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ECONOMY
MONGOLIA’S ECONOMY PROJECTED TO GROW BY 2.1 PERCENT IN 2022
World Bank initially projected Mongolia's economic growth to expand by 3.5 percent in 2021. However, it lowered the forecast by 2.4 percentage in its previous forecast released in June, 2021. It was noted that the rising inflation rate put significant pressure on the country’s economy in addition to the risks of new variants of COVID-19 and external debt.
Inflation has reached the highest level since 2011 in most developing countries with external debts putting pressure at the same time. World Bank analysts also point out that commodity price fluctuations are an obstacle for countries that depend on commodity exports. In addition, income inequality is deepening around the world, and access to vaccines varies.
As for this year's outlook, Mongolia's economy is projected to grow by 2.1 percent in 2022 and 6.2 percent in 2023.
Source: Montsame
MONGOLIA'S 2021 COAL OUTPUT SLUMPS 29.6 PCT YOY
Coal production of Mongolia dropped 29.6% year on year to 30.12 million tonnes in 2021, showed data from the National Statistical Office of Mongolia.
The inland country's coal production in December slumped 59.57% on the year but rose 3.36% on the month to 2.47 million tonnes, data showed.
Mongolia's iron ore production was 796,900 tonnes in December, down 15.16% on the year but falling 16.7% on the month, bringing total iron ore production down 7.27% year on year to 12.93 million tonnes in 2021.
Iron sand output was 553,000 tonnes in December, rising 9.25% year on year but down 10.71% from November, while iron concentrate production was 243,9000 tonnes in December, down 43.69% from a year ago and 27.71% month on month.
Source: SXCoal.com
FOREIGN TRADE BALANCE IN SURPLUS OF USD 2.4 BILLION IN 2021
In 2021, Mongolia traded with 159 countries from all over the world, and the total trade turnover reached USD 16.1 billion, of which USD 9.2 billion were exports and USD 6.8 billion were imports. The total foreign trade turnover increased by USD 3.2 billion (25.0 percent), where exports increased by USD 1.7 billion (22.1 percent) and imports increased by USD 1.5 billion (29.2 percent) compared to the previous year.
In December 2021, exports reached USD 417.3 million, decreased by USD 889.0 million (68.1 percent) and imports reached USD 660.7 million, increased by USD 117.9 million (21.7 percent) compared to the previous month.
The foreign trade balance was in surplus of USD 2.4 billion in 2021, increased by USD 121.1 million (5.3 percent) compared to the previous year. In December 2021, trade balance deficit reached USD 243.4 million and decreased by USD 1.0 billion from previous month. Trade with China reached USD 10.2 billion in 2021, which is 63.1 percent of the total trade turnover.
Source: Montsame
EMPLOYMENT SUPPORT LOAN CONTINUE TO BE ISSUED
The Ministry of Finance has announced that it will continue to provide soft loans to support employment this year in the framework of the ‘MNT 10 trillion Comprehensive Plan for Health Protection and Economic Recovery’.
A total of MNT 4.3 trillion loan were issued last year. Fifty percent of the total loan was provided to support and create more jobs, which is the main target activity. The Ministry of Finance is studying what sector should be prioritized. Loans up to MNT 50 million will be issued to individuals and up to MNT 500 million to businesses.
The employment support loan with an annual interest rate of 3 percent will continue to be provided from March 1.
Last year, 62 percent of the total loan were issued to businesses in the capital city while 37 percent in aimags and rural areas. Orkhon, Darkhan-Uul and Selenge aimags lead with its amount of loans issued.
Source: Montsame
GENERAL GOVERNMENT BUDGET EXPENDITURE INCREASED BY MNT 1.7 TRILLION IN 2021, UP 12 PCT
According to the preliminary results at end of the 2021, the total revenue of the general government budget was MNT 14.3 trillion, increased by MNT 3.8 trillion (36.5 percent) compared to the previous year. The equilibrated revenue of the general government budget was MNT 12.7 trillion increased by MNT 3.2 (34.1 percent) trillion compared to the previous year.
In 2021, general government budget expenditure and net lending was MNT 15.6 trillion, increased by MNT 1.7 trillion (12.2 percent) compared to the previous year. This increase was primarily affected by MNT 1.9 trillion (17.8 percent) increase in current expenditure compared to the previous year. In December 2021, the general government budget expenditure and net lending was MNT 2.0 trillion, increased by MNT 678.2 billion (49.9 percent) compared to previous month.
Source: Montsame
REVENUE FROM ALL TYPES OF TRANSPORT INCREASES BY 2.2 PERCENT
At the end of 2021, 49.2 million tons of freight were carried in total by all types of transport. Compared to the same period of the previous year, the carried freight was decreased by 11.1 million tons (18.5 percent). This decrease was mainly due to the 12.5 million tons (41.0 percent) decline in road transport freight.
At the end of 2021, 107.2 million passengers (in repeated counting) were carried in total by all types of transport. The number of carried passengers dropped by 19.4 million (15.3 percent) compared to the same period of previous year. This decrease was mainly due to 17.6 million passengers (14.2 percent) decline in road transport.
In the fourth quarter of 2021, the carried freight by all types of transport decreased by 764.1 thousand (6.9 percent), while the number of passengers increased by 18.6 million (60.6 percent) compared to the previous quarter.
Source: Montsame
See also: Inbound foreign passengers decreases by 41.4 percent
FINANCING SYSTEM TO BE BUILT TO SUPPORT NON-MINING EXPORT
On January 14, CEO of Development Bank of Mongolia N. Manduul and President of Mongolian National Chamber of Commerce and Industry O. Amartuvshin signed a Memorandum of Understanding on cooperation. The MoU provides an opportunity to boost active cooperation between the government, private sector and investors to develop a non-mining export financing system. It will also support the development of a specific financing system for the preparation and purchase of raw materials to support non-mining exports, and the mutual exchange of information, research and data on the economy, trade and investment.
Furthermore, a joint working group will be set up on the selection of tenders to fund non-mining exports. The MNCCI will be committed to provide research and information related to the financing, and organize meetings and events aimed to support non-mining exports.
Source: Montsame
MEETING HELD ON PREPARATIONS FOR MONGOLIA-U.S. DIRECT FLIGHT
Representatives of the Ministry of Foreign Affairs, the Civil Aviation Authority, MIAT and the Embassy of Mongolia in the United States held an online meeting yesterday in preparation for a direct flight between Mongolia and the United States.
During the meeting, they exchanged views and information on the progress of the work and further steps to be taken.
The meeting was attended by Mongolia’s Ambassador to the U.S. U.Batbayar, Director of the Department of Americas, Middle East and Africa of the Ministry of Foreign Affairs A.Anand, Executive Director of MIAT Mongolian Airlines B.Munkhtamir, Director General of the Civil Aviation Authority S.Munkhnasan and other relevant officials.
Source: Montsame
MONGOLIA’S BAN ON MOVING TO OVERCROWDED CAPITAL HURT MIGRANTS: IOM RESEARCH
Research by the International Organization for Migration (IOM) in Mongolia shows a migration ban aimed at reducing overpopulation in Ulaanbaatar only increased the vulnerabilities of the capital city’s urban migrants.
IOM found that rural-to-urban migration improved the lives of most internal migrants in Mongolia, providing them with more and better job opportunities and increasing their incomes.
Due to development discrepancies between rural areas and the capital, Mongolia has experienced a dramatic rural-to-urban migration flow, raising Ulaanbaatar’s population to almost 1.5 million – half the country’s total, according to its 2020 census.
The Municipality of Ulaanbaatar shut the door to new residents with annual bans between 2017 and 2020 in a bid to protect health and safety, and the environment, but given IOM's findings, it will not reintroduce a ban.
Source: International Organization for Migration
PEERING INTO THE YEAR AHEAD IN ASIA (MONGOLIA)
Prime Minister Oyun-Erdene has laid out an ambitious agenda for economic growth and reform and brought many fresh faces into government, but at the same time, some elements within the ruling party seem more focused on limiting opposition from political rivals and civil society. How the tensions and competing objectives within the MPP are managed, and the extent to which party unity can be maintained, will shape much of what occurs in the coming year. It is likely that the persistent challenges of corruption and weak policy implementation will continue to constrain the government’s policy ambitions.
The completion of an agreement with Rio Tinto to continue the expansion of the Oyu Tolgoi mega-mining project will give a boost to plans to accelerate the economic recovery that started in 2021, but the pandemic continues to create significant downside risk.
Source: The Asia Foundation
MONGOLIA’S POPULATION INCREASES TO 3.4 MILLION
At the end of the previous year., the population of Mongolia totaled 3.4 million, increased by 56.2 thousand or 1.6 percent compared to 2020, according to the National Statistical Office of Mongolia.
As of the end of 2021, 71166 mothers gave birth, and 73866 children were born, decreased by 4528 (2.3%) and 4080 (5.2%) respectively, compared to 2020.
The death toll totaled 20002, increased by 4012 or 25.1 percent compared to the previous year.
Source: Montsame
HERDERS VS. VOLES: THE BATTLE FOR MONGOLIA’S GRASSLANDS - EDITORIAL
The endless prairie has become a colander, peppered with what look like golf holes. Small gray rodents dart in and out, growing more numerous as late autumn sunshine warms the Mongolian steppe in the country’s central Khangai region.
Munkh-Erdene Baasanjav, a herder for 30 years, drills a hole into a raised mound and puts his hand inside to confirm his fears: a nest of thick grass. After removing the material, he pumps 60 liters of water into the hole, an environmentally friendly method of freezing the creatures out.
“When I was a child, there were rodents in some places, but now they are bustling everywhere like dust rising,” he says.
The pests are Brandt’s voles, one of the fastest reproducing mammals in the world. Female voles can give birth three times a year, up to 11 offspring each time.
Source: Global Press Journal
MONGOLIA SUFFERS UNDER CHINA’S ZERO COVID POLICY - EDITORIAL
Food shortages, inflation, hundreds of thousands of people without an income, and thousands of shipping containers stuck on the border, not to mention rising Covid-19 cases, job losses, closed businesses, a crippled export sector, and a decimated tourism industry: this has been the situation in Mongolia for the past two years. In an interview with the author, Deputy Prime Minister Amarsaikhan Sainbuyan described the pandemic as “the biggest crisis of my career” and went on to explain the difficulties that a small, developing democracy experiences when it tries to balance the economy while safeguarding public health.
To make matters worse, inflation skyrocketed to 9.6 per cent, with the prices of food, solid fuels and gasoline increasing the most. Ten months into the pandemic, meat prices in Ulaanbaatar had risen 16 per cent and fuel prices 38.8 per cent.
Source: Lowy Institute
POLITICS
BILL ON ESTABLISHING KHUSHIG VALLEY FREE ECONOMIC ZONE PRESENTED
On January 14, Deputy Prime Minister S.Amarsaikhan presented a bill to Speaker G.Zandanshatar on a resolution for establishing a Free Economic Zone at Khushig Valley.
With an area of 1,000 hectares in the territory of Sergelen soum, Tuv aimag, the Free Economic Zone will be based around the new Chinggis Khaan International Airport.
By establishing the Khushig Valley Free Economic Zone:
• A specialized zone will be established for tourism, business, and financial operations through production and services, such as tourism services focusing on nomadic culture, betting games and associated services, cultural and creative industry, trades, and international bank and financing services,
• A zone will be created for export-oriented production and innovation based on science, advanced technology, and artificial intelligence,
• Opportunities will be created for the country to become ‘Transit Mongolia’ by utilizing the geographical advantage of being located between Asia and Europe in facilitating trade and transportation and creating more favorable conditions for investment.
Source: Montsame
NEW MINISTER OF ENVIRONMENT AND TOURISM APPOINTED
Prime Minister L.Oyun-Erdene has issued an ordinance on appointing former Head of the Authority for Fair Competition and Consumer Protection B.Bat-Erdene as a Cabinet member and the new Minister of Environment and Tourism.
In accordance with the article 39.2 of the Constitution of Mongolia, the Prime Minister shall appoint and dismiss a member of the cabinet, presenting the appointee to the State Great Khural and the President. According to the article, the newly appointed minister is to take the oath of office to the parliament.
On January 16, Minister of Environment and Tourism N.Urtnasan was dismissed as she failed to achieve results in the implementation of policy for reducing air pollution and to realise certain assignments given by the Prime Minister.
Source: Montsame, News.mn
See also: Officials of Ministry of Environment and Tourism dismissed
AUTUMN SESSION OF STATE GREAT KHURAL CLOSES
2021 autumn session of the State Great Khural, the unicameral legislature of Mongolia, closed on January 18.
During its autumn session, the parliament convened 75 times and resolved 243 proposals and parliamentary standing committees held 97 meetings, subcommittees 5 meetings and temporary committees 9 meetings, emphasized Chairman of the State Great Khural G.Zandanshatar adding “The parliament took an important step in implementing constitutional amendments, approving 16 laws and revised laws and ratifying five international agreements and treaties”
He said, “The approval of the Law on Oversight of the State Great Khural marks the beginning of a new stage in parliamentary development. Since the adoption of the democratic Constitution, there have often been overlaps, gaps and contradictions in laws due to inadequacy in the implementation and the alignment of laws. I am confident that this law will be an important step in solving that…
Source: Montsame
MINING MINISTER INTRODUCES DRAFT BILL ON MINING PRODUCTS EXCHANGE
On January 17, the Parliamentary Standing Committee on Economy discussed the bill on the Mining Products Exchange. Minister of Mining and Heavy Industry G.Yondon introduced the bill at the meeting.
In his presentation, the Minister highlighted the necessity to take certain measures to increase investors’ interest in Mongolia’s mining sector and further increase the sector’s contribution to the country’s economy by creating the conditions for mining products to be publicly traded and regulating exports through a unified policy.
Alongside setting the structure of a mining products exchange, the bill reflects the framework of operations to be carried out by the exchange, such as the type of trades and transactions to be made through the exchange and their guarantee, and issuance of trading rights, and the necessary regulations to ensure fair and transparent trades.
Source: Montsame
AMENDMENTS TO LAW ON TRADEMARKS AND GEOGRAPHICAL INDICATIONS
As promised, we will continue to discuss about intellectual property law reform in Mongolia. On May 6, 2021 lawmakers passed amendments to Law on Trademarks and Geographical indications. The revised version of this Law was adopted in 2010, and was previously amended only once in 2015. Since this Law was adopted some trademark-related relations have evolved and several new regulations were implemented. For example, IP office started to take trademark applications online. Due to these circumstances, it became necessary to make relevant amendments to the Law.
Let’s look at key points of new regulations implemented in new amendments to Law:
- Terms and definitions are redefined in accordance with international treaties, to which Mongolia is a party (such as TRIPS, the Paris convention, Singapore Treaty on the Law of Trademarks),
- New ground for refusal to register a trademark is added: if a mark (trademark) matches the name of a legal entity that is registered in state registration.
- …
Source: LehmanLaw Mongolia
LATEST ON COVID-19 IN MONGOLIA
Below are headlines from the past week concerning Covid-19 in Mongolia:
Source: Various
PARLIAMENT ADOPTS BILL TO RATIFY AMENDMENT TO THE MONTREAL PROTOCOL
At its plenary meeting yesterday, January 18, the Mongolian Parliament approved a Bill on ratifying the Amendment to the Montreal Protocol on Substances that Deplete the Ozone Layer.
In 1996, Mongolia joined to the Vienna Convention for the Protection of the Ozone Layer and the Montreal Protocol on Substances that Deplete the Ozone Layer, and is now working to phase down the consumption of ozone depleting substances by establishing a registration and monitoring system.
Adopted on 15 September 1987, the Protocol regulates production and consumption of nearly 100 man-made chemicals referred to as ozone depleting substances (ODS). The Montreal Protocol phases down the consumption and production of the different ODS in a step-wise manner, with different timetables for developed and developing countries. To date, the Parties to the Protocol have phased out 99 percent of ODS globally compared to 1990 levels.
Source: Montsame
MONGOLIA’S AMBASSADOR TO AUSTRIA SIGNS EXPORT CREDIT AGREEMENT
Mr. Tsengeg Mijiddorj, Ambassador of Mongolia to the Republic of Austria and Ms. Mary-Ann Hayes, Head of Structures Trade and Export Finance, UniCredit Bank as well as Mr. Georg Karner, Director for Structured Trade and Export Finance, UniCredit Bank, signed the Export Credit Agreement for the ‘Upgrading of Medical Equipment at the National Cancer Center; Cancer Navigation and Stereotactic Radiotherapy Center Project’ with a value of 7 million Euros on January 13, 2022 in Vienna.
The project will be implemented within the framework of the Financial Cooperation Agreement signed between the Government of Mongolia and the Government of the Republic of Austria.
The project will be implemented by Austrian company VAMED and will establish a neuro-oncology center of navigation surgery and stereotactic treatment at the National Cancer Center in order to provide comprehensive, modern diagnostic and treatment for patients with brain and spinal tumor and to develop brain cancer care services in Mongolia to international level.
Source: Montsame
STRONG IMPACT OF POLICY
For the first time, the Parliament established an Ad Hoc Committee on Ulaanbaatar City Development Policy on May 28, which was a highly significant event for the capital city and its citizens.
The Ad Hoc Committee, composed of 26 members, who joined to work together for the development of the city regardless of their party affiliation has made significant role on the passage of the Law on the Legal Status of the Capital City of Ulaanbaatar. In other words, as a result of the Ad Hoc Committee's initiative and efforts, the capital city gained a special status that allows the capital city's governor to be present in cabinet meetings, interacting directly with the prime minister and other cabinet members.
The Ad Hoc Committee has proven in a short period of time that it is not just a capital city lobby group in the parliament, but an important structure for defining the capital city's policy.
Source: Montsame
GROUNDS FOR REFUSAL OR RESTRAINT OF GRANTING MONGOLIAN CITIZENSHIP
A foreign person or a stateless person shall be refused Mongolian citizenship on the following grounds:
- 1. when it is proved that a person has committed a crime against humanity as defined by international legal regulations;
- 2. when a person has conducted or is conducting an activity against national security or vital interests of Mongolia;
- 3. when a person is being claimed as a member of international terrorist organization;
- 4. when a person is determined by court to be a dangerous criminal;
- 5. when a person is being deported from the territory of Mongolia;
- 6. has not passed 10 years since deported from the territory of Mongolia;
- 7. when a person advertised a religion that inconsistent with the Mongolian national customs and law.
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