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Tuesday, December 16, 2014
Headlines in Italic are ones modified by Cover Mongolia from original
Mogi: Positive step I guess but how long will this take? Fixing the tax issue is a Rio condition for project financing. TRQ closed -6.95% to US$2.81
Rio, Mongolia Plan Group to Set Royalties, Tax System, Montsame Says
By Michael Kohn
(Bloomberg) -- Rio Tinto, Mongolian govt plan to establish working group that will develop system to calculate, register mineral royalties, related taxes: Montsame News Agency, without giving origin of information.
* Head of Rio's copper division, Jean-Sebastien Jacques, met Mongolian Finance Minister Erdenebat Jargaltulga on Dec. 12
* Rio, Mongolia also discuss possible export of copper concentrate to Japan
* NOTE: Mongolia, Rio Tinto unit Turquoise Hill co-own Oyu Tolgoi copper mine
Turquoise Hill Resources Sets New 1-Year Low at $2.75 (TRQ) – Analyst Ratings, December 15
Turquoise Hill Resources Sets New 1-Year Low at $2.75 (TRQ)
December 15 (Analyst Ratings Network) Turquoise Hill Resources (NYSE:TRQ) hit a new 52-week low during mid-day trading on Monday , AnalystRatingsNetwork reports. The company traded as low as $2.75 and last traded at $2.85, with a volume of 2,110,906 shares changing hands. The stock had previously closed at $3.02.
Separately, analysts at Cowen and Company cut their price target on shares of Turquoise Hill Resources from $10.29 to $9.89 in a research note on Wednesday, October 15th. They now have an "outperform" rating on the stock.
The stock has a 50-day moving average of $3.28 and a 200-day moving average of $3.48. The company has a market cap of $5.805 billion and a P/E ratio of 104.14. Turquoise Hill Resources also was the target of a large decrease in short interest in November. As of November 28th, there was short interest totalling 27,294,569 shares, a decrease of 13.2% from the November 14th total of 31,455,559 shares. Approximately 3.0% of the shares of the company are short sold. Based on an average daily trading volume, of 3,603,483 shares, the days-to-cover ratio is presently 7.6 days.
Turquoise Hill Resources (NYSE:TRQ) last released its earnings data on Monday, November 10th. The company reported ($0.02) earnings per share (EPS) for the quarter, missing the consensus estimate of $0.03 by $0.05. The company had revenue of $466.00 million for the quarter, compared to the consensus estimate of $604.00 million. During the same quarter in the previous year, the company posted ($0.06) earnings per share. The company's revenue for the quarter was up 2877.6% on a year-over-year basis. On average, analysts predict that Turquoise Hill Resources will post $0.08 earnings per share for the current fiscal year.
Mongolia Growth Group Removes CEO Paul Byrne to Cut Costs
By Michael Kohn
(Bloomberg) -- Byrne to be replaced as CEO by co. founder Harris Kupperman, Toronto-based real estate investor says in statement.
* Byrne removed as part of board realignment
* Kupperman won't receive cash compensation for 2015
* Jim Dwyer, Brad Farquhar, Nick Cousyn, Robert Scott to join co.'s board
* Bill Fleckenstein, Paul Sweeney, John Shaw, Jordan Calonego, Byrne agree to resign from board
* Co. reduces costs to "thrive regardless of the economic situation in Mongolia," Kupperman says in statement
Mongolia Growth Group Ltd. Announces Issuance of Stock Options to Independent Directors
Toronto, Ontario, December 15 (FSCwire) - Mongolia Growth Group Ltd. ("MGG" or the "Company") announces that a total of 375,000 5-year, fully-vested stock options to purchase shares of MGG at an exercise price of CDN $1.09 per share have been granted to the 5 independent Board members of MGG subject to TSX Venture Exchange approval. These options have been issued pursuant to the Company's Stock Option Plan in order to attract, retain and motivate new and existing directors of the Company.
NOBLE GROUP PARTICIPATES IN XANADU MINES RIGHTS ISSUE
December Xanadu Mines Ltd (ASX: XAM – "Xanadu") is pleased to announce that major shareholder Noble Resources International Pte Ltd ("Noble Group") has confirmed that it will participate in the Company's Rights Issue.
The funds raised under the Rights Issue (after payment of costs) will be used to partly repay the deferred acquisition consideration for the Kharmagtai project and advance exploration activities at the Kharmagtai and Oyut Ulaan copper-gold projects.
The Rights Issue Offer Document and personalised Entitlement & Acceptance Forms booklets were dispatched to eligible shareholders on Tuesday, 9 December 2014. The Rights Issue Offer will remain open until Tuesday, 23 December 2014.
Xanadu: EXTENSION OF RIGHTS ISSUE, December 15
MSE News for December 15: Top 20 -2.26% to 14,679.77, Turnover ₮231.5 Million
Ulaanbaatar, December 15 (MONTSAME) At the Stock Exchange trades on Monday, a total of 134 thousand and 601 units of 20 JSCs were traded costing MNT 231 million 486 thousand and 361.00.
"Sor" /123 thousand and 839 units/, "APU" /8,000 units/, "Genco tour bureau" /1,938 units/, "State Department Store" /149 units/ and "Khokh gan" /145 units/ were the most actively traded in terms of trading volume, in terms of trading value were "Sor" (MNT 199 million 999 thousand and 985), "APU" (MNT 30 million and 008 thousand), "Tavantolgoi" (MNT 409 thousand and 800), "Baganuur" (MNT 331 thousand and 500) and "Makh impex" (MNT 213 thousand and 700).
The total market capitalization was set at MNT one trillion 435 billion 064 million 873 thousand and 937. The Index of Top-20 JSCs was 14,679.77, decreasing 339.34 units or 2.26% against the previous day.
MSE to Recognize Best Brokers of 2014 on December 25
December 15 (MSE) Mongolian Stock Exchange made a statement to award it's member stock companies every year based on achievement that has been made on trading activity, trading amount and quality of service , which has been offered to customers.
The company would be awarded based on its active participation in trading government securities and stock in 2014 on December 25, 2014.
IAAC Awards MSE with "Good Initiative of Good Governance without Corruption" Certificate
December 15 (MSE) In recognition of the successful implementation of the anti-corruption activity planning, control of private interests of employees and registration, supervision and report of assets and income declaration forms , the MSE was awarded a certificate on "Good initiative of good governance without corruption" by the Anti-corruption Authority of Mongolia on December 9, 2014.
FRC Issues Recommendations on Boosting Government Securities Trading on MSE
December 15 (MSE) On December 5, 2014, Financial Regulatory Commission's Securities Market Policy Committee has held a meeting.
Mongolian Government's debt security (bond) has been started to trade at Mongolian Stock Exchange from November of 2014 and the council has discussed over some issues regarding to this, during the meeting.
Before November of 2014, the Government debt securities were only traded and auctioned at Central Bank, and the approved participants were commercial banks. If the individual or entity wants to buy the bond, the only choice was to make a request to commercial banks, and commercial banks were acting as intermediaries.
11 Commercial banks were received the "Special license to act behalf of the clients, by their request, and provide investment activity and service" from Financial Regulatory Commissions, based on council for financial stability board's guideline.
However, today the Government debt securities are regularly traded at Mongolian Stock Exchange, and it creates opportunity to the individuals and entities that interests to buy bond. They can participate government securities primary trading, furthermore secondary trade, by their brokerage companies assistance at stock exchange.
The Securities Market Policy Committee discussed an issue on activating government bond trading at the MSE and came to a common agreement that individuals and legal entities who are interested in investing in government bond purchases would execute them at the MSE through their brokers but not at the Mongol Bank through commercial banks.
However, the commercial banks, main participants of the Government bond purchases, can buy the securities by their own capitals but are restricted from acting as intermediaries and would advise the FRC on regulating this issue.
BoM MNT Rates: Monday, December 15 Close
December MNT vs USD, CNY Chart:
BoM issues ₮12 billion 1-week bills, total outstanding -74.4% to ₮58.7 billion
December 15 (Bank of Mongolia) BoM issues 1 week bills worth MNT 12 billion at a weighted interest rate of 12.0 percent per annum /For previous auctions click here/
Mongolia Running ₮440.5 Billion Budget Deficit in First 11 Months
Ulaanbaatar, December 15 (MONTSAME) In the first 11 months of 2014, total equilibrated revenue and grants of the General Government Budget (GGB) amounted to MNT 5,267.8 billion and total expenditure and net lending reached 5,708.3 billion, representing a deficit of 440.5 billion in the equilibrated balance.
Tax revenue increased 131.8 billion or 3.0 percent due to increases of 102.5 billion or 13.6 percent in social security contributions, 71.6 billion or 11.7 percent in other tax revenue, although income taxes decreased 11.6 billion or 1.2 percent due to declines of 33.4 billion or 6.0 percent in revenue from corporate income tax, 19.0 billion or 5.5 percent in taxes on foreign trade, 18.5 billion or 1.1 percent in taxes on domestic goods and services.
By the end of November, total expenditure and net lending of the General Government Budget reached MNT 5,708.3 billion increasing 580.7 billion or 11.3 percent compared to the same period of the previous year. This was mainly due to increases of 227.9 billion or 13.7 percent in subsidies and transfers expenditure, 191.7 billion or 9.3 percent in expenditure on goods and service, 181.1 billion or 2.1 times in Interest payments expenditure, 83.7 billion or 7.7 percent in capital expenditure although there was a decrease of MNT 103.7 billion or 78.2 percent in net lending.
Mongolia's Foreign Trade Review, November 2014
December 15 (Bank of Mongolia) --
Total trade turnover: $10,022.6 millions
As of Nov 2014 the total cumulative trade turnover increased by 3.2% (USD 306.1 millions) from that of the previous year and reached USD 10,022.6 millions. The increase in the trade turnover was due to the increase in exports by USD 1,329.3 millions.
The structure of the trade flows with the neighboring trade partners is as following: (i) trade with PRC: 61.7% or USD 6,185.6 millions and (ii) trade with Russia: 14.8% or USD 1,484.7 millions. The trade volume between Mongolia and China increased by 24.4% and the trade volume between Mongolia and Russia increased by 0.5%.
Trade balance: $358.2 million
As of Nov 2014, the cumulative trade balance improved by 118.0% (USD 2,352.4 millions) from that of the previous year and reached USD 358.2 millions. During the reporting period the total exports increased by 34.4% from that of the previous year, imports de-creased by 17.5% from that of the previous year, thus the trade balance improved by USD 2,352.4 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 ex-ports and imports have been declining since October 2011). But since the beginning of 2014, it has been increasing.
Trade balance of paid trade flows: $650.5 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 Nov 2014, the trade balance of paid trade flows reached USD 650.5 millions. During the reporting period, paid imports decreased by 17.6%, and paid exports increased by 33.1% from that of previ-ous year.
Terms of trade: 1.593 (test estimation)
As of Nov 2014, terms of trade index (2012 base year) increased by 15.5% from that of the previous year and reached 1.593.
This increase in the terms of trade is mainly attributed to the de-crease in import prices of durable consumer goods, fuels and in-crease in export price of copper concentrate.
Composition: 89% + 11%
The share of mineral exports in total exports increased by 0.3 points from that of the previous year and reached 89%.
Exports of coal, copper concentrate, iron ore and concentrate and crude oil have a weight of nearly 78% of total exports and 88% of mining exports.
In addition, these 4 products' share in the mining exports in-creased by 3.3 points from that of the previous year, share in the total exports increased by 3.2 points.
Mongolian export increased by 34.4% from that of the previous year, which was mainly affected by 30.8% increase in mineral exports. Exports of copper concentrate and crude oil increased by 169% and 35%, respectively, which accounted for 47% in growth of mining export. On the other hand, coking coal and iron ore ex-port decreased by nearly 24%, 32% respectively, which accounted for 13% decrease in the growth of mining export.
As of Nov 2014, Mongolian export increased by 1,329.3 million USD from that of the previous year. It is affected by the increase of export commodities' quantities (USD 1,236.6 millions) and de-crease in export commodities' prices (USD 92.7 millions) .
Because of the increase in crude oil and copper concentrate quantities, mining export increased by 1,146 millions USD. On the other hand, because of decrease in prices of coal, iron ore and de-crease in quantities of iron ore, zinc ore mining export declined by 517 million USD.
Cashmere, cashmere products and other exports increased by 40.9 and 100.9 million USD respectively.
World market prices for primary commodities
As of Nov 28 2014, gold price reached 1,167.4 USD, decreased by 6.9% from that of the previous year and by 0.5% from that of the last month.
As of Nov 28 2014, copper and iron ore prices reached 6,412.0 and 70.0 USD, decreased by 5.2%, 11.4% from that of the previous month respectively.
Composition: 26% + 41% + 22%
As of Nov 2014, 26% of total imports were consumer goods, 41% were capital goods and 22% were fuels.
Share of the capital goods in total imports decreased by 4% from that of the previous year while the share of fuels stood at the same level.
Mongolian imports decreased by 17.5% from that of the previous year. Main contributors of this decrease were capital goods de-crease, which equals to 12% of the total decrease, and oil imports which equals to 4% of the total decrease.
Capital goods and fuels imports decreased by 25% (674 millions USD) and 16% (207 millions USD) respectively. Thus total import decreased from that of the previous year.
Consumer goods import decreased by 11% (147 millions USD) from that of the previous year. Main contributors of this decrease were durables goods, in particular decrease in passenger car imports.
Capital goods import decreased by 25% (674 millions USD) which was mainly contributed by 38% decrease in machinery, equipment and supplies (650 million USD). On the other hand, import of construction materials increased by 2% (13 million USD).
Intermediate goods and industrial materials import increased by 1% (4 millions USD).
Fuels import decreased by 16% (207 millions USD). The oil price on the border decreased from beginning of 2012 to august 2012. Since then, the oil price increased slightly, but from October 2012 it is decreasing slowly. (Figure 8).
Import of the consumer goods
The growth of consumer goods import, calculated by 3 month moving average method, is constantly declining. / Figure 7/.
Even though the import growth of non-durable consumer goods was relatively stable, that of durable consumer goods was declining by the bigger phase.
228.5 thousand youth unemployed in Mongolia
December 15 (news.mn) Young people between 15 and 34 make up 38.5 percent of the population in Mongolia.
Recent studies show that 228.5 thousand (24.1 percent) of the nation's youth are unemployed. While 125.9 thousand young people work in animal husbandry, they represent only 13.1 percent of the younger generation.
The Government of Mongolia and Ministry for Population Development and Social Welfare have created the Youth Department, for the first time in the past two decades, to be in charge of youth issues and focusing on youth development.
In the scope of youth development issues, the government will put greater effort towards meeting with non-governmental youth organizations to discuss youth issues and consider incorporating them into government programs.
Through the "Youth Development Project" with support from the Swiss Agency for Development and Cooperation (SDC), the Grand Duchy of Luxembourg, and the United Nations Population Fund (UNFPA), the Government of Mongolia has established Youth Development Centers in nine provinces in Mongolia.
Government House facing parking problems as MPs take over west wing
December 15 (news.mn) Available parking at the west and east sides of the Government House is one of the busiest places in the city center, as it is where state agencies and ministry staff work and serve the public.
The west side parking at the Government House will now only be available to parliamentarians, as MPs Z.Bayanselenge and G.Uyanga have complained about the lack of parking and made a request for separate parking for parliamentarians. Responding to the request, Speaker Z.Enkhbold ordered that only parliamentarians will be able to park their vehicles on the west side.
That leaves over 1,000 staff members and visitors to park on the east side only.
The new parking regulation has already resulted in confusion and difficulties.
Observers have noticed that the west and east sides of the Government House parking areas see different "rush" times. The east side parking is full all day long, and west is often empty as many parliamentarians fail to show up to work on time during normal business rush hours.
Policy Series: Failure of Not Strengthening the Parliament
By Mendee Jargalsaikhan
December 14 (Mongolia Focus) Under the 1992 Constitution, the parliament is supposed to become the state policy black box. It was empowered to develop, approve, and enforce state policies that would strengthen the country's sovereignty, maintain its domestic stability, facilitate the economic development, and more importantly, protect core principles of democracy (i.e., our rights and rule of law). But, now we're already losing trust in the legislature. Firstly, we witness increasingly polarized debates without any substantial studies and facts. Secondly, we see intense factionalized fightings over the political posts, election laws, and allocations of funds, loans, and bonds. Thirdly, we see erratic temptations of changing laws, rules, and regulations even without giving justifiable reasons. Finally, we now can rationally expect what would be major issues for any parliaments in pre-election years (i.e., the changing the constitution, election laws, and revision to the state budget) and post-elections (i.e., dividing up ministries and agencies, cancelling/revising previous economic/financial decisions, and typical 'pork and barrel' politics). This was the case for all past parliaments from 1992. No surprise, same applies to present one.
So, why our parliament is becoming less respected, weak, and the easiest target for the political blame game? Why it moves from the most powerful constitutional institution to more like 'symbolic' one? Why the law (policy) making institution become 'law (policy) breaking one? Are our 'esteemed parliamentarians' trading the power of the parliament for their parochial, short-term interests? So, what the parliament should do now to regain its real policy-making power and our trust?
We all know – if parliamentarians respect the rule of law and hold their temptations for 'cheating' from their own approved rules, the parliament would easily gain the public trust. But, the overall structure appears to be encouraging cheating; therefore, even a good principled person talks about moral principles and patriotic deeds, but acts in favour of parochial interests. The result is mistrust and fragmentation.
So, how can we get out of this proverbial crabs in a barrel scenario without dictatorship, oligarchy, revolutions, and foreign interventions? We need to improve our institutions – especially, the parliament. Our esteemed members should unite on common objectives of the national sovereignty, development, and democracy (i.e., human rights and rule of law) while constraining their tactical (may be strategic) parochial interests.
In this regard, a key solution seems to me to invest and to empower the parliamentary policy making and enforcing capacity. It's constitutionally given, but neglected.
Let's learn from the institutionalization process of the President. The 1992 Constitution intentionally made the presidential institution symbolic and deal-broker (for the national interests) along with some rights of checks and balances. As a result, Mongolia didn't slide into 'super-presidentialism' which is common in most post-communist, esp., post-Soviet, cases and all our presidents played quite constructive roles during major crises (e.g., hunger strike of 1994, July 1 in 2008). But, they made the presidential institution – the most bureaucratic and influential one. Each president enlisted leading experts (as advisors); expanded the National Security Council, its secretariat and think tank; enshirned its power in judiciary and foreign affairs; and brought all security organizations under the presidential influence (esp., the president's power to confer the highest ranks for leaders of these security institutions).
In contrast, the parliament did not increase its bureaucracy and even stripped numerous executive power-checking rights to others. Yes, the parliament has 8 standing committees, 10 sub-committees, and secretariat with 9 special departments. But, the real question is – do they matter in the parliamentary policy-making process? How much autonomy and power does the parliament give to its own bureaucracy? Or, the parliament and its members simply use them for daily secretarial, clerical, and protocol purposes?
The fault of our parliament is unable to unite and empower its own bureaucracy to regain its chief policy-making power and to increase the public trust. To do that, parliament members need to get over their parochial interest and self-defeating internal bickering.
The law (policy) making is a complicated process. First, we need to state the problem and identify the main causes. Here the parliament need to provide greater autonomy for its standing committee members and staffers. They must be empowered to question all stakeholders, including outside experts. Second, we need to develop short, mid, and long-term solutions and attempt to calculate its possible intended and un-intended consequences. Parliament members could not do that because they are constrained by multiple interests (party, business, local, and personal). The parliamentary staffers with help of experts could perform these tasks of developing and evaluating different options. Finally, we need to follow up our policy outcomes for years. Parliament members couldn't do that because they are temporary political creatures and overwhelmed with their interests. Therefore, the parliament needs to build up and empower its own non-partisan bureaucracy – that would build up the parliamentary institutional memory, knowledge, and expertise, and serve as gate-keepers against parochial, corporate, and ad-hoc interests.
Otherwise, our policy-making process will still be failure and victim of parochial interests.
First, repeated elections of parliament members would not provide the policy continuity. Just take an example of this parliament, there are 28 new members, 19 members in their second term, 16 in their third, and 12 in their fourth and more terms. Previous parliaments had quite well-balanced representation of new and old members. Have we seen the policy-continuity and responsible policy-making?
Second, increasing the number of individual staffers also couldn't contribute for the good policy-making. From 1992, parliament members continuously adding funding and numbers of their staffers. But, they are also political creatures – more concerned with their own options and interests – than contributing to the institutional memory of the legislature.
Third, increasing the secretarial capacity of the parliamentary secretariat without adding more powerful policy experts will not strengthen the parliament. Even though the current parliamentary secretariat has many fine policy experts, they would not stand for the good policy making unless the parliament provides the protection from the political and business interests.
The parliamentary non-partisan staffers – who are protected from political and business interests – could help the parliament to ensure proper policy-making and monitoring capacity. Otherwise, we will continue to operate on the USB memories of parties, factions, and influential politicians.
There are many policy issues are waiting for parliamentary non-partisan policy reviews, the followings are just examples.
1. The control and use of the security, law-enforcement organizations and tax authority: as we have witnessed explicit and implicit attempts by politicians, parties, and factions to insert their control and influence in security organizations and to use them for their own interests. The politicization and fractionalization of the security, law-enforcement, and tax organizations are the most dangerous phenomena for any states [examples are abundant]. Now it is time for the parliament to re-examine the entire set of policies of institutionalization of security, law-enforcement, and taxation agencies to keep them outside of domestic politics and committed for the public good.
2. The investment agreements especially in mining: the parliament could set up an independent commission to examine the past mining investment agreements, including the OT, for the policy-making (learning) purposes. The commission along with parliamentary staffers should able to question and examine all past agreements and evaluate the state policy-making procedures in order to improve its own policy-making processes and to train policy experts. The commission results should not be used for political purposes; therefore, the commission could be headed prominent politicians – outside of the current politics. Otherwise, we don't learn anything from our past and most current policy-making expertise.
3. The public service is another aspect, which dearly needs non-partisan review. The current politicization (could even we called, privatization of ministries and agencies by parties, factions, and politicians) of the public service adds to public mistrust of politicians and parties. If public servants, especially, those are entering into service, lose their fate in principle of rational bureaucracy (based on professional merits), it is hard to expect good policies and dedications. Changing and re-appointing political appointees to the ministerial, vice-ministrial, and directorial posts are not the solution. They would be the part of the problem – deepens the current legitimacy crisis. [There are many examples in our neighbourhood – both good and bad – in South Korea, Taiwan, and Japan.]
In the past, there were attempts to investigate and conduct open hearings on the July 1 riots and anti-corruption reporting, but members used them for their own political purposes. But, now it is a time for our politicians to rise above parochial interests and focus on national imperatives – by strengthening and empowering the law (policy) making capacity of the parliament. More importantly, parliamentarians need to cure their 'let's change it' syndrome. If parliamentarians keep changing rules without thinking (i.e., not asking hard questions), parliamentarians are (non)intentionally propagating the culture of 'rule of chaos' – not 'rule of law'. If parliamentarians couldn't strengthen their own base, it will breed the ground for unstable domestic politics, emergence of authoritarian figures, and may be even foreign intervention.
At the macro level of international relations (i.e., systemic level), we clearly see how our own domestic polarization and fragmentation makes the state (a Mongolian state) a weak actor to deal with other state and non-state actors (i.e., multi-national corporations, international institutions). If we look our domestic political structure at micro-level (i.e., domestic level), we could easily see how parochial interests of parliamentarians deteriorate the institutional capacity of the parliament. Now it is a time for parliamentarians to strengthen the policy (law)-making capacity of the parliament.
Development Bank of Mongolia seals bigger $300m loan
The Development Bank of Mongolia, whose loan has been in the works since July this year, has finally wrapped it up at a larger size of $300m
December 15 (GlobalCapital) Led by Credit Suisse. the loan had a base size of $200m, which could rise by exercising a $100m greenshoe option. And after five months in the market, the borrower has now signed the deal at $300m, according to a banker.
The names of the lenders and the allocations were not disclosed, but the final syndicate consisted of four banks including the sole bookrunner, added the banker.
DBM's loan was split between a three year bullet, which offered a margin of 425bp over libor, a five year amortiser with a margin of 437.5bp and a seven year amortiser paying 450bp over libor.
When launched in July, the transaction came with three participation levels: mandated lead arrangers for $50m or more, lead arrangers for $25m-$49m and co-arrangers for $10m-$24m.
The levels offered fees of 125bp, 150bp and 175bp respectively for the three, five and seven years for MLAs. 110bp, 125bp and 150bp respectively for lead arrangers, and 85bp, 100bp and 125bp respectively for coarrangers.
IFC/World Bank Hold Seminar on Introducing New Financial Instruments for Agriculture
Ulaanbaatar, December 15 (MONTSAME) A "New financial instruments for agriculture" discussion is running at "Blue Sky" hotel here, on occasion of the 90th anniversary of the Bank of Mongolia and the Ministry of Food and Agriculture.
The event is being co-organized by the International Financial Corporation of the World Bank. The gathered are discussing the current state, strength and weaknesses of the state policies and value networks being conducted in order to sustain the financial system within the sector.
The discussion is also aiming to give information updates and to introduce the new instruments to the key stakeholders of the sector.
Thiess Global Mining (Leighton) - Mongolia
December 9 (Thiess) The Thiess Mongolia team mobilised at the remote South Gobi Desert site in 2008. The haul trucks were assembled in China and driven across the desert for three and a half days before they reached their destination.
Asia's Frontier Markets Stand Out In A Slowing World
Deutsche Bank's Juliana Lee on why investors should watch economies like Mongolia, Vietnam and Sri Lanka.
December 15 (Barron's) In this report on Asia's frontier economies, we take stock of the recent developments and outlook of Bangladesh, Cambodia, Lao P.D.R., Mongolia, Myanmar, Pakistan, Sri Lanka, and Vietnam.
We continue to see this cohort delivering relatively better performance than EM (emerging markets), subject to only marginally higher risk. The countries in this study have seen strong growth and impressive gains in income in recent years. Indeed, latest projections made by the International Monetary Fund suggest considerable upside going forward for most of these economies. If the present trend continues, we think that by the end of this decade a majority of these countries could well be represented in EM bond and equity indices, with a few of them with investment or close-to-investment grade sovereign ratings.
The transformation of Asia's frontier economies has been recent but striking. While much more progress is needed before investors can find an array of investment opportunities in these countries, some are already fairly investor and business friendly, and others have begun to realize their rich potential.
Over-exuberance about mining prospects and poor governance have become drags to the economy. Highly expansionary policies in recent years have resulted to economic imbalances, compromising macroeconomic and financial stability. There is pressing need to re-orient policies towards safeguarding buffers to external shocks.
UB Trims Car Plate Restriction Hours, Area, Now 8am-8pm
December 15 (infomongolia.com) On December 15, 2014, the regular Citizens' Representative's Khural of the Capital City (City Council) took place in the Khangarid Palace in Ulaanbaatar, where one of the issues awaited to resolve was a new regulation to reduce the limit hours of restricted vehicles.
According to new decision, authorities agreed to change the hours of limit, which is effective from 8 o'clock in the morning until 8 in the evening.
Before, drivers were not allowed to participate in the city traffic once a week between 07:00 am and 10:00 pm depending on their plate number endings in order to reduce the city traffic as well as air pollution.
In other words, all vehicles those plate numbers ending with 1 or 6 will not drive on Mondays, those ending with 2 or 7 on Tuesdays, 3 or 8 on Wednesdays, 4 or 9 on Thursdays and vehicles ending with 5 or 0 will not run on Fridays, where the regulation does not comply on weekends.
Mogi: probably not a coincidence this coincided with management changes at UB Railway
Mongolian Leaders Meet Russian Deputy PM to Stimulate Bilateral Cooperation
December 15 (infomongolia.com) On December 12, 2014, Prime Minister of Mongolia Ch.Saikhanbileg received in his office the Deputy Prime Minister of the Russian Federation and Presidential Envoy to the Far Eastern Federal District, Yury Petrovich Trutnev.
At the beginning of meeting, Russia's Presidential Envoy congratulated the newly elected Head of the Government and in response, Premier Ch.Saikhanbileg expressed his gratitude to the President V.V.Putin on advocating to stimulate largescale projects negotiated during his visit to Mongolia.
In this regard, Premier noted that the Government of Mongolia has started to commence big projects in infrastructure development such as renewing Ulaanbaatar Railway and under the "Steppe Road" project to construct highway road from Altanbulag (administrative division on the border with Russia, where Altanbulag Free Trade Zone is located) to Zamyn-Uud (administrative division on the border with China, where Zamyn-Uud Free Economic Zone is created) through Ulaanbaatar, the capital city of Mongolia.
Furthermore, Premier Ch.Saikhanbileg underlined that in order to forward these projects, efforts from both sides are essential and pledged to pay particular attention on providing convenient condition to supply agricultural products to Russia such as meat and meat products, besides, to enhance bilateral trade turnover on new projects.
On the same day, Deputy Prime Minister of Mongolia U.Khurelsukh has also received his counterpart Yu.P.Trutnev and during the meeting, parties expressed their satisfaction on strengthening bilateral cooperation and successful high-level reciprocal visits.
During the meeting, Deputy Premier U.Khurelsukh mentioned that Mongolia had requested to annul tax on import products from Mongolia for a certain period in order to balance and increase trade volume that has been decreasing in the past two years. For instances, on meat and light industry products and thus, he asked to support these issues and affirmed to work more constructive on biggest projects to implement between the two countries.
In response, Russia's Presidential Envoy Yu.P.Trutnev said, if a Mongolian Government supports, Russia is ready to study on establishing a joint meat processing manufactory.
At the meeting, Minister of Roads and Transportation of Mongolia N.Tumurkhuu, Minister of Mining of Mongolia R.Jigjid, Ambassador Extraordinary and Plenipotentiary of the Russian Federation to Mongolia I.K.Azizov, Deputy Minister of Transport of the Russian Federation A.S.Tsydenov, and First Vice President of Russian Railways JSC V.N.Morozov were present.
Deputy PM Meets Russian Counterpart – Montsame, December 15
Ch.Saikhanbileg Meets Russian Deputy PM – Montsame, December 15
Ulaanbaatar Railway Appoints Former Deputy L. Purevbaatar as Director
December 15 (infomongolia.com) The regular General Committee Meeting of Ulaanbaatar Railway JSC, a Mongolian-Russian joint venture, was successfully held in Ulaanbaatar on December 11-12, 2014.
During the two-day meeting, sides reviewed the 2014 Report and Rail Transport Planning & Management Issues for the upcoming year. Moreover, the Mongolian-Russian joint venture announced management changes by appointing the Head of Ulaanbaatar Railway JSC (UBTZ) as Mr. Luvsandagva PUREVBAATAR, who used to serve as Deputy Director of UBTZ.
In accordance with the rules of Ulaanbaatar Railway JSC, the General Committee consists of six members representing 3 members from each side for the term of three years. Besides, the General Committee's Chairman and Deputy Chairman are also elected for three years.
The UBTZ General Committee's six members are:
- V.N.Morozov, UBTZ General Committee's Chairman and the First Vice President of Russian Railways JSC,
- A.S.Tsydenov, Deputy Minister of Transport of the Russian Federation,
- V.V.Morozov, General Representative of the Russian Railways JSC to Mongolia;
- Kh.Yerjan, Deputy Minister of Roads and Transportation,
- Ch.Surenkhorloo, President of Mongolian Association of Railway Engineers,
- D.Naranpurev, Head of United Association of Mongolian Transporters;
The Committee's three members representing Russian side were remained as previous panel, but made changes for Mongolian side and due to appointment of the Head of UBTZ as L.Purevbaatar, the Acting Head G.Sereenendorj is appointed as the General Engineer of Ulaanbaatar Railways JSC.
L.Purevbaatar Becomes Head of UB Railway – Montsame, December 15
Foreign Ministry Holds Online Training for Diplomats Stationed Abroad
Ulaanbaatar, December 15 (MONTSAME) Officials working overseas at Mongolia's diplomatic missions attended December 11-12 online trainings arranged by the Ministry of Foreign Affairs.
Some changes were made by the Ministry to certain domestic laws, regulations, rules and duties, so the trainers aimed to give updated guidance on visa issuing, civil and consular activities and notary. The diplomats also received thorough answers to their questions of interest from the Consular department and state administration department of their Ministry, State Registration Office, General Authority for Citizenship and Migration, Chamber of Mongolian Notaries.
Such trainings will run regularly in future.
U.S. Secretary of State Congratulates Ch.Saikhanbileg, Commends Mongolia's Democracy
Ulaanbaatar, December 15 (MONTSAME) The US Secretary of State Mr John Kerry has sent a congratulatory letter to Mr Ch.Saikhanbileg on being appointed the new Prime Minister of Mongolia.
Mr Kerry writes that the USA, the "Third neighbor" of Mongolia, highly values Mongolia who has formed the democracy and free market system in Northeast Asia, is chairing the Freedom Online Coalition (FOC) and is active in the UN peacekeeping operations.
Mr Kerry is also deeply confident that he will collaborate with the PM in determining ways of strengthening the Mongolia-USA relations.
Turkey's cooperation agency delivers reindeers to Dukha Turks of Mongolia
December 15 (Hürriyet Daily News) The Turkish Cooperation and Coordination Agency (TİKA) has given 19 reindeer as a New Year's present to the Dukha Turks, who live in the northern-most part of Mongolia.
The Dukha Turks, who live in the province of Khövsgöl in Mongolia, which is about 700 kilometers from the country's capital Ulan Bator, received 19 reindeer as a New Year's present from TİKA.
Murat Karagöz, Turkey's ambassador to Ulan Batur, said he was happy to deliver the reindeer in -39 Celsius degrees.
"We are happy to give to the Dukha Turks," said Karagöz, adding that the delivery was realized with the orders of Prime Minister Ahmet Davutoğlu and TİKA Head Serdar Çam.
TİKA's Ulan Bator Coordinator Ekrem Kalan said the Dukha Turks had asked for the reindeer for breeding purposes from them and they were happy and honored to help.
"The Dukha Turks will breed the reindeer that we brought from Russia's Tuva region with their own reindeer to increase their size, and to make the reindeer live on in future generations," said Kalan.
Kalan said the horns of the 19 reindeer were cut in order to avoid any complications during their transportation to Mörön.
The Dukha are a distinct tribe of Tyvan-lineage reindeer herders who have resided in Khövsgöl province since the borders between Russia and Mongolia were officially closed in 1947 at the start of the Cold War.
Today, only a total of 200 to 400 Dukha people making up 44 families remain. They ride, breed, milk and live off of reindeer, despite the fact the reindeer population has dropped to approximately 600 since the 1970s, when it was an estimated 2,000. Much of the Dukha's income today comes from tourists who pay to buy their crafts and to ride their domesticated reindeer.
Why development matters: Economic growth vs. development
Does economic growth automatically translate to development? Mongolia's story says no.
By Luvsantseren Orgil, Mongolia's permanent representative to the United Nations in Geneva and ambassador to Switzerland. A career diplomat, he was a former foreign policy adviser to the Mongolian president as a specialist in international relations. Orgil has also worked for the U.N. office in Tajikistan and has experience in the private sector.
December 15 (Devex) The recent Annual Democracy Forum 2014 co-hosted by Botswana and International IDEA entitled has been another fresh look at the old debate on the link between democracy and development.
To these general premises, I wish to add my own personal observations in the case of my own country, Mongolia, which witnessed a rapid economic growth for last few years reaching 17 percent in 2011. Was Mongolia successful in translating its rapid economic growth, mainly fueled by mining, into a development success story? The predominant answer is "no," leading to an obvious conclusion that economic growth does not automatically translate into development, the latter being understood in its broader definition, including human development and growth. When one talks about economic growth and development, a distinction should be made between the two or the two terms should be narrowly defined.
So what went wrong and what went missing in case of Mongolia? Was it the lack of good governance or a clear-cut national development policy? Corruption? Populism? Civil society participation? Lack of transparency? Policymakers and those in power were well familiar with these notions. They tried to have good governance in place.
In order to look for answers to these questions, one should revisit the state of Mongolian politics for the last few years. The first predominant answer is weak implementation or insufficient enforcement of rules for successful development or in short, lack of political will by the authorities. The political failure to build a strong framework for translation of economic growth into successful development was caused by widespread populist sentiments among the voters that no political parties and politicians could ignore.
As more discoveries of mineral wealth and abundance were made, voters grew nationalistic, with increasing demand for the wealth to directly benefit them. During the 2008 parliamentary elections, the two major political parties both promised the voters cash distributions if they were elected. From 2008 to 2012, Mongolia experienced the period of double-digit economic growth fueled by foreign and domestic investment into mining of copper, gold, coal and iron ore. To keep its election promise, the coalition government made cash distributions to voters — billions of dollars that otherwise could have been wisely and effectively invested in infrastructure, education, public health, urban development and in fighting urban pollution.
With the mining boom, a resource nationalism grew as well as a notion that investors were pilfering the country's wealth at the expense of the local population became widespread. In early 2012, just a few months before the next parliamentary elections, Mongolia adopted a law restricting foreign government-controlled direct investment. Another law restricting mining fed by populism rather than environmental concerns had been adopted earlier. All these developments, combined with the falling demand in coal, drove investors out.
What are the lessons for the development community? Economic growth by itself does not lead to development. Even development stakeholders with knowledge and tools for successful development can't guarantee success. Political will and sound implementation are needed for development to happen.
Birth Rate Rises 2.4% Over Last Year to 75.2 Thousand in First 11 Months
Ulaanbaatar, December 15 (MONTSAME) In the first 11 months of this year, 74 thousand 767 mothers delivered children, a number of live births reached 75 thousand 213.
The number of the mothers who gave births increased by 1,692 or 2.3 percent, the number of children rose by 1,768 or 2.4 per cent against the previous year.
Infant mortality reached 1,117, increasing 84 children or 8.1 percent, under 5 year-old babies' mortality reached 1,356, increasing by 72 or 5.6 percent against 2013.
Advanced prenatal screening tests now available in Ulaanbaatar
December 15 (news.mn) The National Center for Maternal and Child Health is now equipped with the latest technology for advanced prenatal screening to identify birth defects.
Before the arrival of the new diagnostic equipment, it was difficult to accurately diagnose birth defects in the early months of pregnancy. But now, birth defects can be diagnosed in the first three months of pregnancy at the National Center for Maternal and Child Health.
Worldwide, it is estimated that most birth defects can develop in the first three months of a pregnancy. The cause of half of all birth defects which develop during pregnancy are unknown, while 25 percent are the result of genetic disorders. Environment, drug use, and some medications are also believed to be factors.
One study has shown that in 2014, birth defects occurred in 2.7 percent of all pregnancies in Mongolia. Researchers believe that there has been an increased number of birth defects due to air pollution and drug use in recent years.
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