market, becomes the face of the financial market and business environment by making the activities of business organizations open and transparent.

Source: FRC

MESSAGE FROM FRC CHAIRMAN

 
NewsWire

Issue 757 –  18 November 2022

BCM NewsWire provides short summaries of news collected from around the world. Each article is kept to a maximum of 150 words for brevity, but click on the link next to “Source” to read the full article.

Economy

• Inflation surges to 14.5 pct in October
• Viktoria Abramchenko: Trade between Russia and Mongolia will reach a historic high this year
• Coal export likely to rally in coming months
• Mongolia launches online platform for tourists
• Foreign currency deposits soar to 4.6 trillion USD
• IRI Mongolia Poll Shows Concerns with Economy and Corruption, Support for Democratic Governance
• Training on yak animal husbandry, disease risk & mitigation, flaying & fleshing techniques, and preservation and storage of yak hides
• New to Ulaanbaatar November 2022 - Editorial

• 2023 Budget Law passed with 1.4 trillion MNT deficit
• Upcoming modifications to Mongolian Double Tax Treaties
• Concerns over restrictive HRD law passed by Mongolian Parliament
• Russia plans to complete designing of Soyuz Vostok gas pipeline to China via Mongolia in 2023
• Civil societies demand withdrawal of ‘anti-association’ bill as it negates past progress
• Mongolia Arrives at COP27 with Largest Delegation in Country's History
• Russia increased electricity export to Mongolia by 100 MW-official
• Kh.Nyambaatar: Citizens of most countries will travel without a visa to Mongolia
• E.Bat-Amgalan MP: Expansion of Amgalan thermal power plant needs to start immediately
• “Food Supply and Security” national movement launched in Ulaanbaatar
• Parents Rally for Child-Friendly Spaces - Editorial

Business

• Rio Tinto’s long-awaited deal comeback is stuck in limbo
• Turquoise Hill reports USD 40-million third quarter profit, raises gold guidance
• Legal Regulation On Mergers And Acquisitions In Mongolia
• Fintech lending debt-to-income ratio regulated to be 70 percent
• Parabellum Resources targets resource update in Q1 2023 at Khotgor rare earth project in Mongolia
• Talon Energy has a world-scale resource on the doorstep of the world’s largest gas consumer: MST Access
• Experts with right to provide professional services in securities market take oath
• Ulaanbaatar’s ger district starts moving to renewable energy
• Agreements signed with sports associations to cooperate in East Asian Youth Games
• Khan bank successfully receives 60 million USD in long-term funding

Global and Regional Trends

• As the world’s population hits 8 billion people, UN calls for solidarity in advancing sustainable development for all
• Russia Falls Into Recession
• China Q3 GDP growth tops forecasts but meaningful rebound elusive
• Japan's economy unexpectedly shrinks as hot inflation, global slowdown take toll
• China Jan-Oct FDI rises 14.4 pct y/y - commerce ministry
• Commodity star lithium shows signs of cooling after 1,200 pct rally
• Key takeaways from the G20 summit in Bali
• IPO funds raised by Southeast Asian companies fall amid economic headwinds
• OPEC cuts oil demand growth forecast again as economic challenges mount
• The global shipping industry is facing a new problem — too many containers
• Central Asia looks beyond Russia's orbit to secure its future - Editorial

• BCM Quarterly Report for Q3'22
• BCM submits policy paper
• The BCM appoints Raphaël Goué as official BCM representative in Europe
• SDG Investor Mapping project survey - Identifying business cases for investment opportunities
• UNICEF: Guidance for employers on flexible work arrangements and other good workplace practices in the context of Covid-19
• UNICEF: Call for actions of the private sector to reduce children’s exposure to air pollution in UB
• BCM Guideline for Companies to Combat Air Pollution
• Member-to-member special offers & benefits

Economic Indicators

• Inflation
• Central Bank Policy Rate
• Sovereign Credit Rating
• Currency Rates

ECONOMY

INFLATION SURGES TO 14.5 PCT IN OCTOBER

Mongolia's inflation, measured as the consumer price index, surged year-on-year by 14.5 percent in October, said the country's National Statistics Office on Tuesday.
The index rose 1.3 percent from the previous month and 10.9 percent from the start of 2022. The increase is largely related to the higher prices for imported goods, the office said in a statement.
There are 410 items in the country's consumer goods and services basket, with 221 of them imported, said the statement.

Source: Xinhua
See also: 

VIKTORIA ABRAMCHENKO: TRADE BETWEEN RUSSIA AND MONGOLIA WILL REACH A HISTORIC HIGH THIS YEAR

The Russian delegation at the talks was led by Deputy Prime Minister Viktoria Abramchenko, head of the Russian section of the commission. The Mongolian delegation was chaired by Deputy Prime Minister and Minister of the Economy and Development of Mongolia Chimed Khurelbaatar.
Viktoria Abramchenko stressed that bilateral relations between Russia and Mongolia are based on a long history of friendship, cooperation and mutual assistance. She noted the two countries’ similar approaches to many topical issues, mutually respectful dialogue and equitable interaction of the parties in international affairs.
The Deputy Prime Minister noted the growing trade between the two countries, which increased by more than 30 percent last year.
“We expect that it will reach a historic high of $2 billion by the end of the year. At the same time, we understand that 98 percent of mutual trade consists of Russian products supplied to Mongolia, and for our part, we emphasise that we want to see Mongolian goods on our market,” Viktoria Abramchenko said.

Source: EINnews..com
See also: Mongolia asks Russia to supply extra volumes of diesel fuel before cold weather-Deputy PM

COAL EXPORT LIKELY TO RALLY IN COMING MONTHS

Mongolia’s coal export is rising as there is less congestion at the Chinese port. The volume of coal transportation has risen in the past two months and analysts emphasized that if this situation continues, coal export can reach up to 30 million tons by the end of the year. As of November, Mongolia has exported 24.4 million tons of coal. 
China consumes about 4.3 billion tons of coal annually, of which 611 million tons are imported. According to an international economic review, it seems that China’s coking coal prices will rise in the upcoming months.
As of October 10, the price of a ton of coal in Shaanxi Province, China is 2,488 CNY or 347.8 USD, which is 9.1 USD higher than in September, while at the Tianjin port, it costs 2,760 CNY or 385.7 USD, 29.4 USD higher than in the previous month.

Source: The UB Post
See also: Coal transport information on Tavantolgoi-Gashuunsukhait becomes transparent
China's Erenhot border port imports more than 2 Mt coal over Jan-Oct

MONGOLIA LAUNCHES ONLINE PLATFORM FOR TOURISTS

The Mongolian government declared 2023 and 2024 the Years of Visiting Mongolia to promote the country’s pandemic-hit tourism sector.
Meanwhile, the government launched an online platform for promoting Mongolia internationally. The website www.mongoliatravel.guide and the application "Visit Mongolia" were launched in test mode.
The www.mongoliatravel.guide website and "Visit Mongolia" travel app will provide information about the history, culture, art, customs, food and nature of Mongolia in Mongolian, English, Russian, Chinese, Japanese, Spanish and Korean languages, schedule of tourist activities and other information.
In addition, every foreign tourist who has obtained an e-visa to come to Mongolia will soon receive a greeting letter from the prime minister of Mongolia titled "Welcome to Mongolia.
Mongolia has set a goal of welcoming 1 million foreign tourists and earning 1 billion U.S. dollars from tourism in 2024.

Source: News.mn, Montsame

FOREIGN CURRENCY DEPOSITS SOAR TO 4.6 TRILLION USD

The National Statistics Office (NSO) announced that the money supply (М2) stood at 27.3 trillion MNT in October based on preliminary estimation, which is an increase of 183.4 billion MNT or 0.7 percent from the same period of last year.
The growth was caused by the increase in foreign currency transactions, up by 82.2 percent (1.9 trillion MNT), and foreign currency deposits, up by 15.2 percent (611.4 billion MNT).
The preliminary findings for October show that the money supply (M1) or money outside depository institutions and MNT-linked accounts reached 6 trillion MNT. This is a drop of 2.1 percent (128.7 billion MNT) from the previous month but a rise of 6.3 percent (358.5 billion MNT) from a year ago. In the money supply (M1), about 87.8 percent (5.3 trillion MNT) consists of MNT-linked accounts while 12.2 percent (735.6 billion MNT) consists of money outside the depository institutions.

Source: The UB Post

IRI MONGOLIA POLL SHOWS CONCERNS WITH ECONOMY AND CORRUPTION, SUPPORT FOR DEMOCRATIC GOVERNANCE

A new poll by the International Republican Institute’s (IRI) Center for Insights in Survey Research (CISR) shows Mongolians have concerns over the economy and corruption, while demonstrating strong support for democratic governance.
When asked about the most important problems facing the country today, most Mongolians chose issues related to the economy. The top three responses show 58% citing high prices and the cost of living, 26% stating unemployment, and 14% declaring other general economic issues. 
In a poll fielded from March to April 2021, 34% cited healthcare and COVID-19 as the top issue in Mongolia. 
The survey also finds that 74% of Mongolians feel that corruption is a very serious problem and there is little faith with institutions to address it. Sixty-four percent have a negative opinion about the Independent Authority Against Corruption, 66% have a negative opinion of the Courts, and 62% of have a negative opinion of the State Great Hural, the unicameral parliament. 

Source: GoGo News

TRAINING ON YAK ANIMAL HUSBANDRY, DISEASE RISK & MITIGATION, FLAYING & FLESHING TECHNIQUES, AND PRESERVATION AND STORAGE OF YAK HIDES

A five-day training programme will be organized for up to 25 representatives of herders’ groups and veterinary extension officers, targeted to highlight essential issues for attention during animal breeding and ultimately during slaughter.
The training will be held on:

• 14/11/2022 – 18/11/2022, Premises of Ministry of Food, Agriculture and Light Industry building – Conference Hall, Arkhangai province, Tseterleg (city center)
• 21/11/2022 – 25/11/2022, Premises of Ministry of Food, Agriculture and Light Industry building – Conference Hall, Khuvsgul province, Moron (city center)
• 28/11/2022 – 02/12/2022, Premises of Ministry of Food, Agriculture and Light Industry building – Conference Hall, Bayankhongor province, Bayankhongor (city center)
• 05/12/2022 – 09/12/2022, Premises of Ministry of Food, Agriculture and Light Industry building – Conference Hall, Uvurkhhangai province, Arvaikheer (city center)

Source: MNCCI

NEW TO ULAANBAATAR NOVEMBER 2022 - EDITORIAL

This list was cruelly interrupted by something that was new to the world in 2020, a global pandemic and thus restrictions on travel. After not being able to visit for 32 months, I finally made it back in August 2022.
What has arrived?

• large-scale BBQ extravaganza on the banks of the Tuul river, particularly near the ASEM Road. On summer weekends, so many cars parked right on the riverside, BBQs planted right next to them, families camping out, some literally

• drive-home service for drivers who have been drinking. You call the service, they drop off a driver who drives you home in your car and is then picked up again. Given – fortunately – much stricter enforcement of drunk driving laws, a great service!
• fixies
• airport road is getting ever fancier, now there’s a giant overpass just before crossing the Tuul on the way into town. Lots of fancy on/off-ramps popping up everywhere on roads.
• …

Source: Mongolia Focus

POLITICS

2023 BUDGET LAW PASSED WITH 1.4 TRILLION MNT DEFICIT

Last Friday, Parliament approved the draft 2023 Budget Law and draft amendments to the Law on Budget Framework Statement for 2023 and Law on Budget Assumptions for 2024 to 2025 among other fiscal bills.
In the state budget, revenue is projected to be about 19 trillion MNT, or 34.9 percent of the GDP, and spending is estimated to be around 20.4 trillion MNT, or 37.6 percent of the GDP. In other words, the state budget was passed with a deficit of 1.4 trillion MNT.
Under the Law on State Austerity, the government will take measures to keep the budget deficit at the target level, stabilize the economy and maintain fiscal discipline at all levels next year, Finance Minister B.Javkhlan said.
The government expects the economy to grow by about 5 percent and plans to reduce the inflation rate to a single-digit level next year.

Source: The UB Post, Montsame

UPCOMING MODIFICATIONS TO MONGOLIAN DOUBLE TAX TREATIES

In brief
Multilateral Convention to Implement Tax Treaty Measures to Prevent Base Erosion and Profit Shifting, also known as the Multilateral Instrument (MLI), is a flexible instrument which modifies tax treaties according to a jurisdiction's policy preferences with respect to the implementation of the tax treaty-related BEPS measures.
On 6 October 2022, Mongolia become the 100th jurisdiction to join the BEPS Convention (by signing the MLI), which now covers around 1850 bilateral tax treaties worldwide.
As a result, the double tax treaties (DTTs) of Mongolia are expected to be modified from 1 January 2024 in the expectation that the MLI would be ratified by the Parliament in the 2023 spring session.
Takeaway and what we can offer:
Adoption of the MLI will impact significantly DTT rules. Specifically, the DTT benefits are not applicable if, having regard to all relevant facts and circumstances, obtaining that the DTT benefit was one of the principal purposes of any arrangement or transaction.

Source: PwC Mongolia

CONCERNS OVER RESTRICTIVE HRD LAW PASSED BY MONGOLIAN PARLIAMENT

The ‘Law of Mongolia on the legal status of Human Rights Defenders’, has been in the making for over 2 years, with participation from civil society, human rights organisations (including ISHR, Front Line Defenders and Forum Asia), the National Human Rights Institution and UN experts. The original draft was approved by a committee in the Mongolian State Great Khural in December 2020 and was later sent to a parliamentary working group for review. The resulting version passed and was celebrated as the first law specifically destined for the protection of human rights defenders adopted in Asia. However, despite major objections from civil society and defenders, some broad provisions that could easily be used to restrict the rights of defenders were included in the version adopted.
Article 8.1.3 prohibits defamation of the ‘honour or reputation of others’. This broad provision could be misused to silence or criminalise defenders, as has occurred with other national laws, by claiming that any act of denunciation breaches this prohibition.

Source: International Service for Human Rights

RUSSIA PLANS TO COMPLETE DESIGNING OF SOYUZ VOSTOK GAS PIPELINE TO CHINA VIA MONGOLIA IN 2023

The designing of the Soyuz Vostok gas pipeline to China via Mongolia should be completed next year, Russian Deputy Prime Minister Victoria Abramchenko told journalists following a meeting of an intergovernmental commission with Mongolia.
"The completion [of the designing] is scheduled for next year. After all, this is a trilateral story, that is, we are supposed to ensure clearance by the three states," Abramchenko said.
Gazprom started to assess the possibility for supplying up to 50 billion cubic meters of gas per year to China via Mongolia in 2020. Design and surveying as part of the Soyuz Vostok trunk pipeline project began in February 2022. The pipeline is to go through Mongolian territory and will be a continuation of the Power of Siberia 2 pipeline.

Source: Interfax
See also: Russia, China continue discussing terms of gas supplies via Mongolia, says ambassador

CIVIL SOCIETIES DEMAND WITHDRAWAL OF ‘ANTI-ASSOCIATION’ BILL AS IT NEGATES PAST PROGRESS

In 1997, Parliament passed the Law on Non-Governmental Organizations (NGOs), which laid out the initial framework for Mongolians to fully exercise their newly gained constitutional rights of association, assembly and expression. Since then, civil society organizations have grown in number and capacity and have made invaluable contributions to the country’s evolving free and open society. However, these groups and the fundamental freedoms they enshrine are at risk as Parliament is discussing more “stringent” bills. Therefore, they have expressed their disapproval of the bills, which govern the work of civil society organizations, including the processes for registration and reporting and the types of activities allowed.
Last November, the Ministry of Justice and Internal Affairs submitted two new bills to regulate NGOs – a bill on associations and another on foundations. Both bills are pending in Parliament and propose a substantial revamp of the country’s regulatory environment for NGOs. 

Source: The UB Post

MONGOLIA ARRIVES AT COP27 WITH LARGEST DELEGATION IN COUNTRY'S HISTORY

The COP27 has begun in Sharm El-Sheikh, Egypt. Leaders from over 100 countries and about 50,000 representatives from 180 countries are participating this year, being held 6-18 November 2022.
This year, Mongolia is paying huge attention and participating in more than 60 people which considering the largest delegations from Mongolia in COP’s history. President of Mongolia, Ukhnaa Khurelsukh, will be attending high-level meetings on November 7-8, and will present Mongolia's position on combating climate change, desertification, and mitigating global warming, as well as presenting policies and activities that have been implemented at the national level.
The COP27 officially included loss and damage in its agenda for the first time. According to the National Emergency Agency of Mongolia, the country faced direct economic losses of 1.6 trillion MNT between 2009 and 2019. Additionally, Mongolia need 30.3 trillion MNT or USD11.5 billion financing on adaptation and mitigation of climate change to reach its climate target by 2030.

Source: EarthJournalism.net

RUSSIA INCREASED ELECTRICITY EXPORT TO MONGOLIA BY 100 MW-OFFICIAL

Russia has increased the capacity of electricity export supplies to Mongolia by 100 MW, Deputy Prime Minister Viktoria Abramchenko told reporters after the meeting of the Russian-Mongolian intergovernmental commission.
"We agreed with the Mongolian partners to scale up electricity supplies to the Mongolian market and increased such deliveries by 100 MW," she said.
Russia’s electricity export to Mongolia and China will grow by 19-20% annually to 5.2 bln kWh, Energy Minister Nikolay Shulginov said earlier.

Source: TASS

KH.NYAMBAATAR: CITIZENS OF MOST COUNTRIES WILL TRAVEL WITHOUT A VISA TO MONGOLIA

The decision of the Cabinet meeting is presented.
Kh.Nyambaatar, Minister of Justice and Internal Affairs, reported:
- The Ministry of Justice and Internal Affairs is preparing the first draft of the Law on Tourism. The regulation of tax refunds for tourists visiting Mongolia is included in this law. In relevance, the law on hunting will be amended an open auction will be organized based on the number of wild animals that can be hunted in that year issued by the Ministry. The hunting market will be more open. Many initiatives to increase the products of tour operators are under process. 
Also we intend to provide visa discounts for tourists. According to this, Mongolia will be the country that allows citizens of the largest number of countries to travel without a visa. The list of countries will be presented at next week's Cabinet meeting. 

Source: GoGo News
See also: Vietnamese citizens to become able to apply for visas online starting from December

E.BAT-AMGALAN MP: EXPANSION OF AMGALAN THERMAL POWER PLANT NEEDS TO START IMMEDIATELY

E.Bat-Amgalan, the Member of Parliament and Chairman of the Ad Hoc Committee on Development policy of Ulaanbaatar city, made a following report.
"The Government of Mongolia is paying special attention to the recovery of the energy sector within the framework of the "New Revival" policy. In June, 2022, a decision to start the expansion of the Amgalan Thermal Power Plant was made in order to provide heat to the eastern region of Ulaanbaatar. As of today, the expansion work has not officially started yet. Therefore, we met with the relevant authorities and exchanged opinions about the stage at which the expansion of the station is delayed”. 
Officials of the power plant said that a contractor for the expansion has been selected and is ready to begin work, but contractual issues related to financing have been holding up delays. The contractor will complete the expansion of the station within 16 months when the contract is finalized.

Source: GoGo News

“FOOD SUPPLY AND SECURITY” NATIONAL MOVEMENT LAUNCHED IN ULAANBAATAR

The ‘Food Supply and Security’ national movement, initiated by President of Mongolia U.Khurelsukh, is ongoing to ensure the food supply and security, to implement the goals of sustainable development, including meeting the domestic needs of 19 main types of food products in the next five years. This movement was officially launched in the capital city of Ulaanbaatar.
On this occasion, Governor of the Capital City and Mayor of Ulaanbaatar D.Sumiyabazar presented the policy to improve food supply and security and to provide the population of the capital city with 19 types of main food products for the next five years.
He said, "Based on the growing demand for food, it is important to increase the production of food and agricultural products, supply domestically, reduce dependence on imported products, and meet safety and hygiene requirements at every stage of the food chain…”

Source: Mayor's Office

PARENTS RALLY FOR CHILD-FRIENDLY SPACES - EDITORIAL

Six-year-old Setsen Unenbat plays out her dream of becoming an astronaut for the day at Mongolia’s only science museum for children, an interactive space that was forced to close during the pandemic due to a lack of funds.
At the DuDu Children’s Museum in the capital, Setsen runs excitedly to her mother, Battsetseg Chagdgaa, and points at a spaceship as she tugs at her mother’s hand. “It’s very interesting, Mom. Let’s go play together,” she says. “It makes me feel great to wear an astronaut’s uniform, float around inside the spaceship, and play in my own imagination.”
For Setsen and thousands of other schoolchildren, spaces like the DuDu museum were vital when school was open for only just three months in 2020 and 2021 due to the coronavirus pandemic. But the pandemic also caused a drastic drop in visitors to the museum’s two sites in the capital.

Source: Global Press Journal

BUSINESS

RIO TINTO’S LONG-AWAITED DEAL COMEBACK IS STUCK IN LIMBO

Mining giant Rio Tinto Group is finding that its long-awaited return to cutting a major deal without the brash spending of its past is proving a challenge.
Its more than $3 billion bid to buy the rest Turquoise Hill Resources Ltd. and boost its exposure to a massive copper deposit in Mongolia has effectively been put on hold. Rio struggled to win investor support, forcing it to offer unusual terms to the most stubborn holdouts which appeared to be enough to close the deal.
But within days, Canadian regulators took issue with the side deal, compelling Turquoise Hill to postpone the shareholder vote.
M&A is a sensitive subject at Rio. Disastrous deals more than a decade ago almost sunk the company, cost a former CEO his job and led to regulatory probes. Yet there’s a recognition within the world’s No. 2 mining firm that those issues have cast a shadow for too long.

Source: Mining.com

TURQUOISE HILL REPORTS USD 40-MILLION THIRD QUARTER PROFIT, RAISES GOLD GUIDANCE

 
NewsWire

Issue 756 –  11 November 2022

BCM NewsWire provides short summaries of news collected from around the world. Each article is kept to a maximum of 150 words for brevity, but click on the link next to “Source” to read the full article.

Economy

• Mongolia Jan-Oct coal exports surge 72 pct on yr
• Creation of the ‘Mongolian Coal’ brand
• FRC meets with Financial Service Commission and the Financial Supervisory Service of South Korea
• Digital solutions to make life easier for UB citizens
• ‘It is necessary to create healthy, safe and green workplaces’ - Interview
• Can monetary policy guarantee 4-5 pct economic growth in 2023? - Editorial
• Miners working long shifts deserve to be paid more fairly - Editorial
• In Mongolia, a Quest to Democratize Carbon Credits - Editorial

• 15 highlights from President of Mongolia's national statement delivered at COP27
• Mining minister J. Ganbaatar met with Minister for Resources of Australia
• “Sustainable Development Cooperation Framework” document presented to Prime Minister
• 'We can approve the state budget without deficit by raising revenue'
• Repayment of MNT 779 billion made to Development Bank
• “Erdenes Tavantolgoi” company to not agree on upfront payment terms
• Construction permits inspected
• District administration to plan green spaces, pedestrian and cycling infrastructure
• Bill on pawnshops passed to protect consumers’ interests
• Defacto Review, November 6 - Video

Business

• Rio Tinto's takeover of Turquoise Hill postponed indefinitely after Quebec watchdog raises concerns
• Golomt Bank LLC has registered shares to be issued as a public offer
• MMC’s Tender Offer Not DDE; Rating Headroom Pressure Easing
• Best handicraft products to be selected and supported for export
• Parks to be built in 2 ger areas in cooperation with Rio Tinto
• TMK delivers resource estimate for Mongolia CBM project
• Sandvik wins 2022 Innovation Award for AutoMine® in Mongolia
• Jade Gas Continues to Deliver Exploration Success
• A Brighter Tomorrow for Mongolia’s Energy Sector
• How Management Accountants Can Lead Digitalization
• Mascot of Ulaanbaatar-2023 East Asian Youth Games introduced
• Steppe Gold's Q3 Financials: Seeing Strong Increase in Gold Production - Video

Global and Regional Trends

• US inflation slows more than expected to 7.7pc annual rate
• Australia's resource-led economy digs stock markets out of hole
• China's trade unexpectedly shrinks as COVID curbs, global slowdown jolt demand
• Codelco proposes 33 pct price hike for Chinese copper buyers for 2023
• EU, Kazakhstan establish strategic partnership on raw materials, green hydrogen
• U.S. midterm elections: Five things Asia should know
• COP27: Key climate goal of 1.5C rise faces new challenge
• ASEAN summit begins with Myanmar likely to dominate agenda; 'little progress expected'
• The precarity of progress: Asia confronts post-pandemic era of insecurity - Editorial

• BCM Quarterly Report for Q3'22
• BCM submits policy paper
• The BCM appoints Raphaël Goué as official BCM representative in Europe
• SDG Investor Mapping project survey - Identifying business cases for investment opportunities
• UNICEF: Guidance for employers on flexible work arrangements and other good workplace practices in the context of Covid-19
• UNICEF: Call for actions of the private sector to reduce children’s exposure to air pollution in UB
• BCM Guideline for Companies to Combat Air Pollution
• Member-to-member special offers & benefits

Economic Indicators

• Inflation
• Central Bank Policy Rate
• Sovereign Credit Rating
• Currency Rates

ECONOMY

MONGOLIA JAN-OCT COAL EXPORTS SURGE 72 PCT ON YR

Mongolia's coal exports came in at 23.11 million tonnes during the first ten months of 2022, up 71.69% or 9.65 million tonnes year on year. The export value jumped 159.27% from the year prior to $5.11 billion, showed data from the Mongolian Customs General Administration (MCGA).
MCGA didn't release the specific figure for October, and Sxcoal calculated the shipments at 4.09 million tonnes based on the overall exports published by the administration.
The volume surged 178.41% or 2.62 million tonnes year on year yet decreased 1.75% or 72,700 tonnes month on month, data showed.
In October, the export amounts totaled $607 million, with the average price calculated at $148.55/t, down $171.91/t year on year and $1.11/t month on month.
Mongolia exported 21.56 million tonnes of coal to China from January to October, soaring 70.5% year on year, taking up 93% of the total.

Source: sxcoal.com
See also: Mongolia Looks to Sell More Coal to China as World Shuns Polluting Fuel
Mongolian enterprises can control coal quality, enhance brand awareness, Fenwei
Coal transportation on Tavan Tolgoi-Tsagaan Khad route surges 370%

CREATION OF THE ‘MONGOLIAN COAL’ BRAND

The bill on the Sovereign Wealth Fund will be discussed at the autumn session of Parliament. As the government supports, its approval without much objection is expected. The main point is that the structure, management, executive management, board of directors, operating strategy, and direction of the state-owned company, Erdenes Mongolia , is clearly stated in the bill. So, if the law is approved, Erdenes Mongolia will become the Sovereign Wealth Fund. On the other hand, by bringing Erdenet Mining Corporation and Mongolrostsvetmet into the Erdenes Mongolia company’s structure, it will become a "holding" company. This also applies to the government decree issued in April of this year that updates the company's rules.
This clarifies many issues. There are good objectives for an open and transparent business environment, good corporate governance, joint management of joint ventures and mutually beneficial investor relations.

Source: Mongolian Mining Journal

FRC MEETS WITH FINANCIAL SERVICE COMMISSION AND THE FINANCIAL SUPERVISORY SERVICE OF SOUTH KOREA

T.Tserenbadral (Vice Chairman, Financial Regulatory Commission, FRC) met with Kim Yong-Jae (Standing Commissioner, Financial Service Commission, FSC), and Lee Myung Soon (First Senior Deputy Governor, Financial Supervisory Service, FSS) on 4 November, 2022. During the meeting, T.Tserenbadral presented a brief introduction about the activities of the FRC, and information about its work in recent years. Particular examples included:

• measures implemented to increase capital market growth,
• policy development to support new services and products,
• increase participation of foreign (and professional) investors, and reduction of financial costs (by creating fair competition in financial markets). 

• optimize the form of ownership of state-owned companies, and
• reform the Bank sector and improve governance (by establishing publicly controlled and open joint-stock companies, in stages). In this way, the stock market value of Mongolia will increase two to threefold, and products that meet the demands of foreign and domestic investors will be created.

Source: FRC

DIGITAL SOLUTIONS TO MAKE LIFE EASIER FOR UB CITIZENS

It is a wise and timely decision to use new solutions to solve the issues of the city, ensure the comfort of citizens and create conditions for living in a safe and pleasant environment. Therefore, the digital transition plan of Ulaanbaatar has been presented taking into account international standards, the characteristics of Mongolia, the culture and traditions of the citizens, the extreme climate and the characteristics of the state structure. In other words, Ulaanbaatar is cooperating with more than 70 national IT entities and 1,000 Mongolian engineers to use information technology solutions in each branch of the capital. We are highlighting digital solutions that were introduced in the city.
As part of the digitalization of public transport, the ePASS project, an integrated system with automation and information technology solutions will be introduced to the city’s public transport and school bus services.

Source: The UB Post

‘IT IS NECESSARY TO CREATE HEALTHY, SAFE AND GREEN WORKPLACES’ - INTERVIEW

The following interview is with Head of the Federation of Energy, Geology and Mining Workers’ Trade Unions of Mongolia D.Dolgor.
How do you evaluate the state of labor relations among employees in the energy, geology, and mining sectors?
Our federation is working to protect the labor rights and legitimate rights of workers in the energy, geology and mining sectors. Since last May, workers in the energy sector have started speaking to the government about concerns for their health and safety. On average, power plants and utility networks have been operating for about 30 years. Due to the lack of investment in the energy sector, the technology and equipment are outdated. People are working under such conditions.
Due to the pandemic, the electricity tariff for households has not been raised since 2019. However, the prices of oil, lubricants and spare parts used in power plants and pipelines have hiked significantly.

Source: The UB Post

CAN MONETARY POLICY GUARANTEE 4-5 PCT ECONOMIC GROWTH IN 2023? - EDITORIAL

Since the macroeconomic policy is aimed at improving the quality of citizens’ life by ensuring economic growth, keeping inflation and unemployment at a stable low level and reducing fiscal and trade deficits, the draft basic guidelines for 2023 state monetary policy, which is expected to be passed by Parliament this week, is drawing people’s attention.
Mongol Bank developed the draft guideline to support the economic and financial stability of Mongolia and overcome the pandemic and international conflict situation, the rise in foreign and domestic prices and other spillovers through the coordinated implementation of budget, monetary and financial policies.
The pandemic effects and the external geopolitical tensions have directly and indirectly affected the country’s economy for the past two years.
Mongol Bank explains that progressive measures taken in terms of budget, monetary and financial policies have yielded results, expanding the economy by 1.9 percent in the first half of 2022 compared to the same period of last year.

Source: The UB Post

MINERS WORKING LONG SHIFTS DESERVE TO BE PAID MORE FAIRLY - EDITORIAL

After the implementation of the revised labour law, which was endorsed last July and made effective from this year, miners have less money in their hands. That is because miners who worked more days at mining sites and spent much less time at home, are now entitled to have more time with their families and earn less. But it is not that simple. Miners require fair salary from their employers under the revised law. But employers have answered them that they are paid what they are entitled. Under the new labour law, miner’s average working hours per day should be limited to eight hours (as regulated by the law’s articles 87, 92, 109.1) and if it is extended, no more than four hours overtime can be added. But the laws are not implemented well. On the contrary, miners’ salaries have been decreased due to the law’s related regulations on average salary defining, salary calculation methodology, approved following the labour law.

Source: Mongolian Mining Journal

IN MONGOLIA, A QUEST TO DEMOCRATIZE CARBON CREDITS - EDITORIAL

For several years, The Asia Foundation’s Mongolia office in Ulaanbaatar has been working to reduce our carbon footprint. We started with simple efforts to reduce our emissions—limiting energy use, walking to meetings, composting our food waste, etc.—but we soon bumped up against some fundamental constraints, such as how our office building is heated during the long cold winters and the inevitability of car and airplane travel. These factors meant there was no direct pathway to zero emissions for our office.
Through this process we discovered that the only path to our goal of net zero emissions was to purchase carbon credits.
Carbon credits are based on a simple concept. Some entities are required by regulation, or choose voluntarily, to reduce their emissions. Those who cannot reduce their own emissions to zero, like our Mongolia office, can instead pay for emissions reductions by others by purchasing carbon credits.

Source: The Asia Foundation

POLITICS

15 HIGHLIGHTS FROM PRESIDENT OF MONGOLIA'S NATIONAL STATEMENT DELIVERED AT COP27

President of Mongolia U. Khurelsukh yesterday delivered a national statement at COP27. The following are some of the highlights of his statement that expressed Mongolia's stance on climate change.

1. In these difficult times when the world is faced with significant challenges such as the global food and energy crisis, rising prices, and geopolitical tensions. It is imperative that all countries remain committed to achieving the Sustainable Development Goals and intensify their actions, especially towards combating climate change without losing momentum.
2. Soil, food, and human beings are inextricably linked. Healthy soil produces healthy food and healthy food nurtures healthy people. Therefore, combating climate change is important to protecting soil, our food, and humankind.
3. Every country needs to comprehensively address the pillars of food supply, food security, and climate change as part of SDGs.
4. Mongolia, in its efforts to achieve SDGs, is successfully implementing the “Food Supply and Security”, “Healthy Mongolians” and “One Billion Trees” national movements.
5. …

Source: Montsame
See also: UN chief warns "We are on a highway to climate hell" at COP27 summit
Mongolia becomes the first Asian country to join the EU Forest Partnership
Mongolia plants over 10 mln trees in 1 year to combat desertification

MINING MINISTER J. GANBAATAR MET WITH MINISTER FOR RESOURCES OF AUSTRALIA

Minister of Mining and Heavy Industry of Mongolia J. Ganbaatar, who is participating in the “International Mining and Resources Conference (IMARC) 2022", met with Madeleine King, Minister for Mineral Resources and Minister for Northern Australia.
During the meeting, Minister J. Ganbaatar mentioned that this year marks the 50th anniversary of the establishment of diplomatic relations between Mongolia and Australia and expressed his satisfaction with the expansion of cooperation in the field of mining.
Minister for Resources of Australia Madeleine King said that she will support Mongolia’s cooperation with relevant organizations of Australia in the fields of geology, exploration, and investment such as Geoscience Australia.
In addition, Minister J. Ganbaatar invited Minister Madeleine King to visit Mongolia at her convenience.

Source: Montsame
See also: Possibilities of attracting investment in geological exploration discussed

“SUSTAINABLE DEVELOPMENT COOPERATION FRAMEWORK” DOCUMENT PRESENTED TO PRIME MINISTER

On November 8, Prime Minister of Mongolia L. Oyun-Erdene received United Nations Resident Coordinator in Mongolia Tapan Mishra to discuss the relations and cooperation between the two sides.
UN Resident Coordinator Tapan Mishra expressed that the UN and its specialized agencies would support the Government of Mongolia's New Revival Policy and presented the Prime Minister with the document of the UN Sustainable Development Cooperation Framework for Mongolia 2023-2027.
The Prime Minister said that this document is aimed at intensifying the implementation of the long-term program document “Vision-2050", is aligned with the Action Plan of the Government of Mongolia for 2020-2024, and also ensures close intersectoral coordination. 
In addition, he informed that the Government of Mongolia is paying a special attention to the issues of renewable energy and water sources.

Source: Montsame

'WE CAN APPROVE THE STATE BUDGET WITHOUT DEFICIT BY RAISING REVENUE'

During its plenary session on November 3, Parliament reviewed the draft 2023 Budget Law and the draft amendment to the Law on Budget Framework Statement for 2023.
Parliamentarians asked questions and expressed their views on the bills at the session.
Legislator M.Oyunchimeg underscored that the Consumer Price Index is estimated to be 8 percent although it is already 13 to 14 percent right now. She noted that the 30 percent increase in the price of flour was putting too much pressure on the people. The best-selling consumer good was baked goods, she said.
Minister of Food, Agriculture and Light Industry Kh.Bolorchuluun explained, “The prices of flour and rice did not increase in the last four to five years and remained stable. However, the price suddenly increased by 30 percent. The price stabilization program was approved in May. This program can only keep inflation at 10 percent. However, the cost of grain and rice increased by 50 percent.”

Source: The UB Post

REPAYMENT OF MNT 779 BILLION MADE TO DEVELOPMENT BANK

Between January 20 and October 31, 2022, a total repayment of MNT 779.6 billion was made to the Development Bank of Mongolia. MNT 681.2 billion were repaid in cash, and MNT 98.4 billion were repaid by real estate.
A total of 14 borrowers' loans were paid-off. 12 loans were paid-off in cash or MNT 278.3 billion, and 2 loans were paid-off by real estate.
As of October 31, 2022, the Development Bank has loans outstanding of MNT 2.8 trillion of 53 borrowers. 31.5% or MNT 890 billion is borrowed by 8 borrowers of state-owned companies, and 68.5% or MNT 1.9 trillion was borrowed by 45 private sector borrowers.

Source: GoGo News

“ERDENES TAVANTOLGOI” COMPANY TO NOT AGREE ON UPFRONT PAYMENT TERMS

During its regular meeting dated October 26, the Cabinet made a decision to impose an emergency regime for “Erdenes Tavantolgoi” state-owned enterprise for six months, assigning State Secretary of the Ministry of Finance J. Ganbat as the Government’s Special Representative to take relevant measures to improve the company’s operations and management and increase the revenue.
In this regard, on November 8, the Special Representative held a press briefing, during which he emphasized that making the company’s information on contracts and activities transparent and open to the public is the most appropriate solution.
After being assigned as the Government’s special representative, he started publicizing the coal mining and transportation information and contracts signed with mining companies accessible on the company’s website. Tender information related to procurement is linked online. Specifically, the quantity of coal loaded from the mine is disclosed on the company’s website.

Source: Montsame

CONSTRUCTION PERMITS INSPECTED

The meeting of the Ulaanbaatar Mayor’s Council was held on November 3.
At the beginning of the meeting, the results of inspections made to the construction permits issued after 2020 were discussed. Head of the Ulaanbaatar Specialized Inspection Agency S.Davaasuren introduced the result of the inspection.
Since 2020, the Ulaanbaatar Urban Planning and Development Department has issued a total of 1,143 building permits, 1,197 electrical and energy permits, 104 utility and network permits, 368 permit extensions and 16 renewed permits. A total of 67 of 410 construction permits were found to be in violation. In this regard, the mayor instructed the relevant officials to eliminate the violations found during the inspection.
General Manager of Ulaanbaatar and Head of the Ulaanbaatar Mayor’s Office D.Ganbold presented the increasing cost of waste disposal at the landfill.
Ulaanbaatar has more than 410,000 households and 175,000 entities. As this number increases every year, the amount of waste is also increasing.

Source: The UB Post

DISTRICT ADMINISTRATION TO PLAN GREEN SPACES, PEDESTRIAN AND CYCLING INFRASTRUCTURE

Mayor of Ulaanbaatar D.Sumiyabazar met with the governors of six districts of the capital city and reviewed plans for building pedestrian and bicycle paths and green facility infrastructure next year. For instance, in Songinokhairkhan District, 1,234 unauthorized garages were vacated this year and the construction of pedestrian and cycling paths has started. The Khan-Uul District authorities presented their plan to build an Eco corridor.
During the meeting, the Policy Research and Analysis Center of Ulaanbaatar provided information on the existing bicycle and pedestrian paths, as well as short-term planning on how to increase them and reduce traffic congestion. According to research, there are 31.4 kilometers of bicycle paths in the city center. However, there are issues such as these roads being cut off and not being connected to each other. Therefore, the study revealed that 31.5 kilometers of pedestrian and bicycle paths are needed to connect them and create conditions for people to go to work by bicycle.

Source: The UB Post

BILL ON PAWNSHOPS PASSED TO PROTECT CONSUMERS’ INTERESTS

During its plenary session on November 4, Parliament adopted the bill on the regulation of money lending, submitted by the government, in order to manage pawnshops.
As of today, there are about 1,000 pawnshops in Mongolia but very few of them pay taxes. Therefore, the law was developed with eight chapters to regulate the activities of pawnshops and protect the interests of consumers. It sets specific requirements for money lending operators and provides regulations for registration and control, according to lawmakers. The newly-approved law also disallows pawnshops to sell collaterals.
According to the Authority for Fair Competition and Protection of Consumers’ inspections in 2020, more than 900 pawnshops were found to be making some kind of violations, including operating without a license, valuing collaterals at up to 80 percent below market value and charging high interest and high overdue payment.

Source: The UB Post

DEFACTO REVIEW, NOVEMBER 6 - VIDEO

Highlights of the week:
1. Cases of fraudulent activities surrounding foreign investors
2. Changes in the management of Erdenes Tavantolgoi
3. Increase in the prices of railway transport and energy

Source: Jargal Defacto

BUSINESS

RIO TINTO'S TAKEOVER OF TURQUOISE HILL POSTPONED INDEFINITELY AFTER QUEBEC WATCHDOG RAISES CONCERNS

A Turquoise Hill Resources Ltd. shareholder vote on Rio Tinto Ltd.’s attempt to take full control of the Montreal-based miner has been indefinitely postponed after Quebec’s securities regulator said the way the transaction is currently structured raises “public interest concerns” due to side deals with shareholders who spoke against the bid.
Turquoise Hill said in a press release on Wednesday that it has been “engaged with Rio Tinto in order to address the differential treatment of minority shareholders resulting from the agreements.”
Once these concerns are resolved, the company said it will provide shareholders with supplemental disclosures regarding the revised terms and provide them with sufficient time to consider them. As such, Turquoise decided to indefinitely postpone the vote.
This is the third time Turquoise has postponed the shareholder vote. On Sunday, it shifted the vote for a second time to Nov. 15 from Nov. 8 because…

Source: Financial Post, AFR
See also: Former OSC chair says Rio Tinto deal with dissident shareholders is illegal, regulators likely to stop Turquoise Hill takeover

GOLOMT BANK LLC HAS REGISTERED SHARES TO BE ISSUED AS A PUBLIC OFFER

A total of 31 issues were discussed at the 20th regular meeting of the FRC (9 November 2022), and decided to register the ordinary shares of "Golomt Bank" LLC in the register of securities approved for public offering. "Golomt Bank" LLC is the second bank among influential banks in the banking system to register its shares for public offering within the framework of the reform of the banking system. Implementation of public offering of shares (IPO) by banks will increase the value of the stock market, increase the number of new products with good liquidity, improve the activity and participation of foreign and domestic investors, and make banking operations more transparent and open. In addition to the creation of long-term sources of financing for banks and the increase in credit output, it will be an important step in creating a multi-pillar financial system.

Source: FRC

MMC’S TENDER OFFER NOT DDE; RATING HEADROOM PRESSURE EASING

Mongolian Mining Corporation’s (MMC, B/Negative) tender offer, if accepted by the holders of its USD440 million senior notes due April 2024, has no immediate rating impact, Fitch Ratings says. Pressure on MMC’s rating headroom is also easing, reflecting the reduction in border disruptions.
MMC plans to purchase with cash part of its outstanding 9.25% senior notes due 2024 for an aggregate price of up to a tender cap. We regard MMC’s tender offer for part of its US dollar bonds as an opportunistic move and we do not treat it as a distressed debt exchange (DDE) even though the buyback consists of a material reduction in terms as it is below par. This is because we do not believe the offer was made to avoid a default since the company’s near-term liquidity remains adequate and its bond maturity in 2024 is close to 18 months away.

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