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Wednesday, March 12, 2014
Headlines in Italic are ones modified by Cover Mongolia from original
TRQ down 10.10% to US$3.56 Tuesday, down 14% in last 3 days
975 down 7.87% to HK$0.82 Monday on the announcement
Mongolian Mining Corp year loss widens to US$58.07m from US$2.54m, revenue down 7.8% to US$437m
[ET Net News Agency, 11 March 2014] Mongolian Mining Corporation (00975) said its loss attributable to the equity shareholders for the year ended 31 December 2013 widened to
US$58.07 million from US$2.54 million for the previous financial year.
The basic and diluted loss per share was US1.57 cents.
The revenue was US$437 million, a decrease of 7.8% from a year earlier. In 2013, gross profit margin was 17.3%, compared with 11.4% in 2012.
The major contributing factor toward the Group's net loss position aside from decrease in average selling price is increase in finance costs due to reductions in interest expenses capitalized as major construction and development activities of the Group were completed, negative change in the net fair value related to the senior notes, and foreign exchange losses due to depreciation of the Mongolian Togrog against US dollar bringing total net finance cost to US$85.5 million.
No final dividend will be distributed.
Mongolian Mining sees weakness ahead for coking coal prices
Oversupply will keep prices low, says Mongolian Mining, as firm posts US$58.1 million annual loss
March 12 (South China Morning Post) Mongolian Mining, the nation's largest miner of coking coal sold primarily to China, expects the steel smelting ingredient's price to remain weak this year due to oversupply, although it has gained market share from rivals by expanding processing and logistics operations.
"I don't expect prices to fall below current levels, but I don't see meaningful price gain either, until demand and supply equilibrium is restored," chief executive Battsengel Gotov told a press conference.
He said prices of seaborne coking coal - mainly from Australia and Brazil - have been trading around the US$85 per tonne mark since the start of the year.
Mongolian Mining's average selling price of its mainstay product, hard coking coal, fell 15 per cent last year to US$92.10 a tonne from US$108.40 in 2012, owing to an estimated excess supply of over 30 million tonnes.
The excess is expected to fall to between 10 million and 15 million tonnes this year, helped partly by higher steel output in Europe and the United States, Gotov said.
The mainland's steel production growth is expected to slow to 4 per cent from 7.5 per cent last year as Beijing seeks to shift the economic growth driver from fixed-asset investment to consumption and services, according to the China Iron and Steel Association.
Mongolian Mining yesterday posted a net loss of US$58.1 million for last year, from US$2.5 million in 2012 as finance costs almost doubled to US$95.1 million.
Revenue fell 7.8 per cent to US$437.3 million as the 15 per cent fall in the average selling price offset a 26 per cent jump in hard coking coal sales volume to 4.3 million tonnes. The firm aims to sell six million tonnes this year.
The company's share price slid 7.9 per cent to 82 HK cents yesterday after the results.
Although the mainland's coking coal imports jumped 41 per cent last year to 75.4 million tonnes as low-cost imports replaced domestic products, Mongolia's share of the Chinese market fell to 20.4 per cent from 35.7 per cent while that of Australia surged to 40 per cent from 26.2 per cent.
Land-locked Mongolia's competitiveness is expected to be constrained until a government-built railway is completed next year or later, while Australian miners ramp up output to lower per-tonne fixed costs.
MMC Aims to Increase Hard Coking Coal Sales to 6m Tons in 2014
By Michelle Yun
March 11 (Bloomberg) -- Mongolian Mining looks to find partners to develop logistics in China, CEO Battsengel Gotov says in a briefing in Hong Kong today.
* Co has no major capex this year for expansion: Gotov
* Co debt obligations for 2014 fell to $34m, he says
* Co can maintain liquidity position for '14, '15 even at weak prices: CEO
* Co will have to explore other options if weak prices persist beyond '15: CEO
* MMC sees coal prices continue to be under pressure this year: CEO
* MMC doesn't have plans to change bond structure: CEO
* NOTE: MMC is Mongolia biggest coal exporter with 31% market share in 2013, according to co.'s presentation
* NOTE: Mongolian Mining FY Loss $58.1m vs Loss $2.5m
(Bloomberg First Word)
WOF last traded 6.5c Friday
Wolf Petroleum poised to reveal initial oil estimate on SB Block, Mongolia, in trading halt
March 11 (Proactive Investors) Wolf Petroleum (ASX: WOF) is preparing to divulge an initial oil estimate on the company's SB Block in Mongolia.
The block is in a proven and producing region, and covers 23,000 square kilometres, and is one of the first identified petroleum blocks in Mongolia.
Around 60%, or 12,000 square kilometres of the block, is interpreted as Cretaceous in age with a high potential for oil source reservoir rocks at depth.
Wolf is looking for farm-in opportunities.
In total Wolf has interests in over 74,000 square kilometres in Mongolia, which equates to over 18 million acres.
The Australian Stock Exchange has granted the company a trading halt today, with its shares placed in pre-open.
The halt will remain in place until the opening of trade on Tuesday 11th March 2014, or earlier if an announcement is made to the market.
MSE Weekly Review, March 3-7: Top 20 -1.17%, Turnover ₮148.3 Million
Ulaanbaatar, March 9 (MONTSAME) Five stock trades were held at Mongolia's Stock Exchange March 3-7, 2014.
In overall, 276 thousand and 150 shares were sold of 48 joint-stock companies totaling MNT 148 million 271 thousand and 785.00.
"Hermes center" /114 thousand and 071 units/, "Remikon" /84 thousand and 091 units/, "Olloo" /26 thousand and 869 units/, "Khokh gan" /7,270 units/ and "Moninjbar" /6,941 units/ were the most actively traded in terms of trading volume, in terms of trading value--"Sharyn gol" (MNT 25 million 677 thousand and 250), "Tavantolgoi" (MNT 17 million 163 thousand and 310), "Hermes center" /MNT 17 million 110 thousand and 650.00/, "Remikon" /MNT 12 million 966 thousand and 485.00/ and "UB-BUK" (MNT eight million and 481 thousand).
BDSec Daily Market Update, March 10: Top 20 +0.19%, Turnover ₮16.6 Million
March 10 (BDSec) Mongolia stocks edged up Monday. Ulaanbaatar Hotel (ULN) led the charge with 3% gain, hitting new all-time high of MNT 110,000. The company reported MNT 6.2 billion sales revenue for FY13, up 1.9% over the year. ULN's net profit was MNT 2.8 billion or MNT 8,278 per share in 2013, up 21.4% compared to the previous year.
Talkh Chikher (TCK) rallied 2.82% to close at MNT 17,490. Tavantolgoi (TTL) and Baganuur (BAN) retreated -1.83% and -0.44%, respectively. Trading turnover was MNT 16.6 million.
Trading Value Leaders
Ulaanbaatar Hotel (ULN)
Makh Impex (MMX)
Khasu Mandal (HSR)
Ulaanbaatar Hotel (ULN)
Talkh Chikher (TCK)
Khasu Mandal (HSR)
MSE News for March 11: Top 20 -0.16%, Turnover ₮26 Million
Ulaanbaatar, March 11 (MONTSAME) At the Stock Exchange trades held Tuesday, a total of 42 thousand and 946 shares of 16 JSCs were traded costing MNT 26 million 047 thousand and 779.00.
"Remikon" /33 thousand and 286 units/, "Khokh gan" /5,171 units/, "Makh impex" /1,810 units/, "Ariljaa impex" /1,553 units/ and "Gan khiits" /371 units/ were the most actively traded in terms of trading volume, in terms of trading value--"Gan khiits" (MNT six million and 307 thousand), "Makh impex" (MNT five million 501 thousand and 001), "Atar-Orgoo" (MNT five million and 193 thousand), "Remikon" (MNT five million 092 thousand and 778) and "Shivee ovoo" (MNT one million 455 thousand and 200).
The total market capitalization was set at MNT one trillion 653 billion 090 million 788 thousand and 904. The Index of Top-20 JSCs was 16,582.26, decreasing by MNT 25.77 or 0.16% against the previous day.
BoM MNT Rates: March 11 Close
March MNT Chart:
BoM FX auction: US$5.6m sold at ₮1,778 from US$29m bids, CNY4m sold at ₮289.55 from CNY26.5m bids, accepts all US$36.5m MNT swap offers
March 11 (Bank of Mongolia) On the Foreign Exchange Auction held on March 11th, 2014 the BOM has received from local commercial banks bid offer of 29 million USD and 26.5 million CNY. The BOM has sold 5.6 million USD as closing rate of MNT 1778.00 and 4 million CNY as closing rate of MNT 289.55 to the local commercial banks.
On March 11th, 2014, The BOM has received MNT Swap agreement bid offer in equivalent to 36.5 million USD and accepted the offer.
February CPI +12.2% YoY, Down from +12.3% in January
2014 / 02
2014 / 01
2013 / 12
2013 / 11
2013 / 10
2013 / 09
2013 / 08
2013 / 07
2013 / 06
2013 / 05
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2013 / 02
Mongolia Copper Concentrate Exports Jump 35% in First Two Months
March 11 (Bloomberg) -- Mongolia's copper concentrate exports increased 35% to 122,600 tons over the first two months, the National Statistics Office says on its website. The Oyu Tolgoi copper and gold mine began commercial production of copper concentrate in July.
* Value of copper concentrate exports for first two months was $186.5m vs $135.9m yr earlier
* Mongolia's gold exports rose to $62.6m in the first two months from $28.2m a year earlier
* The U.K. was the only recipient of Mongolian gold exports during the first two months, according to the agency
* Mongolia coal exports drop to $108.6m from $122.8m a year earlier.
* By volume, coal exports rise to 2m tons from 1.7m tons a year earlier.
* Exports rose 17.5% to $594.6m vs $506.1m yr earlier
* Imports fell 24.3% to $613.9m vs $811.2 yr earlier
(Bloomberg First Word)
MONGOLIA'S FOREIGN TRADE REVIEW, February 2014
March 10 (Bank of Mongolia) --
Total trade turnover: $658 millions
As of February 2014 the total cumulative trade turnover fell by 8.3% (USD 108.8 millions) from that of the previous year and reached USD 1,208.5 millions. The decrease in the trade turnover was due to the decrease in imports by USD 197.4 millions.
The annual growth rate declined by 2 percentage points from that of the previous year as a result of the decrease in the growth rate of imports by 11 percentage points and increase in the growth rate of exports by 21 percentage points.
The structure of the trade flows with the neighboring trade partners is as following: (i) trade with PRC: 54% or USD 647.4 millions and (ii) trade with Russia: 15% or USD 181.5 millions. The trade volume between Mongolia and China increased by 11% and the trade volume between Mongolia and Russia declined by 37%.
Trade balance: -$19 million
As of February 2014, the cumulative trade balance decreased by 94% (USD 201 millions) from that of the previous year and reached USD –19 millions. During the reporting period the total exports increased by 17.5% from that of the previous year, imports decreased by 24.3% from that of the previous year, thus the trade balance improved by USD 286 millions.
The value of the three-month moving average of the difference of annual growth rates of exports and imports has been decreasing recent years (Picture 1 shows that the annual growth rates of exports and imports have been declining since October 2011). But since August 2013 , it has been increasing slightly.
Trade balance of paid trade flows: +$16.3 million
The state of the trade balance of paid trade flows is one of the main variables that determines the pressure on the domestic foreign exchange market.
As of February 2014, the trade balance of paid trade flows increased by USD 240 from that of the previous year and reached USD 16.3 millions. During the reporting period, paid imports decreased by 21%, and paid exports increased by 17% that of previous year.
Terms of trade: 1.266
As of January 2014, terms of trade index (2000 base year) decreased by 9.8% from that of the previous year and reached 1.266. This decrease in the terms of trade is mainly attributed to the fall in export prices of exporting commodities.
Composition: 92%+ 8%
The share of mineral exports in total exports was 92% of the total export and increased by 1.5 points from that of the previous year.
Coal, copper concentrate, iron ore and concentrate and crude oil have a weight of nearly 77% of total export and 84% of mining export.
In addition, these 4 products share in the mining exports decreased by 3.4 points from that of the previous year, share in the total exports decreased by 1.9 points.
Mongolian export increased by 17.5% from that of the previous year, which was mainly affected by 17.6% increase in mineral exports. Exports of copper concentrate, crude oil and non monetary gold increased by 37%, 67% and 122%, respectively, which accounting for 27% in growth of mining export. On the other hand, coal export decreased by nearly 12% and because of this mining export has decreased by 3% from February 2013.
In February 2014, Mongolian export increased by 88.5 million USD from that of the previous year. The increase of export commodities' quantities (USD 160 millions) offsets decrease in export commodities' prices (USD 72 millions) .
Because of the increase in crude oil, copper concentrate and non-monetary gold quantities, total export would've increased by 123 millions USD. On the other hand, coal, iron ore and monetary gold's prices, molybdenum and spar's quantities decreased in reporting period, so total mining export decreased by 78 millions USD.
Cashmere and cashmere product exports' both prices and quantities decreased by 0.4 and 0.1 million USD, respectively . For other exports, prices and quantities both increased, so total of other export increased by almost 0.1 millions USD.
World market prices for primary commodities
As of February 28 2014, gold price reached 1,326.4 USD, decreased by 16% from that of the previous year and increased 6.6% from that of the last month.
As of February 28 2014, copper and zinc prices reached 7,080.0 and 2,111.0 USD, decreased by 9%, 3% from that of the last year, respectively. Copper price decreased by 0.2%, zinc price increased by 7.5% from that of the previous month respectively.
Composition: 23% + 21%
As of February 2014, 44% of total imports were oil products and industrial inputs' imports, 19% were consumer goods and food imports, rest 37% were other products' import.
Share of oil products and industrial inputs' imports in total imports decreased by 16 points from January 2013. This decrease affected by oil import, which decreased by 15 points.
Mongolian imports decreased by 24% from that of the previous year. Main contributors of this decrease were industrial inputs' decrease, which equal to 7% of the total decrease, and oil import which equal to 20% of the total decrease.
Oil and industrial inputs' imports decreased by 55% (159 millions USD) and 30% (59 millions USD) respectively, thus total import decreased from that of the previous year.
Prices and quantities of import goods both decreased by 73 and 124 millions USD respectively, thus total imports decreased by 197 millions USD from that of the previous year.
Because of decrease in quantities, oil import decreased by 143 million USD , thus total oil import decreased by 159 millions USD from that of the previous year. The oil price on the border decreased from begin of 2012 to august 2012. Since then, the oil price increased slightly, but in 2014, it is decreasing slowly. (Figure 6).
Industrial inputs' imports price decreased by 68 million USD, thus industrial inputs' import declined by almost 59 millions USD. At the same time, 20% of decrease in consumer products' import were quantity related causes, 80% were price related causes, thus consumer products' import decreased by 6 million USD.
Import of the primary consumer products*
As of February 2014, growth of primary consumer products' import, which calculated by 3 month moving average method, decreased by 7% / Figure 7/.
Annual growth of electronics import had been decreased from mid of 2012 year, but since April 2013, it has been increased slightly. In the other hand, passenger cars import had been decreased since beginning of 2011, but since beginning of this year it has been decreased, slowly.
*In this calculation, among the all consumer products' import, main 48 goods is chosen and used.
8% Mortgage Program Update: 17,238 Citizens' ₮487.5B Refinanced, ₮903.7B Newly Issued for 16,006 Citizens
March 7 (Cover Mongolia) As of March 7, ₮487.5 billion (₮487.5 billion as of March 7) existing mortgages of 17,238 citizens (17,238 as of March 7) were refinanced at 8% out of ₮844.9 billion (₮844.9 billion as of March 7) worth requests.
Also, ₮903.7 billion (₮902.9 billion as of March 7) new mortgages of 16,006 citizens (15,984 citizens as of March 7) were issued at new rates out of ₮927.7 billion (₮927.7 billion as of March 7) worth requests.
Link to release (in Mongolian)
Moody's: Outlook for Mongolia's banking system remains negative
Hong Kong, March 11, 2014 -- Moody's Investors Service says that the outlook on the Mongolia banking system remains negative, reflecting the expectation of continued weakness in Mongolia's key commodity exports, namely coal and copper, which account for 88% of its exports and 20% of its GDP.
"While oversupply and weak global prices in the steel and coal sectors constitute a primary and external pressure point, our outlook also takes into account the Mongolian government's aggressive macroeconomic measures to support the economy against the resultant growth headwinds," says Hyun Hee Park, a Moody's Analyst.
Park was speaking on a just-released Moody's report, titled "Mongolia Banking System Outlook", which expresses Moody's expectation of how bank creditworthiness will evolve in this system over the next 12-18 months.
The report looks at the banking system in the five categories of operating environment; asset quality and capital; funding and liquidity; profitability and efficiency; and systemic support. Moody's assesses systemic support as stable, but considers the other four categories to be deteriorating.
While Moody's central scenario assumption is for the economy to maintain an annualized real growth pace of 11% in the coming 12-18 months, this growth will be powered by the government's ongoing pump-priming measures, some of which are heavily credit-driven.
Specifically, aside from policy rate reductions and fiscal spending, the government also provided MNT4.3 trillion in loans to the banking system as of end-2013, representing about 40% of total credit. These loans were extended to the banking system for on-lending to targeted industries. As a result, bank assets grew rapidly by 74%, and loans by 54%, in 2013.
"A continuation of the current credit growth pattern increases risks to the banks' liquidity, capitalization and profitability," adds Park.
Current cyclical headwinds have exacerbated the system's vulnerability. As such, Moody's expects asset performance to deteriorate further in 2014, as the mining sector remains under pressure, and while the current credit boom seasons.
The liquidity and capital conditions of Mongolian banks have continued to tighten -- despite liquidity injections by the Bank of Mongolia (BOM) in 2013 -- as loan growth has exceeded both growth in deposits and expansion in internal capital sources.
In particular, the foreign currency loan-to-deposit ratio jumped to a record high of 112% in late-2013. In a system where foreign currency deposits account for 23% of total deposits, this development highlights the risks faced by the system, especially in the context of a sharp depreciation in the MNT.
Moody's report further states that the system's profitability will likely shrink, as banks lower their lending rates to support the government's accommodative policy, while maintaining relatively high deposit rates to stem their deteriorating funding profiles.
Yet, the banks are also vulnerable to potential changes in economic policy, given the instrumental role that the BOM has played in the past year to support both the banks and economy.
In Moody's view, if the BOM withdraws from its current policy lending role, it will leave a re-financing gap equivalent to as much as 22% of banking system liabilities as of end-2013.
Moody's expects the government to support deposits at those banks considered to be of high systemic importance to the economy. However, potential government support to bank non-deposit creditors is less predictable given the experience of bank resolutions in Mongolia.
The negative outlook on the banking system is in contrast to Mongolia's stable sovereign outlook. The sovereign outlook places more emphasis on the country's strong growth potential and its abundant mineral resources, despite Moody's negative outlook for the banking system.
M.A.D. Research Note: Mongolia's New Investment Law
January 2014 (M.A.D. Investment Solutions) Please find attached a (slightly belated) research note published by Audier & Partners in Q1 2014 on the new investment law of Mongolia and its significance to the future growth of the country.
As the population of Ulaanbaatar awaits the fate of the OT PF for Tranche 2, the contents of this law is of particular importance to all. IF the OT deal is signed before its 'end-of-march' deadline, it will 'relaunch' the Mongolian economy with this law as its backbone. If, on the other hand, OT fails to pass, the law will in all likelihood be of greater importance in establishing long-term economic stability for the country but be marginally less relevant in the short-term.
About the Investment Law
On 3 October 2013, a new law on investment (the "Investment Law") was passed by the Mongolian Parliament marking a significant development in Mongolia's investment regulations. The law is intended to turn the page after the recent troubled history of foreign investment in the country. By repealing the controversial Strategic Entities Foreign Investment Law of 2012 (the "SEFIL"), which regulated investment in strategic sectors, the Mongolian Government now seeks to strike a better balance between promoting investment and protecting Mongolian interests. The outcome is an investment-friendly compromise overall, even though a few uncertainties remain.
Seven steps to overcoming exchange rates
By Jargalsaikhan Dambadarjaa
March 9 (UB Post) Economy is a comprehensive, living system just like a human body. In this metaphor, exchange rates could be seen as blood pressure. Looking at the tugrug to U.S. dollar rates from the past, we can observe that the blood pressure of our economy increased by 30 percent last year. This means one-third of the money you put aside to buy a new car has completely vanished.
This sudden decline of the Mongolian tugrug is the consequence of the policies that have been pursued by our government. It discloses Mongolia's current need to revise its economic, monetary and financial policies and change the way the things have been done. Albert Einstein once said, "No problem can be solved from the same level of consciousness that created it." Therefore, we have to turn up our thinking a notch to solve the problems we face today.
In order to strengthen our tugrug, we need to find the underlying cause, come up with an accurate diagnosis, and fix the problem in the same way a doctor treats disease. Let me present my personal opinion on how we can find the root cause and solve the problem.
CAUSES OF THE WEAKENING TUGRUG
Main cause: Government involvement has been expanding while more nationalization, instead of privatization, has been taking place. Moreover, an increasing number of state-owned companies have been established only to constantly run deficits that are made up by the public budget. In short, Mongolia is returning to socialism and it is being led by the Democratic Party itself. It is such an irony that this political party has changed its direction along the way, expanded government involvement, and allowed an economic collapse when two of the people who initially went on a hunger strike to establish democracy have now become the President of Mongolia and the Mayor of Ulaanbaatar. The Democratic Party today resembles a toothless lion that can only roar, but not bite. Having lost their power due to secret conspiracies with the former administration, the Democratic Party is currently not in a position to make significant economic decisions on their own.
Another cause: The authorities work with the sole purpose of retaining their power by getting re-elected rather than increasing economic growth and efficiency. For them, it is more important to obtain money by issuing bonds than wisely spending loans and repaying debt. Although the central bank attempted to "promote consumption and preserve employment levels" by injecting three billion MNT into circulation, the government failed to create new jobs. Mongolians today are consuming more than we create. The prices of fuel, electricity and meat are being set by the government, not the market.
Third cause: There are no proper regulations on ownership relations while public and private properties have become undistinguishable in our capital city. Ulaanbaatar, which is home to more than half of our total population, has unclear rules and procedures regarding the sale of public land. The authorities keep it that way on purpose in order to steal public property and the new management is doing nothing about it. Even our hero mayor is afraid of disclosing the "Zaisan-ing" at Yarmag. Lawmakers whose objective it is to redistribute wealth once they are in power have been changing the business and investment environment to their advantage. As a result, both domestic and foreign investors were scared away. Also, they have been getting rid of private property unless it belongs to their associates, which has forced domestic business owners to place their capital abroad.
WAYS TO STRENGTHEN THE TUGRUG
First and foremost: It is essential to significantly reduce government involvement in the economy, restore faith in the private sector, allow the private sector to take part in mining and other industries, and offer the state-owned 34 percent of strategic deposits on the international market. Also, government spending needs to be decreased and no more state-owned companies should be established. It would also be a good step to have an employment freeze in the public sector.
Two: We need to stop spending the public budget to make up for deficits run by state-owned companies. The state-owned companies should be privatized by offering their shares on domestic and foreign markets. In order to do so, we need to privatize our financial infrastructure, the stock exchange, first. A part of our stock exchange shares could be sold to the London Stock Exchange, which boasts high credibility internationally. If that happens, big international banks will open custodial accounts in Mongolia, which will allow a brand new currency flow into our country. It will open up an opportunity for Mongolian companies to offer their shares on both domestic and foreign markets at the same time.
Three: The government needs to stop setting prices for fuel, electricity, meat and other products so that market competition will produce real prices. In the long term, it will result in a more reliable supply of goods, reduced price fluctuations, and more investment opportunities. Furthermore, it will allow Mongolian coal mines and power plants to actually make profits and export their products.
Four: In order to make Mongolian companies internationally competitive in tourism, wool, meat, dairy products, mining services, information, and communication, we need to develop and implement a policy that is solely based on productivity. If we implement the experiences of Foundation Chile and increase our non-mining exports, the trade balance will become favorable.
Five: The government should only invest in education and the health sector, the current obsolete structures of which need fundamental changes. The management of schools needs to be handed over to a Board of Directors to be employed under contract. Insurance companies should start assessing the quality and price of health care services. Universities need to be ranked and enter into healthy competition. Also, industry and business need to be connected to university research programs.
Six: We need to stop the universally provided social welfare program and use these funds to provide services to those who truly need them. More hardworking people who are bringing benefits to society could even be given extra care. The government needs to fully support citizens who want to do business.
Seven: Political parties need to start producing financial reports, and those who've stolen public property should be held accountable, their position or political affiliation notwithstanding. As long as such politicians are in the government, they will keep making everything political, put their every effort towards obtaining ruling power, turn citizens against each other, and create instability within the nation. Their continued existence will prevent our country from developing despite the changes we make to laws.
WHAT SHOULD BE DONE?
When these measures mentioned above are implemented, we will be able to lower the blood pressure of our economy and restore its health. At that time, the tugrug to dollar rate would be kept stable at an appropriate level.
Since these measures cannot be put in place overnight, the only option readily available to lower our economic blood pressure is the International Monetary Fund. Regardless of whether we want it or not, Mongolia – as a member of the IMF – will acquire a loan from this fund. The recent decision by the government to increase its payment quota to the IMF proves that they are preparing to apply for a large loan.
From its experiences in 2009, our government is now well aware that an IMF loan will have some very tough conditions (Stand-by Arrangement) this time. There will be nothing surprising if the SBA requires the government to register the Development Bank loan with the public budget and if Mongolbank stops printing money. If such conditions are to be met, a pre-agreement between the Democratic Party factions will be broken and a new balance of power will be formed.
Extraordinary Session of Parliament Called to Discuss Audit of Frozen Projects, 2014 Budget Amendment
Ulaanbaatar, March 10 (MONTSAME) MPs have decided to convene irregular session of parliament on March 24.
It is expected that they will discuss the 2014 budget clarifications, a list of agenda of the spring session of parliament, and results of audit inspection over "frozen" buildings.
The latter is considered as rather crucial matter. The 2014 approved budget does not reflect a financing for construction of some buildings due to the cost increase and a fact that a construction has not started although money were ready, in hands taken from the budget. Because of this, the financing was ceased and left for the inspection. It was later run by the Audit Office and the results were discussed with the Standing committee on budget.
Next urgent question on the table has become the agenda for the spring session, for, on the final day of the autumn session, MPs did not manage to discuss it with representatives of political parties and to include some bills submitted from the Mongolian People's Party (MPP) and the "Justice" coalition.
According to some sources, the regular spring session will start on April 5.
Mining Minister Mongolia@PDAC Presentation: "discrepancies" in laws will be addressed by parliament
In remarks at the Mongolia@PDAC conference in Toronto on March 4, Mining Minister Gankhuyag Davaajav warmly welcomed foreign mining investment, saying Mongolia's goal was to offer investors "firm sustainability of politics, economics and legal environment." Over 130 people registered for the Second Annual Mongolia@PDAC conference – almost double last year's attendance -- organized by the Canadian Government and the NAMBC. The Minister's PowerPoint presentation can be downloaded below.
The Minister candidly admitted Mongolia had made mistakes affecting foreign investment in the past but that it would "never repeat" them.. He also said that the moratorium on new mining exploration licenses, first imposed in June 2010, might be ended as the result of Minerals Law amendments and other legislation to be taken up during the spring session of parliament. Minister Gankhuyag said parliament would address the "many discrepancies" in previous mining laws including perhaps long-awaited revisions to the so-called "Long Name Law" on mining near rivers and forests.
The Minister did not directly address the issue of the106 exploration licenses annulled last year as part of an investigation into corruption at the Mineral Resources Authority of Mongolia (MRAM). When asked about Oyu Tolgoi LLC, the Minister several times said that all matters regarding Oyu Tolgoi LLC would be resolved by its Board of Directors, which includes three Mongolian directors, without involvement by the cabinet or parliament.
In Toronto, Gankhuyag also met with Ed Fast, Canada's Minister of International Trade, and Ungad Chadda, senior vice president of the Toronto Stock Exchange (TSX) who is responsible for all aspects of TSX's listings business.
Mongolia Urges Other Nations to Put Moratorium on Capital Punishment
Ulaanbaatar, March 9 (MONTSAME) Mongolia has managed to create a legal environment for abolishing the capital punishment.
The State Secretary of Mongolia's Ministry of Justice Ms J.Bayartsetseg said it at the 25th regular session of the Human Rights Council, which kicked off March 3 in Geneva, Switzerland.
Mongolia also urges other nations to put a moratorium on the punishment, she added.
As known, the President of Mongolia issued a moratorium on January 14 of 2010 to abolish the death penalty. Following it, Mongolia joined the Second Optional Protocol to the International Covenant on Civil and Political Rights, and the draft amendment to the criminal law has been submitted to parliament, reflecting a clause on annulling the capital punishment.
After the meeting, Bayartsetseg expressed a willingness of Mongolia to run for the 2015 election of the UN Human Rights Council (UNHRC) during a meeting with Shahrzad Tadjbakhsh, a Chief of Staff of the Office of the High Commissioner for Human Rights (OHCHR).
She also met with Ibrahim Salama, a Director of the UNHRC Office of Human Rights Treaties; and Rory Mungoven, Chief of the Asia and Pacific Region at the Office, to introduce to them legal reforms in Mongolia and to exchange views on further measures and cooperation.
Mongolia moves forward with $30 billion coal-to-gas project with Sinopec Group
March 10 (infomongolia.com) At the Cabinet meeting held on March 07, 2014, it was resolved to set up a working group responsible for introducing technology on coal gasification.
The fuel supply is one of the key economic issues to resolve and the Government of Mongolia had been starting to implement projects to produce fuel from coal. In the frameworks, during his official visit to the PR of China held in October 2013, Prime Minister of Mongolia N.Altankhuyag was present the signing ceremony of "Memorandum of Understanding on Cooperation between the Ministry of Mining of Mongolia and Sinopec Group of China" to build a gas plant based on Mongolian thermal coal resource that aimed to provide domestic needs with its production and further to export to China.
The project team to introduce the coal gasification technology will be established under the Ministry of Mining and in the scope of the 30 billion USD project, four plants and some complexes to produce 16 billion cubic meters of coal gasification. Within September of this year the feasibility study should be completed and the next level of project implementation is to go into intergovernmental negotiation for further discussion, also the construction issues is planned to be completed in 2015-2018.
This is not the first discussed and resolved "Coal Gasification" project to carry out, the Government of Mongolia had been negotiating with German ThyssenKrupp Uhde to build the coal gasification plant in Mongolia since 2009, where the latter part concluded economic studies in 2012, moreover ThyssenKrupp Uhde and the Government of Mongolia established an agreement to start the project.
Earlier, in the scope of developing the "Sainshand Industrial Park" Project, it was also discussed to build a "Coal Gasification Plant" in collaboration with "Bechtel", the company that won in the bidding as General Advisory Service Provider for "Sainshand Industrial Park" Project in May 2011.
Besides in July 2011, it was reported that an Australia-based Cougar Energy Limited had been engaged in the development and commercialization of underground coal gasification (UCG) projects in Mongolia.
Moreover in August 2011, South Korean steel maker POSCO had signed a collaborative memorandum of understanding with Mongolian MCS Group to build a coal gasification plant in Mongolia, where parties had been negotiating since 2010 and the economic studies were completed by Canadian Hatch Company.
Sinopec Group (China Petrochemical Corporation) is Asia's largest oil refining and petrochemical enterprise, administered by SASAC for the State Council of the People's Republic of China. It is headquartered at Chaoyangmenwai in Beijing, across the road from the headquarters of competitor CNOOC Group.
Hunnu Air appoints APG as its General Sales Agent in 17 countries in Europe, NA, Far East
March 7 (APG) Mongolia's Hunnu Air has announced its appointment of APG as its GSA in 17 countries in Europe, North America and the Far East from the end of February this year.
APG will be providing full sales and marketing services as well as call centre and ticketing facilities.
Hunnu Air has also signed with APG to join further BSPs worldwide through APG's IBCS programme which offers airlines pay-as-you-go access to BSPs and is now used by over 160 airlines.
Founded as Mongolian Airlines Group in 2011, the company was renamed Hunnu Air in 2013. The airline, based in Ulaanbaatar, currently operates 2 Airbus 319 aircraft and 3 Fokker 50s on its scheduled domestic and regional routes to destinations including Hong Kong and Bangkok.
Hunnu Air's international network will be augmented by a new twice-weekly service to Paris CDG which is due to commence in June 2014. A further new route to Singapore, scheduled for 2015, will coincide with delivery of Hunnu Air's first Airbus A330-200.
Skymedia Corporation Chooses AVSystem Unified Management Platform Solution
March 5 (AVSystem) AVSystem, a technology leader in multi-protocol device management, announced today that Skymedia Corporation Mongolia has decided on AVSystem Unified Management Platform as a solution for provisioning, management and monitoring of its customer premises equipment (CPE).
Skymedia chose AVSystem after in-depth evaluation of the market in terms of diverse state-of-the-art solutions as well as system performance benchmarking. AVSystem UMP was top-ranked by Skymedia engineers as the most flexible software due to a wide set of unique features, essential for technical support and network operations teams, it offers. Skymedia also indicated AVSystem UMP's high-frequency monitoring capability to be another important factor that they considered while choosing an ideal system for their company.
"We find AVSystem Unified Management Platform the most mature product on the market bringing best performance together with a set of advanced monitoring and data mining tools for pro-active problem detection. We have selected AVSystem because we are sure that their products will help us to deliver best quality services to our customers", stated Gantogoo Zundui, CTO of Skymedia.
Skymedia, being the 2nd official operator in Mongolia (first ever competitor of this market), delivers broadband services to residential and corporate customers across Mongolia via PON and WiMAX technologies.
AVSystem is a market leader in advanced CPE & device management for Telcos and ICT SPs based on TR-069 family and other management protocols like http/s, SNMP, ssh, telnet, t/ftp, OMA-DM. High performance architecture supporting modems/routers (xDSL, Cable, WiMAX, 3G, LTE), STBs, xPON/FTTx/ETTx, VoIP terminals and Femtocells helps to improve operational processes & reduce costs through auto-configuration, mass operations, remote diagnostics & troubleshooting, advanced monitoring and QoE.
Mövenpick Hotels & Resorts Launches New Hotels in Turkey, Mongolia and Morocco
March 11 (Hotel News Resource) --
Mövenpick Hotels & Resorts has also announced it is to manage a new hotel in the capital of Mongolia from 2018. The Mövenpick Hotel & Residences Ulaanbaatar with 250 rooms and 124 residences will be based in the upmarket area of Banyanzurh District just 3.5km from the historic centre of Sukhbaatar Square.
WEF: List of 2014 Young Global Leader Honourees
March 11 (World Economic Forum) --
Senior Vice-President and Director of Strategic Planning
Miner & Supplier 2014 Conference & Exhibition, March 13-14, Chinggis Khaan Hotel
March 10 (infomongolia.com) The fourth annual "Miner & Supplier" Conference and Exhibition is to take place at the Chinggis Khaan Hotel in Ulaanbaatar on March 13-14, 2014.
This is single and larger event in the sector of Mongolian mining supply and executive officers, supply managers, financial directors and engineers that have great expectations for Miner & Supplier 2014.
This year's edition will be held under the slogan "Let's Move to the Development New Stage" where mining companies will share experiences, introduce with advanced technique, technology and management.
The 2014 Miner & Supplier event organized by the Ministry of Economic Development and Mongolian Mining Exchange NGO will be focused on key agendas such as to increase the socio-economic role of the conference, extend environment friendly technology and products, and to increase business coordination between mining suppliers and mining businessmen.
Mongolia approves ₮13.3 billion e-bus project for Ulaanbaatar
Ulaanbaatar, March 10 (MONTSAME) The government has decided to introduce advanced technologies of GPS registration and E-payment systems to the city's public transport service.
A total of 13.3 billion togrog for this will be issued from the Development Bank and a domestic "Slide" company will work on its execution.
The City Mayor E.Bat-Uul will be in charge of the work, the Information Technology, Post and Telecommunication Authority (ITPTA) will put control on the work process.
This latest hi tech will control how the public transportation companies adhere to schedule and to routes in service. For the time being, there are a thousand big buses and 700 micro buses of 24 companies.
US Ambassador visits US-funded English Translation Training as part of Transparency Agreement
Ulaanbaatar, March 9 (MONTSAME) On March 6, the Ambassador Extraordinary and Plenipotentiary of the USA to Mongolia Ms Piper Anne Wind Campbell together with representatives of the Ministries of Foreign Affairs and of Justice visited a special English translation course, funded by the U.S. Embassy.
This course is preparing Mongolian translators to help translate draft laws under the Transparency Agreement. The "Agreement on Transparency in Matters Related to International Trade and Investment" was signed by the U.S. and Mongolia in September. It has not been ratified yet by the Mongolian parliament but the United States has been already providing technical assistance to Mongolia to help it live up to its obligations under the agreement.
The agreement requires that Mongolian draft laws that affect business and investment be published in English. To help Mongolian translators build the necessary skills, the U.S. Embassy, in coordination with the American University of Mongolia's English Language Institute has organized legal translation classes for selected staff members from the Ministry of Justice and National Legal Institute.
Parliamentary Delegation Visits Japan
Ulaanbaatar, March 9 (MONTSAME) A Mongolian delegation led by B.Garamgaibaatar, a head of the parliamentary Standing committee on economics, paid a visit to Japan recently invited by Japan's Ministry of Foreign Affairs.
Our delegation was received by Mr Masaaki Yamazaki, the president of the House of Councillors (upper house of parliament). The sides discussed how to strengthen the bilateral strategic partnership and to expand the economic cooperation.
Then the group ran several meetings--with Ts.Otsubo, a head of the Standing committee on economics and industry at parliament's House of Councillors; Sh.Tomita, a head of the Standing committee on economics and industry at parliament's House of Representatives (lower house of parliament); M.Hayashi, a head of the parliamentary group on supporting the Japan-Mongolia relations at the Liberal Democratic Party (LDP).
The parties exchanged views on a present situation of the bilateral cooperation and prospects and agreed that the "Erch" initiative /"Impetus"/ must be backed created by Japan's Prime Minister Shinzo Abe during his visit to Mongolia, and a middle-term programme on strategic partnership.
After this, the delegation met with Seiji Kihara, the Vice Foreign Minister of Japan; Kazuyoshi Akaba, the Vice Minister of Economy, Trade and Industry; and Ryutaro Hatanaka, Commissioner of the Financial Services Agency (FSA).
Other meetings were held with authorities of the Japan International Cooperation Agency (JICA), the Japan Bank for International Cooperation (JBIC), the Japan External Trade Organization (JETRO), the Tokyo Stock Exchange (TSE), the Japan Business Federation (Keidanren), and the Japan-Mongolia Economic Committee. At every talk the Mongolian side spoke about a newly adopted law on investments, state policy on mineral sector, law on investments fund and other steps being undertaken for fortifying the legal environment of investments. The sides emphasized an importance of an Agreement on Economic Partnership (AEP) that will be established between the two countries.
Our delegation comprised R.Amarjargal, D.Zorigt, L.Enkh-Amgalan MPs, and Sh.Enkhbat, an advisor to a Vice Speaker.
Speaker Enkhbold to Conduct Official Visit to South Korea, March 12-15
March 11 (infomongolia.com) Upon the invitation of Speaker of the National Assembly of South Korea Kang Chang-hee, Speaker of the State Great Khural (Parliament) Zandaakhuu ENKHBOLD is conducting an official visit to the Republic of Korea on March 12-15, 2014.
In the frameworks of the visit, Speaker Z.Enkhbold will have bilateral talks with his counterpart Kang Chang-hee and will be received by the President of the country Park Geun-hye. Also, it is planned to tour the Korea Industrial Complex Corporation (KICOX) site and get familiarized with KICOX industrial complex-based cluster program. Speaker also will visit the Korea Institute of Science and Technology (KIST) and attend the Mongolia-Korea Forum and Mongolia-Korea Business Forum, besides to get au fait with activities of Busan-Jinhae Free Economic Zone and meet Mongolian citizens residing in Busan.
Speaker Z.Enkhbold will be accompanied with Chairwoman of Petitionary's Standing Committee of the Parliament MP R.Burmaa, Minister of Labor MP Ya.Sanjmyatav, Minister of Population Development and Social Welfare MP S.Erdene, MP O.Baasankhuu, MP G.Batkhuu, MP D.Sarangerel, MP Ts.Tsolmon, Ambassador of Mongolia to the Republic of Korea B.Ganbold, Advisor to the Speaker Z.Narantuya, Director of Foreign Relations Department at the Secretariat of Parliament Ts.Narantungalag and Director of Press and Public Relations Department O.Batkhand.
Parliament Speaker to Visit South Korea – Montsame, March 11
Foreign Minister of Mongolia Meets Ambassadors of Five Permanent Members of UN Security Council
March 11 (infomongolia.com) On March 10, 2014, Minister for Foreign Affairs of Mongolia Luvsanvandan BOLD received Ambassadors Extraordinary and Plenipotentiary of the French Republic, the People's Republic of China, the Russian Federation, the United Kingdom of Great Britain and Northern Ireland, and Charge d'Affaires of the United States of America to Mongolia, the Five Permanent Members (P5) of the UN Security Council.
Minister L.Bold thanked the five nuclear-weapon states for issuing Joint Declaration on Mongolia's Nuclear-Weapon-Free Status in September 2012 welcoming the declaration by Mongolia in 1992 of its nuclear-weapon-free status and affirming their intent, as long as Mongolia maintains its nuclear-weapon-free status, to respect that status and not to contribute to any act that would violate it.
The regular session of UN General Assembly has scheduled this fall the discussion of a report by the UN Secretary General on the Mongolia's international security and nuclear-weapon-free status and adoption of a resolution thereon. Informing that Mongolia is greatly interested in including in the resolution a provision officially recognizing the Mongolia's specific status and in cultivating closer cooperation with the five nuclear-weapon states in this regard, Minister L.Bold handed over a memorandum thereon to the Ambassadors.
Though the five nuclear-weapon states recognized the Mongolia's nuclear-weapon-free status, they have not backed reflecting a certain provision recognizing the Mongolia's status in considering that it might be used by other states as precedent.
At the meeting the parties exchanged views on international and regional issues of mutual concern, reports the Ministry of Foreign Affairs of Mongolia.
World Bank Country Manager for Mongolia Ending Term, to Take Madagascar Role
March 10 (news.mn) The Country Manager of the World Bank for Mongolia, Ms. Coralie Gevers is to leave for her next mission to Madagascar completing her mission in Mongolia. Ms. Coralie Gevers assumed her position based in Ulaanbaatar on October 16, 2010. The Country Manager of the World Bank for Mongolia, Ms. Coralie Gevers was preceded by Arshad Sayed, Country Manager and Resident Representative, the World Bank in Mongolia.
During her term in Mongolia, dozens of programs and projects "Integrated Budget Law Capacity Building", "Ulaanbaatar Clean Air Project", "Mongolia E-Health Project", "Community-led Infrastructure Development for the Urban Poor in Ulaanbaatar Phase 2" were carried out with finance of 115 million US dollar loans and free aid by the World Bank.
Making Grasslands Sustainable in Mongolia: International Experiences with Payments for Environmental Services in Grazing Lands and Other Rangelands
February 2014 (Asian Development Bank) --
Payments for environmental services are one potential mechanism to provide land users in grasslands with incentives to increase the supply of positive externalities of grassland utilization (e.g., biodiversity), and decrease the supply of negative externalities (e.g., soil erosion or carbon emissions). The main distinction between payments for environmental services and other forms of incentives or support is that payments for environmental services schemes make payments conditional upon performance of improved management or delivery of environmental services.
Evidence suggests that payments for environmental services schemes can result in an increase in the supply of environmental services, although some schemes have not increased their supply and there have been few rigorous evaluations. One general set of reasons for the limited environmental impact is that market-based instruments may be less effective in contexts where other markets are missing or not working well, since these constrain the opportunities for land users to pursue more profitable livelihood options. Even where schemes are able to increase the supply of one environmental service, there may be trade-offs with other environmental services. Similarly, not all payments for environmental services schemes have improved incomes for the poor or addressed equity concerns. Careful design and a thorough assessment of these issues can improve payments for environmental services implementation.
About this report
Payments for environmental services is currently not widely practiced in Mongolia, but has been included in the recent Green Development Strategy of the Government of Mongolia. This knowledge product provides a descriptive overview of 50 payments for environmental services schemes in operation in grasslands and other grazing lands worldwide as well as a number of schemes under development in Mongolia. It also discusses some key issues relating to the design of payments for environmental services schemes in the context of Mongolian grasslands.
Sister of missing Kiwi, en route to Mongolia for 'dream job', holding onto hope
March 11 (3 News) There is still no sign of Malaysia Airlines flight MH370, leaving the families of the 239 people on board in limbo.
One of those families is the Weeks family of Christchurch and Perth.
Paul Weeks left Christchurch after the earthquakes and started a new life in Western Australia, as so many young Kiwis have.
This morning in Christchurch, Paul's sister Sara Weeks spoke of how grateful she and her family are for all the kindness they're receiving. She says they want everyone to know what a wonderful man Paul is.
"The waiting is terrible, the not knowing is the worst thing," says Ms Weeks. "You mentally prepare yourself for the worst, but you have that little bit of hope because you don't know."
She and her family members have decided they are best off waiting in New Zealand, in the comfort of their own surroundings.
"But I guess should they find something, perhaps my brother or my mother might consider going [to Kuala Lumpur]."
Ms Weeks is keeping her phone on constantly in hope of news.
"I don't want to turn [my phone] off, because that's our direct link to knowing something and how we are going to find out."
Paul was on the flight on the way to Mongolia to start a new job as a diesel technician, his dream job.
Ms Weeks says her brother is a fantastic man and that everyone who knows him loves him.
"Fantastic husband, wonderful father, great brother."
Genghis Khan rode climate change to take over Asia
March 10 (USA Today) Throughout human history, natural climate change has played a role in the rise and fall of civilizations around the world, from the Mayans to the Romans.
The empire of Genghis Khan of Mongolia, one of the most notorious characters in world history, was helped by a dramatic rise in rainfall and mild temperatures in central Asia in the early 13th century, according to a study released Monday in the Proceedings of the National Academy of Sciences.
Led by Genghis Khan and his sons and grandsons, the Mongols ruled most of modern-day Russia, China, Korea, Southeast Asia, Persia, India, the Middle East and Eastern Europe, forming the largest land empire in world history.
Previous research had speculated that the Mongols were escaping extreme drought, but this research takes the opposite tack.
Scientists led by physical geographer Amy Hessl of West Virginia University and Neil Pederson of Columbia University's Lamont-Doherty Earth Observatory believe that the rise of Genghis Khan and the start of his sprawling empire was propelled by a temporary run of nice weather.
How did the additional rain and unusually mild weather help Khan? Horsepower, Hessl said. The abundant grasses provided the fuel for the horses that helped the Mongols and their superb cavalry conquer vast lands. It also helped provide food in the way of livestock fed by the bounty.
"Where it's arid, unusual moisture creates unusual plant productivity, and that translates into horsepower," she said. "Genghis was literally able to ride that wave."
Khan's rise to power was in 1211 to 1225 A.D. During that time, scientists found that Mongolia saw sustained rainfall and mild warmth never seen before or since.
At its height, Genghis Khan's empire stretched all the way from eastern Europe to Korea.(Photo: Columbia University Earth Institute)
Khan and his crew didn't carry rain gauges or thermometers as they marauded over the steppes, so scientists used paleoclimatic "proxy" data -- in this case rings from dead pine trees -- to reconstruct the climate of that era.
The tree rings from those years were "persistently wide," said Pederson, which he said "suggest that period, climatically speaking, was persistently wet."
Since the mid-20th century, the region has warmed rapidly, and the rings show that recent drought years were the most extreme in more than 1,000-years — possibly a side effect of global warming.
"Future warming may overwhelm increases in precipitation, leading to similar heat droughts, with potentially severe consequences for modern Mongolia," the authors wrote.
"Though we cannot attribute a single event to climate change, warming temperatures have stacked the deck toward (more evaporation), so even if the amount of precipitation remains the same, high temperatures will generate a more intense drought," Hessl said.
"That's what we observed in the early 21st century, and based on past moisture variation in Mongolia and future predictions of warming, we would expect to see similar events in the future."
Two Existing Mercedes-Benz Zetros 6×6 Vehicles Can Be Found in Mongolia
March 11 (stupidDOPE) Mercedes-Benz is known for their amazing, stunning and brilliant designs. They have a storied career in building some of the world's finests automobiles and today unleash a detailed first look at their latest design, the 6×6 Zetros. The two existing Zetros models can be found in Ulan-Bator, the capital of Mongolia, where two businessmen use the massive vehicles for hunting in luxury.
Movie: Amka and The Three Golden Rules
March 10 (WCBE 90.5 FM) A memorable coming-of-age tale set in exotic Mongolia.
Amka and The Three Golden Rules
Director: Babar Ahmed (Genius, Sid's Paralysis)
Cast: Ganzorig Telmen, Dashnyam Maralgua
Runtime: 86 min.
Acclaimed South-Asian director/writer Babar Ahmed has crafted an affecting Mongolian tale as instructive about the enduring values of an ancient culture as it is a universal story of a boy's coming of age. Unlike more sophisticated Western kids' films of heroics and CGI splendor, the honest, minimalist Amka and The Three Golden Rules keeps it simple: Learn to confront three major challenges in life, "borrowing, overspending, and saving" and you will be prepared to love a life no riches could ever give you.
Ten year-old Amka, played with unalloyed realism by Ganzorig Telmen, has lost his parents and consequently his moral compass. Coming into money through the sale of found gold coin, he spends on trendy clothes to such a profligate extreme that he borrows money from friends, whom he can't pay back.
In this slight turmoil, Ahmed has made sure not to overstate the digression from the virtuous life but to keep it as real as he can, assuring that every youngster in the audience will understand where the young boy has gone wrong and what will bring him back: the golden rules of virtuous living. Interestingly enough, the lesson of the story goes beyond the three fiscal determinants of borrowing, spending, and saving, for it really is about transcending those to a state where family and friends are the real coin of the realm.
The beautiful, spare, independent Mongolia, whose roots go back to Genghis Khan and Kublai Khan, is rich with love of family that casts a spiritual glow over the uncomplicated but informed life of the natives. In some respects it is reminiscent of the Oscar-nominated Beasts of the Southern Wild but less complicated and harrowing. While Telman is not the gifted actor that Quavenzhane Wallis is, perhaps it's all the better for the realism.
Visually the wide plains are punctuated by occasional huts and animals; otherwise the expanse of nature melds with the peaceful lives of the natives.
Not to say modernity hasn't arrived in Mongolia, for a little store has Barbie Dolls and soccer balls, and a red motorcycle can symbolize the fluid assimilation of progress into the rural quietude. There are empty plastic bottles Amka harvests, yet Ahmed makes the frame uncluttered in order to emphasize the uncomplicated allegory.
The naturalistic actions (when was the last time you saw someone on the can for a time, but you weren't repulsed?) lend believability about a culture that values friendships, family, and love over materialism. Amka and The Three Golden Rules will tell your children more about the valuable life than most other films from mightier countries.
For lucky visitors to the upcoming Cleveland International Film Festival (March 19- March 30, 2014), Amka and The Three Golden Rules will be screened.
John DeSando, a Los Angeles Press Club first-place winner for National Entertainment Journalism, hosts WCBE's It's Movie Time and co-hosts Cinema Classics. Contact him at JDeSando@Columbus.rr.com
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