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Cover Mongolia's Mogi Announced as Speaker at Mongolia Investment Summit 2013 Hong Kong
Munkhdul "Mogi" Badral, has been closely involved in the Mongolian capital market over the last 5 years, starting off as an analyst at a local investment bank to heading the Mongolian office of a top Western Australian junior resource broker. Recently founded a Mongolia focused market intelligence firm called Cover Mongolia, with the goal of bridging the information gap that exists between global and local markets. His firm's CoverMongolia NewsWire is the top source of up-to-date one-stop market news and coverage on Mongolia. Mogi is a frequent guest analyst on local and international media and publications. Studied Business Administration in Japan, and Software Engineering in Mongolia.
Sentosa Mining heads to market, has copper-gold porphyry potential near Rio's Oyu Tolgoi
September 18 (Proactive Investors) Sentosa Mining (ASX: SEO) recently confirmed large copper-gold porphyry potential near Rio Tinto's (ASX: RIO) giant Oyu Tolgoi copper porphyry deposit in Mongolia, with the company now heading to market to raise funds.
The ASX has granted Sentosa a trading halt, with its shares placed in pre-open.
The halt will be in place until the open of trade on Friday 20th September 2013, unless announced earlier.
Newera Commences Seismic Survey Seeking Coal Bed Markers within the Ulaan Tolgoi Project Area in Mongolia
September 18 -- Newera Resources Limited (ASX: NRU) is pleased to advise that it has commenced a seismic survey seeking coal bed markers under cover, within the Ulaan Tolgoi joint venture area in the South Gobi region of Mongolia.
· An Australian owned seismic contracting business with previous experience in conducting such surveys in Mongolia has been selected to carry out the survey.
· On site supervision of data collection and day end modelling will be carried out by the contractor principal.
· Day end modelling of data will allow rapid interpretation of structure and allow modification to the program if required.
· An initial 15 Line kilometres of survey to be conducted, with an estimated completion date of 10th October 2013.
· The interpreted Sonduult thrust fault zone will be tested by two lines crossing the interpreted fault structure.
Turquoise Hill Announces Resignation of Director Jean-Sébastien Jacques
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Sept. 17, 2013) - Turquoise Hill Resources (TSX:TRQ)(NYSE:TRQ)(NASDAQ:TRQ) announced today that the company's Board of Directors has accepted the resignation of director Jean-Sébastien Jacques. Mr. Jacques is resigning from the Turquoise Hill board in order to fully concentrate on his many responsibilities as Chief Executive, Copper at Rio Tinto.
A new Rio Tinto-nominated director will be announced in due course.
MINING MINISTER MEETS NEW PRESIDENT OF OT LLC
Ulaanbaatar, September 18 /MONTSAME/ The Minister of Mining D.Gankhuyag Wednesday met Mr Craig Kinnell, president and CEO of the Oyu Tolgoi LLC at a request of the latter.
The Minister expressed a satisfaction with the OT project's collaborating with the world-scale and biggest company.
He said Mongolia wants the new CEO of the OT LLC to carry out the project, maintaining the country's laws and related rules under open and transparent principles.
Mr Kinnel promised to adhere to the Mongolian culture, custom, laws and the cooperation treaty and to collaborate with Mongolia at a level of international standards. He also pledged to maintain principles of responsible mining and the mining rules.
The parties agreed to quickly resolve the current problem in a creative way. (Mogi: creative?)
"DEMYSTIFYING MONGOLIA" IN WESTERN AUSTRALIA
An international business forum "Demystifying Mongolia" took place in Perth, Western Australia on 11 September 2013. The one day event was co-hosted by the Honorary Consul for Mongolia in Western Australia and the Chamber of Commerce and Industry of Western Australia and was organised by the Honorary Consul and Aspire Mining Ltd.
The Forum aimed at Australian investors already operating in Mongolia or wanting to establish businesses in Mongolia. To share with and give a better understanding of how to begin, continue and succeed. Although Mongolia's natural resources wealth attracted business opportunities for international investors in recent years, there remains a level of uncertainty in relation to its culture, methodologies, legal and political systems which leave many investors unsure of where to begin.
The Forum was opened by the Mongolian Ambassador to Australia, His Excellency R. Bold who spoke of Mongolia being "open for business – the Mongolian way".
Philippe Pierson, Senior International Trade Officer of the CCI of Western Australia spoke of the CCI's services and their strong link which was formed in the 1990's with the National Chamber of Commerce and Industry of Mongolia.
The Gold Sponsors of this event, who were the key speakers, are experienced leaders who have already established operating businesses in Mongolia such as David Paull, CEO of Aspire Mining Limited, Bill Colvin CEO of Bayan Airag, John Miragliotta, Manager Environment of Sustainability, George Lloyd, Managing Director of Xanadu Mines and David Thomas, CEO of R2R Services. Professor Samir Chatterjee of Curtin University, Perth addressed the packed auditorium on "The Dilemma of a Nomadic Society Facing a Resource Pressure".
They spoke of their real experiences and the importance of respecting the laws of Mongolia, of recognising the culture and the values of the authorities at central, aimag, soum and even baag levels. In different ways these speakers stressed the need to maintain on-going dialogue with all levels of society and at all times with due respect for the indigenous culture.
Special importance was given by all speakers to the importance of understanding that Mongolia is a young nation that is still evolving to find its own brand of democracy and free market economy.
The whole day was characterised by a sense of positive belief that Mongolia will move towards developing its resources in partnership with the latest technology and systems for the benefit of its people and the foreign investors. As UB based Gold Sponsor Ms Elisabeth Ellis of Minter Ellison said "there is an atmosphere of dynamic energy" that is now sweeping through the nation that will surely create opportunities for international businesses and potential investors to explore Mongolia, Mongolian culture and the investment opportunities it presents.
Ms Rebecca Ball, State Director of Austrade, highlighted the importance of the "third neighbour" relationship between Mongolia and Australia.
Peter Stuart, the Honorary Consul for Mongolia in Western Australia closed the day's proceedings after summarising key issues covered by the various speakers:
Ø Need to find the right JV partner at all levels of business whether in mining, agriculture, education, environmental and facility management services, infrastructure development;
Ø Recognising the traditional Mongolian approaches of dialogue and cooperation at all levels of society involved in any project;
Ø Understanding the complexity of regulations and legal requirements that are still evolving in this young vibrant nation;
Ø Transferring knowledge by training the intelligent human resource base in Mongolia;
Ø Accepting the words of guest speaker Prof Samir Chatterjee, that "like the Naadam horse race, there are no short races in Mongolia – only the long run".
The day's business session was followed by a delightful social evening of wine, huumi and morin khuur performances by Mr Enkhbayar flown in from Canberra by the Mongolian Embassy and traditional dances by Miss Zaya of Perth. Paintings of Ulaanbaatar artist J Oilan were displayed.
For further information please contact Mr. Peter Stuart, Honorary Consul for Mongolia in Western Australia via email: firstname.lastname@example.org or tel: +61 419957945
Montsame MSE News: Top 20 -0.38%, Turnover ₮31.3 Million
Ulaanbaatar, September 16 /MONTSAME/ At the Stock Exchange trades held Monday, a total of 19 thousand and 952 shares of 19 JSCs were traded costing MNT 31 million 271 thousand and 170.85.
Rates of shares of nine companies increased, of five decreased and share price of five were stable.
The total market capitalization was set at MNT one trillion 377 billion 154 million 179 thousand and 890. The Index of Top-20 JSCs was 13,720.35, decreasing by 52.31 per cent (Mogi: points) against the previous day.
Montsame MSE News: Top 20 -0.11%, Turnover ₮18.9 Million
Ulaanbaatar, September 17 /MONTSAME/ At the Stock Exchange trades held Tuesday, a total of nine thousand and 390 shares of 19 JSCs were traded costing MNT 18 million 881 thousand and 893.00.
Rates of shares of five companies increased, of nine decreased and share price of five were stable.
The total market capitalization was set at MNT one trillion 372 billion 878 million 958 thousand and 823. The Index of Top-20 JSCs was 13,704.85, decreasing by 15.50 per cent (Mogi: points) against the previous day.
Montsame MSE News: Top 20 +0.03%, Turnover ₮767.9 Million
Ulaanbaatar, September 18 /MONTSAME/ At the Stock Exchange trades held Wednesday, a total of two million, 491 thousand and 599 shares of 40 JSCs were traded costing MNT 767 million 894 thousand and 688.98.
Rates of shares of 19 companies increased, of 13 decreased and share price of eight were stable.
The total market capitalization was set at MNT one trillion 374 billion 416 million 494 thousand and 815. The Index of Top-20 JSCs was 13,709.38, increasing by 4.53 per cent against the previous day.
FMG Mongolia Fund lost 6.7% in August
The Mongolian stock market was largely flat in August, but the Mongolian currency (Tugrik) lost over 8% to the $US, accounting for all the Fund´s losses. The F/X drop was mainly due to declines in mining exports and foreign direct investments (FDI). Also effecting negatively was the lower tourism revenue and lower foreign currency savings in banking sectors. Bank of Mongolia has supplied big loans and financing packages to support critical sectors in the economy, increasing the money supply by 13.5% during 1H13. Mongolian central bank officials claim that the relatively low level of intervention has not fuelled the depreciation of the Tugrik.
In the first half of the year, GDP expanded by 11.3% from a year earlier, according to the National Statistical Office of Mongolia. This GDP growth stemmed from expansionary fiscal policy from the Mongolian government and was higher than expected considering the shrinking FDI and decline in commodity exports.
Mongolians are now critically aware of the country's FDI needs and hope to see positive development surrounding the draft Mineral Law. The Fund continues to be positioned somewhat defensively but is adding positions when opportunities arise.
Bank of Mongolia Official Exchange Rates: September 18 Close
Consolidated Balance Sheet of Banks, August 2013
September 17 (Bank of Mongolia) --
BoM: Monthly Statistical Bulletin, August 2013
September 17 (Bank of Mongolia) --
BoM holds FX auction
September 17 (Bank of Mongolia) On the Foreign Exchange Auction held on September 17th, 2013 the BOM has received bid offer of USD and CNY from local commercial banks. BOM did not take a part on this auction.
On September 17th, 2013, The BOM has received bid offer of USD for Swap agreement from local commercial banks and accepted the half of offer.
Total outstanding 1-week bills climb from ₮760.6 billion to ₮949.1 billion
BoM issues 1-week bills
September 18 (Bank of Mongolia) BoM issues 1 week bills worth MNT 519.3 billion at a weighted interest rate of 10.5 percent per annum /For previous auctions click here/
RESULT OF GOVERNMENT SECURITIES AUCTION
September 18 (Bank of Mongolia) Regular auction for 28 weeks maturity Government Treasury bill was announced at face value of 20 billion MNT and each unit was worth 1 million MNT. Face value of 20 billion /out of 25.0 billion bid/ Government Treasury bill was sold to the banks at discounted price and with weighted average yield of 10.49%.
First 47 Days of New Mortgage Program: ₮449.1 Billion Refinanced, ₮438.5 Billion Newly Issued
September 18 (Cover Mongolia) Bank of Mongolia announcement dating September 18 (in Mongolian only) reports that commercial banks have so far received requests to refinance ₮794.6 billion (same as 43nd day) worth of old mortgages and accordingly have converted ₮449.1 billion (previously ₮439.1 billion) old mortgages of 16,064 citizens (previously 15,380) to 8%.
₮452.2 billion (previously ₮403.8 billion) worth of new mortgage requests were received and ₮438.5 billion (previously ₮350.2 billion) out of these of 7,746 citizens (previously 6304 citizens) were issued at 8%.
Link to release (in Mongolian)
Mongolia's Tugrik Rallies 2.5% in Biggest Gain Since 2009
By Michael Kohn
Sept. 18 (Bloomberg) -- Mongolia's tugrik climbs 2.5% in biggest rally since April 2009 to 1,635/dlr in Ulaanbaatar.
· Tugrik pares decline to 12% in Q3, worst performance among about 80 exotic currencies tracked by Bloomberg
· Tugrik seeing correction from oversold levels, Sandagdorj Bold, chief economist at central bank, says in interview
· Currency moving on positive developments including plans to sell yen-denominated bonds in Japan, or Samurai debt, and possibility of cutting budget deficit to 1t tugrik: Bold
Mongolia Tugrik Rivals Syria as Biggest Exotic Loser: Currencies
By Michael Kohn
September 18 (Bloomberg) After Syria and Iran, Mongolia is delivering the world's worst currency returns this quarter as tumbling international investment and coal revenue starve the country of the foreign exchange needed to fund imports.
Mongolia's tugrik sank 15 percent to 1,692.50 per dollar since June 30, the third-biggest loss among more than 100 foreign-exchange rates tracked by Bloomberg and the largest drop of about 80 exotic currencies. The former Soviet satellite's tender weakened in all but three of the last 19 years and sank to a record 1,728 on Sept. 10.
Currencies of some of the smallest developing economies are taking a hit as the prospect for the Federal Reserve to announce a withdrawal of monetary stimulus as soon as today reduces the cash pursuing higher-yielding assets. A 15 percent drop in coal prices this year eroded earnings from Mongolia's biggest export by 47 percent, while foreign direct investment to the nation slumped 46 percent, both weighing on the tugrik.
"There's no foreign-currency revenue right now, it's simply not coming in," Norihiko Kato, the Ulan Bator-based chief executive officer of Khan Bank LLC, one of Mongolia's two biggest lenders, said in a Sept. 11 phone interview. "We may end up with a dollar crunch."
Trading in exotic currencies is limited. The tugrik didn't make it to the list of the 35 most-traded currencies in the world, according to a Bank for International Settlements survey published on Sept. 3. The Peruvian sol, the least traded currency on the list, accounted for about 0.1 percent of the global daily trading of $5.3 trillion, according to the survey.
The pullback from exotic currencies is a reversal from the trend up until a year ago when foreign-exchange traders, faced with lower volatility and record-low interest rates in the U.S. and Europe, poured cash into countries rich in commodities or with high growth rates.
JPMorgan Chase & Co.'s Global FX Volatility Index tumbled 80 percent in the four years through 2012, reducing money managers' ability to exploit price moves. The gauge was 9.18 percent yesterday, up from a five-year low of 7.07 percent on Dec. 17.
Papua New Guinea's kina, the second-worst performing exotic currency this quarter with a 7.2 percent drop, gained a record 23 percent in 2011, data compiled by Bloomberg show. Uruguay's peso weakened 7 percent since the end of June, after climbing 25 percent in 2009, while Mongolia's tugrik rallied an unprecedented 15 percent a year later.
The Iranian rial weakened 50 percent this quarter and the Syrian pound dropped 23 percent, the biggest losses among currencies tracked by Bloomberg. They fell amid speculation that the U.S. was readying a strike against Syria's government following a chemical weapons attack.
Until last month, developing-nation currencies were in the midst of their biggest slide in five years, and Goldman Sachs Group Inc. and UBS AG say those declines will continue as the Fed prepares to taper stimulus. This quarter's losses in exotic currencies compare with an 11 percent decline in Indonesia's rupiah and a 5.5 percent drop in the Indian rupee, which touched a record-low of 68.845 per dollar on Aug. 28.
Mongolia's central bank has intervened in the currency market since November to stimulate business, promote growth and stem accelerating inflation, according to Sandagdorj Bold, the bank's chief economist.
"We have a variety of open-market tools for influencing the foreign-exchange market," Bold said in a Sept. 6 e-mailed interview from Ulan Bator, Mongolia. Policy makers are "fully capable of influencing the market," Bold said.
Foreign-exchange reserves fell 27 percent to $3 billion in July from a year earlier, according to the Bank of Mongolia's website. That compares with $19 billion in oil-rich Kazakhstan, whose tenge is another frontier currency, data compiled by Bloomberg show.
Consumer prices in Mongolia rose 9.4 percent in August from a year earlier, compared with 8.3 percent in July, the National Statistics Office said Sept. 10. The last time the annual rate was below 10 percent was 2009, when it averaged 4.2 percent.
China buys more than 86 percent of Mongolia's exports, leaving the country exposed to a slowdown in Asia's biggest economy. China's government is targeting growth of 7.5 percent in 2013, which would be the worst performance since 1990 and compares with 7.7 percent last year.
While Mongolia's $10 billion economy is growing at almost double the pace of China, the expansion is starting to slow. Gross domestic product increased 11.3 percent in the first half of the year, down from 12.4 percent for all of 2012 and a record 17.5 percent in 2011. The World Bank cut its 2013 growth forecast in April to 13 percent, from 16.2 percent.
Mongolia's exports dropped 5.9 percent to $2.7 billion in the first eight months of 2013, while imports fell 8.6 percent to $4.3 billion, the government said Sept. 10.
Coal exports declined to $693 million from $1.3 billion and accounted for 26 percent of total shipments. The nation ranked seventh among the world's top 10 coking coal producers last year, according to the statistics office.
Investors interested in the commodity-rich economy aren't "running for the hills," Howard Lambert, the chief representative at ING Groep NV's Mongolia office, said in a Sept. 11 phone interview from Ulan Bator. The country has attractive features such as a democratic political system, a convertible currency and a well-educated population, he said.
Speculation that the Fed has been preparing to taper its $85 billion of monthly bond purchases has weakened assets that investors consider higher-risk. The U.S. central bank will confirm a reduction of its stimulus efforts at a policy meeting ending today, according to 71 percent of economists surveyed this month by Bloomberg News.
The tugrik has slipped 14 percent since Fed Chairman Ben S. Bernanke signalled the central bank may trim bond purchases on May 22, while the Uruguayan peso and Nepalese rupee both fell more than 12 percent. The tugrik rallied 1.3 percent in the last two days after former U.S. Treasury Secretary Lawrence Summers, considered by investors to be less in favor of maintaining stimulus, withdrew from the race to replace Bernanke as Fed chief in January.
Fed policy makers have kept their benchmark interest rate in a range of zero to 0.25 percent since December 2008, while the European Central Bank cut its key rate to a record 0.5 percent from in April.
The Bloomberg U.S. Dollar Index, which tracks the greenback against the euro, yen, pound and seven other major counterparts, fell to an almost six-week low of 1,020.1 after Summers' announcement, from a three-year high of 1,054.4 in July. The measure rose 5.4 percent in the first six months of this year, the most since 2011, on speculation that the Fed would pare money printing.
"The tugrik's weakness needs to be seen in the global context," Michael Preiss, managing partner at Mongolia Asset Management Ltd., said in a Sept. 10 e-mailed interview. "The story for most of this year was dollar strength across the board, not just against other major currencies, but in general against emerging markets and in particular frontier-market currencies."
Mongolian Prime Minister Norovyn Altankhuyag needs to reverse a May 2012 law restricting foreign ownership in businesses that prompted capital flight and hurt the currency, Chuluun Gankhuyag, a member of the opposition Mongolian People's Party and a former vice finance minister, said in a Sept. 10 interview from Ulan Bator.
Investor sentiment has also soured amid a dispute over fees, royalties and funding of the Oyu Tolgoi copper and gold mine controlled by Rio Tinto Group, the world's second-largest mining company.
Concern that the current-account deficit will widen is also leading the tugrik to depreciate, Bold of the Bank of Mongolia said. The shortfall in the broadest measure of trade and investment increased 8.5 percent to $2.1 billion in the first seven months of 2013, the central bank's website shows.
"The weakness we've seen in the tugrik has to do with the drop in coal prices," Eddie Cheung, a currency strategist at Standard Chartered Plc in Hong Kong, said in a Sept. 16 phone interview. "Mongolia still has a big current-account deficit."
CENTRAL BANK RELEASES STATEMENT REGARDING LATEST ECONOMIC SITUATION OF MONGOLIA
September 18 (InfoMongolia) In relation to the latest economic situation of Mongolia, a statement was released by the Central Bank of Mongolia on September 13, 2013.
Statement by the Central Bank of Mongolia
In the past 19 months, foreign trade conditions declined by 23%, direct foreign investment decreased by 4.6% in 2012 and by 30.6% in 2013, financial sources became scarce and excluding Chinggis Bond assets, foreign net asset decreased by 1.2 billion USD during this period.
Difficulties such as insufficient budget and delay of economic growth may have occurred due to the state budget income not reaching its estimated level during a high risk period of outward movement of financial sources and loan interruptions. As a result of the actions taken by the Central Bank for the past 9 months to avoid this, such as implementing contrary policies and increasing money supply when needed, it was able to protect the real income of citizens, support the activation of real sectors, and slow down negative impacts in the economy.
The Central Bank of Mongolia is operating within the "Guideline to follow in 2013 by the State regarding monetary policy" and providing the conditions for foreign rates of MNT to be flexible to meet with the basic conditions of macroeconomics. The weakening of USD rate by 20% at the beginning of the year complies with the decline in foreign currency inflow and worsening of foreign trade conditions and the Central Bank hopes to decrease the negative impact of foreign markets in the domestic economy and further support domestic productions, support export, decrease import, and improve economic competitiveness.
Therefore, the Central Bank will continue monetary policy towards emerging quality work places and supporting investments in domestic productions capable of competing in foreign markets and replace import.
The Bank feels the actions taken by the Parliament and Government to improve investment environment, revive investors' trust, and increase of currency inflow will support stable economic growth in the long term. The Government's focus to not exceed this year's budget deficiency by 2% of GDP in accordance with "Law on Budget Stability" will build trust in state credit rating agencies, investors, and international organizations that a sustainable macro environment will be provided in Mongolia. These measures will balance the flow of currency that has been negative for the past 6 season and further maintaining these conditions will provide conditions for stable currency rates.
Government Provides Update on Tavan Tolgoi Power Plant and Infrastructure Projects
Ulaanbaatar, September 17 /MONTSAME/ The Oyu tolgoi mine and other constructions to be erected in southern region of Mongolia will be fully provided with electricity when a first part of a 450 MWT power station is put into use in 2016.
A director of the "Tavantolgoi power station" project M.Enkhsaikhan said it at the "Hours of great construction" meeting on Monday. Traditionally, the Prime Minister N.Altankhuyag receives reports from Ministries on the construction at this meeting.
According to Enkhsaikhan, a feasibility study document of the station is being drawn up, and technical obligations will go soon to four companies who want to invest this work. These companies are based in Japan, the Republic of Korea and France, he said. Taking into account the proposals, the primary investor will be selected, the money for the project will be raised from international and financial organizations, and a construction will launch in spring next year, he added. In general, one billion USD is required, by the preliminary calculations.
The Minister of Road and Construction A.Gansukh reported that the construction of a 24.1-km paved road between Nalaikh district and Tsonjinboldog (near Terelj National Park) almost has been done, only 52 meters are left to be run soon. A repair of crossroads in Ulaanbaatar has been completed in frames of the "Street" project, the City's Auto road Department added.
Let's Call them Sumo Bonds
By Julian Dierkes
September 16 (Mongolia Focus) In a great conversation with a fellow long-time Mongolia watcher, we were contemplating what to call a ¥-denominated Mongolian bond.
This follows Prime Minister Altankhuyag's trip to Japan last week. It appears that a ¥-denominated Mongolian bond with a volume of around US$1b will be issued later this year. Press reports are referring to this as a samurai bond, thus using the term that is generally applied to non-Japanese debt issued in Yen. This is in contrast to a sushi bond, for example, which is issued by a Japanese borrower in a currency other than the Yen outside of Japan. So, by common usage, the Mongolian bond would be known as a samurai bond.
In our conversation we were pretty sure, however, that this bond ought to have a special name, just like last year's US$-denominated Mongolian bond that came to be known as a Chinggis Bond.
Some of the options we considered:
Continuing the Chinggis theme: Kublai Bond. Giving more attention to Kublai Khaan would have the additional advantage of reminding Chinese investors that the Yuan Dynasty was founded by this Mongolian. But, there's no link to Japan in this name – other than via the attempted invasions (see below) – which seems like a missed opportunity. Also, if Mongolia were to ever issue a RMB-denominated bond, this should really be known as Kublai Bond.
Emphasizing the Japan link: Kamikaze Bond. 神風 was the 'divine wind' that saved Japan from Mongol invasions (under Kublai Khaan) in 1274 and 1281. But, these bonds are intended to save Mongolia from its budget crisis (more on that and the wisdom of this bond issue in future posts), not Japan, so that's not quite right either. Also, the obvious association with the 'special attack units' of the Asia Pacific war makes this unattractive as a name.
So, the clear solution came to us:
Yen-denominated Mongolian bonds henceforth shall be known as Sumo Bonds. Sumo here stands for Japanese-Mongolian ties, of course and carries a notion of Mongolian strength when wrestlers arrive in Japan. All recent top wrestlers have been Mongolian of course. Sumo bond is easily pronounced and will mean something to bond traders in far-flung places as well.
Work with me here, use the term, first in quotation marks than without if you are a financial reporter or analyst.
If the term catches, I will trademark it and donate the receipts from my trademark income to a Mongolia-focused charity.
For some notes about sumo wrestlers' role in Mongolian politics, see my post for the FT's beyond BRICS blog, "Mongolian Politics – A Wrestling Match"
Mongolia loses 14 places in global competitiveness ranking to 107
September 17 (news.mn) The World Economic Forum (WEF), a Geneva based non-profit international organization released its annual Global Competitiveness Report for 2013-2014.
The Global Competitiveness Report assesses the economic competitiveness of 148 countries across the world considering 12 pillars of competitiveness on infrastructure development, macroeconomics and the environment, labor and financial market development and business environment.
According to the Global Competitiveness Report Mongolia ranked 107th place out of 148 countries falling back 14 places compared to previous years.
Klaus Martin Schwab, the founder and executive chairman of the World Economic Forum noted that Mongolia falls to 107th position this year, almost entirely the result of a significant deterioration of its macroeconomic environment (130th) as captured by data from the IMF. In 2012, Mongolia's budget deficit doubled to 7 percent of GDP, inflation surged to 15 percent, the gross savings rate plummeted to 28 percent of GDP, and public debt increased slightly. The country's performance in most other dimensions of the Index remains stable, suggesting that a great deal remains to be done for Mongolia to live up to its significant economic potential. In order to create opportunities for its citizens and build up the confidence of businesses and investors, the country must urgently upgrade its institutional framework (113th), develop its transport and energy infrastructure (113th), improve the functioning and efficiency of its goods markets (96th), establish clear rules for foreign investment, and develop its fledgling financial sector (129th) on the Global Competitiveness Report.
According to the Global Competitiveness Report 2013-2014, the top 10 countries are Switzerland, Singapore, Finland, Germany, USA, Swiss, Hong Kong, the Netherlands, Japan and the United Kingdom.
World Bank East Asia Pacific Regional Vice President to Visit Mongolia
Ulaanbaatar, September 18, 2013 (World Bank) - Axel van Trotsenburg, World Bank Regional Vice President for East Asia and Pacific, will make his first visit to Mongolia on September 19-22.
Mr. van Trotsenburg, a distinguished economist with extensive development experience, will meet with government counterparts, to discuss how the World Bank Group can continue to support the development of Mongolia and help improve the lives of its citizens, in particular the most vulnerable.
"Mongolia has been able to grow its economy at an average 12% since 2010 and it has made impressive gains in reducing poverty from 38.7 percent to 27.4 percent since 2010. The challenge for the country now is how it can sustain strong growth and make it more inclusive so more people benefit, especially the poor," said Mr. van Trotsenburg. "I look forward to visiting Mongolia to better understand the country's development challenges, so we can help create opportunities for all."
"Mongolia's economy has grown by leaps and bounds in recent years and as the government addresses current challenges it also has the opportunity to make long term investments for the future," said Mr. van Trotsenburg. "It's important to diversify the economy, invest more in the skills of young Mongolians and prudently managing the country's mineral wealth so future generations can benefit."
In Mongolia, Mr. van Trotsenburg will also visit Bank-supported projects in rural areas which focus on making development work for all, including a school where providing books and integrating reading into the curriculum has helped improve primary education quality.
As Vice President for East Asia and the Pacific, Mr. van Trotsenburg manages more than 1,000 staff working across 22 countries – including Mongolia— and a US$30.2 billion lending portfolio.
Parliament working group formed over Law with the Long Name
September 18 (news.mn) Members of the Standing Committees on the Economy and Environment and on Food and Agriculture discussed and agreed to establish a task force to study the law on the Prohibition of Mineral Prospecting Exploration in water basin areas and forest areas on Tuesday September 17th. The purpose of the task force will be to understand the respective departments positions on the controversial issues surrounding the amendments to the draft law and to streamline them into regulatory compliance within the law.
The law makers noted that the law on the Prohibition of Mineral Prospecting Exploration in water basin areas and forest areas was enacted in July in 2009 and the process of issuing mining licenses ran ordinarily for 11 months. During this period four new mining licenses were issued to 120 mining sites until the introduction of the law on prohibiting the release of new special licenses for mineral resource exploration was initiated by the President in June 2010. Therefore those special licenses and 789 exploration special licenses granted before the law was enacted and the 77 operation licenses after the law was passed will not be affected by the new amendments into the law.
But there will be an opportunity for 346 operating special license holders to apply to continue their operations.
At the end of the meeting the Standing Committee members agreed to establish a task force to accommodate views on the controversial issues of the draft law. MP D.Arvin has been appointed to lead the task force to study the controversial law on the Prohibition of Mineral Prospecting Exploration in water basin areas and forest areas.
ABOUT POSITION OF MPP FACTION AND DISCUSSION OF INVESTMENT LAW
Ulaanbaatar, September 18 /MONTSAME/ A plenary meeting of the irregular spring session of parliament discussed Wednesday draft amendments to the laws on investment, on prohibiting mineral exploration and extraction near/at water sources and forests.
The debates were complicated between the Democratic Party (DP) and Mongolian People's Party (MPP). The MPP said they do not back a discussion of the draft law on prohibiting mineral exploration and extraction.
"The agenda should not include this draft because it was considered at meetings of a working group and Standing committee without our participation," the MPP's faction head N.Enkhbold said. A chairman of the Standing committee on economy B.Garamgaibaatar denied this statement, "two your members took part in the meeting." After many inquiries it was "revealed" that Ts.Dashdorj MP attended it. Justifying himself, he complained that the matters were discussed under domination of the DP and advised N.Enkhbold to take a break. However, the MPP did not do so, and Enkhbold stated that the MPP will decide whether to discuss this draft law. After this he repeated the statement made yesterday.
"More than a year passed since the establishment of the cabinet for reforms. This time is enough to judge, and we say that the country is already facing problems and negative indicators, for instance, the state budget had a deficit of 1.5 trillion togrog. This is a consequence of avoiding to set up a coalition at the cabinet," N.Enkhbold said.
According to him, the ruling DP is concealing the truth about the "Chingis" bonds and other matters. The MPP faction requested parliament to investigate the Bank of Mongolia several times, but it has not been done yet, Enkhbold went on.
"The DP blames the previous parliament for all problems, but we are sure that the BM is the guilty one," he stressed.
Then the session started discussing the agenda. The Minister of Economic Development N.Batbayar explained a content of the draft law on investments, emphasizing that it reflects a system of regularizing the tax in a specific period in order to attract both domestic and foreign investments based on effectiveness of projects. For example, the size of some taxes will be regular for 5-10 years for those investments with a financing of above MNT 15 billion, they must be environmentally-friendly and in harmony of the country's economic development, must introduce new technologies and augment new jobs.
During Q&A times, J.Batzandan asked the Minister to make clear a difference between contracts on stability and on stabilization and criticized that this draft means a support for the mining-based economy.
In response, N.Batbayar said the understanding "Contract on stability" only belongs to the law on minerals, whereas the "Contract on stabilization" is wider and is used for any spheres. Generally, the new law on investments equally treats foreign and domestic investments, he emphasized again.
Other questions were put by G.Uyanga, M.Batchimeg and B.Bat-Erdene, for example, about a reason of abolishing an understanding "Strategic sector" in the new law.
Majority of MPs criticized that the draft law mainly supports big companies, ignoring small businessmen. To this the Minister said the session will discuss soon a policy on specific advantages for small- and middle-sized businessmen and productions.
FIVE PEOPLE DETAINED OVER MONDAY GUNFIRE INCIDENT, COULD FACE 15-25 YEARS
Ulaanbaatar, September 18 /MONTSAME/ Five people are remanded in custody and are being investigated accused of serious crimes, the Central Intelligence Agency (CIA) (Mogi: think they prefer General Intelligence Agency) said Wednesday.
On September 16, fully armed members of the "Gal undesten" ecological union entered the garden behind the State Residence--the special protected zone--to express a protest against implementing procedures of the law "with long name"--a ban on exploration and exploitation near/at water basins, protected areas and forests. They threatened the public, attacked the special forces, and threw a grenade to the State Residence, later it was revealed that they had hidden explosives at several buildings close to the central square and the Residence.
"If found guilty, the suspects will be sentenced to 15-25 years' imprisonment, the CIA must investigate the threat, so we will continue the investigation," the CIA representative said.
With a connection to this incident, some more people might be arrested and held under investigation, the CIA added.
Mongolia environmentalists held after shot fired at parliament
September 17 (AFP) Nine Mongolian environmentalists protesting against legal changes which they say will loosen controls on mining were arrested outside parliament on Monday after one fired a shot, reports and officials said.
Leaders of the Fire Nation NGO coalition, which includes some nationalistic organisations, attempted to enter the building where the Great Hural was to meet for a special session but were stopped by guards, and a gunshot was heard, police said.
Information portal news.mn said nine people were arrested and two guns confiscated including a Kalashnikov assault rifle. There was no immediate official confirmation of this.
"The demonstrators wanted to take a petition into the parliament house but were stopped by the guards. The demonstrators didn't shoot on purpose but fired a gun unintentionally," said police captain Yondon Lkhagvasuren, adding that no one was injured.
A mining boom has given sparsely-populated Mongolia one of the world's highest growth rates and created a wealthy new elite, but also raised accusations of exploitation and concerns over environmental consequences.
Ulan Bator brought in new foreign investment laws last year, since when incoming investment has fallen, and parliament was due to review the changes.
Fire Nation leader Tsetsegee Munkhbayar previously said that Mongolian laws delaying mining activities would be neutralised by the revised proposals, and the group had drawn up a text of its own.
"We will make them adopt this resolution," he said last week.
The Central Tower, a luxury shopping and office development in Ulan Bator was evacuated on Monday, employees said, while reports said there was a bomb threat at the environment ministry nearby. There was no official comment.
"IT'S NOT A PROTEST AGAINST INVESTMENTS, IT'S AN ATTEMPT TO PROTECT NATURE"
Ulaanbaatar, September 16 /MONTSAME/ On Monday, the irregular spring session of the State Great Khural opened at 10.00 am in the State House. The session intends to discuss and adopt several laws aiming at supporting foreign investments.
According to the Bank of Mongolia (BoM), the size of foreign investments decreased in the first nine months this year by 30.6 percent. In order to recover from this and attract the investments, the irregular parliament session is running to discuss the bills submitted by the cabinet, which is an expression of the cabinet's willingness to keep a high volume of its GDP which is likely to decline to 11 percent from 17 percent of the last year.
The same day, some NGOs who protect environment organized a demonstration near the State House which co-incided with the session opening. They do not want an adoption of a draft law on adherence rule of the law on prohibiting mineral exploration and extraction near/at water sources and forests being afraid that it may lead to a cancellation of this law.
"We do not protest against the investment laws, we do support them, and our struggle is just to save our environment and water," the demonstrators said.
"By the above law, some 40% of lands are protected but these areas do not have big mineral strategic deposits. About six percent of territories only are covered by forests, the rest are steppes and Gobi desert. In the last twenty years, forest lands equaling to two percent of the whole territories have been destroyed. All know that the forest fund is located near sources of rivers. Small rivers in northern parts of the country provide the southern regions and serve as a water source for more than 40 million heads of livestock," they said.
"Since 90 percent of our territories are likely to become desert, we must save the nature, especially forests and water, in times of a global drought, our next generations will suffer if we do not act," they stressed.
Some MPs consider that the protection of forests and water sources will not affect mining investments and companies because a majority of the biggest mineral deposits are located in the southern region (Gobi region).
"In order to attract attention, the protesters have shot an air rifle into sky," said Ya.Tserenkhand, a head of one of the NGOs at the demonstration. After the incident, the police arrested nine people who led the demonstration.
OSCE/ODIHR final report on Mongolia's presidential election recommends improvements to legal framework
September 18 (OSCE/ODIHR) Mongolia's presidential election on 26 June 2013 was characterized by a competitive campaign and respect for fundamental freedoms, but further efforts are required to address gaps and inconsistencies in the legal framework, concludes the final report by election observers from the OSCE Office for Democratic Institutions and Human Rights (ODIHR).
The report released on 18 September 2013 acknowledges recent improvements in the electoral legal framework but notes that further review of the electoral legislation is needed to ensure compliance with OSCE commitments and other international standards for democratic elections.
The report says the legislation should require the General Election Commission to adopt a comprehensive set of guidelines for the work of lower-level election commissions, including for election day procedures. It also recommends amendments to consolidate legal provisions governing the complaints and appeals process, to simplify electoral dispute-resolution and to ensure timely remedy for complainants.
While the report assesses the legal framework as generally conducive for the freedom of expression, it recommends that legislation be reviewed to provide for fair, balanced and impartial media coverage of election campaigns. Consideration should be given to repealing criminal defamation laws in favour of proportionate civil sanctions, in accordance with relevant international standards.
Among the report's other recommendations are the establishment of detailed criteria for the nomination of civil servants to election commissions; allowing independent candidacies, as stipulated in OSCE commitments; the introduction of additional measures to safeguard the secrecy of the ballot; and considering the introduction of a legal requirement to publish detailed election results for each polling station without delay.
Mongolia to Take Stake in Areva Uranium Project to Help Revive Investment
By Yuriy Humber
September 17 (Bloomberg) Mongolia will take a stake in a domestic uranium venture led by France's Areva SA (AREVA) and support its development, signaling the nation's willingness to revive foreign investment, said Prime Minister Norovyn Altankhuyag.
"Through this we see that foreign investors are continuing to invest in Mongolia," Altankhuyag said in an interview in Tokyo on Sept. 14, at the end of a four-day visit.
Mongolia will take a 34 percent share of the uranium mining unit of Areva Mongol LLC, he said, adding that this is the level of ownership under domestic law that designates a strategic deposit. Areva Mongol owns 27 uranium exploration permits in the country and is seeking to upgrade them to allow mining. It is negotiating an equity interest with state-owned MonAtom LLC, according to the Paris-based company's website. Japan's largest trader, Mitsubishi Corp. (8058), is also a potential investor, it said.
Mongolia's premier is seeking to revive direct foreign investment, which shrank by 42 percent, or $1 billion, in the first half of the year, due to stricter regulation of overseas companies and the government's dispute with Rio Tinto Group.
The London-based mining company has delayed underground development of Mongolia's biggest investment project, the $6.6 billion Oyu Tolgoi copper field, while it negotiates financing with the government. Mongolia holds 34 percent of Oyu Tolgoi.
Coupled with slowing Chinese demand for Mongolian coal, the drop in foreign investment has damped economic growth, which slowed to 11.3 percent in the first half of this year, from 12.4 percent in 2012 and 17.5 percent in 2011. The local currency, the tugrik, has weakened 18.3 percent against the U.S. dollar this year.
The "hiccups" in Mongolia's economy are not unexpected and longer-term investors realize that the issues are par for the course in an emerging market, said Howard Lambert, chief representative of ING Groep NV in Mongolia, the first foreign lender to open an office in the country.
"Investors want stability and they want transparency," Lambert said in an interview from Ulaanbaatar. "In emerging markets it's rare to have all those things at the same time and for extended periods of time."
Mongolia's government is aware of the need to improve stability and transparency and plans to pass new laws soon to address the issues, Altankhuyag said.
Its parliament begins an extraordinary session this week to discuss five draft laws seeking to end "discrimination between foreign and domestic investors," Mongolian Investment Banking Group LLC said Sept. 16 in a report.
Under one law, the mining, finance and communications industries would no longer be designated as sectors of strategic importance, which will make them easier to navigate for foreigners, Mongolian Investment said.
Consumer goods leasing and financing for agriculture are two industries outside of resources that have strong potential to attract foreign investor interest, ING's Lambert said.
Areva has explored for uranium in Mongolia since 1997 and has 144 staff in the country, according to its website. MonAtom's stake would be in Areva Mongol's unit, Areva Mines LLC, the company that will produce the uranium.
Mitsubishi is waiting for Mongolian government approval to exercise its option on Areva Mongol shares, Japan's biggest trading company said in an e-mailed response to questions. The approval is expected in the near future, Mitsubishi said.
CIVIL AVIATION AUTHORITY OF MONGOLIA PLEDGES TO REFORM SECTOR
September 18 (InfoMongolia) The Sector Reform 2013 meeting will be held soon to discuss the reform actions being and to be implemented in the aviation sector initiated by the Civil Aviation Authority of Mongolia.
During the meeting, matters such as providing better air traffic services to aircrafts passing over Mongolian territory, advantages of the new International Airport in Khushigt Valley, and planned policies to be implemented by the Government in the aviation sector will be also included.
Last year, a total of 82.6 thousand aircrafts passed over the Mongolian territory, which made an income of 45.2 billion MNT (Tugrug). Mongolia is the second largest landlocked country after Kazakhstan. Therefore, the air transport sector is a large factor to increase economic growth and develop international trade, investments and tourism. Therefore, providing services to aircrafts passing over Mongolian territory, that have temporarily landed and taking off from Mongolia would play a significant economic role.
The biggest factor causing difficulties in the air transportation sector is a delay caused by bad weather conditions. The new international airport being built at Khushigt Valley would resolve this issue, because the new airport enables two-way entrance lift off and landing runways, which will provide the maximum opportunity to make aircraft landing without weather delay. Besides increasing the chance to receive aircrafts, the new airport will be significant to reduce centralization into Ulaanbaatar City.
Centralization in the Capital City is increasing daily and is unable to meet its capacity including road traffic. By accomplishing the Khushigt Valley Airport and developing infrastructure, the opportunity to establish a sub-city will be set simultaneously.
The New Government for Changes is implementing several projects in order to develop the air transportation sector and the latest example is the purchase of new Boeing 767-300ER aircraft. With this aircraft, flight services are being provided with the routes Ulaanbaatar - Bangkok and Ulaanbaatar - Erlian City. Therefore, the Civil Aviation Authority is aiming to increase the use of this aircraft and open a new air way.
Also, local flight services are being provided in Ulaanbaatar - Sukhbaatar and Ulaanbaatar - Tosontsengel routes. The Government policy includes the matter of developing local transportation services. Hence, the meeting will also hold talks about the suitable projects and programs for this and to increase the number of aircrafts and services. Mongolia is able to travel through 15 air gates to conduct international flights, whereas 9 of this go via China and 6 via Russia. Therefore, promotions will be raised on developing the activities of air transportation and how to cooperate and develop relations with neighboring countries to open new air gates.
RUSSIA-MONGOLIA-CHINA INTERNATIONAL TRANSIT ROUTE OPERATIONAL BY OCTOBER 2013
September 18 (InfoMongolia) In the past 5 years, the U.S. Government has invested 285 million USD into Mongolia. One of its projects was to build a 176.4 km paved road connecting Choir, the center of Govisumber Aimag with Sainshand, the center of Dornogovi Aimag with investment of the Millennium Challenge Account Mongolia which made its opening on September 05, 2013.
At the opening, Prime Minister of Mongolia N.Altankhuyag, Minister of Road and Transportation A.Gansukh, Ambassador of the United States of America Piper Anna Campbell, Executive Director of the Millennium Challenge Corporation Cassandra Butts, Governor of Dornogovi Aimag P.Gankhuyag, Governor of Govisumber Aimag L.Otgonjargal, Chief Executive Officer of the Millennium Challenge Account Mongolia B.Batbaatar, Road Project Manager P.Batsaikhan, executive companies, and local citizens were present.
The 176.4 km paved road from Choir to Sainshand was completed along with 8 bridges of 10-64 meters long, 239 concrete pipes, and a parking lot at every 30 km. Moreover, the 1.7 km road construction from Airag Sum to Sainshand and 1.2 km road from Dalanjargalan Sum to Sainshand were also accomplished.
In addition, the 42 km road from Sainshand to Khamar Monastery (Khamaryn Khiid) and the 120 km road from Zamyn-Uud to Sainshand will be completed by the end of October 2013.
Therefore, Mongolia is to have a paved road that meets international standards connecting vertically from the Russian border to China and international transit transportation will be able to pass through.
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Asia Foundation: Good Governance and Corruption Prevention Plan Signed in Mongolia
Ulaanbaatar, Mongolia, September 16, 2013 (The Asia Foundation) — On September 09, 2013, the Governor of the Capital City and Mayor of Ulaanbaatar City, Mr. Erdene Bat-Uul, the Commissioner General of Independent Authority Against Corruption (IAAC) Mr. Naavansuren Ganbold, and Country Representative for The Asia Foundation Meloney C. Lindberg signed a Good Governance and Corruption Prevention Plan 2013-14. The Foundation supports this plan under the USAID-funded Strengthening Transparency and Governance in Mongolia program. Aiming to improve accountability and promote transparency, the plan will be implemented in several front-line departments of the municipality. These include the Education Department, Health Department, General Planning Department, and Office of Property Relations. Effective implementation of the plan will result in support to the city in its efforts to bring more accountable services to the citizens.
"After two decades of rapid political, economic, and social change, Mongolia is tackling many of its governance challenges through a strengthened legal framework that promotes increased transparency and accountability," said Country Representative for The Asia Foundation Meloney C. Lindberg. She added: "The Asia Foundation is excited to support Mongolian-led reform efforts, with the City Municipality of Ulaanbaatar in close collaboration with the IAAC. We hope these efforts will result in better access to services for citizens."
As an independent and the leading anti-corruption body in the country, the IAAC has been implementing targeted corruption prevention and public awareness activities and is currently seeking to engage more directly with municipal and local governments throughout the country. Two of the major components under the plan include establishing and strengthening ethics committees and ensuring robust accountability systems are in place within these departments. These measures will lead to greater trust in these important institutions.
The joint prevention plan will be implemented over the course of one year, ending in September 2014. The Foundation will provide technical and methodological support in the implementation of the plan.
Back in the UB
By Julian Dierkes
September 14 (Mongolia Focus) It's become a bit of a tradition for me to post about my first impressions back in Ulaanbaatar after an absence.
This time, my absence was not very long, i.e. from the presidential election in late June until mid-September.
First impressions have recently been a mix of exhaustion as transfer through Beijing are NEVER smooth [this time I ended up waiting for a hotel shuttle bus for 1 3/4 hrs missing a meeting], and elation at being back in Mongolia.
The flight from PEK was the emptiest flight I've ever been on into ULN, and that includes several trips in the winter. Only about 25 people on the plane I would guess. I am not sure whether that means anything, but it was especially surprising to see so few Mongolians travelling on the plane. I don't think I've been to Mongolia in mid-September before, so perhaps it was just a matter of the time of year.
The only disappointment about the small crowd was that there was a reception committee from the Ministry of Foreign Affairs for visitors who were coming for the World Economic Forum Strategic Dialogue on the Future of Mongolia – like myself. There offer of VIP (me, hah!) treatment through immigration was somewhat less useful given that it took longer to check my name on their list than for the other passengers to clear through immigration. Also, I had arranged a pick-up through ACMS, so didn't need a ride.
One of the great joys of my arrival this time (in addition to that, ah, I'm back in Mongolia feeling) was that as of Sept 1 Germans no longer need a visa to travel to Mongolia. It was with great delight that I presented my visa-less passport, received a smallish stamp, and went on my way.
Were the five huge apartment blocks right next to the airport already under construction in June? I can't recall.
The airport road close to the airport has disintegrated into a sandy mess. Fortunately, I didn't care at all as the driver started singing along to radio folksongs which always makes me very happy.
The airport road has now disappeared and been replace by a temporary road that lies to the right (heading into town) which the real new airport highway is being constructed in place of the old road. Anyone who has arrived into Ulaanbaatar especially late at night will have a definite image in front of their eyes, of the bumpy road into town where drivers were especially fond of passing on the right, i.e. on the gravely shoulder of the road.
Just before you cross the Tuul, the "Hunnu Mall" is being constructed. It advertises 50,000sqm of retail space. Is that big for a mall? It certainly looks awful with some gaudy neo-classical elements.
Tragically, the police booth that oversaw the intersection just past power plant #3 on the other side of the Tuul seems to have fallen victim to the construction. For me, this police booth was always the clear marker that a) I was in a post-socialist country, and b) we were almost in town. Is this a metaphor signalling the end of the post-socialist period?
ULAANBAATAR CONSIDERING RELOCATING ALL TECHNICAL MARKETS INTO ONE CENTRAL LOCATION TO REDUCE TRAFFIC
September 19 (InfoMongolia) The rapid increase in number of automobile trade entities in Ulaanbaatar City in recent years is related to the demand of imported vehicles and studies show an increase of an average of 45,000 new automobiles throughout the country per year.
As of today, there are 9 markets in Ulaanbaatar City's 25 hectare land operating in automobile, technical, and spare parts trade, such as Da Khuree, Uguumur, Technical Import Market, Diesel Khuree, Tsakhlai, Dako, Buyan Khurakh, and Sutai Buyant, where 6,000-10,000 customers receive services daily in these markets with around 8,000 tenants, causing road traffic in the routes toward the markets. It also brings the criticism that the large number of technical markets violates citizens' health and public security.
Therefore, the matter to merge such markets operating in technical and spare parts sales and establish an "Auto Trade Complex" was discussed and supported during the regular Board meeting of the Capital City on September 05, the Governor of the Capital City issued an order for land ownership and the matter will be discussed at the next decisive-level meeting of the Capital City Citizen Representative Khural (City Council).
During the first stage of planning, the "Auto Trade Complex" is planned to be established on a 130 hectare land in 32nd Khoroo of Songinokhairkhan District (western part of Ulaanbaatar), as part of the General Plan of the City until 2030.
Buildings for trade, service, office and auto expo center are also planned to be constructed in the Auto Trade Complex and international trade fairs can be organized at the center. Also, places for automobile trade, parking, as well as open parking with roofs equipped with solar panels and an area for customer test drives are included in the planning. The full operation of the Auto Trade Complex will not only decrease road traffic by a certain amount, but it is aimed to be a place as all-in-one.
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Prime Minister concludes Japan visit with Strategic Partnership deal
September 17 (news.mn) Prime Minister N.Altankhuyag has finished his official visit to Japan that continued over September 11th to September 14th.
During the visit the bilateral relations between Mongolia and Japan were developed into a strategic partnership. The two countries determined the next-five year bilateral cooperation between Mongolia and Japan.
A memorandum of understanding between the Development Bank of Mongolia and the Japan Bank for International Cooperation was signed by their representatives.
According to the memorandum of understanding on bilateral cooperation for the allocation of SDP to Mongolia by the Japan Bank for International Cooperation a guarantee for a Mongolian government bond was defined.
The Japan Bank for International Cooperation is the institution that promotes economic cooperation between Japan and overseas countries by providing resources to foreign investments and by fostering international commerce supporting Japanese exports and imports, and the country"s activities overseas.
Last June Mongolia signed an agreement to open lines of credit with Japan Bank for International Cooperation and negotiated to provide loans to companies that want to export equipment to Mongolia.
The two banks also plan to sell a yen-denominated as much as 600 million US dollar worth of Samurai bonds this year according to the bilateral cooperation.
The Governments of the two countries negotiated to cooperate on large-scale investment projects during a visit by Japanese Prime Minister Shinzo Abe in Mongolia last March.
The cooperation between the Development Bank of Mongolia and the Japan Bank for International Cooperation will lead to a new way to solve finance issues that will be required to launch the projects.
Prime Minister N.Altankhuyag arrived back in Mongolia after completing the successful negotiations with Japan on Saturday September 14th.
China, Mongolia launch joint military training for disaster relief
ULAN BATOR, Sept. 16 (Xinhua) -- Chinese and Mongolian armed forces on Monday kicked off joint training for natural disaster relief.
The eight-day training, code-named "Prairie Pioneer," features joint training courses, discussion forums, simulation and field exercises.
Simulating an earthquake scenario, the troops will have to respond to various situations, including road collapses, muddy roads, snowstorms and fire alarms. There will be exercises for quake relief in urban areas, emergency electricity supply, establishment of water-processing stations and make-shift shelters, as well as the provision of medical services.
The training aimed to help the two military forces improve capacity in non-traditional security fields such as natural disaster relief, enhance pragmatic cooperation and exchanges and promote the development of bilateral military relations.
It is the second joint military training between China and Mongolia after joint peace-keeping exercises in 2009.
Chinese VP meets Mongolian Defense Minister
BEIJING, Sept. 17 (Xinhua) -- Chinese Vice President Li Yuanchao met with Mongolian Defense Minister Dashdemberel Bat-Erdene on Tuesday, vowing to push forward the strategic partnership between the two countries.
Li said China-Mongolia relations have kept up healthy development in recent years. China would like to work with Mongolia to promote mutual trust and respect, and to intensify substantial cooperation of mutual benefits to enrich their bilateral strategic partnership, he said.
Bat-Erdene said Mongolia valued its traditional friendship with China. He said Mongolia expected to enhance bilateral cooperation with China in various fields in order to forge ahead with bilateral ties between the two nations and the two armed forces.
Mongolia: India's friend and future in North East Asia
September 17 (dna) As my flight began descent to Ulaanbaatar, a fellow passenger remarked about the irony of landing at the Chinggis Khaan airport. Named after the historical figure who not only united Mongolia but created an empire beyond Asia, the airport now welcomes plane-loads of foreign investors.
Some investors are the marauding kind, keen to exploit the country's natural resources. While Mongolians are warm, welcoming people, global powers are keen to control their country.
Mongolia is landlocked between China and Russia and has made a dramatic transition from being a Communist country to becoming a stable democracy and open society.
Unlike China, it does not impose any restrictions on global social media like Twitter and Facebook. China blocks it, Mongolia embraces it.
While there are few Indians here, Mongolia looks up to India for being a democratic market economy. It is also now welcoming global investors who can help the country reduce its crippling economic dependence on China. While the country has closer cultural ties to Russia, its mineral exports go mainly to China.
Mongolia has a population of 3 million, a GDP of US$10 billion but a staggering natural wealth valued at over US$3 trillion.
I participated in the World Economic Forum's strategic dialogue in Ulaanbaatar where global business and civil society leaders did some crystal ball gazing on its future.
WEF has developed three potential scenarios for Mongolia in 2040. First, where it is able to sell its mineral wealth across the world and also diversify into other products and services. This is the ideal scenario. The second is where it finds it tough to sell its minerals but is able to expand into other products and services.
This is not ideal, since it's growth in this scenario would be moderate.
The third scenario is the nightmare option where it is unable to sell minerals and also can't diversify. Industry experts and academics feel that all these are possible but Mongolia will have to think hard about its policies.
While minerals are its strength, China is the biggest buyer for Mongolia. Also, competition from other countries and volatile commodity prices mean that Mongolia may not get adequate returns on investment.
India has to play a critical role by supporting its institutional framework especially in trade and education. Indian investment in social infrastructure like health and skill development can help our friend in North East Asia diversify its market and reduce its dependence on China. Indeed, Mongolia must focus on other developing markets to ensure that a few global powers don't control it's destiny. Countries like Japan, India and South Korea can be the gateway to growth for Mongolia.
The author Pranjal Sharma tracks India's political economy and its engagement with the world.
French-Mongolian relations reach new levels of partnership
September 18 (UB Post) The Speaker of Parliament, Z.Enkhbold, received Member of the National Assembly of France and Chief of the French–Mongolian Peace Group, Jerome Sharte. Beginning the meeting, Z.Enkhbold expressed Mongolia's aim to bring the Mongolia-French partnership to a new level, stabilizing high level meetings and talks as France identifies Mongolia as its "special partner country" in Asia.
The sides also agreed to ink a stakeholders' agreement to establish a joint company between Mongolian state-owned Mon-Atom LLC and Areva Group of France. Z.Enkhbold expressed his satisfaction with the cooperation memorandum established between the Government of Mongolia and the GDF Suez led Group of France, which was selected to build a 1.2 billion USD coal-fired power plant in Ulaanbaatar. He noted that Mongolia has launched agricultural cooperation with France, introducing some 200 Alpine-bred milking goats to Uvurkhangai Province.
During the meeting, Jerome Sharte stressed that he has been working as the chairman of the Mongolia-France parliamentary group for 11 years, since 2002, and noted the implementation of various cultural projects and programs under the operation of the Mongolian Fellow Foundation.
An official visit of the Minister of Foreign and European Affairs of France, Laurent Fabius, to Mongolia has been postponed for an indefinite period of time, the Ministry of Foreign Affairs reported on Monday. Fabius planned to pay an official visit to Mongolia at the invitation of the Minister for Foreign Affairs of Mongolia, L.Bold, on September 15-17.
Mongolian delegation observes Australian election
September 18 (UB Post) A Mongolian delegation headed by the Secretary General of the General Electoral Commission, B.Altanjargal, observed the Australian 2013 Parliamentary Election for the first time, representing Mongolia.
Australian Parliament consists of two chambers, including the House of Representatives with 150 members and the Senate with 40 senators. A general parliamentary election was carried out in 2013 to choose 150 members of the House of the Representatives and 40 senators. A general election for the House of Representatives and half of the Senate was held on September 7.
During their visit to Australia, Mongolian delegates became acquainted with the Australian election system and the operations of the Australian Electoral Commission, and held a meeting with its chairman and board members of the Australian Electoral Commission's council.
Our observers visited three electoral stations and observed the manual counting of ballot papers.
The voting began at 8 a.m. and ended at 6 p.m. in Australia and the preliminary election results were announced three hours after the end of voting, even though ballot papers were counted manually.
September 18 (Oxford Business Group) After decades of economic dominance by neighbours China and Russia, Mongolia is breaking out by forging new trade ties with East Asian countries. While Korean firms are eyeing construction contracts, Japan is set to enter the field of energy and mining investment.
In August Japanese media reported that consensus had been reached between Tokyo and Ulaanbaatar on a majority of the issues behind an Economic Partnership Agreement (EPA).
The EPA will see Japan given privileges in the mining sector, with the prime minister of Mongolia, N. Altankhuyag, expected to sign the deal during a visit to the country in September. The agreement is also set to exclude Japan from upcoming laws and regulations that will limit foreign investment in the financial and communications sectors.
The move follows remarks by Altankhuyag in March in which he said the Mongolian government wants to develop a strategic partnership with Japan as a foreign policy priority, adding that Ulaanbaatar's "official negotiations focused on activating this partnership in all social spheres, especially elevating economic ties to a new level".
"Japan will be a wise choice as partner in Mongolia's coal and oil shale sectors," wrote Professor P. Ochirbat in the Mongolian Mining Journal in March. "Japan is clearly the second-biggest [coking coal] market after China, and we should seek Japanese help on operating Tavan Tolgoi."
Japan's coal imports are set to hit another record over the next year as utilities led by Tokyo Electric Power Company burn more of the cheaper fuel to cut surging energy bills. Utilities firms bought 4.24m tonnes of coal in May – 22% more year-on-year – as the return of coal-fired plants following the March 2011 earthquake and tsunami causing severe damage to the Fukushima nuclear plant continues to push imports higher.
Other infrastructure and energy deals are getting under way with Korean organisations. On August 17 Ulaanbaatar Mayor E. Bat-Uul met with South Korean parliamentarian Park Jin to discuss a Korean firm's plans to build the new city administration building, as well as the Korea International Cooperation Agency's involvement in improving its water supply and heating network.
"I'm thankful that our relations are improving and Korea is becoming a special investor in the education, health and infrastructure sectors. We will collaborate with Korean companies in Ulaanbaatar city's construction," said E Bat-Uul. In July the Korea Trade-Investment Promotion Agency (KOTRA), the nation's trade and investment promotion agency, opened a branch in Ulaanbaatar.
"The value of trade between the two countries, which was only around $1m in 1990 when we first established diplomatic ties, now stands at about $480m," KOTRA president Oh Young-ho said at the opening. "Our official investment to Mongolia that began at $240,000 in 1994 has also reached $50m in the past 18 years."
However, recent cancellations also hint that it is not all plain sailing for the major infrastructure contracts being awarded. At a cabinet meeting on August 5, officials confirmed that the government was terminating its deal with South Korea's Baek Suk Engineering and Construction, which was in the process of building a 253-km road between Ulaanbaatar and Khuvsgul Aimag.
The move came alongside the cancellation of two other road contracts with Chinese firms, with the government saying it was not happy with their performances. "A Korean company which is building the road between Khuvsgul and Ulaanbaatar has reported to the Ministry of Road and Transportation that it cannot open the road within 2013 as planned," reported the Ulaanbaatar Post in July.
Although a blow to planned road construction projects, surging Korea-Mongolia ties easily outweigh the significance of the cancellation.
Mongolia is also entering into the frontier market of North Korea, with domestic oil trading and refining company HBOil JSC in June acquiring 20% of the state-run entity operating North Korea's Sungri refinery.
That Ulaanbaatar is playing a mediation role in talks between Japan and North Korea also underlines the diplomatic impact of the country's manoeuvres into East Asia, while Mongolian President Ts Elbegdorj is set to visit Pyongyang later this year.
The entry of Japan and the Koreas into the Mongolian investment equation is a challenge to the Russian and Chinese dominance over Mongolia's energy and infrastructure markets. Last year was the 13th straight year in which China maintained its position as both Mongolia's largest trading partner and investor.
According to a foreign trade review released by Mongolia's central bank in July, in the past 12 months the trade volume between Mongolia and China ($2.99bn) represented a decrease of 12% and the trade volume between Mongolia and Russia ($893m) fell by 21%.
While the move to diversify markets is to be lauded, Mongolia's leaders must guard against a geopolitical backlash from its dominant neighbours, which could see them aim for other strategic allies.
Anniversary of Opening of DPRK-Mongolian Diplomatic Relations Marked in Pyongyang
PYONGYANG, September 17 18:07 KST (KCNA) — A film show and friendly meeting took place on Tuesday to mark the 65th anniversary of the establishment of diplomatic relations between the DPRK and Mongolia.
Invited to the show and meeting were Manibadrakh Ganbold, Mongolian ambassador to the DPRK, and staff members of his embassy.
Present there were Kim Jin Bom, vice-chairman of the Korean Committee for Cultural Relations with Foreign Countries who is chairman of the DPRK-Mongolia Friendship Association, members of the association and Pyongyang citizens.
The participants watched the Mongolian documentary "13th World Festival of Youth and Students".
The staff members of the Mongolian embassy also played sports games with teachers of the DPRK-Mongolia Friendship Songyo Junior Secondary School in Songyo District, deepening feelings of friendship.
RUSSIAN AMBASSADOR V.V.SAMOILENKO COMPLETES TERM IN MONGOLIA
September 18 (InfoMongolia) On September 17, 2013, Minister for Foreign Affairs of Mongolia L.Bold received the Ambassador Extraordinary and Plenipotentiary of the Russian Federation to Mongolia Viktor Vasilyevich Samoilenko as he completes his diplomatic mission in Mongolia.
During the meeting, Minister L.Bold highly praised the contribution made by Ambassador V.Samoilenko to develop Mongolia-Russia strategic partnership relations and cooperation and wished him the best in his future endeavors.
by Cassandra Butts, Senior Advisor
September 17 (Millennium Challenge Corporation) I was fortunate to visit Mongolia last week to attend closeout celebrations for the country's MCC compact, whose projects finished on budget and on time with impressive results. Every celebration showcased a sampling of Mongolia's traditions and culture that are deeply intertwined with daily life—like drinking mare's milk, eating cheese curds and listening to the sounds of fiddles and throat singers.
I first attended the inauguration of the 176-kilometer road that MCC rehabilitated. There was a series of dirt tracks previously that were extremely dusty because of their proximity to the Gobi Desert, littered with huge and dangerous potholes. Now, Mongolians have a smooth and safer road that connects them to markets in Mongolia, China and Russia.
I took this road to the city of Choir, the site of a training center MCC funded as part of the Vocational Education Project. Students from across the country benefit from the school's excellent training for mining careers. I saw the hands-on training modules that companies like Wagner Asia have developed. I heard immense satisfaction from both teachers and students, who are now prepared to enter a challenging workforce with the right skills that are in demand by employers.
On our way back to Ulaanbaatar, we stopped by the wind farm that MCC helped connect to the national grid. This is the country's first wind farm, funded through a public-private partnership between the Mongolian government, General Electric and Newcom. MCC played a small but key role in this effort, and it was encouraging to see how green technologies, along with our investment in providing energy-efficient products such as cook stoves, are helping Mongolians enjoy cleaner air.
I also saw the widespread benefits of the health project for all of Mongolia. I count myself among the beneficiaries as I tasted skim milk, saw designated smoking areas and ate less salt in staple foods such as bread—all thanks to the project's nationwide advocacy for healthier living. I visited one of the hospitals that received state-of-art equipment, including computer tomography and angiography machines, as well as an intensive care and rehabilitation unit for heart attack and stroke patients. Having these tools in place is vital in a country where cardiovascular diseases are the leading cause of death and one of the four major causes of disability. "I have never seen such a comprehensive investment in health in my past 20 years in the field," one doctor told me.
Finally, one of the most gratifying successes across all projects is a deeper awareness of the importance of gender equality. The Mongolia Compact has been a model for incorporating gender integration into funded activities consistent with MCC's gender policy. I met Ms. Javshan, a herder who participated in the Property Rights Project. She is the head of her household and a role model for her eight children and 20 grandchildren. MCC-funded training taught her more about sustainable grazing and land management, and she believes that she is now able to make better informed investments in her land because of this knowledge and the security of the property lease she received though the project. The compact created opportunities for her family that she never thought possible, and she has become a real leader in her community as a result.
During this trip, I saw the past, present and future of Mongolia—from gers and herders to wind farms and clean cook stoves to women leaders and technically-trained professionals.
I am proud of the contributions Mongolia's MCC compact has made to help realize the vision for a healthier and more prosperous future for the people from the land of the eternal blue sky.
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Mongolia Signs Cooperation Memorandum with 2030 Water Resources Group
Ulaanbaatar, September 18 /MONTSAME/ The Mongolian Ministry of Environment and Green Development has established a cooperation memorandum with the 2030 Water Resources Group.
The document was inked on Tuesday at the end of a sub-meeting themed "Water resources of Mongolia is a developmental accelerator" within the World Economic Forum Strategic Dialogue on the Future of Mongolia.
In accordance with the memorandum, a project will be co-implemented in the water resources. The project's first stage will launch soon to continue for 1-2 years with a 1-1.5 million UDS financing.
The 2030 WRG is an innovative public-private platform for collaboration to mobilize stakeholders from the public and private sector, civil society, centers of academic expertise and financing institutions to engage in fact-based, analytical approaches and coalition building initiatives that help governments catalyze sustainable water sector transformations in support of their economic growth plans.
2030 WRG engages with those governments who invite it to work on a comprehensive water sector reform strategy and then it provides a public-private approach to support them. 2030 WRG acts as an independent entity and offers no political, partisan or national nuance to its advice.
KOREAN HOSPITALS ISSUING E-VISA TO THOSE NEEDING MEDICAL TREATMENT IN KOREA
September 18 (InfoMongolia) The Ministry of Legislation of the Republic of Korea has given authority to some hospitals to accept e-visa applications from foreign nationals, which is effective from September 01, 2013.
In the scope of this decision, Mongolian citizens who need medical treatment at hospitals in South Korea do not need to apply for visa at the Embassy of the Republic of Korea in Ulaanbaatar, and can travel to South Korea with the e-visa inquiry sent by the hospital.
This e-visa inquiry is as valid as the visa for passport to cross the border.
In conjunction with the South Korea's visa issue, the agreement between Mongolia and the Republic of Korea to alleviate visa conditions came into effect from October 26, 2012 and as part of the agreement, the Korean Embassy is returning the visa fees to citizens who haven't applied for visa.
National Library of Mongolia joins Online Computer Library Center
September 18 (UB Post) The National Library of Mongolia (NLM) has joined Online Computer Library Center (OCLC) through an agreement negotiated on behalf of NLM by D.Enerel, Assistant Professor and Catalog Librarian at Middle Tennessee State University, and Andrew H. Wang, Vice President, OCLC Asia Pacific. The agreement provides the National Library of Mongolia use of OCLC Connection Service through September 2014, and allows NLM to contribute up to 1,000 titles on WorldCat, an international online catalog that helps OCLC members share resources, reduce costs, and increase their visibility and impact in the communities they serve.
The National Library of Mongolia is the first library in Mongolia to introduce the OCLC online cataloging system in the country and the largest library in Mongolia in terms of publications and services. Its collections include more than three million printed books, serials, and manuscripts in all subject areas, and in many foreign languages, including Tibetan, Sanskrit, Manchurian, Russian, German, English, French, Hindi, Japanese, and other languages. Included in these collections are rare sutras written in Classical Mongolian scripts, including Uyghur, Clear (Oirat), Square, and Soyombo.
D.Enerel is currently in Ulaanbaatar as a Library Fellow at the American Center for Mongolian Studies. She is assisting NLM with OCLC cataloging training and the implementation of cataloging standards, and conducting short-term library development projects. D.Enerel said, "Joining the OCLC community is a significant milestone for The National Library of Mongolia to share its collections with the world. The library is delighted to cooperate with OCLC, and hopes to make valuable contributions for years to come."
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