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Tuesday, January 28, 2014
Headlines in Italic are ones modified by Cover Mongolia from original
YAK closed -6.09% to C$1.85 Monday
Mongolia Growth Group Ltd. Publishes December 2013 Monthly Letter to Shareholders
THUNDER BAY, CANADA, January 27, 2014 /FSC/ Mongolia Growth Group Ltd. (YAK – TSXV), a real estate investment and development company participating in the dynamic growth of the Mongolian economy via ownership of institutional-quality commercial property assets in Ulaanbaatar, Mongolia, is pleased to announce the release of its December 2013 letter to shareholders.
December 2013 Shareholder Letter
To the Shareholders of Mongolia Growth Group Ltd.,
In December 2013, MGG's core commercial property portfolio* experienced a same-store rental increase of 23.6% relative to December 2012 on properties owned 12 months or longer as measured in local currency (Mongolian Togrog). Total billed revenue for December 2013 was 243.9 million Mongolian Togrog as compared to 187.5 million Mongolian Togrog in December of 2012 or a 30.1% increase.** The occupancy rate for the core portfolio in December 2013 was 93.9%, including an occupancy rate of 98.5% for core retail properties and an occupancy rate of 84.7% for core office properties.
Investment Portfolio and Operations Update
During the month of December we continued on-track with our plan to shift MGG's asset mix away from smaller properties that cost more to maintain and manage, and towards larger institutional-quality assets that are easier to scale, as we build MGG into a leading real estate company. This repositioning is making progress and during December we disposed of 1 property. Since we began this plan in May of 2013, we have sold 6 of the 23 assets we set out to dispose of. We expect to substantially conclude the repositioning by the middle of 2014.
During December, we completed the sale of Mandal Daatgal, enabling MGG to re-focus its energies on the property sector which is currently experiencing significant growth alongside the growth of the Mongolian economy. We expect to begin realizing substantial savings at the corporate level, beginning in the first quarter of 2014. In addition, we have re-aligned our rents from Mandal to market rates, leading to an increase in our revenues.
Throughout the year, MGG has advanced its mission to help provide equal opportunities for the less fortunate in Mongolia. MGG has continued in its highly successful education initiatives for the third consecutive year, donating over 400 books to the three schools that were selected as part of the program in 2011.
In addition, throughout the year, members of the company donated significant time and personal resources to 3 different orphanages. Employees provided mentorship, food, warm clothes and improvements to each of their facilities.
Mongolian Economic Update
In the most recent quarter for which data is available (Q3 2013) Mongolian real GDP growth was 11.9%.
Since our previous update to you:
§ Mongolia's Ministry of Economic Development has projected that the GDP will grow at 14.7% in 2014
§ Mongolia sold $290 million worth of Samurai Bonds at an interest rate of 1.52% which are backed by a guarantee from the Japan Bank for International Cooperation (JICA)
§ Trade and Development Bank of Mongolia has issued Mongolia's first Renminbi-denominated bond, raising Rmb 700 million (USD $ 115 million)
§ Mongolia has reduced the tax on gold mining from 10% to 2.5% in an effort to increase investment in gold mining
§ December's foreign direct investment figure was US $196.6 million, the highest since May of 2013. The increase is attributed to the new and improved foreign investment law
We look forward to updating you again on our progress and new developments in the Mongolian economy next month.
Chairman & CEO
Mongolia Growth Group Ltd.
KOT closed -4.76% to C$0.20
Khot Infrastructure Announces Resignation of Director Paul Rapello
ULAANBAATAR, MONGOLIA--(Marketwired - Jan. 27, 2014) - KHOT INFRASTRUCTURE HOLDINGS, LTD. ("KHOT" or the "Company")(CSE:KOT) announces that Mr. Paul Rapello has tendered his resignation as a director of the Company, effective January 22, 2014.
"On behalf of the board of directors and management, I would like to thank Paul for his commitment to the development of the Company since its creation in November 2011 and to his willingness to contribute to a positive and constructive transition," said Don Padgett, President and CEO. "We also wish to thank him for his years of service and wish him the very best in his future endeavours."
Khot is pleased to announce the launch of its newly redesigned website at khot-infrastructure.com. The new corporate website offers clear and concise access to information pertaining to Khot's operations, providing an informative and visually appealing platform for its shareholders and potential investors to receive the most current company information.
Our goal is to become the leading Mongolian transportation contractor and the preferred choice for employees, shareholders and partners. Our focus is on high margin contracts, such as highways and regional roads. Our mission is to provide the infrastructure needed for one of the world's fastest growing economies.
MSE News for January 27: Top 20 -0.56%, Turnover ₮17.9 Million
Ulaanbaatar, January 27 (MONTSAME) At the Stock Exchange trades held Monday, a total of 6,243 shares of 17 JSCs were traded costing MNT 17 million 877 thousand and 841.40.
"Tavantolgoi" /2,302 units/, "State Department Store" /1,397 units/, "Hai Bi Oil" /935 units/, "Remikon" 427 units/ and "Genco tour bureau" /373 units/ were the most actively traded in terms of trading volume, in terms of trading value--"Tavantolgoi" (MNT 12 million 189 thousand and 345), "Gobi" (MNT one million 493 thousand and 075), "UB hotel" (MNT one million 092 and 480), "State Department Store" (MNT 766 thousand and 562) and "Makh impex" (MNT 607 thousand and 997).
The total market capitalization was set at MNT one trillion 582 billion 644 million 340 thousand and 575. The Index of Top-20 JSCs was 15,398.32, decreasing by MNT 82.09 or 0.56% against the previous day.
BoM MNT Rates: January 27 Close
January MNT Chart:
BoM issues ₮295 billion 1-week bills, total outstanding down 6.5% to ₮903 billion
January 27 (Bank of Mongolia) BoM issues 1 week bills worth MNT 295 billion at a weighted interest rate of 10.5 percent per annum /For previous auctions click here/
8% Mortgage Program Update: ₮482.4 Billion Refinanced, ₮821.8 Billion Newly Issued, Total ₮1.3 Trillion
January 27 (Cover Mongolia) As of January 27, ₮482.4 billion (₮482.4 billion as of January 22) existing mortgages of 17,057 citizens (17,056 as of January 22) were refinanced at 8% out of ₮844.1 billion (₮844.1 billion as of January 22) worth requests.
Also, ₮821.8 billion (₮805.1 billion as of January 22) new mortgages of 14,346 citizens (14,031 citizens as of January 22) were issued at new rates out of ₮897.1 billion (₮881 billion as of January 22) worth requests.
Link to release (in Mongolian)
Mongolia mulls sovereign wealth fund
January 27 (bne) Mongolia is mulling a plan to use its mounting income from the mining sector to establish a sovereign wealth fund. An apparent reaction by the president to concern that the country is not leveraging that revenue to the benefit of the wider population, the fund would be used to promote long-term economic development.
President Tsakhia Elbegdorj's bill on launching the "Treasury Fund", was discussed in the President's Civil Hall on January 24, UB Post reports. Presidential Advisor Luvsandash Dashdorj criticised the government's lack of a "clear system and policy" to handle the income from Mongolia's rising raw materials exports.
Dashdorj pointed out that accumulating $500m a year in the fund from 2016 would leave Mongolia with some $230bn by 2064. Elbegdorj's bill proposes spending up to 25% of the fund on education, with investments starting in 2025.
Natural resources, in particular coal, account for around 80% of Mongolia's exports. Revenues are expected to soar as more mining projects - including the development of the Oyu Tolgoi copper-gold deposit - progress. However, this has sparked a rise in resource nationalism, and there is popular pressure on the government to ensure that the exploitation of Mongolia's natural resources benefit the entire population.
Other countries in the region have already launched sovereign wealth funds as their import revenues increase. Kazakhstan has established a national oil fund, while Yerevan operates the State Oil Fund of the Azerbaijan Republic (SOFAZ).
DBM Samurai Bonds Trading at 1.45%, Below 1.52% Coupon
JBIC to expand bond backstop programme
January 27 (FT) The Japan Bank for International Co-operation is set to expand its bond backstop programme, which has allowed lowly-rated issuers from Panama, Tunisia and Mongolia to tap yield-hungry investors in the world's third largest economy.
Since 2009 Tokyo-based JBIC has supplied guarantees on the repayment of up to 95 per cent of the principal and interest on "samurai" bonds sold in Japan to domestic investors. By doing so, the wholly state-owned bank has effectively rented its higher credit rating for a fee, providing borrowers with access to a market that would otherwise be closed to them.
Interest in JBIC's programme has picked up in the wake of "Abenomics," which has seen the Bank of Japan pledge to keep pumping cash into the economy until inflation stabilises at 2 per cent. That commitment has driven borrowing costs for issuers of all descriptions to record lows.
Sovereigns and quasi-sovereigns are particularly anxious to secure stable, long-term funding, at a time when emerging-market finances are under scrutiny.
A debut 10-year yen bond from the Development Bank of Mongolia, for example, sold with a coupon of 1.52 per cent on Christmas day, was trading at a yield of 1.45 per cent on Friday, with investors apparently shrugging off concerns over emerging-market assets caused by the slump in the Argentine peso.
Adding to the appeal of the samurai market is the decision by Shinzo Abe to press ahead with an increase in consumption tax, said Mr Watanabe, even as the prime minister pushes up spending in the current fiscal year to support his attempt to throw off deflation.
The Sales Managers' Index: Mongolia - January 2014
Winter and falling business confidence puts freeze on Mongolian economy
· Mongolia headline SMI suggests growth continues to slow
· Speed of price inflation slows
· Market expansion remains stable
World Economics -- The Mongolia Sales Managers' Index brings together the collective wisdom of Sales Managers throughout Mongolia to produce the earliest source of understanding about what's really happening in one of the most dynamic countries in the world.
The Headline Index is designed to reflect overall economic growth, bringing together the average movement of Confidence, Market Expansion, Product Sales, Prices Charged and the Staffing Indices.
Confluence of factors including business confidence with seasonal effects is reflected by a cooling in economic activity.
Confidence among Sales Managers has been falling steadily since April.
The January Index suggests a bottom has been reached after the second month of improvement. Panellists have explained they feel the coming months may see developments that will improve confidence.
The Market Growth index reflects growth of the general marketplace in panellists' own industry sectors. Sales Managers' report that the overall speed and direction of growth remains modest in comparison to readings seen earlier in the year.
The index reading of 53.4 indicates an economy that is expanding at a stable rate. Although the trend is congruent with the cooling of GDP growth.
The Product Sales Index reflects the sales of individual companies rather than the wider economy.
The Index has continued to decline, reaching 44.1 in January. Panellists have suggested that problems with investment in the key mining sector, challenging seasonal conditions and the high cost of importing goods have contributed to falling sales.
The Prices Charged Index registered 64.0 in January which marks a decrease from last month. The Index suggests Sales Managers are still passing on large price increases to business and consumers albeit at a slowing rate.
Panellists noted that the decline in value of the Tugrik appears to have stabilised. Although the high cost of importing goods is still the main cause of price rises.
Managers are recruiting staff to meet new demand at a modest pace – and despite several months of falls in the growth of recruitment, the jobs market remains in marginal expansion.
Short term seasonality problems aside, it is clear that managers expect double digit GDP growth to continue.
World Economics Chief Executive Ed Jones commented:
"Sales Managers have told us that the weakened Tugrik appears to have stabilised against the US Dollar, although high importing costs mean price rises are still evident.
Overall Market Growth remains indicative of an expanding economic environment. Whereas individual Sales are in decline, which panelists have noted is due to high prices.
Taken together, these data suggest Panelists are confident that strong GDP growth will continue in 2014 despite short term seasonal challenges."
2013 Consumer Confidence Index Drops 36.4 Points to 96.7, Lowest Since 2009
National Research and Consulting Center --
In October 2013, the Consumer Confidence Index (CCI) in Ulaanbaatar has significantly decreased from last year's level. In 2013, the CCI has decreased by 36.4 percentage points (27.3 percent) compared to the same period of 2012 and reached 96.7. Both components of the Index, the current situation index and the expectation index, contributed to this decrease. In particular, the expectations index has decreased by 50.2 percentage points from last year's level (152.2) or by 32.9 percent and reached 102, whereas the current situation index has decreased by 15.7 percentage points and reached 88.8.
Share of the households, responded good on job availability, decreased by 10 percentage points (30 percent) and it was the main reason for the pessimism about the current situation of the economy.
Saturday Cabinet Meeting Postponed to Tuesday, January 28
Ulaanbaatar, January 27 (MONTSAME) A regular meeting of the cabinet did not meet because of coincidence with several events.
By its decision, the cabinet meeting will be held on January 28, and it was postponed until this day due to some works such as a consultation of foremost herders and farmers.
Mogi: DP's VAT bill proposes increasing VAT revenue threshold to ₮50 million, leaving voluntary VAT payer possibility from ₮10 million
DP Faction Rejects Opposition VAT Bill Due to Technicality
Ulaanbaatar, January 27(MONTSAME)The Democratic Party's (DP) faction has not backed a draft law on VAT initiated by S.Byambatsogt MP.
It was reported by S.Odondtuya, a deputy chairwoman of the DP faction; and A.Bakei MP at its regular meeting on Monday.
"Although parliament is making a friendly environment for big entities, the legislative body now should discuss the draft law which aims to support small- and middle-sized enterprisers by setting the VAT threshold at MNT 200 million," S.Byambatsogt said about its purpose.
The DP faction explained the bill violates principles of the Constitution because any draft law on budget matter shall be initiated and submitted by the government not by MP. "Changing VAT size is a matter belonged to the cabinet, so it is not possible to back it, but we are ready to back the same bill formulated by the cabinet," the faction members said.
The same day, the faction backed a bill on joint pension that will be discussed this week at a plenary meeting of the parliamentary session.
President Highlights Smart Government Initiatives at Davos Roundtable
Ulaanbaatar, January 27(MONTSAME) The President of Mongolia Ts.Elbegdorj took part in a roundtable meeting titled "The Next State" ran Friday within the 44th annual meeting of the World Economic Forum in Davos, Switzerland.
Apart of our President, the roundtable meeting brought together representatives of other countries, world famous professors and scholars from research and technological centers to discuss tendency of state in modern time and its features.
Main topic of the roundtable was a way of designing a future political system with the latest technology or model. The participants agreed that blueprint of future state will be determined by creating a new state system which is based on IT, innovation and researches more than based on previous industrial tendency, and by collaborating with the private sector.
Mentioning about a forum called "From big state to smart state" ran last year in Mongolia, the President emphasized that it is time for his country to abolish cumbersome system of state in order to make it smart and compact. "In order to do this, we have launched some reforming works," Mr Elbegdorj said. For example, the number of licenses issued by state was declined by 40%, and issuing of 30% of total licenses will be transmitted into the private sector. Any permission and licenses will be created only through parliament.
Mongolia is working to stop state-run business activities, and it halts the state to intervene business environment of the private sector, the President said. Moreover, the country is introducing the law on transparent so-called "glass" account. By this law, a state servant must report online his/her expenditure of money from taxpayers in 72 hours, he added.
Saying that Mongolia could reduce its corruption index last two years by 36 places, the President emphasized Mongolia will keep and increase this achievement, and it will be criteria for the 'smart' state of the country. "We will be becoming a nation in twenty years from now to share our experience on smart state. Tendency of Mongolian next state will be based on researches, and will have service-oriented legal governance," the President stressed.
Mogi: "important"? Well that's very presumptuous of Montsame, when that word can't be found in Schwab's quote.
Mongolia Becomes Important Partner of WEF
Ulaanbaatar, January 27 (MONTSAME) The 44th Annual Meeting of the World Economic Forum 2014 comes to a close on Saturday, on 25 January in Davos-Klosters, Switzerland.
Mongolian delegation led by the President of Mongolia Tsakhiagiin Elbegdorj participated actively in the WEF sessions and expressed Mongolia's position on various issues.
During the meeting with President Elbegdorj, Founder and Executive Chairman of the WEF Professor Klaus Schwab noted: "Before, our purpose was to introduce Mongolia to the Annual Meeting of the WEF, but now, Mongolia has become an active partner of the WEF. We are glad to see that Mongolia is strengthening its position in the WEF, actively participating in the session on anti- corruption, governance, water, fair mineral development and other important issues".
At the meeting, President Elbegdorj proposed to organize the WEF's East Asia Summit in Mongolia in 2016 and Professor Schwab accepted the proposal. Also, President Elbegdorj and Professor Schwab discussed possibilities to introduce Mongolian culture and arts at the WEF.
January 27 (MIBG) Mongolia Politicians are well versed on the impact that rising living costs and the rapid depreciation of the currency is having on the middle class - they also understand the solution. Attitudes of Politicians across the country have taken a 180 degree turn towards foreign investment into Mongolia. The fall out of protectionist sentiment that once characterized Mongolia's political landscape has provided a reality check to Politicians and the public alike. Peaking in April of 2012 following the Parliamentary ratification of the Strategic Entity Foreign Investment Law (SEFIL) we saw the rush for Mongolian debt and equities, which started in 2009 come to a screeching halt. The results were devastating - a 20% depreciation in the Mongolian Tugrik, 50% drop in FDI, and further commitments by the Government to continue spending in order to maintain economic growth. With the 2013 GDP forecasted at 14% we await the final numbers from the National Statistics Office to see how much of an impact the past 18 months have had.
Reflecting on the past year we do believe that the Government of Mongolia has done an excellent job of keeping the inflation of non-durables under control through the Price Stability Program. Without this, inflation in non-durables would have driven inflation even higher. That said, we do not believe that the Government of Mongolia can keep the current Price Stability Program going for long. This view is the result of funding concerns as Mongolia's borrowing cost continues to rise and foreign currency is falling within the economy. The only viable solution that we see for the Government of Mongolia right now is to attract FDI.
Fundamentally speaking, Mongolia is an FDI driven economy. Based on recent changes in the legislative environment we believe that the Government finally realizes this fact. Furthermore, it would appear that they share our view that a resurgence in FDI is needed in order to stabilize the economy and provide the necessary foundation for continued expansion. To this end, the legislative reforms that have taken place over the past year have been directly focused on attracting FDI and providing a stable investment climate for foreign capital. So what are these changes?
1. Approval of the new Investment Law and establishment of the Invest Mongolia Agency (abolishing SEFIL)
2. Approved Securities Market Law, allowing dual listing, createding a relaxed capital market environment
3. Approved Investment Fund Law, aimed at attracting institutional investors into the market
4. Approved GoM Mining Policy 2025 (Final document not released yet) promises to limit state involvement in exploration and mining activity
5. Amended Minerals Law to include Gold Transparency Initiative, decreased Gold royalty by 50% to 2.5% for producers who sell to Mongol Bank
6. Expected amendments to the Minerals Law in accordance with the Mining Policy 2025. Moratorium on new exploration licenses will likely be lifted
7. Expected amendments to the Law on Government of Mongolia to stop appointing parliament members to ministerial positions. Populist sentiment at cabinet level will be reduced and policy continuity will materialize offering further stability
Each of these pieces of legislation is critical to the development of the market. However, the latter two are of a particular significance. The issuance of new exploration licenses has been banned since 2010, causing widespread doubt among investors regarding the Government of Mongolia's commitment towards the minerals industry. Similarly, the Law on Government stands out as a key initiative as it would stop the appointment of parliamentarians to ministerial positions, which will increase stability and professionalism within cabinet.
Overall, based on the changes that have already taken place and those still to come we believe that Mongolia's legal environment will be completely revamped by the end of 2014. This will create an incredibly positive environment, one that has not been seen in Mongolia for some time and a clear standout compared to other frontier and emerging markets. The only uncertainty that remains is whether investors agree.
Eco-warrior or eco-terrorist? Mongolia jails environmentalist for 21 years
By Michelle Tolson
January 28 (Asian Correspondent) One week ago, the courts of Mongolia sentenced environmental activist and former herder Tsetsegee Munkhbayar and four other members of the "Fire Nation" group to 21-and-a-half years in prison each for "acts of terrorism." He had come to deliver a petition to Parliament to stop the amendment of a 2009 law, called "the Long Name Law," created to ban mineral exploration near river heads, reservoirs and water sources so as to guard against pollution. Activists say the amendment would have weakened the law he had fought so hard for. According to , he had brought fire arms and (inactive) grenades to his protest.
"Ts.Munkhbayar's actions highlighted the desperation of helpless Mongolian pastoralists who had no choice but to resort to an unconventional approach to defend their land, rights and way of life after exhausting all other means," Enkhbat Toochog, of the Southern Mongolian Human Rights Information Center (SMHRIC) told from the group's headquarters in New York.
He hopes for a better future for independent Mongolia, having witnessed Inner Mongolia, now considered an autonomous region of China, transformed by rapid development.The case of Ts.Munkbayar also suggests that the Government of Mongolia, advertising itself in the west as a model democracy of Asia, is no less oppressive than authoritarian regimes like China, especially when conflict of interest between the government and common public is inevitable."
Munkhbayar founded of the United Movement of Mongolian Rivers and Lakes () to protect water sources from mining pollution and his tireless lobbying for legislation earned him the Goldman Prize in 2007, awarded to outstanding environmental activists. Though Goldman does not condone violence, they stand by the activist. "In 2010, UMMRL filed a law suit against the government for failure to implement their own law and in October 2011, the Supreme Court of Mongolia found the government guilty and forced them to begin implementing the rules and regulations spelled out in the LLN [Long Name Law]," . However, when the new government came to power in 2012, his years of work began to be dismantled owing to pressure from foreign mining companies. By August of 2013 shrinking foreign investments, down 42 percent, caused parliament to consider revamping investment laws. In September, Munkhbayar staged his demonstration and a firearm accidently went off. "It is widely understood that the shot was not fired on purpose and nobody was injured," reported Goldman.
Eugene Simonov, Coordinator for Rivers without Boundaries, an organization that advocates for the protection of river basins questions the "terrorist" claim as well. "Munkhbayar and the United Movement of Rivers and Lakes employ an extremely wide variety of work methods from environmental education, ecosystem restoration and close work with legislature to theatrical projects to armed demonstrations and seizing illegal mining sites," he explained from Ulaanbaatar.
For instance, in September of 2010 Munkhbayar came under scrutiny for taking shots at the mining equipment of Canadian Centerra Gold and China's Puraam for mining within the headwaters of the Selenge River, which was prohibited under the 2009 law. Though initially condemned, his actions brought about the eventual support of the courts. "About 90 percent of the methods they used, I see as fully justified by situations in which they acted and they led to constructive results they wanted to achieve," Simonov said.
Due to Mongolia's economic downturn, support for environmentalists is waning in the sparse investment climate, said Dugersuren, executive director of OT Watch, an environmental group in Mongolia. "[There is] a broad media campaign against civil society organizations' reputation accusing them of every possible ethical crime."
According to Sukhgerel, this backlash against civil society has coincided with the weakening of environmental protections. "The current government is amending and/or adopting a huge number of laws and policies at a very fast pace that are detrimental to the environment and society. I would name the amendments to the law which Munkhbayar attempted to protect, draft law on forced eviction, minerals law and policy, foreign investment law and a number of laws on tax exemption for extractive projects. Extractive industries are waging a huge campaign on changing Mongolian laws to allow rampant, uncontrolled and loss-making extraction of Mongolia's wealth."
French AREVA has been exploring Mongolia's uranium deposits in the Gobi desert. Herders living in the area and a consortium of grassroots groups, including the controversial Fire Nation which Mukhbayar is a member of, have fought against this. Local livestock deaths and deformities emerged in the vicinity though the government contends that an investigation into herders' concerns conducted by the Nuclear Energy Authority showed no links were found, but . Despite their protests the government agreed to a in September to "revive investments."
"Mongolia is being 'developed' by westerners, Russians and Chinese with little regard to its tradition and natural peculiarities," said Simonov, who questions the negative connotations of nationalism attributed to Mukhbayar. "One of major objections of western investors to the 'Law on protection from mining impacts of rivers, headwaters and forests' was that it 'has no analogy in western, civilized countries.' [Yet] real damage in habitat destruction, forced migration and river poisoning is very serious. In such situations, environmentalists quickly acquire a nationalist stance and nationalists use environmental slogans. We saw it in Russia in the late 1980s."
Sukhgerel expressed shock at the sentencing. "First of all, prosecution's claim of a terrorist act in this case is ridiculous. My personal opinion is that [his actions were] an attempt to get the attention of powers by demonstrating access to fire arms [and this] is in nowhere near the damages that will be caused to environment and society by the mining companies demanding this amendment. Public officials tried for corruption and squandering of public money amounting to billions get only three to five years of imprisonment. Another fair trial principle not employed here is use of the least harsh punishment in the case when there is doubt of harm or damages caused. In this case there is no victim and damage caused by this act."
Enkhbat sees parallels between independent Mongolia and 'Inner,' or Southern Mongolia, as some activists prefer to term the region.While the independent country of Mongolia becomes one of the few mineral-rich countries, Southern Mongolia was declared by the Chinese Government as the "Energy Base of China" due to the fact that it produces 95 percent of the world's rare earth and becomes the top producer of coal and natural gas in China. Just two weeks before Ts.Munkhbayar and six of his fellow environmentalists were sentenced to long term imprisonments, another Munkhbayar and five of his fellow activists from Chinese-occupied Southern Mongolia were sentenced to by the Chinese authorities for defending their grazing lands from encroaching Chinese settlers and miners."
Enkhbat thinks Mongolia has a chance to avoid the same fate as Southern Mongolia, but sees the need for a broader movement. "It is very difficult for any nation to come up with a truly ideal model of development. Yet, one thing is clear. A development that comes at the cost of natural environment and traditional way of life is not a worthy and sustainable one. Environmental or human rights activism is not a responsibility of a handful of activists or those who are affected only. It should be a social movement."
Exclusive: Abu Dhabi investor seeks to exit Mongolia bank after governance row
BY LAWRENCE WHITE, HONG KONG Mon Jan 27, 2014 (Reuters) - A foreign investor has moved to sever ties with Mongolia's largest private lender, Golomt Bank, because of its concerns over the lender's weak corporate governance standards, according to documents and a source familiar with the matter.
The Abu Dhabi Investment Council (ADIC), which lent Golomt $25 million in 2010, is seeking to call in the loan after a turbulent 15 months inside the bank, in which auditors identified serious management failings, according to the source and an external audit report reviewed by Reuters.
ADIC and Golomt are currently in dispute over whether the sovereign investor can redeem its five-year loan before maturity and the matter has gone to confidential arbitration proceedings in London, the source said, declining to give details.
ADIC's accusations of mismanagement inside Golomt, which holds a quarter of Mongolia's deposits, underline wider concerns voiced by credit rating agencies and the World Bank in recent months about poor corporate governance among the nation's banks.
The original loan agreement signed by Golomt and ADIC, an investing arm of the Abu Dhabi government, came amid a surge of foreign interest in Mongolia and its mineral wealth, which in turn spurred strong growth in bank lending.
Golomt Bank declined to comment.
ADIC's falling-out with Golomt began in 2012 when Japan's Itochu Corp (8001.T), a maker of mining and construction equipment, sued the bank for $43 million that Itochu said it was owed under letters of credit issued by Golomt in 2007 and 2008.
Letters of credit are a form of bank guarantee to facilitate trade. In this case, according to Itochu, Golomt guaranteed to pay Itochu on behalf of a Golomt client - Mongolian gold miner Altan Dornod - for the purchase of equipment from the Japanese firm.
The equipment purchases turned out to be faked, according to Itochu's version of events, as part of a scheme hatched by Altan Dornod and Itochu's own Mongolian sales manager to siphon money from the Japanese firm to the then Russian-owned mining firm.
The miner's owner at the time, Sergei Paushok, denies fraud took place and the former Itochu manager could not be reached for comment. Itochu has only given an outline of the alleged fraud in its public disclosures and many details remain unclear, including what, if any, benefit the sales manager obtained.
Itochu declined to comment.
For ADIC, though, the main issue was not about Itochu's allegation of fraud. Indeed, Golomt Bank appeared not to know about the alleged fraud at the time the LCs were issued, according to an independent investigator's report commissioned by the bank's board. Rather, it was that the bank had given such large guarantees - exceeding its entire share capital at the time - to Altan Dornod, without consulting the bank's board, the source said.
The size of the guarantees created internal uproar about how the LCs - in breach of central bank limits on single-customer exposures - could have been issued without triggering alarm bells inside the bank and without escalation to board level.
An investigative auditor, Dubai-based FSI Capital, probed the matter on behalf of Golomt's board in late 2012 and in December of that year recommended internal checks and balances be introduced - recommendations that, according to ADIC in April 2013, had still not been adopted.
It was then that ADIC took its director off the board.
"We feel we have no alternative given the board and management's unwillingness to co-operate with us to raise the bank's standards to a level consistent with what we set out to help Golomt Bank achieve," ADIC director Mark Cutis wrote in a letter to the central bank explaining his resignation.
The Bank of Mongolia, the central bank and the banking supervisor, declined to comment.
BANKING ON A MINING BOOM
The LCs controversy led to the delay of Golomt's published 2012 accounts - an event that ADIC said breached the terms of its convertible loan to the bank and triggered ADIC's demand for early repayment. The delay also led Moody's to withdraw its credit rating on Golomt and for Standard & Poor's (S&P) to suspend its rating. S&P cited "internal disagreement over Golomt Bank's corporate governance issues" for the suspension.
FSI Capital, which interviewed Golomt managers for its investigation, said the bank's credit committee had argued the LCs never put the bank at risk of a loss. The FSI report quoted a committee member as saying this assessment was based on an assurance given to Golomt by the Itochu sales manager that the Japanese company would never call on the LCs.
FSI director Stephen Price, who prepared the report, questioned the credit committee's explanation, saying that such an assurance from a relatively junior Itochu official should have raised red flags with the committee. Itochu has said its sales manager acted without head-office authorization.
The FSI report concluded that the committee, acting with questionable ethics, had accepted the Itochu manager's assurance out of a desire to charge a $1 million fee for issuing the LCs.
"The reasonable conclusion that can be reached by an objective examination of the facts is that the credit committee's decision was swayed by the opportunity to make fees and commission in excess of $1 million off the back of a set of transactions that would require very little effort ... and no capital, given the bank's decision to treat these LCs as 'risk free'," the report said.
OTHER FOREIGN INVESTORS
Golomt has three other foreign investors: Credit Suisse, which lent $10 million to Golomt in 2007, as well as Swiss-Mo Investment Ag, which has a 10 percent stake in the bank, and Dutch trading firm Trafigura which has a 5 percent stake.
Credit Suisse has also sought to call in its loan to Golomt, according to legal correspondence dated last September. But it is unclear if this move was also related to the LCs controversy or if Credit Suisse has been successful.
Credit Suisse declined to comment.
Swiss-Mo, which is controlled by Swiss financier Urs Schwarzenbach, and Trafigura both declined to comment.
Supreme Group Wins Site Services Contract for Mongolia's First Wind Farm Project
Renewable Energy Project Developed and Operated by Clean Energy in Collaboration With Mongolian Government, International Development Organizations and Private Sector
Reston, Virginia (PRWEB) January 27, 2014 -- Supreme Group, a global leader in the provision of end to end supply chain solutions in challenging environments around the world, has been awarded a twelve-month contract to provide catering, cleaning, laundry and security services for Mongolia's first wind farm project. The contract was awarded by Clean Energy, a joint venture among Newcom Group, General Electric (GE), European Bank for Reconstruction and Development (EBRD) and Netherlands Development Bank (FMO).
Located 70 kilometers south of Mongolia's capital Ulaanbaatar, the Salkhit Wind Farm is a landmark project established by the private sector with support from the Mongolian Government and international development organizations. The project aims to improve living conditions in Mongolia through the production of electricity by a local, clean and renewable energy resource. The 50 megawatt facility uses 31 GE turbines and will annually offset around 180,000 tons of CO² emissions; reduce coal usage by 122,000 tons; and save 1.6 million tons of fresh water. The power generated by the project will service customers connected to the central grid in Mongolia; a country in which energy demand has been increasing by eight per cent annually over the past few years.
"The wind farm is a flagship development for Mongolia's renewable energy sector; and we are delighted to have the opportunity to work with Clean Energy on this project, especially as sustainability is one of our core values," said Stephen Orenstein, Principal, Supreme Group. "We are committed to local economic development and in particular to national sourcing and creating local employment opportunities, so we have hired a team of local employees and Mongolian suppliers to work with us as part of our Mongolia First Program. Since commencing operations in Mongolia in 2012, we have focused on providing world-class support services to help further develop the Mongolian mining and energy industry," Orenstein added.
Supreme provides end to end supply chain, construction and site service solutions in Mongolia including the South Gobi region, with specialized skills in construction, food supply and site services. In addition to the Clean Energy project, Supreme also provides food supply and camp services to workers in a road construction camp in the South Gobi Desert, which is a contract awarded by one of Mongolia's largest industrial holding companies.
Since 1957 Supreme has delivered logistics support in some of the world's most remote and hostile locations. The company's integrated capabilities include procurement, transportation, construction, storage, technology and full site services. For more information about Supreme, visit http://www.supreme-group.net.
Fluorspar Exports Reach USD 81 Million in 2013
Ulaanbaatar, January 27 (MONTSAME) Last year, Mongolia collected USD 81 million from its fluorspar exports.
The nation exported fluorspar totaling 430 thousand ton at price of USD 188.7 per ton.
The current global demand for fluorspar is 6.0–6.5 million ton per year. Thus, the fluorspar production of Mongolia represents 7% of the total output. Fluorspar prices go between USD 180-400 per ton at global markets, depending on its content, grade and production level.
Police issues warning over large amount of counterfeit tugrugs reported
January 27 (news.mn) Attempts to use counterfeit bills of Mongolian currency in transactions have been reported lately around Mongolia`s traditional holiday Tsagaan Sar. It has been revealed that a transaction was recently made with a large amount of counterfeit notes with value of 5,000 Mongolian tugrug.
A 20,000 tugrug counterfeit note was also found during a transaction attempt. The Criminal Police Department and Financial Regulatory Commission of Mongolia have created a task force to investigate where the counterfeit bills are being made. Police have warned civilians to be cautious dealing with money during the shopping boom during the holiday period.
Apparently larger denomination currency notes are usually counterfeited. Officials say that counterfeit bills are easily recognized by seeing and touching them. The high encryptions of currency bills are not usually copied by counterfeiters.
Mongolian Cashmere - There's More to Discover
- Products for fashion and interiors collections that have unique story and source
- High quality fibres and reliable workforce
- Vertical and big brands could find it useful and promising to engage across the value chain
- Women-owned companies make up about 90% of total SMEs which have large impact on livelihoods
- Opportunity for brands to partner and develop blends and variations in counts of yarn
- Differentiated product opportunity through hand knitted and machine knitted products
- Yak and Camel have huge potential as complementary products to cashmere
- The EU is Mongolia's third biggest trading partner
- Majority of Mongolian exports benefit from tariff-free entry into the EU markets through the GSP+ (Generalised System of Preferences) programme.
- EU-Mongolia Trade and Cooperation Agreement Joint Committee meetings take place in Ulaanbaatar and Brussels each year
Cashmere and yak are high-end products with potential to be sold in international markets as luxury goods. While 'cashmere' has become something beyond the name of a fibre -effectively a brand in itself – yak is becoming the next eco and exotic luxury fibre across the fashion and interiors industry due to the process used for gathering, cleaning and processing the fibres which are all traditionally eco-friendly and humane. Annually Mongolia produces 7,000 tones of cashmere, 22,000 tons of sheep wool, and 300 tons of yak wool. Several Chinese companies buy the yak wool, but it is not as well known in other parts of the world. The Mongolian government is keen to encourage value added exports from this and other fibres.
Mongolia is second to China as the largest producer of raw cashmere in the world and the tenth largest exporter of wool globally. Despite this fact, 80% of Mongolia exports in this sector constitute low value raw materials. In 2011, export figures show that 10,115,288 kg of cashmere and wool were exported and 284,475 pieces of finished goods made it to exports. The total value of exports from this large sector was valued at: USD 212,546,800. Whilst there is a great demand for cashmere in the desinger and high fashion market in the EU and US, most of the raw material (fibre)is exported to places such as Italy and China where all the value addition takes place. Most of the companies in Mongolia are small and medium in size and are mainly involved in knitting. Some work on felting and weaving. While traditional techniques such as embroidery on felt and printing on felt have exisited over the years, there is a significant lack of market exposure and thus, market demand.
Cashmere is Mongolia's third largest export product after copper and gold and provides income to over 1/3 of the population. Cashmere is said to be the economy's largest employment provider. As per World Bank data from 2003, over 43% of Mongolian households depends on livestock herding for a part of their incomes and many depend on goat herding. According to detailed studies conducted between 2005 – 2007, if all the raw cashmere produced in Mongolia was fully processed, finished and exported, this would generate about double if not more of the total textile and clothing export and employment in the processing industry would more than double as well.
The textiles, clothing and home furnishing sector in Mongolia represents several different product categories. Traditionally wool and cashmere have been used not only to create internal home decorations and products for everyday use, but the unique and skilled 'felting' process has helped the nomadic populations build their houses known as 'gers'. The 'ger' was made through a felting process of layering, which was done by the woman of the family. These embroidered 'gers' form the basis of the tradition related to felting.The key stakeholders in the country, the chamber, the ministry, the association and the businesswomen's association all re-iterated the same message; that about 90% of the companies in the Mongolian cashmere and wool industry are run, owned and managed by women. These are SMEs and also make up the majority of the SME sector.
Women in Mongolia have historically been working with cashmere and wool and have been running businesses through the centuries, even when Mongolia controlled a large part of the silk trading route. The princesses of Mongolia (daughters of Chingis Khan) were known to have been amongst the toughest and most business savvy rulers of the time. As Mongolian men have always been out of the house fighting wars, or tending to the herds, the women have developed and run businesses and trade, managed houses and made the money, making them a population of natural entrepreneurs, negotiators and exporters. They also posess incredible felting, knitting and embroidery techniques that have been passed from mother to daughter. While felting had always been a technique that Mongolian women have used, embroidery, knitting, brocaded and other traditional techniques were brought into Mongolia through influences from Kazakhstan, China, Russia and other regions of Asia and Europe over centuries. These have now become embedded into Mongolian history and tradition. In addition, Mongolian boots made from strong leather with a very thick layering of yak hair is another technique which was used over generations to keep the herders warm while moving constantly with the animals.
Knitted cashmere garmets are a core product export from Mongolia. While good quality cashmere clothing is found easily, the design and variety available in terms of colours, patterns, silhouettes or blends is still low in comparison to international requirements. Local people wear and use cashmere products throughout the year due to harsh weather conditions. There are about seven major cashmere companies, the majority of which were state – owned companies in the past. These and some other smaller manufacturers offer cashmere products in super markets and factory outlets around Ulaanbaatar which are mostly bought by locals and tourists. However, finding products of acceptable design for the international market is more difficult. There is a critical and urgent need for design and development of the cashmere, yak, camel and wool products. While general quality is good, variety of garments and yarn, product development and marketing is desperately needed. SMEs make up a very small component of Mongolia's high-value export basket. Limited language skills, awareness and exposure to market access channels makes it difficult for SMEs to compete in the international market and showcase products that could be sold at good prices.
Mongolians have a history of working as herders and living a nomadic life across the 'steppes'. While in Ulaanbaatar the lives of the majority have changed, traditional methods and artisanal skills are still present and can provide a source of economic livelihood to many in the rural areas. Within Ulaanbaatar and its surrounding areas, the wool, cashmere, camel and yak industry is a main source of income for many. Trading and business in the cashmere and wool industry is mainly based in the Ulaanbaatar region whilst herding and animal rearing takes place across Mongolia. The key regions where the fibre is said to be the best are: Hentii, Sukhbaatar, Uvs, Arkhangai and Bayankhongor located in the western region as the micron is finer there. The western part of Mongolia has high mountains which is said to offer the best Yak fibres.
As per discussions with the Mongolian National Chamber of Commerce and the Mongolian Association for Wool and Cashmere, which has most of the cashmere and wool industry as their members, there are 198 member companies of which 90% are SMEs. Of these 198 companies, only 45 companies are integrated and produce finished garments.The remaining 150 companies are very small 'household' companies, two of which work only on felted and woven products. These mostly undertake sub-contracting work and sometimes only undertake knitting and linking work only from bigger companies. 90% of these companies are owned and run by women across the value chain. The majority of these businesses are located in and around Ulaanbaatar. These are small, but have a very large impact on the economic development of the population of Mongolia.
Having spoken with 7 small and medium cashmere businesses and having met and spoken with the artisanal shop which focuses on a project funded by the Norwegian government, selling products made from wood, leather, wool and felted wool and cashmere, it is clear that cashmere and wool sectors play a very critical role in the economic development of the country. Garments are always a more difficult area to focus on due to the requirements of size, patterns and techniques. Conversely the home textiles sector is a very interesting point of entry for high design and high value products made from luxury fibres. The State Department Store in Ulaanbaatar also showcases key artisanal products.
The modern day industry of cashmere and wool in Mongolia is largely made up of knitted products largely because of the ease with which a knitting industry can be set up as compared to a woven industry. Today, the majority of women who run cashmere companies produce and export knitted goods. A large majority of the women-owned businesses work as sub contractors and complete orders provided to them by the handful of larger companies. That being said, there are several incredibly bold and competent women entrepreneurs who have made it by themselves and have managed to get direct orders from one or two European, Japanese and Russian clients.
There appears to be relative gender equality in Mongolia compared to many other countries. Literacy is highfor both men and women (98%), and there is even a reverse gender gap at higher levels of education as per the census statistics from 2004/05 (the latest data which was available) however, a disproportionate and growing number of female-headed households are living in poverty. High economic participation rates of women in formal employment is in contrast with a falling proportion of women elected at all levels (for the national parliament it fell from 23% in 1990 to 7% in 2004). Despite the passing of equality legislation, discrimination against women and persistent gender gaps remain in all sectors. Land privatisation is highly politicised and negative gender impacts may result if the process is not conducted from a gender perspective.
Internationally, the luxury end of the market is trending upwards and while consumers are seeing harder times with the economic downturn, they are more and more careful and keen to buy fewer pieces, but better and special pieces for their wardrobes. As more consumers start looking for special pieces, luxury products like cashmere, yak, alpaca, and camel become increasingly interesting. At the same time, consumers are keen to see and hear about the story behind the product, where its from, how its made, what is the history and who is behind it.
Felting and embroidery made up of traditional motifs using traditional techniques would have a great market in Europe and US. Felted products are becoming very fashionable and simpletop stich and running stitch embroidered patterns are extremely trendy. These happen to be traditional techniques practised over generations in Mongolia, mostly handed down from mother to daughter or daughter-in-law. As a result, these techniques along with those of fine cashmere hand knitting could command great prices and would find several luxury market buyers. Simple products such as skirts, jackets, coats, bedspreads, throws and other accessories such as scarves and shawls would be simple and yet extremely high value. The majority of luxury brands are keen to have a story and work with the source. They would like to get involved in community development projects and work together with the women to design and manufacture contemporary products with a traditional story.
As a result of the meetings and discussions during this mission, five business women from the cashmere and wool sector came together with the founding president of the Women's Council of the Mongolian National Chamber of Commerce to work with SPINNA Circle (based in UK) to operate as the satellite group hub, SPINNA Circle Ulaanbaatar, to benefit from the market linkages and potential to access greater networks globally. They are keen to receive funding and training to prepare for the event and are now built into an institution so as to enable capacity building for the industry at large.
The women have identified and understand that they have constraints in terms of access to markets, knowledge of the market trends, design, sizing and customer preferences, price points, international regulations and languages. Howerver they are keen to overcome these challenges through training and inputs and hope to reach European markets. Their biggest challenge is access to finance or the lack of it especially for women who do not have the possibilty to provide collaterals for loans in the majority of cases which inhibits their ability to expand / grow their business. Key stakeholders such as the Mongolian Cashmere and Wool Association along with the Mongolian National Chamber of Commerce are eager to support initiatives to engage with international organisations, buyers and supporters who are keen to work with small women owned businesses to export value added products in cashmere and other wools.
Austrian Engineering Firm Waagner Biro Offers Services to Ulaanbaatar
Ulaanbaatar, January 27 (MONTSAME) Chairman of the Citizens Representatives Khural D.Battulga Monday received Daniel Benes, an executive director of Waagner Biro Indonesia.
At the meeting Mr Benes expressed a willingness to cooperate with the city administration in construction projects that include a footbridge building in Bayangol district. Blueprint of the footbridge project has been prepared and is projected to be completed within a funding of 500 million togrog, Mr Benes said.
Waagner-Biro is a Vienna, Austria-based corporation which owns companies in steel and mechanical engineering. It has about 1000 employees in 14 locations in Europe, Asia, and the Middle East.
Mongolian firm blocked from buying N. Korean 'embassy' in Tokyo
Source says complications with sale led Kim Jong Un to deny meeting with Mongolian President
BY KOSUKE TAKAHASHI , JANUARY 23, 2014 (NKNews) A Japanese court has blocked a Mongolia-based company's bid to buy the Tokyo headquarters of the main pro-North Korea organization in Japan, Chongryon.
After months of screening, the Tokyo District Court announced on Thursday that due to purchase irregularities it would not allow the Ulan Bator-based Avar Limited Liability Company to purchase the property, which still serves as the headquarters for Japan's main pro-North Korea organization.
The Mongolian firm, which had previously won an October 2013 auction for the building with a 5.01 billion yen (U.S. $48 million bid) bid, was rejected by the court because a certificate it submitted to support the purchase appeared to be a color photocopy and did not bear the official seal of the Mongolian government.
"It is a company on paper," Hideshi Takesada, an expert on regional security at Takushoku University in Tokyo, told NK News on Thursday.
"With the bid tendering highly unlikely to be successful, Chongryon will be able to stay at the headquarters building and use the land. In a sense, the Japanese government is doing a favor for North Korea," Takesada said. Takesada is a former executive director of the National Institute for Defense Studies in Tokyo, the Japanese Ministry of Defense's think-tank. (Mogi:
Since Pyongyang has no diplomatic relations with Tokyo, the Chongryon headquarters have for decades virtually served as North Korea's de facto embassy in Japan.
North Korea is therefore interested in keeping the headquarters active and buyers sympathetic with the Chongryon's activities are more likely to allow the group to continue using the building as a headquarters.
"There is nothing we can say," a spokesman at Chongryon told NK News on Thursday when asked about the blocked purchase.
In March 2013 the property was put up for auction by the Tokyo District Court to pay off huge debts of the Chogin Credit Association, a failed credit union affiliated with Chongryon.
But the Tokyo District Court decided to postpone approval of the Mongolian company purchase on October 22 and asked the Ulan Bator government to cooperate in conducting background checks on the company.
The Chongryon originally planned to rent the property from a winning pro-North Korea bidder, but the sale has been mired in complications.
A chief priest of a Japanese Buddhist temple who won the March 2013 auction was forced to cancel his purchase due to financial difficulties. The priest, Ekan Ikeguchi, leader of Saifuku temple in Kagoshima Prefecture, said he could not complete the purchase because he had been unable to raise the 4.5 billion yen to pay for the building on deadline. Ikeguchi explained that many Japanese banks hesitated to lend money to him.
It was subsequently decided to make a second sale attempt, leading to the auction that the Mongolian company won in October 2013.
In face of the Tokyo District Court's decision to halt the sale, the Mongolian company can file an appeal against the court's decision within one week. But if the appeal is rejected, the auction will become void, prompting a potential third round of auction.
With the Tokyo court's latest decision, experts have expressed uncertainty about the future of Japan-North Korea relations, especially in light of the longstanding issue of North Korean abductions of Japanese nationals.
"North Korea must be unhappy at today's court decision," said Mitsuhiro Suganuma, a former officer of the Public Security Intelligence Agency. "But the Shinzo Abe administration is trying to find clues as to how to resolve the two countries' various problems, most notably the abduction issue".
In relative terms, Suganuma said the two nations' ties have recently been improving, evidenced most recently by Pyongyang's outreach to Tokyo.
One example of this outreach, Suganuma pointed out, was that North Korea officially used a recent meeting with Upper House member and former professional wrestler Antonio Inoki to invite Japanese lawmakers to Pyongyang to discuss the abduction of Japanese nationals and normalization of relations.
"Because of the execution of Jang Song Thaek, relations between North Korea and China are becoming worse. This is a very favorable situation for Japan," Suganuma said.
CHONGRYON IMPACT ON PRESIDENTIAL VISIT?
Earlier this month, a Russian source familiar with Korean affairs told NK News that he learned Kim Jong Un had provided money to a Mongolian company to help a Japanese Buddhist group buy the Chongryon's headquarters.
But the source said the Mongolian company stole the money, explaining why Kim Jong Un chose not to meet Mongolian President Tsakhiagiin Elbegdorj when he visited Pyongyang in October.
Not all agree, however, and Public Security Intelligence Agency officer Mitsuhiro Suganuma flatly rejected the claim, describing it as nothing more than propaganda spread by a South Korean government keen to spike any North Korea-related bid to purchase the headquarter building. In Japan Chongryon and pro-South Korean Mindan have had a strong rivalry for decades, dividing the Korean community in Japan into two.
But Lee Young-hwa, an economics professor at Kansai University and third-generation Korean resident in Japan, said Kim Jong Un cancelled the meeting for reasons unrelated to the Chongryon headquarters.
In particular, Lee said Kim shunned the meeting with President Elbegdorj because Mongolia, serving as the go-between of Tokyo and Pyongyang, unilaterally negotiated with Japan on the abduction issue, connecting its own economic development aid from Japan to the return of Japanese citizens.
"The Mongolian government might calculate how much money it can get from the Japanese government per person whenever a kidnapped Japanese can return home from Pyongyang," Lee said.
Takesada at Takushoku University said North Korea is now relying more on Mongolia to diversify its previously heavy dependence on China and Russia. Pyongyang and Ulan Bator have been discussing cooperation on development of natural resources. Meanwhile, Japan and Mongolian ties are also improving due to Japan's Official Development Assistance (ODA), he said.
Takesada said all of these factors have been raising expectations of the role of Mongolia as a reconciliatory nation between Japan and North Korea.
Honorary Consul of Latvia Receives Exequatur
Ulaanbaatar, January 27(MONTSAME) Foreign Affairs Vice Minister D.Gankhuyag Friday handed over an exequatur to Ch.Bat, an Honorary Consul of the Republic of Latvia in Mongolia.
Mr Gankhuyag wished the Honorary Consul successes in his mission to foster bilateral ties in politics, economy, culture and humanity spheres.
Present at the event was N.Bataa, a Vice director of the Consular Department of the Foreign Affairs Ministry. Mongolia and Latvia established diplomatic relations on October 15, 1991.
Foreign Minister Conducting Official Visit to Latvia
January 27 (infomongolia.com) Mongolian delegation led by Foreign Minister Luvsanvandan BOLD is conducting a two-day official visit to the Republic of Latvia and during his visit, Minister L.Bold will meet the Latvian President Andris Berzins today at 02:15 pm by local time on January 27, 2014.
Minister L.Bold is also scheduled to meet his counterpart Mr. Edgars Rinkevics and Speaker of the Saeima (Parliament) Mrs. Solvita Aboltina.
The visit is aimed to broaden bilateral cooperation between the two states, in particular focused on exchange of mutual high-level visits, economic cooperation and in educational sector.
As part of the visit, Mongolian delegation will lay flowers at the Freedom Monument; visit the Occupation Museum, as well as taking part in a round table discussion on business opportunities in Mongolia jointly organized by the Ministry of Foreign Affairs and the Investment and Development Agency of Latvia (LIAA).
The delegation is arriving in Latvia from Switzerland, following the Davos World Economic Forum, and will depart for Lithuania and Poland.
Nationwide Forest Cleaning Program Announced to Prevent Risk of Fire
Ulaanbaatar, January 27 (MONTSAME) The Ministry of Environment and Green Development is planning to launch a forest cleaning program for the first time through countrywide.
The program will result at reduced forest fires after cleaning combustible waste in forests. Collected woods will be supplied to wood market, note specialists, thus decreasing illegal wood preparation.
The program is planned to start from the first session of the year.
A total of four billion togrog is required to provide professional companies with high technologies, and a single brigade will be able to collect nine thousand cube meter woods from 200-250 hectare areas a year.
The money source will be decided by the government, the ministry informed.
The forest covers 18.5 million hectare or 11.09 percent of the total territories in Mongolia.
Samsung engineer N. Nandinbold: Robots will become a crucial part of our future
January 26 (UB Post) Samsung Electronics Telecommunication Network R&D Center plays a major role in not only South Korea but also in the world's information technology. Four proud Mongolians work in this world leading company, where only the most brilliant and creative minds from all over the world are accepted.
N.Nandinbold, one of the four Mongolian programmers at Samsung, spoke to us about the company and the world information and technology development.
N.Nandinbold majored in electronics and engineering at the Bogazici University in Turkey and got his master's degree in South Korea, where he is currently living with his family. His wife is working as a marketing manager in the European Marketing Division of Samsung.
-You are one of the people who showed young people in Mongolia that they can contribute world's information technology development. What qualifications are required to work in companies like Samsung?
-Every world-renowned company with long history has their own policies. New employees require quick adapting skills as the world market constantly changes and new ideas are essential. They can only pass international qualifications if they have the ability to overcome daily hardships, and have the willpower and effort to learn the basics and develop oneself.
-You advanced your studies and got your master's degree in the Republic of Korea through a ILWOO Foundation (IWF) scholarship program. Does your employment at Samsung Electronics have any connection with the scholarship program?
-The job interview for Samsung Electronics takes place twice a year, from June to July, and the competition is very fierce. The screening process is divided into four sections (test, qualification, interview and practical training) which have standards exclusively determined by Samsung Electronics. The IWF scholarship program does not affect the interview at all. However, the fact that I was able to advance my studies abroad with the help of the IWF scholarship program strengthened my resume.
Scholarship graduates working in global companies such as Google Korea, Shinhan Bank, Naver and SK C&C influenced me the most to work abroad and reassured me that I could work for renowned foreign companies.
-How many interviewing stages does Samsung Electronics have and what are the requirements?
-The interview process is different every year. Overall, it has six stages.
On the first stage, quantitative index of English skills, academic average performance, achievements in University and oral tests are important. On the second stage, you have to take mathematics, logic and English tests. Thirdly, you are to present your technological solution or programming assignment, depending on your profession, to the head engineer. The next stage is an interview with the company directors and executives and if you pass, you have to do training with other new Samsung Group employees for a month. On the final stage, you will be put into your assigned team and do another three month practice.
-Were you confident that you would be employed during your interview?
-By observing Koreans, I have noticed that they prepare for job interviews and test for a long time. I was doubtful on my employment as the competition was intense. I started preparing for the interview from the last school semester so I had a lot going on. This included preparation for graduation exams, publishing my research, interview for Samsung, final exams and my diploma work. I was extremely nervous on the final stage when I had to do a technical discussion with three vice presidents. After a fortnight, I received a letter of acceptance.
-If you hadn't flown straight back to Mongolia from Turkey in order to take the scholarship exams and attended your graduation party, where would you be working now?
-I had planned to get my master's degree in a foreign country where electronics sector had advanced and if possible, work in that country after I had graduated the Bogazici University in Turkey. I would still be working in another highly developed country as an engineer even if I hadn't taken the scholarship exam.
-Did you face any hardships in terms of level of knowledge or with other colleagues?
-The deeper your knowledge, the easier it will be to earn a colleague's trust and adapt to your workplace. No matter how good you were as a student, if you lack the knowledge, you will face some hardships to harmonise with fellow engineers. This alone brings excessive stress and pressure. I've faced these issues when I first the company.
-How did you overcome it?
-Every project and products are based on new and advanced technologies. To develop it to a higher level, we face more and more issues every day. The designing R&D Center is different from other departments. We can't find solutions from the internet or social networks so we get advice from those who have more experience in the field. I've never spared my time for self-development and in my opinion; I was able to overcome those hardships by broadening my extent of knowledge.
-Mongolians started studying abroad since 1990 and many innovative and startup companies have been established. The government stated that it will provide full support to developed information technology in 2014. In your opinion, what is the South Korean government focusing on mainly to make startup companies more competitive in the world arena?
-By observing South Korean educational system, it struck to me that they focus on giving knowledge and skill to the mass instead of individuals. This gives large business groups skilled personnel who become their main pillar. On the other hand, it limits the number of those with incredible creativity skills and erases all chances to distinguish themselves.
The main policy of South Korean President, Park Geun-Hye is to transform the industrially dependant country into a "creative economic" country. Favourable ecosystem for ventures and startup companies to work efficiently is being formulated. For instance, many reforms and changes like a special fund where millions USD is saved with low taxes are being made for innovative and startup companies. Estimation shows that four billion USD is required for such services.
-Competent personnel are the key for the information technology sector. Mongolia is unable to develop train qualified personnel. You've observed foreign teaching methods. What's the best way to train qualified personnel?
-I believe it's best to share from my experience. Language skills are essential. In top universities in Turkey and South Korea, majority of the lessons are taught in English. They teach based on not only American curriculum but also English research materials. The English language requirement for Turkey's Bogazici University is 550 points from Toefl. This is connected to the publishing of science and advanced technology research materials in English. In order to access this information, English language needs to be taught promptly in Mongolia. If Mongolia uses translated American textbooks and curriculum, our English skills will reach the world standards.
Obviously, not every problem will be solved by just improving language skills. Especially in engineering, you need to work on actual projects, and make designs and experiments to master the profession. Furthermore, a fund to pay capable teachers and acquire laboratories and technologies is necessary. I believe money-related issues can be settled by either increasing tuition or localising grant systems and student loans to those with potential but unable to pay tuitions. This will be a huge advancement in Mongolia's education system.
-A task force for the project to a establish startup company in Silicon Valley, USA was recently created. Experts evaluated this as the start of Mongolian "brand" in the world information technology sector. Do you think that Mongolia has the potential to compete in the world?
-Facebook was founded by a student and Google by two students, yet now they have expanded into giants. Truthfully, there's no one in Mongolia who can come up with an innovative product and work nonstop for it to develop.
In Mongolian startup companies, huge sum of funds are used up just to develop their product and find initial investments. There are many instances where the main product is lost due to lack of focus on it while working on sub-products to pay expenses. There are possibilities of producing Mongolian brand if we can create venture capital funds that supports startup companies financially until they find initial investments. In addition, Mongolia could have multiple million USD worth companies if startup companies launch new creative products.
-How do you determine trends in technology in the world? What do you think will be the next trend in the market?
-World leading information technology companies can make trends based on their acquisition and patent clearance. Smaller companies make production changes in products they see as potential trends based on demand.
In the last few months, Google bought eight robot companies. This indicates that robots will become an integral part of our future.
'For Hearts & souls': Doctor shares trials, tribulations of caring for patients in Mongolia
Editor's Note: The following is an account of a recent mission trip to Mongolia by Dr. Kristina Kypuros, an assistant professor in the Department of Pediatrics, Division of Critical Care at Texas Tech University Health Sciences Center at El Paso.
January 27 (El Paso Times) Mongolia holds a special place in my heart, as this was my fourth year traveling with "For Hearts & Souls" to the country.
During my time there, I was able to serve as a physician in the pediatric cardiac critical care unit and unite with great Mongolian friends in medicine.
"For Hearts & Souls" has been serving this country in pediatric cardiac repair since 2005 and introduced the cardiac bypass procedure in 2006.
This year our team included 28 participants including two pediatric cardiologists, seven pediatric nurses, two pediatric anesthesiologists, one pediatric cardiothoracic surgeon, one perfusionist, one biomedical technician, one child life specialist, six helper volunteers, one chaplain, three pharmacists, one medical student, one pediatric critical care fellow and myself as a pediatric intensivist.
We went to Shastin Third Hospital in the capital city of Ulaanbaatar. Shastin Hospital is the only hospital providing cardiac surgery in Mongolia. We performed 15 diagnostic and interventional catheterizations and five open-heart surgeries.
We traditionally perform about 10 surgeries and 20 catheterizations, but due to circumstances we took each day as it came.
The first complication in our plans was that the hospital started renovating the floor on which we usually work. They thought they would have it done prior to our arrival, but as most timing occurs in construction projects, it was incomplete.
We're used to the OR, ICU, team gathering area, and storage area all being right beside each other on the fourth floor. The catheterization lab has always been on the first floor, so we were at least used to that.
This year, still thankful to the hospital's accommodation, we had an OR down the opposite hall from our usual fourth floor location. The team gathering area was on the same floor but not near the OR. The ICU was on the third floor in a completely opposite wing. The storage room that we've had for eight years, that we've organized and familiar with its contents, had been dismantled, boxed up, and moved to a different building on the sixth floor.
We went from two to four locations.
The distances that needed to be covered to communicate, coordinate care, and move patients and supplies were long and confusing.
The second obstacle was a family tragedy for one of our beloved team members and pediatric ICU doctor which prevented her from joining us at the very last minute. The PICU team was down to a fellow and myself for day and night coverage.
The third dilemma was that we usually have time on the weekend to unpack and organize our supplies at the hospital, so we can hit the ground running on Monday morning. This did not happen this year due to construction. Instead, we really had an incredible time of team bonding on Sunday that we usually do not have time for. We needed this time to really get to know each other.
So we planned a lighter schedule for the week, especially for Monday.
We always start the week with a planned schedule. It always changes due to kids getting sick, families not showing up or deciding they don't want procedures, lack of supplies, unforeseen complications, or just things taking longer than we expect.
We have a tremendous amount of trust in each other as a team. If any physician on the team thinks it is not safe to proceed with something, we don't.
Dr. Kirk, a pediatric cardiologist, and Mongolian pediatric cardiologist, Dr. Ariunaa, ultimately interact with the patients and families and communicate with the rest of us our next steps.
They said they had never experienced anything like it this year with patients eating when they shouldn't, not showing up, getting sick or families changing their minds.
We felt like the schedule changed so much and never really knew what was coming next. On top of this, everything just seemed harder, probably because we had done it one way in primarily one location since 2005.
We had hit somewhat of a stride in past years and now everything seemed new again. Despite all this, by Wednesday night, we had managed to accomplish three successful surgeries and ten successful catheterizations.
One reason that makes these trips so worthwhile is the story that follows.
When Dr. Kirk and interventional cardiologist Mary Porisch were in Mongolia for a catheterization one week in July, they met an infant who had a critical narrowing of the valve leading to his lungs, severely limiting the blood flow to his lungs, making him very blue, and was significantly at risk of dying.
They simply did not have the resources to take care of him well, so they prayed that he would live so that we could take care of him the week we were there. doctors Kirk and Porisch have seen another child like this internationally, who didn't survive long enough to see the team return. They were overjoyed to see him when we returned.
The family was a poor nomadic family from the western part of Mongolia and they had never left the capital. They had just stayed, waiting for the team's return.
Unfortunately, this child had a very significant respiratory infection this week, which markedly increased the child's risk for general anesthesia.
Knowing the baby would likely die if we didn't intervene, our amazing pediatric anesthesiologist, Dr. Kim, came up with an anesthetic plan to proceed with his case.
It was very successful!
There are cases where we know we are significantly impacting a child's life and then there are cases when we know we are part of truly saving a child's life.
This was one of those cases.
We were so pleased to see him turn from grayish-blue and sickly to pink and healthy.
Thursday was a day of highs and lows. The team was able do another miraculous case in the OR for a 22-year-old young woman who should have, because of her cardiac defect, been inoperable after two years of age.
We also got to take care of a patient who we were unaware of before we arrived.
This young man was a dancer for Asia. Most of the time, he had a huge smile on his face even though he was definitely not feeling well when we first met him.
Unfortunately, he had a heart condition that is not easily treatable. He had gone to another country a few weeks before we met him in hopes that they could buy him time with surgery.
When we met him, his heart had been in a very abnormal rhythm for several days, beating twice as fast as it should have been.
It became apparent that we would have to take more direct and somewhat dramatic measures to restore his normal heart rhythm. After trying medications to reset his heart, we ended up having to use electrical shock.
When I asked the Mongolian nurses for shock pads they didn't understand, as they had never shocked anyone in the ICU.
Nevertheless, the patient had a successful outcome. When he woke up he told us that it felt like a giant weight had been lifted off of his chest. He still needs a miracle for his heart, but that intervention bought him time and quality of life
On this same day, things continued to look promising for ending the week strong. However, there was an infant in the cath lab that should have been an "easy" case. Her case should have been fast and uneventful.
Her day started in the cath lab where she was to have a coil placed in a vessel that should have closed at birth, but didn't. The whole thing shouldn't have lasted more than a few hours.
Everything seemed to go wrong from the start, from IV lines and getting her to sleep, to the coil migrating to where it wasn't supposed to be. Then it proved difficult to retrieve the coil and the decision was made to take her to the operating room to take the coil out that way and close the vessel.
The complications were piling on, and although the procedure was ultimately successful to close the vessel in her heart, there was concern that something may have happened to her brain due to the many complications and extended time under anesthesia (over 12 hours).
The team members who took care of her throughout the day will tell you they have never seen such a cluster of complications all together on one patient in one day. It was unreal.
When it came time to see if she would wake up, there was a lot of praying, crying and waiting.
That first night in the ICU was pretty busy as she began to seize and have other neurological manifestations.
We did everything we could to stabilize her and give her the best chance. As the hours progressed we knew that there was nothing medically for us to do that would fix what had happened.
We made her comfortable. She needed a miracle so we prayed. In the meantime, we held her, spent time with her and prayed some more. She passed away about 24 hours after the team left.
We try so hard to not take unnecessary risks. This was not a risky procedure. Everything we do in medicine has inherent risks involved, but none of us would ever have imagined this scenario.
The primary benefit of this international experience is all encompassing as a physician and human being. I was able to identify and utilize community collaboration to provide best care practices in a resource-poor environment.
My post-operative skills and management were also sharpened by the ability to adapt to less resources and technology.
I learned to maintain excellent care and outcomes relying on sole clinical skills.
Last but not least, I participated as an effective member of the multidisciplinary post-operative congenital cardiac team including surgery, PICU, cardiology, perfusion, anesthesia and nursing.
Fostering the humanistic approach to underserved areas around the globe is enriching for all involved but most importantly, the assistance we provided to disadvantaged needy children is the ultimate goal and I'm truly blessed to have had such an essential role on this mission.
For information on funding or to contribute miles for airfare for causes such as Dr. Kristina Kypuros', please contact Paige Carlisle Stewart, Director of Development, Office of Institutional Advancement, Texas Tech University Health Sciences Center at El Paso. 783-6270.
Restored Mongolian Antiques Return Home from Germany
Ulaanbaatar, January 27 (MONTSAME) Ancient findings which were restored in Germany arrived in the country on Friday.
In frames of joint Mongolia-Germany project themed "Geo-Archeology of Orkhon Valley", items including funeral deel /traditional clothing/, hat and musical instruments, had been sent to Germany for restoration.
Belonging to nomadic people who lived in period of AD /Anno Domini/ VIII-XVI, those antique items were found in Mongol Altai region.
The instrument receiving ceremony was attended by Ts.Oyungerel, the Minister of Culture, Sport and Tourism, Gerhard Thiedemann, the Ambassador of Germany to Mongolia , M.Rossbach , the First Secretary of the German Embassy and D.Tseveendorj, a director of Archeology at the Institute of History of the Mongolian Academy of Sciences and D.Sukhbaatar, a director of Mongolian National Museum.
Photo News: Mongolian National Team Wins over American Legionnaires in Basketball All-Star Game 2014
January 27 (infomongolia.com) Last weekend, the Super League's "Basketball All-Star Game" between Mongolian National Team and American legionnaires was held in the Buyant-Ukhaa Sports Complex on January 25-26, 2014.
The first day event, Mongolian National Basketball Team vs. American legionnaires, was very competitive, where American legionnaires were defeated by national team players by a narrow score of 99:101. Such event is being organized for consecutive second year, and last time foreigners won by 124:108 and at this year's edition Mongolian players' skills much improved.
Following the match, best player of Mongolian Team was named T.Sanchir ("SBL Khasyn Khuleguud") who scored 19 pts plus 7 rebounds, 8 assists, 4 blocks, and 3 steals. Moreover, M.Otgonmunkh ("TananGarid") made a total of 22 pts and Christopher Moore ("Rigs") scored 15 pts respectively.
In the Three-point play, T.Sanchir, M.Otgonmunkh and Ts.Azbayar ("TananGarid") representing Mongolia won over Dash Harris ("Aravtuud"), Joe Davis ("Tanan Garid"), and Corey Bethea ("Rigs").
The second part of the event was a game held between "Sprite" and "Sengur" Teams, where "Sprite" defeated over its opponent by 109:103, and P.J Gaynor ("Gurvan Tamir") who brought to its team 35 pts was named the player of the day.
The winner team was awarded with 2 million MNT and runner-up with 1 million MNT (Tugrug), but athletes pledged to donate their prize in humanitarian deeds.
Also, after competition three-point shootout, slam dunk and skills challenge contests were held, where in the three-point shootout - E.Tseveldorj ("Aravtuud"), Christopher Moore ("Rigs") in the slam dunk, and O.Sergelen ("SBL Khasyn Khuleguud") won in the skills challenge contest, who were awarded with 1 million MNT respectively.
St. Kitts Basketball Star Selected To Mongolia Super League All Stars – St. Kitts Nevis Amateur Basketball Association, January 27
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