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Monday, June 29, 2015
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KRI jumps +55.56% to C$0.70 on the announcement
Mongolia to Pay Khan Resources Award of About $100m: Prime Minister
June 26 (Bloomberg) -- Khan Resources Inc. dispute will be "resolved accordingly" because Mongolia respects rule of law and will carry out all its obligations as ordered by intl arbitration court ruling in March, Mongolian Prime Minister Saikhanbileg Chimed says in interview with Bloomberg News in New York.
* "We're not ignoring, we're respecting. We will comply."
* Saikhanbileg says he asked Russian President Vladimir Putin during a meeting last week in St. Petersburg for the Russian company to pay its 21% stake in ~$100m award
* NOTE: ARMZ Uranium Holding OAO holds the 21% stake
* Putin promised Saikhanbileg that he will address this issue with the proper Russian organizations
* Saikhanbileg says hard to predict when full resolution will happen
* "Having these kinds of arbitration cases doesn't mean that Mongolia is treating all investors in this way"
* Khan Resources dispute gave Mongolia chance to improve its overall business environment
(BFW)
TRQ closed -0.77% Friday to US$3.88, -11.8% in last 1 month, EGI closed -2.78% to US$0.35, -9.09% in last 1 month
Rio Tinto to invest at least $250 million in Oyu Tolgoi this year: Mongolia PM
June 26 (Reuters) Mining firm Rio Tinto Ltd has pledged to invest at least $250 million to $300 million in the construction of the underground section of the massive Oyu Tolgoi copper and gold mine in Mongolia this year, Mongolia's prime minister said on Friday.
The second phase of construction at the mine is expected to begin this year, Prime Minister Chimed Saikhanbileg told Reuters in an interview, marking progress for the long-stalled $5 billion mine that is expected to boost Mongolia's economy by a third when it reaches full capacity in 2021.
Saikhanbileg's comments came during a trip to meet U.S. political and business leaders in a bid to revive foreign investment in Mongolia after it fell 74 percent in 2014 as a dispute with Rio Tinto over taxes and cost overruns deterred investors.
In visits to New York and Washington, D.C. this week, Saikhanbileg, who took office in November, is touting the success of a deal reached with Rio Tinto last month to resume work on the mine.
"Mongolia is back for business," he said. "This should be one of the hottest destinations for investors."
During the trip, Saikhanbileg said he met with Vice President Joe Biden, held an event at the U.S. Chamber of Commerce that attracted more than 160 attendees, visited the New York Stock Exchange and held individual meetings with investment companies.
He added that 14 different international organizations and banks are involved in the financing of the next phase of the Oyu Tolgoi mine, including the World Bank's International Finance Consortium and the Multilateral Investment Guarantee Agency.
The mine, operated by Rio Tinto, is expected to produce an average of 430,000 tonnes of copper and 425,000 ounces of gold annually, but still needs an additional $4 billion in project financing.
Saikhanbileg added that he expects a resolution with the country's parliament over the fate of Mongolia's giant Tavan Tolgoi coal mine before a legislative recess on July 11.
The administration was close to an agreement with a consortium of foreign companies to invest $4 billion in the 1.8 billion tonne coal mine before parliament halted the deal in April, saying it may breach Mongolian law.
In addition, Saikhanbileg said plans were underway to set up a public investment entity modeled after Singapore's Temasek Holdings, providing few details but saying he hoped to establish it "as soon as possible."
Rio Tinto, Mongolia, and the Art of Negotiating Amidst Price Volatility
Amir Shafaie is a senior legal analyst at the Natural Resource Governance Institute.
June 24 (Natural Resource Governance Institute) Negotiating complex mining deals can be challenging for resource-dependent countries under any circumstances. But commodity price volatility adds an additional challenge to the mix, as Mongolia's recently concluded renegotiation with Rio Tinto on the Oyu Tolgoi project illustrates.
From dispute to agreement
Few natural resource projects are as significant as the Oyu Tolgoi copper mine, the biggest ever foreign-investment project in Mongolia. But the project has hit myriad snags since the signature of the deal between the government and Rio Tinto in 2009. Faced with cost overruns estimated at around $2 billion and the realization that the state's much-heralded 34 percent equity ownership would likely not pay dividends for decades, the government became keen to revisit the terms a few years into the project.
Discussions around Phase II, a multibillion-dollar underground expansion, provided the opportunity, and the government sought renegotiation with Rio Tinto in October 2012. Prospective lenders like the IFC and the EBRD required government sign-off on the Phase II financing plan; this provided the government with negotiating leverage to revisit problematic aspects of the earlier phase, including cost overruns, tax liability and Rio Tinto's management services fee. At that time, Mongolia was likely emboldened by relatively high copper prices (see chart below) and its status as the "world's fastest growing economy." The government had also successfully negotiated an earlier amendment in June 2011 (near copper's peak price) resulting in limited but positive changes for Mongolia.
Anatomy of a deal
Finally in May 2015, after more than two years of strained on-and-off negotiations, Rio Tinto and Mongolia reached an agreement. As with the initial Oyu Tolgoi contracts, and in line with international good practice, the new agreement is publicly available. Taken in combination with company and government statements, this makes it possible for observers to start analyzing the deal. As the table below indicates, each side can claim certain victories.
Key terms of May 2015 Oyu Tolgoi agreement: Victories for each side | |
Rio Tinto Phase I cost overruns. Resolved without any admission of fault. No new measures to limit or address possible cost overruns in Phase II. Tax dispute. Settlement at $30 million, significantly less than the $127 million initially claimed by Mongolia; tax stability principles of initial agreement maintained. Agreement on Phase II financing plan. Government agreement in principle to plan, which includes using the mining licenses as collateral and the option, sought by Rio Tinto, to use the debt to first repay existing shareholder loans from Rio Tinto to the project. | Government of Mongolia Reduced management services fee rate. Management fee will be 3 percent (down from 6 percent) of capital costs incurred for Phase II. While this is significant, the fee is still based on uncapped costs; as costs go up so do the fees, meaning there is a perverse incentive by which the manager gains from incurring higher costs. Also, ambiguity as to "sustaining capital" (subject to higher 6 percent fee) could lead to future disputes. Cancellation of a regular payment (2 percent net-smelter value of production) claimed by Rio Tinto as due to its subsidiary. A legacy of the buy-out of former concession holder BHP. Mongolia had challenged the legality of the payment and was never likely to move on the issue. |
Rio Tinto estimates that the agreement results in a value transfer to Mongolia of around $148 million, or 2 percent of the overall value of the project. Industry analysts have called this as a small price to pay for such a significant project, with one saying that the deal was basically "adjusting the terms back to what they should be on any mining project in the world," and another that "there are no momentous changes." This gives the impression that the agreement's main elements could have been agreed much earlier.
So what took so long, and why did they finally agree?
The length of the Oyu Tolgoi negotiations and the timing of the agreement are related at least in part to shifts in bargaining power. These shifts are common during the life of a natural resource deal. In this case commodity price changes and corresponding economic and political pressures played a particularly important role. In theory cyclical price changes should not significantly influence decisions for long-term projects like Oyu Tolgoi. But in practice resource companies do make decisions with an eye on prices and try to take advantage of price dynamics in negotiations.
In the Oyu Tolgoi case, copper's downward price trend for much of the renegotiation period (a 33 percent drop from October 2012 to January 2015), progressively weakened the government's hand. This fall allowed Rio Tinto to argue against fiscal changes and to create the impression that it could live without fast-track development of Phase II.
As prices faltered and softening Chinese demand left Mongolia's economy in a serious slump, the Mongolian government lost even more leverage. The dispute with Rio had direct and reputational impacts, and foreign direct investment plunged from $4.45 billion in 2012 to just $0.51 billion in 2014. Mongolia's mining investment attractiveness ranking dropped from the 38th to the 69th percentile.
Eventually the economic pressure produced a political shift. By late 2014 the new prime minister Chimediin Saikhanbileg was focused on a quick resolution to the impasse with Rio Tinto and secured backing for his approach through a text message referendum.
While prices and politics softened the government position, the eventual deal was not totally one-sided. So what brought a previously intransigent Rio across the finish line? Price dynamics may have had a role, this time in the form of an uptick of 17 percent in copper prices in the months preceding the agreement Rio Tinto's stated optimism on the future prospects of copper and interest in timing Oyu Tolgoi's next phase to come online as the copper market recovers may, as suggested in the Financial Times, have accelerated previously stalled negotiations.
Lessons learned
Oyu Tolgoi's key lesson for countries in similar situations is that any natural resource deal renegotiation must be thought through strategically and with eyes on both the commodity price cycle and political economy impacts. When circumstances such as price are in the government's favor, it is important for officials to act quickly to achieve the best possible deal while recognizing the limits of negotiating leverage. Waiting or overestimating the government's bargaining position runs the risk that volatile factors such as commodity prices may change in an unfavorable direction. Such changes not only create direct shifts in bargaining power, they can also result in secondary impacts (e.g., macroeconomic deterioration or reputational risks from prolonged renegotiations) that further weaken the government's hand.
Finally, the difficulties of deal renegotiation underscore the importance of ensuring that initial agreements (such as those currently under consideration for Mongolia's other mega-project, Tavan Tolgoi) are strongly negotiated in the first place. This should include provisions (such as fiscal terms) that are sufficiently flexible to adapt to changing circumstances so as to avoid renegotiations where possible. But governments and companies must also recognize that renegotiations do happen. This can potentially be anticipated by including periodic review mechanisms in contracts. Another essential element is investing in government negotiating capacity (e.g., having an established negotiating team, bringing in outside support – if necessary – early in the process, adopting a strong communications strategy, etc.) so as to ensure that when price levels and political factors require it, both sides are well placed to efficiently negotiate adjustments to the initial agreement.
Mongolia dines on dim sum
June 26 (FinanceAsia) The Government of Mongolia made its dim sum bond market debut on Wednesday, hoping to ride on the back of positive momentum generated by the resolution of its dispute with Anglo-Australian mining group Rio Tinto over the expansion of the Oyu Tolgoi copper mine in May.
The two had been locked in disagreement for two years over how to share the costs and revenues of the $5 billion phase two development at one of the world's largest copper deposits.
Mongolia will now be hoping the resumption of the project will not only bring in much-needed cash but also help set its credit rating back on a positive trajectory as it starts to venture out into the international bond markets again.
The Rmb1 billion ($161 million) transaction, which priced on Wednesday, is likely to be but an appetiser before a much larger dollar-denominated deal of up to $1 billion, according to local press reports.
At the moment the sovereign's B2/B+/B+ foreign currency rating is on negative outlook from all three agencies.
In a ratings assessment accompanying the dim sum bond offering, Moody's said that, until production at Oyu Tolgoi ramps up, Mongolia is very dependent on external borrowings and liquidity easing measures. It said its negative outlook "reflects the strain on the external liquidity position, with the sharp loss in foreign-exchange reserves over the last year."
"Although reserves have stabilised they remain insufficient to cover fully maturing external debt obligations in the event of a sudden stop in credit," it added.
The new bond deal adds to two dollar- denominated bond issues in its own name, which have 2018 and 2022 maturities, and two bonds it has guaranteed for the Trade & Development Bank (TDB), which mature in 2017 and 2020.
The most recent TDB bond has traded extremely well since its debut in mid-May and dim sum investors will be similarly hoping to reap gains from the new offshore CNH deal, which has a 2018 maturity and 7.5% coupon. According to a term sheet seen by FinanceAsia, the deal drew demand of Rmb1.5 billion from 44 accounts.
The vast majority of the deal was allocated to Asian investors (93%), with the remaining 7% going to Europe. By investor type, fund managers took 66% of the bonds, banks 42% and private banks 12%.
Mongolia's dim sum deal has rarity value since it represents only the second non-Chinese sovereign issuer following the UK's debut last October. It also provides greater diversity among high-yield offshore Rmb credits, the majority of which are Chinese property names.
However, some thought it had little value. "Investors are reluctant because it's Mongolia issuing the bond, not the UK," said one Hong Kong-based bond analyst.
"Just look at the country's rating," he added. "Even the 7.5% yield doesn't look very appealing."
The sovereign's existing 2018 bonds and 2020 bonds were trading on Thursday at a mid-yield of 5.58% and 6.67%, respectively.
Meanwhile, TDB's new $500 million 9.375% 2020 bond was trading at a mid-yield of 7.54% and mid-price of 107.25%. This represents almost 200bp of tightening in the space of one month.
TDB has also previously issued a dim sum bond, pricing the deal at a yield of 10.0%, a record high coupon for a dim sum offered by a bank issuer.
Joint bookrunners for the dim sum deal were Citic CLSA Securities, China Citic Bank International, HSBC and ING. TDB Capital was joint lead manager and Ulaanbaatar Capital was co-manager.
The bonds will list in Singapore.
Mongolia Allocation Increases to 1.1% from 1% at Templeton Emerging Markets Income Fund
June 28 (Cover Mongolia) --
1.1% of $605,647,090 ($6,662,117.99) at end of May vs 1% of $606,353,050 ($6,063,530.5) at end of February.
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MATD closed -5% Friday to 4.75p, -26.92% in last month
New Chapter in the History of Mongolia's Oil Industry
June 23 (Mongolian Economy) Petro Matad LLC and British Gas signed a cooperation agreement today. British Gas had been negotiating with the Central Asian Petroleum Corporation since last month to enter the Mongolian market. The Central Asian Petroleum Corporation transferred the rights and responsibilities of oil exploration fields under a production sharing agreement to British Gas. The Deputy Minister of Mining E.Temuulin said the addition of British the contracting company to our oil industry will expand the scope of cooperation between our two countries and that it is important that a professional company from a third country is cooperating in our oil industry.
According to both parties, a reformed legal environment allowed for a better, more favourable investment agreement to make this cooperation possible. Petro Matar stocks have been traded on the London Stock Exchange since May of 2008. The company's main shareholder is Petrovis LLC, which is also the first Mongolian company to trade its stock on an international stock exchange.
J.Oyungerel, Acting Chairwoman of Petro Matad LLC:
Petrovis LLC, the majority shareholder of Petro Matad LLC, has started to work in the high risk sector of oil by issuing stocks on the London Stock Exchange 10 years ago in order to help Mongolia's oil industry become independent. Petro Matad LLC has started a chapter in the history of the industry by cooperating with the world-renowned oil exploration company British Gas. British Gas's operation in Mongolia is crucial for natural gas and oil exploration sector. Exploration work will be carried out in 2015 and 2016 under the cooperation agreement. Lessons in safety amongst other things will be taken away from this major company.
Rob Macaire, Public Relations Manager of British Gas:
Our company has branches in more than 20 countries and over 5,200 employees; we operate worldwide as a contractor company. Exploration work is at the core of our company. For example, we have discovered 17 world-class large deposits with 500 million barrels of oil reserves in 17 years. Over the same period, our oil resource base increased to 3-17 billion. We believe that Mongolia has a huge oil reserves. Therefore, we are happy to co-own 78 percent of the exploration rights with Petro Matad LLC. The exploration work will continue until 2017 in accordance with the production sharing agreement. In this context, high precision 2D magnetic field and air field measurement at a depth of 2,000 km and geo-physical surveys at a depth of 1,500 km are planned to be carried out for the first time in Mongolia. It needs to be said that Petro Matad LLC's operation will continue as usual during this time. Our company prefers to provide long term stability and establish trust. We will value safety and consult with our partner organisations to mutually benefit and bear responsibilities.
G.Ulziiburen, Chairman of the Petroleum Authority of Mongolia:
A professional company coming to Mongolia during times such as these when oil prices have fallen on the world market combined with unfavourable conditions for exploration and other capital is a good sign for the oil industry. This shows the improved legal environment will attract foreign investment. Under the negotiation between British Gas and Central Asian Petroleum Corporation, investments will be made in exploration works at the Bogd Khan-IV and Ongi-V exploration fields covering about 10 provinces. We are confident that we will work successfully, meeting international standards and using environmentally friendly technology and equipment.
Ambassador Extraordinary and Plenipotentiary of the United Kingdom to Mongolia, Catherine Elizabeth Jane Arnold:
The partnership of the contracting companies is an important occasion to the cooperation between the United Kingdom and Mongolia. Furthermore, it is a big step that will benefit Mongolia and its people. The UK developed by attracting investments from the best companies and introducing the best practices. An opportunity to let the best experts to work, attract leading companies' investments and potentiate spare economic capacity will get provided under this scope. This cooperation has become an example that Mongolia is a country that can bear the trust of internationally influential companies.
O.Sodbileg, Member of Parliament:
The total investment is about USD 30 million. But most importantly, learning from this major group's experiences in technical knowledge, manpower and exploration skills is a huge opportunity. Today's event is good news for us. However, if the exploration results will indicate that extraction can be carried out, it would be global scale news. British Gas's cooperation is a huge confidence indicator at a time when the situation in the minerals sector is difficult. In addition, we value the efforts of the employees of Petrovis LLC's subsidiary Petro Matad LLC.
Ch.Gankhuyag, CEO of Ard Financial Union:
We must learn to appreciate each other's successes. In the past, our country was dependent on one country's policy. The signing-on of a third country is a historical event for our country. In addition, it has a positive impact on the investment environment and will help restore investor confidence.
Centerra Gold 2015 Second Quarter Results Conference Call and Webcast
TORONTO, ON--(Marketwired - June 19, 2015) - Centerra Gold Inc. (TSX: CG) will host a conference call and webcast of its 2015 second quarter financial and operating results at 11:00AM Eastern time on Wednesday, July 29, 2015. The results are scheduled to be released after the market closes on Tuesday, July 28, 2015.
· North American participants should dial the toll-free number (800)-268-5851.
· International participants may access the call at +1 (303)-223-2680.
· The conference call will also be broadcast live by Thomson Reuters and can be accessed at Centerra Gold's website at www.centerragold.com.
An audio recording of the call will be available approximately two hours after the call via telephone until midnight Eastern Time on Wednesday, August 5, 2015. The recording can be accessed by calling (416) 626-4100 or (800) 558-5253 and using the passcode 21770467. In addition the webcast will be archived on Centerra Gold's website www.centerragold.com.
FMG Mongolia Fund +2.31% in May, +3.5% in 2015
June 19 (FMG Funds) --
Year | Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | Year |
2015 | -6.07% | 0.50% | -2.97% | 10.46% | 2.31% | 3.50% | |||||||
2014 | -3.70% | 2.12% | -5.27% | 0.00% | -5.96% | -1.27% | 2.36% | 1.46% | 6.19% | -8.16% | -4.44% | -5.31% | -20.74% |
2013 | -1.33% | -5.38% | -8.27% | -7.46% | -3.96% | -3.17% | -4.42% | -6.68% | -3.12% | 3.22% | -4.40% | 3.65% | -34.86% |
2012 | 0.00% | -0.20% | -0.30% | -3.23% | -2.40% | -2.77% | 2.63% | -8.13% | -2.56% | -4.66% | -3.26% | 7.38% | -17.10% |
MSE Weekly Review: Top 20 -0.59% to 15,221.72, Turnover ₮10 Billion T-Bills, ₮301.5 Million
Ulaanbaatar, June 26 /MONTSAME/ Five stock trades were held at Mongolia's Stock Exchange on June 22-26, 2015. In overall, 698 thousand and 809 units of 43 JSCs were traded costing MNT 10 billion 301 million 475 thousand and 636.00.
"Remikon" /291 thousand and 627 units/, "Merex" /132 thousand and 183 units/, "Hermes center" /105 thousand and 167 units/, "Evrofyo Asia" /30 thousand and 270 units/ and "Mongol shiltgeen" /8,990 units/ were the most actively traded in terms of trading volume, in terms of trading value were "Evrofyo Asia" (MNT 96 million and 894 thousand), "Talkh chikher" (MNT 46 million 130 thousand and 390), "Gobi" (MNT 24 million 990 thousand and 950), "Remikon" (MNT 23 million 483 thousand and 545) and "Tomriin zavod" (MNT 20 million and 220 thousand).
The total market capitalization was set at MNT one trillion 412 billion 181 million 777 thousand and 533. The Index of Top-20 JSCs was 15,221.72, and the all index of MSE was 1033.78.
Mongolian Stock Exchange Sets Sights on Top 100 Enterprises
June 24 (Mongolian Economy) Currently accounting for just one percent of Mongolia's financial market, the Mongolian Stock Exchange (MSE) is focusing on getting the stocks of Mongolia's top 100 enterprises to become publically traded. As part of this endeavour, the "IPO and dual registration" forum was organised today. Mongolia's biggest companies have interest in being traded on the stock market, but they lack the knowledge and preparation to make it happen.
Representatives from Mongolia's top 100 companies, securities companies and relevant governmental organisations attended the forum co-organised by Financial Regulatory Commission, Japan International Cooperation Agency (JICA) and the Mongolian National Chamber of Commerce and Industry.
The current financial system of Mongolia is relies on a single pillar – the banking system. Banks comprise 96 percent of the financial market. If the nation's biggest companies start trading their stocks on the stock market, it will become an attractive source of investment and help diversify this single-pillar financial system. Only a few of the top 100 are listed on the stock exchange at the moment.
To change this situation, the Financial Regulatory Commission in cooperation with JICA started to implement the "Capital market capacity expansion" project seven months ago. The project will carry on for three years, and during this time, the biggest companies will issue IPOs on the stock market and begin to be double listed on the Tokyo, London and Hong Kong stock exchanges, opening the door for easier foreign investments to flow in.
Thoughts of representatives of participating companies and relevant organisations.
D.Angar, Acting Executive Director of Mongolian Stock Exchange:
-The Financial Regulatory Commission and Tokyo Financial Service Agency have started the work on registering Mongolian limited liability companies on the stock exchange and make them more open. In addition, the work to get them dual listed on Tokyo, Hong Kong and London stock exchanges has begun. During the initial phase of the project, leading companies will issue IPOs and get dual listed on the above-mentioned stock exchanges abroad. The opportunity to dual register has become available to Mongolian companies after the approval of the new stock market law. The law has been in effect for a year. However, registration requirements and costs of major exchanges bring up some difficulties. However, it's still possible for our top enterprises.
Ts.Enkhbat, Director of Policy Management at Mobicom Corporation:
- Mongolian companies have the potential to get dual listed. However, companies have to make the right preparations in order to make this a reality. This itself is not such an easy process. Companies internally prepare their governance for 3-5 years to enter a stock market. I believe there are some well-prepared companies. Mobicom's level of corporate governance is quite developed. In 2014, our company ranked fourth among Mongolia's leading enterprises. Our stock has not been issued on the stock market yet, so we're attending the forum.
B.Lkhagvadorj, Vice President of BDSec JSC:
-Getting dual registered means meeting the criteria of two stock exchanges and conducting trade on both. The main issue is the differences between the two exchanges' criteria. For example, there is the issue of our largest public companies being listed on the First Board of the Tokyo Stock Exchange. There are also issues concerning cost. Companies are required to cooperate with international underwriting companies and pay them in order to enter foreign stock markets. Now that companies are working with JICA, these issues can be resolved and the first companies could get dual-registered.
Z.Narantuya, Director of Financial Regulatory Commission:
-The London Stock Exchange Group and State Property Committee of Mongolia are cooperating for the third year under an agreement. The purpose of this is to get Mongolian companies listed on the London Stock Exchange and attract foreign investment in this fashion. Unfortunately, the introduction of the system and other infrastructure works has not progressed as quick as it should. But recently, negotiations were conducted and the works are soon to take off. So hopefully, the MSE will be open for foreign investors and become world-class. One important issue is that people would rather deposit their money in banks rather than investing in stock markets because the rates on bank deposits are high.
Ts.Bat-Orgil, Economist at Thermal Power Plant #3 state-owned enterprise:
-Our company is a state-owned enterprise engaged in the field of energy. People are contemplating issuing stocks of state owned companies on the stock market. As such, we're studying opportunities and foreign experiences. State companies are following a policy to trade 30 percent of the total assets on the stock market and increase equipment and market capacity from the capital raised. Our power plant's equipment are out of date. The challenge we face in issuing an IPO is that the government regulates our industry's unit prices. I think an IPO would be possible if the state would reform these price controls as well as its policies on investment.
S.Bayanmunkh, Chief Investment Officer of Monos Group:
-Monos Group is interested in issuing an IPO. We are conducting research at the moment, especially on issuing an attractive, active stock on the domestic market. Monos Group operates in more than 10 sectors. Some of our companies operating in certain sectors definitely have an opportunity to issue an IPO. Furthermore, we are studying the possibility of getting dual listed on international stock exchanges. As for dual registration, we must be well-informed and well-prepared.
BoM MNT Rates: Friday, June 26 Close
| | 6/26 | 6/25 | 6/24 | 6/23 | 6/22 | 6/19 | 6/18 | 6/17 | 6/16 | 6/15 | 6/12 | 6/11 | 6/10 | 6/9 | 6/8 |
| USD | 1,948.93 | 1,942.56 | 1,931.93 | 1,928.90 | 1,923.22 | 1,917.38 | 1,913.32 | 1,898.95 | 1,882.64 | 1,872.13 | 1,862.17 | 1,863.61 | 1,863.41 | 1,866.47 | 1,869.69 |
| EUR | 2,182.31 | 2,174.02 | 2,163.38 | 2,172.52 | 2,191.32 | 2,175.17 | 2,170.57 | 2,137.74 | 2,130.30 | 2,102.21 | 2,089.26 | 2,103.18 | 2,104.63 | 2,108.64 | 2,086.20 |
| CNY | 313.88 | 312.88 | 311.18 | 310.72 | 309.72 | 308.80 | 308.13 | 305.84 | 303.27 | 301.51 | 300.01 | 300.28 | 300.28 | 300.80 | 301.34 |
| GBP | 3,067.32 | 3,049.53 | 3,052.06 | 3,048.34 | 3,059.27 | 3,041.25 | 3,026.30 | 2,969.77 | 2,941.15 | 2,909.66 | 2,887.95 | 2,878.63 | 2,871.98 | 2,864.10 | 2,860.63 |
| RUB | 35.55 | 35.68 | 35.89 | 35.76 | 35.71 | 35.91 | 35.58 | 35.35 | 34.56 | 33.78 | 33.98 | 34.30 | 33.70 | 33.50 | 33.54 |
Bank rates at time of sending: TDB (Buy ₮1,930 Sell ₮1,950), Khan (Buy ₮1,932 Sell ₮1,952), Golomt (Buy ₮1,929 Sell ₮1,950), XacBank (Buy ₮1,934 Sell ₮1,950), State Bank (Buy ₮1,935 Sell ₮1,953)
MNT vs USD (blue), CNY (red) in last 1 year:
BoM issues ₮805 billion 1-week bills at 13%, total outstanding -11.6% to ₮1.11 trillion
June 26 (Bank of Mongolia) BoM issues 1 week bills worth MNT 805 billion at a weighted interest rate of 13.0 percent per annum /For previous auctions click here/
8% mortgage loan down payment lowered to 10% from 30%
June 24 (gogo.mn) Last April during the Mongolian Economic Forum Minister of Construction and Urban Development made an announcement which turned the attention of many.
The announcement was reduction of the mortgage loan deposit to 10 percent.
According to the current regulation eligible person for the mortgage loan should pay 30 percent deposit. The change was to be made in reducing the deposit amount to 10 percent and drop the restriction of the eligible housing to be up to 80 sq.m. at most.
Today during the press release at the Ministry of Construction and Urban Development minister D.Tsogtbaatar announced that the cabinet has supported the reduction of the deposit to 10 percent through its session held on Monday.
Although there was a demand on residential housing it was not possible for the low income residents to realize their demands, while with current developments and support from the state acting as the guarantor for the 20 percent of the deposit residents are enabled to purchase housing through mortgage loans.
Commercial banks requirements stay the same while the eligible person for the mortgage loan should apply for the 20 percent guarantee from the Development Bank of Mongolia.
Minister emphasized that this decision is beneficial for both construction companies and residents as the new regulations will help to balance the supply and demand on the market.
With the decrease in the deposit amount many fear the sudden increase in the prices of the property, to which minister answered: "This is not the gift from the government. It is an opportunity for the residents. We haven't pushed commercial banks to lower their requirements. This is the best involvement of the state into the market. We can't allow the banks to go bankrupt and economy should proceed on its own principles."
SINCE WHEN RESIDENTS WILL BE ABLE TO PAY 10 PERCENT DEPOSIT?
New regulations and rules for mortgage loan are being developed jointly by Ministry of Construction and Urban Development, Ministry of Population Development and Social Welfare and Ministry of Finance. Those will be ready within next months as per PMs order. Which means by end of next month residents with constant income and who have been paying social welfare fees will be able to get mortgage loans with 10 percent deposit.
But the number of the residents to be included in the program is limited as the state is only providing guarantee for MNT 200 billion through the Development Bank of Mongolia.
In view of the limited funds available currently, Minister of Finance was ordered to seek for the ways to finance this program further and budget additional funds in the budget of next year.
MORTGAGE LOAN CURRENT SITUATION
Currently 30,000 housings are waiting to be sold, while the construction companies are tied with loans. If the situation is to proceed this way construction sector is to face serious problems. The decline in the deposit will benefit construction companies as the estimates forecast that at least 10,000 currently available supply to be sold. Minister D.Tsogtbaatar also emphasized that housing prices won't go up as the mortgage loan with 10 percent deposit will be available for only those housings which are already ready for purchase or will be ready soon.
Moreover, minister mentioned that the program will be directed mainly for low and middle income residents. The regulations will clearly define which residents are elgibile for the mortgage loans. Since the mortgage program started in 2013:
· MNT 556 billion loans were refinanced and transfered into 8 percent loans for 19,116 residents
· MNT 197 billion of new mortgage loans approved for 36,864 residents
Estimates forecast the following positive outcomes of 10 percent deposit:
· Balanced supply and demand on housing market
· Protect construction sector from financial risk
· Mortgage loan program to proceed further
· Increase housing supply for population
In conclusion the commercial banks will still require 30 percent deposit for mortgage loans. No changes will be made for those residents who already have mortgage loans with deposits made of 30 percent. Bank of Mongolia is conducting studies on possibilities to drop the limit on size of the housing, which is currently should not exceed 80 sq.m.
Chair of Economic Standing Committee Meets ADB Country Director
Ulaanbaatar, June 24 (MONTSAME) Head of the parliamentary Standing committee on economy J.Batsuuri Wednesday received Mr Robert Schoellhammer, the Country-director of the Asian Development Bank (ADB).
Thanking the Standing committee head for an audience, Mr Schoellhammer underlined that next stage projects being implemented by the ADB in Mongolia focused on the agricultural sector, and then presented to the Standing committee head about planned projects on development of agriculture and countryside and on improving methods of ensuring hygiene of plants and livestock and food safety.
Mr Batsuuri noted that Mongolia has co-implemented many projects and programs together with the ADB, and pointed out that he has got familiarized with some projects presented by the ADB.
Present at the meeting were Takeshi Ueda, an economist on natural resources at the ADB; and other officials.
Mongolia's debt-indulging money market
By Jargal "DeFacto" Dambadarjaa
June 21 (UB Post) Just until recently, when the new century began, Mongolia was unable to acquire any loans from international capital markets. It was a time when we did not hold any currency in our hands, but had natural wealth buried underground. Foreign countries used to send us food and provided funds to fix our plants and buy coal so that the capital would not freeze during the winter. Even the budget deficit was made up with foreign aid.
However, we have been extracting the natural wealth that lies underground, using foreign capital and other resources, and selling it to China, our neighbor to the south. As a result, our economy has grown exponentially, while GDP per capita today is ten times higher than it was 1990.
As the public budget got bigger, the same thing happened to its deficit. These days the budget deficit is well over ten percent of GDP. Although a law was passed two years ago to keep this deficit at two percent of GDP, the cap was changed to six percent last year. The expansion of the economy allowed the government to raise foreign loans by issuing bonds. Any long term government securities are always low-risk investments that yield regularly. Having low risk means smaller interest rates. The interest rates of bonds issued by local companies, both big and small, are always higher than those of government securities.
Besides being guaranteed, government securities are exempt from taxes and have a great fluidity, making securities available to be easily sold at any time. For this reason, government securities are heavily weighted in the market portfolio.
LEVEL OF RISK OUR GOVERNMENT BEARS
The interest rates of our government securities are too high. Six month securities have an annual interest rate of 16.4 percent, which is bigger than the 13 percent policy rate of our central bank. It is interesting that government securities have interest rates which are also higher than the savings account rates of smaller banks (State Bank 14.2 percent, Capital Bank 14 percent).
Does our government bear such high risk? The main reason is that the budget deficit continues to grow while the government's spending is still higher than its revenue. As of the first quarter of 2015, the budget revenue was 1,228.5 billion MNT, which was 88.4 billion MNT short of its target. It appears that the gap will increase to 488.3 billion MNT by the end of the year.
Transactions related to Mongolia's public budget and debt paymets are made through the State Fund at Mongol Bank. Approximately 370 billion MNT goes through this account for payments related to the public budget. However, their checking account has a negative balance of 674 billion MNT. The public budget is currently coming from other accounts of the State Fund. Any deficits have been made up by domestic loans, i.e. three and six month securities issued by the government.
The interest of those domestic loans is paid with twelve percent of budget revenue. If the budget deficit is not reduced, we will be paying that interests with 25 percent of the budget revenue by the end of this year, and with the entire budget revenue by 2018. What will the government do then? Government securities worth 3.4 billion MNT will be issued this year.
Recognizing this reality, in April this year, Standard & Poor's (S&P) lowered Mongolia's credit ratings and revised its outlook to negative. The ratings will be downgraded again if contractionary monetary policies are not pursued, off-budget spending is not cut, and domestic loans continue to be raised. Such lowered ratings will make it difficult to issue securities in foreign markets and to make payments on time.
MONETARY POLICY THAT IGNORES BUDGET DEFICIT
The Development Bank, which was established by the government in 2010, has handled approximately 5.6 trillion MNT in total; including its own 143.9 billion MNT, 580 million USD from Eurobonds, 1.49 billion USD from Chinggis bonds, 24.2 million JPY from Samurai bonds, and money from other sources.
The ministers at the time, along with Mongol Bank authorities, came up with a "wise" idea to print the equivalent of the incoming 2.4 billion USD in MNT, and inject the money into circulation. They concluded that tugrik would be in shortage and would get stronger when a burst of USD suddenly came into our small economy.
The Government of Mongolia and Mongol Bank established a memorandum of understanding on October 22, 2012, and started implementing a midterm price stabilization program that targeted consumer products.
The initial agreement was that Mongol Bank would make approximately two trillion MNT in total available: 167 billion for stabilizing the retail price of fuel, 303 billion for reducing costs of imported consumer goods, 248 billion for stabilizing the prices of main food products (87 billion for meat accumulation and 100 billion for meat storage), 379 billion for supporting the construction industry, and 800 billion for stabilizing housing prices and funding eight percent mortgage loans. However, due to changes that took place over time, Mongol Bank has put about three trillion MNT into the money market.
Since then, Mongol Bank has printed 3.1 trillion MNT and injected it into circulation. However, would Mongol Bank be able to take the equivalent of the bond payments in cash out of the money market?
Another step taken by the central bank to keep tugrik rates stable is the establishment of a currency swap agreement with the central bank of China. The agreement would allow Mongolia receive up to 15 billion RMB (2.5 billion USD) while keeping the agreed upon amount of MNT in the central bank of China. If Mongolia cannot repay on time, the money will be circulated in the market and used for repayment.
As of today, most of the 15 billion RMB has been spent. The government will probably repay it using bonds, or extend the deadline. Mongol Bank has transferred the loan balance of the long term housing loan to the relevant housing organization, and handed over the balance of the price stabilization program to the government.
The actions taken by Mongol Bank look as though they are making up for foreign investment while supporting the balance of payments. However, it has become silent support to the government in raising even more internal debt. The nation's monetary and fiscal policies must be as independent as possible from each other.
Trans. by B.AMAR
Survey on Perceptions and Knowledge of Corruption (SPEAK)
Strengthening Transparency in Mongolia Project
June 23 (The Asia Foundation) In April 2015, The Asia Foundation, in collaboration with Sant-Maral Foundation, conducted its sixteenth Survey on Perceptions and Knowledge of Corruption (SPEAK) in Mongolia, a nationwide survey of citizens in rural soums, aimags, and the capital city Ulaanbaatar, generously supported by Australia's Department of Foreign Affairs and Trade. Known from 2006 to 2011 as the Mongolia Corruption Benchmarking Survey, it was renamed SPEAK in 2012. SPEAK is one of just a few regular, nationwide surveys in Mongolia, and its results are widely cited and used by civil society and government organizations.
Parliament Session Agenda for June 26: Plenary Session
June 26 (GoGo Mongolia) Plenary session is scheduled for today.
1.Draft law on urban redevelopment and affiliated other drafts
-Introduction by MP G.Batkhuu
2.Approval of draft resolution of State Great Khural on the state property privatization in 2015-2016
-Introduction by MP U.Enkhtuvshin
3.Draft law on fire security and affiliated other drafts
-Introduction by MP D.Lundeejantsan
4.Draft resolution of State Great Khural on approval of state policy on food and agriculture and state policy on establish Khalkh Gol free zone
-Introduction by MP R.Burmaa
-Introduction by MP G.Bayarsaikhan
5.Amendments to draft law on Intelligence Organization and affiliated other drafts
-Introduction by MP S.Bayartsogt
-Introduction by MP N.Nomtoibayar
6.Draft law on firearms and affiliated other drafts
-Introduction by MP Kh.Temuujin
-Introduction by MP Ts.Oyungerel
7.Draft law on the proceedings of the Constitutional Court law and affiliated other drafts
-Introduction by human right and legal policy advisor to the president Ch.Unurbayar
-Introduction by MP L.Bold
8.Amendments to draft law on social insurance
-Introduction by Minister of Population Development and Social Welfare S.Erdene
-Introduction by MP D.Sarangerel
9.Draft law on future heritage and affiliated other drafts
-Introduction by Citizen Participation and Economic policy Advisor to the President L.Dashdorj
-Introduction by MP R.Amarjargal
10.Draft law on damages and affiliated other drafts
-Introduction by Minister of Justice D.Dorligjav
-Introduction by MP Ch.Khurelbaatar
11.Draft law on custom tax exemption and draft law on value added tax exemption
-Introduction by Minister of Finance J.Erdenebat
-Introduction by MP D.Gankhuyag
12.Renewed draft law on labor and affiliated other drafts
-Introduction by Minister of Labor S.Chinzorig
-Introduction by MP A.Tleikhan
At 02PM:
- To hear the Prime Minister`s respond to the questionnaire asked by MP D.Gankhuyag, S.Odontuya and L.Erdenechimeg on the implementation of legislation on land ownership by Mongolian citizens.
Saikhanbileg: JV issues to be discussed at business level without interference of government
June 22 (gogo.mn) Prime Minister Ch.Saikhanbileg attended the Saint Petersburg International Economic Forum last week and arrived on Friday. Upon his arrival PM made a press conference on the outcomes of his visit.
This visit at the Economic Forum was one of the major events PM Ch.Saikhanbileg plans to do in the very near future.
According to PM main message he wanted to convery to Russian side was to move forward with the joint ventures and look beyond the small targets that have been on way for many years and advance the cooperation to higher level.
Further the PM concluded that meeting with the President of Russian Federation V.Putin was satisfactory which extended to 50 minutes, although was planned for 30 minutes.
Russian side included the management of the joint ventures in this meeting as well as Mongolian side introduced officials from Erdenet Corp, Mongolian Railroad and State Property Committee.
During the meeting main issue discussed was the elimination of the participation of the political interests into the dealings with the joint ventures and leave those discussions to the business level and board of directors discretion.
Both sides have agreed to move forward the bigger joint projects and do not stall them over small household issues.
Further PM addressed the herder to pay attention to the winter preparations for the cattle as opportunities for meat exports to Russian market is widening as V.Putin confirmed the continued support for first stage of the cattle vaccination and meat imports from Mongolia.
As of today, there are seven manufactures which adhered to the standards and requirements to export meat and are ready to start the shipments.
Another issue touched during the meeting with Russion President was the line issues at the borders of the two countries arised with increased traffic due to the visa-free travels among the citizens. President V.Putin promised to pay extra attention at this issue and make the procedures as easy as possible for the citizens of the two countries.
Issues of building two lane railroads and investments into mega projects from the Russian ventures are to be supported by the Russian President as well as the support for the educational institutions operating in Mongolia as the number of the Russian speakers have dropped by 30 percent since 1990s.
During the Russia visit PM met with V. B. Khristenko, Chairman of the Board of the Eurasian Economic Commission in Moscow and signed the MOU on Cooperation between Mongolia and Eurasian Economic Commission. The signing of this MOU is crucial for Mongolian side in terms of the transportation tariffs and customs fees as the Commission is to be responsible further for these issues in Russian Federation.
Overall PM concludes the visit at the Saint Petersburg International Economic Forum as fruitful as it has provided with opportunities to deal with pressing issues before the Ufa trilateral high level meeting to be held in July this year.
According to the Public Relations Department statement from the Office of the Government Russian side highly values Mongolian participation at the Saint Petersburg International Economic Forum, which Mongolia took part for its second year as this helps greatly to promote the business relations among the private sector of the two countries.
Parliament with continuous operations not operating properly
June 23 (gogo.mn) According to the law the Plenary session of the State Great Khural is to be closed on July 1st. Out of the total 33 laws and resolution drafts to be discussed the following were reporte to be done so far:
· 3 laws approved
· 21 law drafts in discussion
· 3 law drafts submitted for discussion
· 6 law drafts not submitted for discussion.
Moreover, total of 124 draft laws and resolutions are in discussions, of which 68 law drafts are not discussed at all, 55 are at the Standing Committee discussion phase and 1 law draft is at final discussion.
As the closing of the Spring Plenary session approaches MPs are in rush to discuss the law and resolution drafts having listed over 20 issues per day of a session.
According to the introduction made by the Speaker of the Parliament Z.Enkhbold there are only 4 plenary sessions left from June 22 and June 29 and announced to the MPs that plenary session might be extended until July 10th if the discussions are not done by the closing date.
If the extension is not enough for the discussions the special sessions will be announced from July 15th as the law allows to have 2 special sessions.
At the end of each Autumn and Spring Plenary sessions State Great Khural reports on how many law drafts have been approved and prepares for the next plenary session with list of new law drafts to be discussed by the next session.
Every MP, party and coalition is looking for a fit into the list with law drafts initiated by them. According to the current report every one easily can make deductions that Spring session is far from its plan. It is easily can be said that the list of the issues to be discussed has become the 'wish list'.
There were 16 drafts and three issues labeled as urgent submitted by the cabinet for the discussio, which are:
· Amendment draft to law on Government Special Fund
· Amendment draft to law on Land
· Resolution draft on Gatsuurt Deposit State Ownership.
According to the report State Great Khural has been deviating from its major direction a lot this Spring Session.
It has become obvious that Spring session is to be extended until July 10th. During the pre-Naadam hype MPs skillfully manufacture the laws which have conflict of interest and make rush decisions while everyone is aware of only how to spend Naadam Festival. This year is no exclusion as well.
Problems with the new draft law on labor
June 23 (UB Post) Minister of Labor S.Chinzorig submitted a revised draft law on labor to Parliament last week. He gave an interview shortly afterwards to clarify why a revision was required and providing details on the new law.
What stuck out to me in the Minister's interview was how the new law on labor gives the state certain power over business structures and internal hierarchy.
"Several new articles concerning working hours, vacation periods, and wages have been included in the draft bill. Specifically, the gap between the wages of foreign and Mongolian workers has become larger in connection to increasing foreign investment in the mining sector. But it's impossible to regulate this gap with Mongolia's legislation. A new provision is being issued so that workers engaged in the same line of work will receive the same pay," said S.Chinzorig.
He went on to say, "Employees aren't getting wages suitable to their skills and professional degrees because the current law isn't able to regulate the payroll system of the private sector. To correct this situation, we've added a new article to establish ranks among people who work in the private sector, depending on their skills and professional degrees, and providing them with wages suitable to their rank."
This is utterly ridiculous. If the state is to determine the payroll systems of all private companies, the basis for fair competition, innovation, and creative business models cannot operate in Mongolia. In a free-market, democratic society, the state should have as little interference in the affairs of its people as possible.
The fact that government officials like Minister S.Chinzorig view essential private business rights that are already in place as something to be rectified is worrisome.
Private businesses should maintain the right to determine their own payroll and how they are going to pay their staff regardless of whether they are foreign or not. The free-market system allows business owners to pay their employees an amount that is congruent to their labor capacity and productivity.
Just because someone has a degree from a reputable school does not guarantee a high salary, their work and contributions to an organization determines their wage. If someone is unhappy with their wages and terms of employments, they are free to renegotiate with their employer or seek other jobs in the market that meet their monetary and other requirements.
When companies higher foreign professionals, it is not simply to rub it in the face of Mongolians in the same profession, but because they need them. The main goal of a business is to profit, and to bring in foreign professionals at high costs goes against their main agenda, unless that employee's contributions are worth the cost.
State officials seem to think that foreign invested companies bringing in foreign labor pisses Mongolians off. The fact of the matter is that these highly paid experts bring a considerable amount of expertise and experience that has been tested and verified, which Mongolian laborers can learn from, instead of envy.
Another worrisome aspect of the draft labor law was the limitations that will be put on student labor.
Although Minister S.Chinzorig said the new labor law will provide better opportunities for students to work, the specific functions of his draft law are contradictory, and put severe restraints on student labor.
"Specific provisions aimed at creating opportunities and conditions for students to work part-time have been issued, too. It's been legislated that students are allowed to work no more than four hours a day and their salary is to be paid on the spot," the minister said.
I do not understand how someone in a minister's position does not see how bad this law is for students interested in working.
The issue is simple – the law specifies exactly how many hours students can work and how they should be paid.
As a certain percentage of the UB Post staff are students, the four hours a day limitation will significantly hinder the employment opportunities for students. There are very few employers in Mongolia who want a four-hour-a-day laborer for their organization. This makes finding jobs improbable.
Instead of setting work hours and payment methods, the law should be focused on ensuring the rights of all laborers from labor exploitation and unpaid work, to which students are prone to becoming victims of.
The law also wants to set the vacation hours of private companies, specifically those of mining companies. As most mines are situated in rural areas, their onsite employees work in intervals. For example, OT workers have 14 days off after every 28 days of work.
What Minister S.Chinzorig's labor law wants to do is set these work and leave intervals for companies.
"The revised draft bill regulates that people working far away from home are provided with a 14-day holiday after working for 21 days. In other words, the work and holiday hours of workers executing work far away from home on a regular basis, particularly those working in the mining and minerals sector, will be specially regulated by the law. This provision is significant, as it will provide moderate operations of production and safe and healthy working conditions for employees."
As long as mines meet health and safety requirements, do not violate human rights, and adhere to all laws pertaining to their business operations, why should the state intervene in how many vacation days they allow their employees? There haven't been issues with work intervals at mines among workers. Sure, some companies give more vacation days than others, but miners have the right to choose their employer. Nobody is being forced to work for these companies, so why does the state need to enforce a regulation on a matter that hasn't been problematic?
I commend Minister S.Chinzorig's efforts in his draft law to address child labor issues, the employment of the disabled, and intermediary recruitment companies exploiting proletarians. He said that over 10 meetings to reflect the interests of the people in the law were held before the law was submitted, but he has not specified who the meetings were with.
Clearly, S.Chinzorig's draft labor law and its motif have seriously worrisome aspects that interfere too much in private business affairs. Parliament should carefully examine and evaluate how the law will impact businesses in Mongolia – and consequently, the people – before approving this law.
In light of the fact that Mongolia is thirsty for foreign investment, all legislation that has an impact on business should be examined diligently from all sides.
Signing Held for Evaluation of JICA Project on Strengthening the Mediation System
June 24 (news.mn) Yesterday (23rd June 2015), the signing ceremony to evaluate the second phase of "Project of Strengthening the Mediation System" took place in the Supreme Court Building. Present at the ceremony were the Court Consultant General T.Mendsaikhan, the Civil Affair Depertment head Kh.Soninbayr, and the leader of "Project of Strengthening the Mediation System" evaluation team of JICA (Japanese International Cooperation Agency) Ms.Mihai, the President of Mongolian Attorney Federation B.Ganbaatar and chief of Financial Development Authority B.Dorjsembed.
The "Project of Strengthening Mediation System" has been implemented in Mongolia since 2010 in two phases within five years. To date 505 mediators have been prepared under this project.
After the ceremony Mrs. Mihai said - the "Project of Strengthening the Mediation System" has been implemented in Mongolia so successfully. I have never seen such a result comparing to other countries, which have been involved in the same project. The second phase will end due to December 2015. We will provide 6 months of support independently of the project. Although, the project is ending we will continue our co-operations in the field of mediation.
A.Gansukh: Proposed TT agreement gives unlimited rights to investors
June 23 (business-mongolia.com) A.Gansukh, Adviser to Speaker of SGK is on Tavan Tolgoi draft agreement
Q: Can you update our readers on the main provisions of the agreement?
A.Gansukh: There are co-related agreements; Cooperation Agreement, Investment Agreement and Railway Concession Agreement in the draft proposal, one of them can't be agreed separately. The main term of the agreement is 30 years, and can be extended another 30 years. Investor side inserted a clause on terms, if the project couldn't reach in its break-even before the end of the term, the agreement term will be automatically extended until the project break-even reaches. This clause is extremely dangerous proposal. This means the investor side can extend the agreement term endlessly according to this clause. The Government has no rights to control the terms, because the investor will decide when to invest, how to invest, investment calculations, coal production, how much to export and the selling price. Based on these arguments, the investor side can continue more than 60 years to run the project using this clause only.
Another view on negotiation progress is that the draft agreement breaches the following laws and regulations: provision 3.1.4 of Investment Law of Mongolia, the 39th resolution of SGK of 2010, 35/32 recommendation of the National Security Council of 2011, the Government Resolution 121 of 2012. Also this negotiation is "major transaction" for Erdenes Mongol LLC, hence the Government shall adhere the related clauses of the provision 88 "major transaction" of the Company Law of Mongolia.
Q: Upon realization of Tavan Tolgoi deposit, the biggest concern from the public is how to realize the shares owned by the people? What is your position?
A.Gansukh: The issue of protecting the interest of the people of Mongolia, who are the shareholder of "Erdenes Tavan Tolgoi" JSC, owning collectively 20% of the share (each 1072 shares), is unclear. If the above-mentioned breaches will be included in the agreement, any citizen can win a legal sue against the agreement. Plus, upon the agreement is signed, the Government has no right to raise issue and cash flow will go to outside. According to the draft agreement, some transactions and payments will be made in abroad. This will end our dream to increase the currency reserve of Mongolia.
Q: What is stated regarding the investment?
A.Gansukh: The investment estimation would be 4 billion USD. But investor haven't made any investment commitment, instead, investment size will vary depending on the financial agreement and feasibility study. This clause says that investment size of 4 billion USD can be changed. Another strange proposal is that 1 billion USD investment in the construction of Energy Resource mine at Ukhaa Khudag will be included in this 4 billion USD investment plan. Ukhaa Khudag has debt worth of 1.3 billion USD. Its owners' capital is 400 million USD. It is obviously wrong to evaluate such company at 1 billion USD.
Finally 4 billion USD investment schedule is unclear. Investor will decide the size of its production, price and pays 2% royalty. This will allow investor to control whole process and run the project without any control.
Q: How the railway issue stated in the draft proposal?
A.Gansukh: The draft agreement breaches provision 6.2 of the Railway Transportation Law. According to the effective law of Mongolia, railway shall be privatized to the state owned company or the company where the majority shares is controlled by the state.
In accordance with the 35/32 recommendation of the National Security Council of Mongolia 2011, Tavan Tolgoi – Gashuun Sukhait railway right is given to the Mongolian Railways. This can't be changed and under such legal environment, planned railway rights can't be transferred to the Consortium. Tavan Tolgoi – Gashuun Sukhait railway is a good project that can reach breakeven within 10 years and there is a calculation that Mongolian Railway can make profit of 2 billion USD. Mongolian Railway shall use this profit to fund the other railway projects in different directions. Mongolia shall use its discounted tariff benefited from the Transit Transport Agreement with People's Republic of China.
MP Baasankhuu: We'll examine if Minister Enkhsaihan abused his power on TT
June 22 (gogo.mn) MP O.Baasankhuu made an official announcement today after he worked at Tavantolgoi mine in accordance with his work at the Petition Standing Committee.
According to him Tavantolgoi mine wasn't operating since April with no definite situation whether the operations are to resume and the employees are having fears, while the mine operations should have been proceeding without delays regardless of the investment agreement issues. Therefore, MP O.Baasankhuu is to examine whether Minister M.Enkhsaikhan abused his power.
MP O.Baasankhuu reported that during meetings with residents of Tsogttsetsii and Khanbogd soums locals were complaining on the lack of infrastructure and social development at the area.
Further he criticized that residents were complaining on the lack of development as seen in Erdenet and Darkhan, while Oyutolgoi is not giving much for the locals.
DeFacto Jargal: People shouldn't be punished for thinking differently and speaking differently
June 23 (UB Post) There's only one person in Mongolia who exchanged his career as a leading economist and banker for becoming an independent journalist and lector: D.Jargalsaikhan. He's been awarded with many monikers, including Jargalsaikhan of De Facto Talk Show among viewers and the public, and as economist Jargalsaikhan among businessmen.
The following is an interview with the host of De Facto Talk Show, The UB Post columnist, and economist D.Jargalsaikhan about his career and life.
De Facto Talk Show has become quite popular lately. As the host of a talk show which covers what is considered "boring" topics of politics and economy, what do you focus on to make it appealing to viewers?
I began doing interviews on television in 2010. It's important to unmask the inner emotions and feelings of people, provide new knowledge and information to viewers, and to promote encouragement in society through interviews. I began to host this show as I believed I could do this. The uniqueness of De Facto Talk Show is that foreigners are invited and interviewed as I'm able to speak Russian and English. Half of my guests are Mongolians, 40 percent of whom are able English speakers, and the rest are Russian speakers. As the Dalai Lama said, people are all the same at their basic stage. Therefore, I proceed towards communicating with guests at their basic stage, regardless of their language, culture and occupation. A journalist can understand and show various perspectives of a person, such as their manner, decisions and views, only if they are genuinely interested in his or her interviewee. It's important for the guest to open up their inner emotions in 30 minutes, so I try to pique all my interest to the interviewee and listen.
During your active participation of five years in journalism, what was the most entertaining and interesting time?
As it is a weekly show, I conduct over 50 interviews and write a similar amount of articles a year. Rather than an interesting time, I have met with interesting people. The majority of my guests are people who make me forget I'm in front of a camera, and the interview time with them finishes quickly. Still, all my interviews have been important and I'm confident that the interviews are improving. Although there are many times I've asked about their lives, we barely have time to answer. That's why I try to answer those questions through articles.
You majored in economics. Do you sometimes find it pointless to question economists and talk about the things you know so well?
No, not at all. It's very fascinating to find out why they have different opinions from mine. The interview feels alive and vibrant as long as the basis of something I've never heard of is brought up.
You met with the Dalai Lama. How did you feel after interviewing him?
The Dalai Lama is a special presence who proves how great a man can be. Even so, he's an amazingly modest person. I was happy, overjoyed and energetic for several days after meeting the Dalai Lama. I felt the beauty of peace from him. I was left with a wonderful impression after the short, 46 minute interview because he explained great things in eloquent simplicity. It seems that the saying that great things are simple to a great man is true. I realized that I was responsible for delivering his sincerity to many Mongolians, because the great Dalai Lama entrusted me with his words and believed I could pass it onto Mongolians. After broadcasting the interview, I published two articles in English and Mongolian.
Before interviewing the Dalai Lama, how prepared were you?
A special preparation is required for interviewing the Dalai Lama or presidents of any state, because they don't just see me as Jargalsaikhan. I pushed myself to prepare questions for the interview with the Dalai Lama on behalf of all Mongolians. I pondered for a long time about what Mongolians would want to ask. I prepared two pages of questions. I contemplated them again. I wrapped up my questions into one page. In general, I try to fit a script to a page. I don't write articles on more than two pages and try to sum it up in exactly 800 words. People don't have time to read extensively long articles in modern times. It's important for articles to be concise and logical.
Do you feel your popularity?
When people read your articles and get invited to appear on television and radio shows, it becomes different. People are recognizing me wherever I go and I've got over 90,000 followers on social media. Support from youth is more apparent. I try to distribute correct content through these sources and media output. Democratic society must move forward consistently to express the voices of the public, and with intelligence. It's good that people are conversing on all topics and expressing their views. In places without words, they converse through rocks, and then bullets. Democracy is amazing. We have the freedom of the weaponry that is words. People shouldn't be "punished" for thinking differently and speaking differently. The ability to correct and improve oneself is born in this exact type of society. Recently, President Ts.Elbegdorj said at Parliament that sometimes he feels that Mongolia has three million journalists. This is a spot-on quote.
Do you have an interest in entering politics?
I've never nominated myself in a political election anywhere. Never will. Entering politics isn't an option just because quite a few people are familiar with me. In fact, an election is something that people in powerful parties with many supporters and good principles of leadership do, and not something one alone can do. The time when a single person can get elected and disrupt the state has passed.
Why did you suddenly become a journalist in your 50s? Do you regret leaving your career as an economist that you built for many years?
After finishing middle school, I went to Moscow State University. I graduated from the economics class as a political economic teacher in 1984 with excellent grades. I earned my MBA at the University of Denver in the USA in 2002, and worked in the banking and financial sector after returning to Mongolia. I gained quite a lot of experience. As for my career, I didn't want to stay as a bouquet of only one flower. Isn't it better [for a bouquet] to have lots of colorful flowers? Now, I'm working in the marketing and PR field, expanding my previously earned education, knowledge and experience. According to global standards, a person changes jobs four to five times. My biography is ordinary.
How long does it take you to write an article?
I take only four to five hours to write. But I think about it for a long time. There are times when I contemplate the topic for several days, but stumble upon one figure. I sit down to write after I've verified figures and numbers and get answers from officials.
It's common for officials to be reluctant to give information to journalists. Are they quick and willing to give you information?
If they treated me that way, it's probably because of my age. Actually, trust is the biggest capital of journalism. It's exactly the same as stock markets.
Is it important for articles to approach difficult topics? Which topic do you like most?
The most convenient topics for me are economics, banking, and finance, since I majored in them. The topic I like to approach whenever I have the opportunity is the city. It's because I'm a city boy.
You're a busy man involved in television talk shows, radio shows, and newspaper articles. Do you have spare time?
All my work is scheduled with exact times and minutes. There's a saying that you should give your work to a busy person if you want it done. The busier people are, the more they learn to manage their time and duties. In a week, I host De Facto Talk Show through three broadcasters, Mongolian National Broadcaster (MNB), NTV, and Eagle. Different guests are invited for each of them, so I interview three to five people a week. I write my articles in English and Mongolian. My program is broadcast every evening at 6:30 p.m. on FM 98.9 Radio. I've started to get invitations to hold lectures at foreign universities. They're probably interested in me since I'm a Mongolian independent critic and columnist with a regular program. I've given lectures at Australian National University, Cambridge University, Ritsumeikan Asia Pacific University, and the University of Denver. I'll be attending a meeting at Oxford University soon, so I'm preparing my programs beforehand.
What do you want audiences to learn through your lectures?
I mainly give lectures on Mongolia's politics, current economic transition, opportunities and challenges. I also host international meetings and seminars. Some of my lectures can be viewed on my website in English and Mongolian.
So do you have spare time?
Of course I do. I go to a fitness club three times a week. I've been going there for 23 years on a regular basis.
Who do you want to interview now?
L.Tudev, but he's been busy writing a book.
Source: Unuudur
Mongolia: 2014 Human Rights Report
June 25 (U.S. Embassy) --
EXECUTIVE SUMMARY
Mongolia is a multi-party parliamentary democracy. In June 2013 presidential elections, incumbent Tsakhiagiin Elbegdorj of the Democratic Party won re-election with 50.23 percent of the vote. The most recent parliamentary elections were held in 2012. Polling place observers judged both elections to have been generally free and fair in accordance with the Mongolian constitution and international standards, but expert observers concluded that vague equal access provisions of the election law prevented Mongolian media from playing a significant role in providing relevant information to voters. Authorities generally maintained effective control over security forces.
The three most significant human rights problems were corruption, a judiciary vulnerable to external influences, and pervasive domestic violence. Lack of transparency--especially in the legislative and judicial branches of government--undermined government efficiency and public confidence. Similarly, the judiciary lacked the financial and human resources as well as the institutional professionalism and status to function as a truly independent and neutral adjudicator of civil and criminal disputes. Domestic violence was widely acknowledged to be a pervasive and serious issue.
Other human rights problems included the following: police abuse of prisoners and detainees, poor conditions in detention centers, arbitrary arrests, government interference with the media, religious discrimination (including continued refusal by some provincial governments to register Christian churches), denial of exit visas and immigration holds on foreign citizens, trafficking in persons, discrimination against persons with disabilities, and discrimination against lesbian, gay, bisexual, and transgender (LGBT) persons.
The government inconsistently took steps to punish officials who committed abuses or rectify instances of discrimination.
…
Universal child benefits: The curious case of Mongolia
June 24 (Development Pathways) Up to now, Mongolia has been famous for Genghis Khan, nomadic herders and grand wrestling competitions in the capital city of Ulaanbaatar. But, it can now add to its list of fame the developing world's only universal child grant!
Worldwide, close to one in seven countries provide non-contributory child benefits on a universal basis, primarily being European and a few other OECD countries (see map below). This means that they give social security payments (or tax rebates) to all parents or guardians, regardless of income or employment status, to help cover the costs of raising children.
In the developing world, though, coverage of such benefits is much more restricted, usually to children with parents working in the formal sector or to those living in poor households. While a growing number of developing countries have introduced universal pensions for older people – with significant positive effects on poverty rates and welfare – the principle of universality is not yet widely embraced when it comes to child-focused schemes.
Mongolia is a rare exception. After a rocky start, its Child Money Programme (CMP) now offers unconditional cash transfers to all children under 18 years.
Global distribution of child benefit programmes by type
Source: ILO, 2015
A turbulent history
Mongolia's CMP has had a turbulent history (see Fritz [2014] and IDS [2011]). Universal child benefits first emerged as a hot political issue in the run-up to the 2004 elections, as the incumbent and the main opposition party made rival promises to attract votes.
In 2005, the CMP was introduced as a conditional cash transfer programme targeted at poor households, who were identified through a proxy means test. Its value was set at Tog 3,000 per month (equivalent to around US$ 2.70 at the time) and it reached some 350,000 children.
But, after continuing pressure to make good on election promises, the CMP was reformed into a quasi-universal programme with weaker conditionalities in 2006. And, less than a year later, the government nearly tripled the total annual benefit per child, by introducing an additional quarterly payment of Tog 25,000 (US$ 21). This was possible because of the fiscal space created by a new windfall tax on mining profits.
In the run-up to the hotly contested 2008 elections, political parties made fresh promises of additional cash transfers to all citizens to further reduce poverty and redistribute the country's newfound mineral wealth. But then, in late 2008 and 2009, the global economy ground to a halt and commodity prices plummeted. Mongolia's public revenues dropped sharply and the country had to take out an emergency loan from the IMF, which included an agreement to revoke universal transfers and reintroduce poverty targeting. As a result, Parliament abolished the CMP as it prepared for the 2010 budget.
The country was quickly back on its feet though, and managed to strike a deal with the mining industry to pre-pay future royalties into a new Human Development Fund (HDF). And – despite the agreement with the IMF – government then used the HDF to offer untargeted cash transfers to all citizens, in line with the 2008 election promises.
Finally, after the 2012 elections, the new government changed course and stopped HDF payments. Instead, it reinstated the popular Child Money Programme as a universal and unconditional benefit for all children under 18 years, offering monthly transfers of Tog 20,000 (≈ US$ 10.50). The CMP now reaches around 994,000 children (i.e. its coverage rate is over 99 per cent) at a total cost of 1.5 per cent of GDP in 2014 (own calculations based on data from the national statistics database).
To target or not to target?
It is interesting to note that the reforms of the CMP led to considerable debates between the government of Mongolia and its development partners, particularly on the issue of targeting. From these debates, two opposing perspectives have clearly emerged:
1. The international financial institutions consistently stress the need to narrowly target the poor, as a way of rationalising expenditures and ensuring fiscal sustainability because Mongolia's public revenues are highly vulnerable to fluctuating commodity prices (see, for example, World Bank [2005], ADB [2010], Fritz [2014] and IMF [2015]).
2. In contrast, United Nations organisations such as UNICEF have argued strongly in favour of the universal child benefit, pointing out that universality effectively resolves most of the large exclusion errors inherent to the proxy means test, and strongly reduces child poverty. Their analysis recognises that cost is an important consideration but, rather than restricting coverage, it recommends that the value of the cash transfer should be kept at an affordable level.
The truth is that income targeting is deeply unpopular in Mongolia. It is widely seen as being unfair, on the grounds that it discriminates by excluding some children. Political parties introduced the universal child grant as a way of gaining popular support, sharing wealth from the natural resource boom, and strengthening the social contract between the State and its citizens. It is also much easier to implement and more effective at reducing poverty. As a result, recent proposals to introduce means testing of social transfers in the first supplementary budget for 2015 were rejected (once again) by Parliament.
Conclusion
While an increasing number of developing countries have introduced universal social pensions that realise the right to basic income security for older persons, Mongolia appears to be the only non-OECD country to provide universal, unconditional benefits to all of its children under 18 years. Child-focussed benefits are a key component of an inclusive life cycle approach to social protection. So, will more countries follow Mongolia's example?
The ILO, in a new publication, calculated that a universal child benefit would cost, as a weighted average, 0.9 per cent of the aggregated gross domestic product (GDP) of 57 low income and lower middle-income countries. To put that in perspective, the total estimated cost for all those 57 countries combined is equal to merely 0.5 per cent of what G20 countries used to bail out the financial sector in 2009. So, it's really a question of political rather than technical choices.
World Investment Report 2015: Mongolia Fact Sheet
(United Nations Conference on Trade and Development)
Chinggis Land Development Hires China's CCCC as Technical Advisor on Russia-Mongolia-China Highway
June 26 (news.mn) "Chinggis Land Development Group" which has finally started the 1000 km Trans-Mongolian Highway having signed a co-operation contract with "CCCC" a leading Chinese civil engineering company. "CCCC" is one of the world's top five construction houses and has 175 branches in 97 countries globally. "CCCC" will provide official and practical advice regarding road surfaces, quality, and loading capacity. It can be noted that this company has a long relationship with Mongolia dating back to 1963 when it built the Peace Bridge. It is not surprising; therefore, that Mongolia chose "CCCC" to build two bridges over the River Orkhon and Tuul with a combined span of 2km.
The environmental and geotechnical research of the 1000 km Altanbulag-Ulaanbaatar-Zamiin Uud highway is now completely finished. A sub-company of "Chinggis Land Development", "Chinggis Civil Engineering" is working on the design. According to the plan, the highway will be launched in 2018.
JBIC to Finance Strategically Important Projects in Mongolia
Ulaanbaatar, June 23 (MONTSAME) The cabinet meeting on Monday discussed a draft memorandum of mutual understanding to be established between Mongolia's Ministry of Foreign Affairs and the Japan Bank for International Cooperation (JBIC), and gave the Foreign Minister L.Purevsuren a right to sign it.
The Mongolia-Japan economic ties and cooperation have been developing by a single flow into Mongolia in a form of granting loans and assistance, now the time has come to change this situation by augmenting the trade and investments and by boosting a mutually-beneficial cooperation. In this new-level ties a participation is important of the two countries' private sectors, and this can be provided by JBIC.
A political decision of Japan on the relations with Mongolia as well as an implementation of projects and programs with the JBIC will significantly contribute to boosting of the bilateral strategic partnership cooperation and biggest projects on great construction such as building railways, producing liquid gas from coal and constructing thermal power stations on coal deposits.
Expansion of Erdenet concentrator adds 33 jobs and ₮240 billion in revenue
June 23 (gogo.mn) Last Saturday Erdenet Corp. has held an opening ceremony of its Concentrator Manufacture expansion. The expansion works has been implemented within 1.5 years which is to result in increase in revenues by MNT 240 billion and taxes MNT 535 billion.
Erdenet is mostly known as being a 'cash cow' for the Mongolian state since its commencement in 1978. As of stats of 2014 the miner has processed 516 thousand tons of copper concentrate, manufactured 113 thousand tons of though cake with revenues reaching MNT 1.3 trillion.
One ton of copper is used to produce 44 km long copper rods with diameter of 1,2 mm, meaning that total of 4,972,000 km copper rods could have been produced with the total tough cake output of 2014.
94.4% of energy consumption produced domestically
June 23 (gogo.mn) As of May, Mongolia used 405.3 million kWh electricity which 94.4 percent was produced by domestic power plants and imported 22.5 million kWh electricity, reported by the Ministry of Energy.
Usage of energy system was low compared with the plan while import has increased. 68.8 percent of energy was produced by Power Plant IV alone and 4.1 percent was produced by Salkhit Wind Farm.
State Great Khural approved amendments to draft laws on Energy and Renewable Energy. Current structure and partnership between institutions are considered as unregulated and uncoordinated with the common policy and inadequate for operating energy sector per market demand. Moreover, license for construction of energy resource needs to be ruled by special policy.
In addition, due to private property lines and substation relations are not being regulated by legislation, users are limited to connection to energy which became the key factor to amend the law on energy, stated by the Minister of Energy.
Industry Minister on visit to Japan for annual trade consultation
June 24 (gogo.mn) Minister of Industry D.Erdenebat is to pay visit to Japan during June 28 to July 1.
In scope of the visit, the 7th Japan-Mongolia Joint Consultation with the Government and Private Sector on Trade and Investment will be organized in Tokyo, Japan. Specifically, consultation will be held with aims to expand cooperation and strengthen economy in accordance with the State Policy on Industry.
Over 80 representatives from 60 entities to take part in the consultation from Mongolia.
Opportunity to expand the cooperation between state and private sectors, businesses, investment and trade relations will be created by paying visit to Japan, reported by the Ministry of Industry.
Related:
Mongolia-Japan Trade and Investment Meeting to Run – Montsame, June 24
TDB Launches Turkish Lira – Tugrug Exchange Service
June 22 (news.mn) The Trade and Development Bank (TDB) has started to exchange the Turkish Lira for the Mongolian Tugrik. This began in May 2015. Therefore, TDB customers can confidently make cash as well as non-cash transfers exchanges simply by creating a new Lira-bank account.
Also, people who are going to buy Liras at Turkish airports and hotels where there is a slight difference in the exchange rate with exchange difference will not be hurt economically if they chose to buy Liras in Mongolia. At present, 40% of internal currency exchanges among the most popular 15 currencies on the international market are made by the TDB.
Mongolia joining AIIB as founding member at 29 June signing ceremony
June 24 (news.mn) Yesterday (23rd June) the Government of Mongolia's Permanent Committee on the Economy discussed the "Founding Agreement of the Asian Infrastructure Investment Bank" (AIIB). The Committee will deliver their recommendations and conclusions to the Parliamentary Permanent Committee on Security and Foreign Affairs.
The establishment of the AIIB will be a huge stimulus to regional development and will create a new financial environment for Asian infrastructure development.
The Chinese Government proposed membership in the AIIB project to Mongolia which was officially accepted at a meeting 28th March 2014. Subsequently the founding members signed, and started their contract works on 28th October 2014.
The amount from each county has been specified as has the voting power, bank procedures and the rights and duties of member 57 countries. This has been after five conferences.
The activity of AIIB is likely to start in late 2015. According to D.Zorigt, a member of parliament, the signing ceremony on the project will take a place on 29th June 2015 in Beijing.
New plant can fully supply Mongolia's vegetable oil demand
June 23 (UB Post) Mind-Tech LLC opened Mongolia's first fully automated, high capacity oil seed processing plant in Bayangol soum of Selenge Province last Friday, enabling Mongolia to fully meet domestic needs for vegetable oil.
The production of rapeseed oil, which the company says lowers cholesterol levels, has begun under the brand name "Orgikh". The oil seed processing plant is equipped with German equipment and technology. It aims to process 100 tons of oil seed a day and manufacture 35 tons of vegetable oil. The plant also has the ambitious goal of enhancing its capacity to producing 400 tons of oil seed a day by next year.
Mind-Tech LLC, a sister company of Delta Holdings Co.,Ltd., has brought a new development that will increase the crop yield of Mongolia by administering a new substitute vegetation, by using its oil seed as the primary raw material for the new oil seed processing plant. The opportunity to boost profit and revenue has become available to farmers through cultivation of the new product.
The main products to be produced by the new plant include:
1. Rapeseed oil handed to consumers under the Orgikh brand name. Rapeseed, also known as "Olive of the North", contains a large amounts of vitamins and essentials for the proper functioning of the body and doesn't include indigestible substances.
2. Maliin Khuchit Tejeel (pungent livestockfodder), known as "Chocolate Fodder" among herders, is a product made out of rapeseed residue with high contents of protein (39 percent). The product is believed to be the solution for resolving protein shortages, an existing issue among livestock in Mongolia.
3. An environmentally-friendly bio diesel is being produced with the oil from Mind-Tech LLC. The bio diesel is helpful for reducing smoke pollution in Ulaanbaatar significantly and can prolong the durability of the engines of any vehicle used in mining, agriculture and other sectors.
Large farms used to import rapeseed residue from Russia and China until now. Since January 2015, farmers and feed manufacturers started using Maliin Khuchit Tejeel produced by Mind-Tech LLC. The company cooperated with animal feed researchers and professors at the Mongolian State University of Agriculture in conducting a study at dairy farms, and determined that the livestock fodder can double milk production.
The fodder also increases livestock fat and strength. A lamb born in spring weighs approximately 32 kg in autumn, when they are six to seven months old. Mind-Tech LLC says that their new fodder can fatten a lamb to up to 52 kg, allowing meat production without having to wait until after winter. Farmers and herders can work more efficiently with this fodder and livestock will fatten within a shorter period.
Herders involved in the study said that livestock fed with the product during the winter of 2014 and spring of 2015 didn't lose any fat or strength, according to representatives of Mind-Tech LLC.
The oil seed processing plant provides permanent jobs for 60 people and seasonal jobs for 50 to 60 people in Bayangol soum in Selenge Province. The plant will increase state and provincial tax budgets and will be able to domestically provide the 30 million USD of vegetable oil imported annually. This will become a major improvement in the nation's development as well as the economy, according to company officials.
Source: News.mn
Planters Bank adds Will Sanders to Commercial Team
Clarksville, TN, June 27 (Clarksville Online) – Planters Bank welcomes Will Sanders as an assistant vice president to its commercial banking division.
A native Clarksvillian, Sanders spent the last few years as executive director and country manager for Hancock Prospecting Mongolia, LLC. Prior to that, he worked as financial advisor at Bank of America Merrill Lynch and financial services officer at Farm Credit Services of Mid America.
"Will is well-known and highly respected throughout the Clarksville market. His experience is going to be a great asset to our team, and we are delighted to have him on board," said President and CEO Elizabeth McCoy.
Sanders graduated from Mississippi State University in 2003 with a B.S. in Agribusiness, where he was vice president of the Phi Delta Theta fraternity. His volunteer experience includes the Wounded Warriors Foundation and the Lotus Children's Center and Notre Dame Children's Home in Ullaanbaatar, Mongolia.
He is the son of Bryce and Jody Sanders of Clarksville and enjoys hunting and fishing. Visit will at our downtown Clarksville office at 325 Commerce Street.
Headquartered in Hopkinsville, KY, Planters Bank maintains eight full-service offices in Western Kentucky and four offices, plus a mortgage office, in Clarksville, TN.
Ulaanbaatar: A Future Regional Financial Hub?
June 24 (Mongolian Economy) London, New York, Hong Kong. These cities are some of the top financial centres in the world. Such cities deserve to be called the centre of the financial world, because their business environments host many prestigious businessmen, while their legal environments act as bodyguards to their assets. Could Ulaanbaatar step forward and become one of the region's top financial centres?
Although such a future seems far away from what we see in Ulaanbaatar today, that doesn't mean it's impossible. In fact, the first steps have already been taken, said E.Temuulin, head of Ulaanbaatar's Economic Development Department. According to him, the city's economic development strategy has six big goals to implement. One of those six goals states that Ulaanbaatar will become a regional financial centre. This would be achieved in cooperation with the City of London Corporation, with a final agreement yet to be signed.
The idea of UB becoming a regional financial centre might seem unrealistic. However, the citizens of Ulaanbaatar surely support it becoming such a prominent city. The term financial centre has broader meaning than skyscrapers and big banks or business people signing deals. These are only the materialistic bonuses that come with it. Having a financially important city indicates that a country has reached a higher standard of development. Life there is convenient. Citizens are content. Big companies that have opened offices there have plenty of choices when it comes to skilled human resources.
Sadly, in terms of the above mentioned requirements, Mongolia has very little to offer. The biggest hindrance, though, is Mongolia's unstable and uncertain legal environment, noted B.Batsaikhan, Partner at Mongolia Opportunities Partners. Mongolia is known for its always changing laws and regulations. Such behavior from the government won't help Mongolia reach its targeted development goals. "This needs to be changed before it's too late", said B.Batsaikhan. "We have conducted several studies on how already existing financial centres developed. And we concluded that a stable legal environment was crucial. The legal environment includes taxation regulations, social protection, education, healthcare, and so on. Developing these sectors, and furthermore adjusting to the international standards, will enable UB with the possibilities to become one of these big financial metropolises", agreed E.Temuulin, the Head of City's Economic Development Department.
If skyscrapers and suits were the only requirements of a financial metropolis, then Ulaanbaatar could easily be one. But when giants like JP Morgan, Goldman Sachs or Moody's come here to get actively involved in the country, it is questionable whether or not the capital can provide them with the required human resources. Providing foreigners with necessary healthcare is another obstacle the city will face. Mongolians are praised for their creativity and intellectual capabilities. Unfortunately, the country's education system has been critised for being too outdated. Businesswise, the city also hasn't earned a good name too. Thus, it means major changes and reforms should be done in Ulaanbaatar, if it wants to become big in financial sector.
If we continue to argue over the long list of bad things in Ulaanbaatar, the list will only continue to grow. Changes must occur and start soon. These necessary changes won't happen in a day. B.Batsaikhan noted: "Can UB become a financial centre? Yes. But we will need to work very hard on that. It might seem a very distant reality, but in the end there is no fact that says we can't accomplish that." According to him, Mongolia, with its rich natural resources, lies in a very beneficial geopolitical region, neighboring the two big economies of Russia and China. Mongolia country is a very new market that's opening its doors for foreign investors. These are enough reasons to answer why investors are still interested in investing in Mongolia. With such advantages Mongolia's capital can become a major player in the financial field.
The recent establishment of the Ulaanbaatar Chamber of Commerce is a tiny step closer to the afore-mentioned goal. To achieve it, the best practices from abroad must be interpreted and integrated. Over the coming years, city authorities should stay true to their word, to reach for that lofty goal and establish Ulaanbaatar as a great city from any point of view.
Nomads Chain's Yesonmunkh to Produce Naadam Concerts
June 22 (gogo.mn) It is confirmed that M.Yesonmunkh of the Nomads Chain to be producing the Naadam Festival concerts.
Last March Mongolia acted as the partner country at the biggest world tourism gathering ITB-Berlin and had a chance to promote Mongolia on a global level. main producer of the ITB-Berlin event M.Yesonmunkh was appointed as the producer for the Naadam Festival concerts as well.
As of this year no director was appointed for the Naadam Opening Ceremony as Ch.Gankhuyag, Director of the Armed Forces Song and Dance Ensemble, and N.Bold, Director at the State Opera and Ballet Theatre are to direct the Naadam Festival concerts.
No foreign bands or singers to perform during Naadam
June 24 (gogo.mn) We made clarifications regarding the cultural program scheduled during Naadam Festival from the Deputy Minister of Education, Culture and Science Ya.Tumurbaatar.
-There were talks that Jennifer Lopes is to perform during Naadam in Mongolia?
-Deputy Minister has received the Naadam Festival Organizing Sub-Committee. There were talks to invite foreign performers during Naadam Festival.
This issue has been resolved during the meeting held yesterday. The organizing committee made changes to the performers during Naadam. The rationale behind the change is that Naadam Festival should introduce Mongolian culture to guests, tourists and anyone interested in the Festival.
-There were rumors that adviser from Korea is hired to produce the Naadam Festival?
-This was one of the issues discussed at the committee meeting. We have approached Russia, China, Korea and North Korea for the advisory and in accordance with this director from Korea worked in Mongolia on the Naadam opening and closing ceremony on use of new equipment and directing the drum show.
Korea has extensive experience in organizing Olympic games and World Cup. Drum show was organized during those events in Korea and the Korean director was one of the organizers of the show. In this regard we have invited to get advice. In other words, other main organizational and performance related direction is being directed by Mongolian professionals.
-What is the criteria for selecting directors of Naadam Festival?
-Last few years we had only one director for all the cultural events. Starting this year we have appointed separate directors for over 10 events to be held in scope of the Naadam. We have conducted open auditions for those directors.
-What can viewers expect at the Opening Ceremony this year and how many people are participating?
-It is impossible to disclose on the opening ceremony. Over 4000-5000 people are participating in the Opening Ceremony event including students from universities and secondary schools. 1000 soldiers are at the training as well at the Tavantolgoi base.
-What is the budget for the Opening Ceremony?
-If previously around MNT 300-400 million was budgeted for only 2-3 events, this year we have budgeted around MNT 1 billion for over 16 events.
-What will be the price for the Naadam Festival?
-Ticket pricing is not under our liability.
Concession to Be Signed for 260-Bed University Medical Hospital
June 23 (gogo.mn) Concession agreement to launch the 260 beds medical center will be made with "University Hospital" LLC.
Total investment of the project which is to improve uncompleted building as a medical center is MNT 28 billion and owner of concession is to commence ambulance within December, 2015 and inpatient section within April, 2016. Total construction work of the hospital will be finished and commenced within two years.
State is not required to commit any financial support for the project and after 25 years, it will be transferred into state ownership free of charge.
Related:
260-Bed Hospital Will Be Built – Montsame, June 23
85% of poll participants vote for stopping license plate restrictions
June 24 (gogo.mn) Capital City authorities have been receiving the requests to stop the license plate number restriction lately. Therefore, city management is considering the drop of the license plate number restriction is conducting research currently on the outcomes of such action.
License Plate restriction was one of the first rulings of Capital City Governor E.Bat-Uul in order to decrease the traffic over load in the Ulaanbaatar city. For over two years UB city residents are already used to not having their cars available for one day a week.
At this time national portal website GoGo.mn have conducted polls whether Ulaanbaatar City residents are for or against the license plate restrictions.
The poll started on June 10th and lasted for two weeks involving over 12 thousand residents. 85 percent of which have voted for dropping the restrictions, while 14 percent voted against. Detailed information is shown in the graph below.
UB receives first batch of articulated buses from Belarus
June 26 (GoGo Mongolia) Today, first round of 17 articulated buses which is to be introduced in Ulaanbaatar`s public transportation service were received.
Officials reported that articulated buses are planned to be served routes from 5 Shar intersection to Safety Island at the Officer`s Palace starting from July 5th.
Buses were produced by "MAZ" company in Belarus and it has capacity of 163 passengers, 38 seats and is 21 meters long. Moreover, it has elevating platform for people with disabilities.
Capital City Governor's Transportation and Infrastructure Deputy N.Gantumur said: "Brand new buses are worth MNT 300 million. Trial operation of the buses will start from July 5 to July 14. From August 15, it will be operating on a regular basis. At first, we will purchase 20 buses and will decide whether to add more after the result."
Maidar City: Does UB need another satellite city?
June 23 (UB Post) As we all know, the new city of Maidar, is being built south of Bogd-Khan Mountain, in Sergelen soum, Tuv Province. Maidar, or "Future City", is going to be an eco-city with minimal primary energy consumption and maximum awareness of sustainable development. The construction of the city is expected to finish in 2024, provided that they get foreign investments in time. The eco-city is going to take up 117 square kilometers, compared to the 4,704.4 square kilometers of UB, and is planned to house 300,000 inhabitants. German architect Stefan Schmitz is working on the urban planning and design along with many other urban designers.
The city will encircle the Great Maitreya statue, a symbol of unity and peace, that will stand as tall as 54 meters with a 108-meter stupa behind it. To put that into perspective, the Statue of Liberty is 46 meters, while Tsonjin Boldog (the statue of Chinggis Khan) is 40 meters.
Ulaanbaatar was first planned for 600,000 residents. Little did the city's planners know that double the expected population would someday be living here, thanks to migration and birth rates. That growth has happened in only half a century. It's unpredictable whether we're making the same mistake with new city planning, with no considerations for population growth.
The reason UB has urban sprawl is because people want access to better healthcare and better education. The schools in the outer regions of the country, namely of the 20 provinces, cannot educate kids enough, or do not offer much inspiration and motivation for competition and development. People can't get enough healthcare support when needed because of the inefficiency and limitations of state hospitals. The city seems to be a million times better because there are more people, more hospitals and more schools in it. There are some skyscrapers and shopping malls, and mostly, more choices that seem to only be a privilege in other areas.
But today's city, where half the population of Mongolia resides, has problems of its own, such as pollution and traffic. Obviously, these are not good enough reasons to build another city, but air pollution has been such a big problem that Ulaanbaatar was named the most polluted city in the world. Constant approaches to battling air pollution have been going on since we became conscious of the problem. The projects include building better stoves, which failed because the stoves didn't produce enough heat to sustain a household; decreasing traffic and car emissions by limiting driving on designated days; and trying to build new housing options for ger district in residents. None of these programs seem to be effective, or they just haven't been enough to fix the already big problem.
So an obvious and easy way out could be to build another city, to create another center for a healthy environment focused on culture and trade. Maidar is unique among the other 25 cities in the country, as it is going to be founded on culture, traditional industries, and tourism, rather than governance, mining and industrialization. This seems like a nice idea, considering the income we could gather from tourism alone, but who knows how many years it will take before we actually recover the money spent on those giant sculptures.
With Chinggis Bond repayment starting in 2017, and the state unable to enforce its desired monetary policy because of a lack of money in the economy, further spending on something that won't become profitable until 2024 seems like a very bad decision.
All cities around the world aim for sustainable development. Ulaanbaatar, with a population density of 272 per square kilometer can adopt sustainable development with better planning and leaders who are not afraid to fix things, rather than leaving one city and focusing on the next. There is so much room for it to develop, and yet, we're talking about leaving it in rubble.
Ulaanbaatar is not overpopulated by global standards, while other nation's capitals have population densities much greater: 4,065 per square kilometer in Washington, D.C. and 5,354 per square kilometer in London. Ulaanbaatar is 17 times less dense than these two cities. London and D.C, are handling overpopulation, managing culture, economy and governance all at once, without the need for rebuilding. Can we find similar solutions?
Bringing Transparency to Ulaanbaatar City Procurement
June 26 (Mongolian Economy) The capital is a place that purchases a lot of goods and services, including huge project tenders that are frequently announced here. Unfortunately, words such as corruption, bribery, and bureaucracy are frequently heard in conjunction with big project tenders and business dealings in general.
It's not a secret that people doubt government decisions made behind closed doors. It's difficult to know if a tender was conducted fairly or not. It's easy to understand people's doubt, because there's no information provided for them. Information on who won what kind of bid and why the other competitors lost was completely unavailable. Until now.
Recently, Ulaanbaatar's Municipality Administration started to emphasise its operation transparency and post their information on their website. For example, the city has incorporated e-tendering in its procurement.
The e-tender process is considered to be the most effective way of tendering internationally. Particularly, it's possible to save costs and establish trust if public organisations incorporate e-tendering into its procurement process. Citizens will trust the government more if the government discloses its tax spending to the public. The City Procurement Office of Ulaanbaatar will use e-tendering throughout this year, and created the opportunity for companies to see tender documents and blueprints for free. The director of the City Procurement Office of Ulaanbaatar Yu.Idertsogt said: "Transparency helps to improve the responsibility of civil servants and tender participants. It directly affects the quality of investment. Healthy, fair competition creates many positive aspects, as it supports the economy and reduces the conditions that create private interests. We have launched many works, and our strategic goal stipulates that the bidding process should be transparent on every level according to the law."
Companies tried to find information about tenders individually by whatever means they could in the past. Today, information about tenders and companies procurement plans is open to the public on seven daily newspapers and 10 websites, because Ulaanbaatar's procurement has become transparent. In addition, Yu.Idertsogt mentioned that the reason for the selection or not of tender participants will be disclosed from now on. By doing so, companies mistakes on tender preparation have declined. While the selection and procurement process has become disclosed to the public, and there's progress on information provided to enterprises, further work needs to be done. It would be a misconception to think that Ulaanbaatar's procurement has become transparent by just broadcasting information on many channels. The director of the City Procurement Office of Ulaanbaatar stressed that it's important to make the people and private sector to understand their rights and possibilities to get information from state organisations.
Ulaanbaatar and its district agencies are planning to hold 671 project procurements of MNT 278 billion by the first quarter of this year. The City Procurement Office of Ulaanbaatar is organising MNT 92 billion and 88 projects out of it. It's planned to spend 37 percent of the investment on the power, heat and engineering network, 19 percent on construction development and 15 percent on roads. Yu.Idertsogt said: "Information about these plans was advertised extensively through the media. Entrepreneurs and enterprises are open to participate in the procurements considering their field of activity and locations."
Some of biddings and procurements were delayed because Ulaanbaatar's budget was approved late. Yu.Idertsogt remarked that the city also loses time in establishing an evaluation committee every year. Currently, the City Procurement Office of Ulaanbaatar has 10 projects unavailable for bidding. He said that the Mayor's decree to establish an Evaluation Committee on four of these 10 projects has delayed them for more than 70 days. Yu.Idertsogt believes that the main reason why tender announcements take such a long time is related to pre-tender preparations.
As for member countries of the International Economic Cooperation and Development Organisation, their government procurements account for 12-13 percent of the country's GDP. International expert at the European Bank for Reconstruction and Development Johannes S.Schnitzer said that Mongolia's government procurement of 27 percent is a very high number. However, international experts consider that Mongolia is moving in the right direction, by incorporating an electronic system in order to reduce this number.
The government is implementing an 'E-Store' programme, and doing state organisations' procurements according to the 'General agreement' in order to reduce their costs. The Mayor's Office of Ulaanbaatar has joined this program. Experts consider that the General Agreement will help many companies to participate in bidding, reduce the price of goods, and support small and medium sized industries.
Ulaanbaatar's City Procurement Office has improved. They will continue to do professional procurements based on honesty, transparency and knowledge.
Statues of UB #2: The Beatles Statue
June 24 (gogo.mn) This statue was installed almost seven years ago and many were having mixed opinions regarding this specific piece of street art. There were ones who disliked it and the ones who appreciated it. But the fact that The Beatles was unbeatable is true.
First the statue would have reminded the guitar body, but now many would refer it as Apple logo. This piece has seen a lot and would have lost its first view, so that its was reconstructed and renovated this year.
According to the information we have the statue was initiated by G.Gankhuu leader of Shar Airag band and was installed with design developed by B.Denzen. The budget for the installation was around MNT 100 million and is the first of The Beatles statue in Asia. There is no information that any other statue dedicated to The Beatles has been installed somewhere in Asian region.
One side has the quartet from Liverpool depicted on the walls and the other side represents a guy with a guitar in a staircase of a residential apartment depicting the typical passtime of the youth during 1970s and 1980s.
There are many statues and art installations around the world dedicated to The Beatles expect Liverpool and there are seven art pieces we want to emphasize. First is the park in New York, where the singer spent his last days of his life, depicting Strawberry Field where John Lennon spent his childhood.
In Hamburgh, Germany there is Beatles Platz square, while in Prague, Czech there is a John Lennon Wall.
In Iceland there is a Imagine Peace tower dedicated to the famed song Imagine by John Lennon.
Once listening to The Beatles would have been considered as a crime against country in Cuba labelling the band as too Americanized. But with the flow of time the old got washed and in 2000 John Lennon Park has been established in Cuba.
Sixth statue is located in Ekaterinburg, Russia, a steel monument depicting the quartet on a stage. The seventh one is easy to guess.
If you are still wondering scroll up.
Ulaanbaatar Dialogue on North East Asian Security Held 25-26 June
June 24 (news.mn) The "Ulaanbaatar Dialogue" conference under the heading of "North East Asian Security" will take place on 25th-26th June 2015 in Ulaanbaatar. In total, 50 experts from Europe and the United States have requested to participate in this conference. In addition there will be experts from North East Asia. During the conference, leading international experts will exchange their opinions about urgent problems of traditional and non-traditional security in North East Asia, specifically in connection with regional energy and infrastructure etc.
The "Ulaanbaatar Dialogue" conference is inspiration of President Ts.Elbegdorj. It will take place in the Mongolian capital every June.
President meets UNDP Resident Representative on end of Mongolia term
June 24 (news.mn) President Ts.Elbegdorj met Sezin Sinanoglu whose term as UNDP Resident Representative in Mongolia ended on 23rd June 2015. At the beginning of the meeting, Ms. Sinanoglu expressed her appreciation to the Government of Mongolia, civil organizations, and the Mongolian people for their great assistance in UN official projects and programs.
Mr. Elbegdorj also thanked her active for the ambitious beneficial projects which she had helped undertake in Mongolia, and wished her all the best.
Ms. Sinanoglu noted that Mongolia is achieving great success in the development of democracy, open society, human rights, and to promoting civil involvement.
Also, during the meeting, both talked about the projects that are currently being implemented in Mongolia. They also talked about the forthcoming lecture about Mongolian development to the UN assembly by Sezin Sinanoglu.
Following Mongolia Sezin Sinanoglu will be taking up a UNDP appointment in Bosnia and Herzegovina.
Related:
UN Resident Coordinator Sinanoglu to Return Home – Montsame, June 24
Belarus-Mongolia commission on trade and economic cooperation sit in Ulan Bator
MINSK, 26 June (BelTA) – The Belarusian-Mongolian joint commission on trade and economic cooperation is holding its regular meeting in Ulan Bator, Mongolia on 25-26 June, BelTA learnt from the press service of the Belarusian Ministry of Foreign Affairs.
The Belarusian delegation, led by Deputy Industry Minister Alexander Ogorodnikov, has comprised representatives of the Agriculture and Food Ministry, OAO Gomselmash, OAO MAZ, OAO MTZ, Baranovichi Automatic Lines Plant, OAO Promagroleasing, Belarusian Healthcare Products.
The program of the visit envisages meetings in the Food and Agriculture Ministry, the Ministry of Construction and Urban Development, the Healthcare and Sport Ministry, as well as with representatives of the Mongolian-Belarusian parliamentary group established at the State Great Hural (parliament) of Mongolia in May 2015.
It is planned that during the visit a memorandum of understanding will be signed between the Agriculture and Food Ministry of Belarus and the Ministry of Agriculture of Mongolia on cooperation in agriculture and an agreement between the Culture Ministry of Belarus and the Ministry of Education, Science and Culture of Mongolia on cooperation in the cultural sector.
Related:
MONGOLIA AND BELARUS HOLDS THE THIRD MEETING OF THE INTERGOVERNMENTAL JOINT COMMISSION – MFA Mongolia, June 26
US Army Pacific command sergeant major visits Mongolia in support of Khaan Quest 2015
TAVANTOLGOI, Mongolia, June 25 (DVIDS) - The command sergeant major of U.S. Army Pacific, Command Sgt. Maj. Bryan Lambert, took time to visit his Soldiers in Mongolia June 25, 2015, as they participate in a joint, multinational exercise at the Five Hills Training Area known as Khaan Quest 2015.
Khaan Quest is a regularly scheduled exercise hosted annually by the Mongolian Armed Forces and co-sponsored by U.S. Army Pacific and U.S. Marine Corps Forces, Pacific. More than 20 nations participate in a multitude of field training exercises alongside approximately 300 U.S. service members.
"The training conducted here is extremely important because it gives everyone a perspective — we learn about each other's armies, we learn about each other's terms of reference, and we are able to witness each other's roles and responsibilities for our Army versus theirs," said Lambert.
During Lambert's visit to the Five Hills Training Area, he was able to witness the search and cordon training event, peacekeeping exercise operations and first aid field training, as well as the command post exercise.
"Our relationship with Mongolia is a long-term partnership that we will continue to develop in the future," explained Lambert regarding the partnership with Mongolia. "We will continue to exercise and train together, we will partner at the lowest levels, and build relationships through the highest levels — we are learning from one another."
The relationship between the Mongolian and U.S. militaries is one of mutual respect and it continues to flourish. Khaan Quest is one way the relationship is enhanced, as well as strengthened through multinational relationships in the region.
"We are here to build trust; that way if something happened in the future, we are prepared to execute as a team, not individuals or individual armies," Lambert said. "That's why we focus on relationships, and that's why we reinforce the importance of trust."
U.S. Army Band to Perform at Chinggis Khaan Square
June 26 (U.S. Embassy) The U.S. Embassy in Ulaanbaatar is pleased to announce that the U.S. Eighth Army Band will perform a concert at Chinggis Khaan Square on Tuesday June 30, 2015 at 6 p.m. The performance is open to the public and are free of charge!
The Band is also scheduled for additional performances at closed events; one of the performances is a joint concert with the Mongolian Armed Forces Band.
The U.S. Eighth Army Band is in Mongolia to celebrate the July 4th U.S. Independence Day and the 25th Anniversary of the signing of the Americans with Disabilities Act (ADA). The passage and implementation of the ADA changed the face of American society in numerous ways, enhancing the independence, full participation, inclusion, and equality of opportunity for Americans with disabilities.
The Eighth Army Band began its proud history of service to the U.S. on July 1, 1916. The Band's highly trained Soldier-Musicians perform musical styles from traditional military marches to chamber music, as well as the latest country, pop, rock, and jazz tunes.
The band members are delighted to collaborate with the Mongolian Armed Forces Band and look forward to seeing everyone at their performances.
We invite everyone to come and experience the uplifting music of these two military bands!
Mongolian Servicemen in Germany Win 3rd Place at Int'l Military Competition
Ulaanbaatar, June 24 (MONTSAME) The servicemen, studying in Germany, have won the third place in category of "Best Non-German Active and Reserve Team" of the 32nd International Mönchengladbach Military (IMM) Competition. The event ran in Nordrhein Westfalen of Germany on June 20.
Some 29 teams from nine NATO states and Mongolia took part in this year's competitions. Mongolian team included L.Purevsuren, M.Bilguun, M.Bat-Orshikh and B.Ugtakhbayar, cadets of University of the German Federal Armed Forces.
The IMM comprised 17 tasks including shooting, marching, navigation, military vehicle and equipment recognition, first aid, obstacle crossing and general military knowledge.
There were a number of prizes, including First, Second and Third places overall, best mixed team, best non-German active and reserve team, best Germen active and reserve team; best mixed teams (male/female), best female teams, best mixed NATO-Teams, best team of every nation
and best team of local Police, Federal Police etc.
Last year, some Mongolian cadets at Bundeswehr University Munich had become the best team and won the Cup from an international military competition which has been organized for the 28th year.
British Embassy Wants Closer Connection via Social Media
Ulaanbaatar, June 22 (MONTSAME) Britain's new ambassador to Mongolia Catherine Arnold celebrated the birthday of Queen Elizabeth on June 18 with a stylish garden party at her UB residence. And she plans to follow the lead of Her Britannic Majesty - who turned 89 this year - by starting to tweet about the diverse life and work of the British Embassy.
"Queen Elizabeth, who is in many ways a thoroughly modern monarch, sent her first Tweet last October while opening a communications technology history exhibition at London's Science Museum" , noted Ambassador Arnold, who presented her credentials to President Elbegdorj earlier in the week.
"I also note with admiration that Prime Minister Saikhanbileg recently used a 'text-message referendum' to consult the public directly about economic policy," she said. " I would like to put the British Embassy in closer touch with the Mongolian people using social media such as Twitter and Facebook, and I warmly invite our Mongolian friends to follow me on '@HMAArnold.com'", reported the British Embassy in Ulaanbaatar.
Queen Elizabeth II sent her very first Tweet from the @BritishMonarchy Twitter account last October as she opened the new Information Age gallery at London's Science Museum.
Queen Elizabeth's actual birthday falls in April but it is usually officially celebrated in May or June at British Embassies around the world.
Catherine Arnold presented her credentials to President Elbegdorj in a grand ceremony on Chinggis Square, Ulaanbaatar on 16 June.
Ms Arnold joined the British diplomatic service in 2006. She has worked on a range of issues including human rights, counter terrorism and public affairs. After serving in Afghanistan, Iran, Iraq and Oman, Ms Arnold returned to London to work on Economic Diplomacy in the Foreign and Commonwealth Office (FCO) before moving to UK Trade & Investment.
Born and educated in Asia, Ms Arnold started her career in the private sector, working in the UK and overseas before joining the FCO. She holds degrees in conflict, philosophy, and theology & mathematics.
Robert Pires leads France to friendly win against Mongolia in senior match
June 21 (UB Post) Senior footballers of Mongolia and France held a friendly match on Friday, as part of the 50th anniversary of political relations between the two countries.
The match ended with the French team's victory by 4:2. Legendary French footballer and former Arsenal star Robert Pires scored four goals, while senior footballers Erdene-Ochir and Lkhumbengarav scored the Mongolia goals.
MNC and TM television channels broadcasted the match live on Friday to allow more football fans to watch the game without delay.
Resurgent crisis: Struggling to afford a meal
June 26 (Mongolian Economy) It has been awhile since the words economy and crisis have been so closely together. Despite optimists saying this is just a downturn and not a crisis, the opposite is true. The purchasing power of the average and below average is coming to a halt, and cash turnover is declining – so say some produce sellers.
Trade and transactions are inextricably intertwined. A vendor at Bumbugur Market said that prices of everyday goods are increasing with each passing day and have gone up by 30-40 percent compared to two years ago. Yet, buyers' salaries and wages have not increased.
Quite the contrary, people are becoming unemployed or having their wages cut. I paid a visit to the food section of Bumbugur market. There, a vendor who sells everyday goods said, "Purchases have plummeted by half in just a year. Sales are declining because of the depreciation of our currency, especially for stores like ours that sell imported products. People are glad just to be able to buy meat, flour and bread, so how can they think about buying anything else." She added, "The number of customers fell drastically. Stores selling other, less vital products such as clothing are of course struggling even more so, considering how bad food products are selling. Food and produce vendors like us at least see some sales because food is a daily necessity. Vendors who sell clothing and other goods on the second floor haven't seen any income in days."
Hard work, no gain
This past April, mutton was at MNT 6,630 per kilogram and beef was at MNT 7,946 per kilogram. As of May 7, prices have increased such that mutton is now at MNT 7,200 and beef is at MNT 8,800. Meat prices alone have increased by MNT 600-950 in the span of just month. One customer named N.Erdenechimeg talked about how the price increases affect people: "There's no point in working. Salary is never paid on time, and the flow of cash has stopped all around. Right now, I'm heading to the pawnshop to pawn my necklace, so that at least I can buy food until I get my paycheck. People are struggling just to afford a meal. In during difficulties in the past, we could at least afford food." She added, "Even if I manage to get some cash from the pawnshop today, tomorrow I will start worrying about how to get my necklace back from the pawnshop. It's tough out here." In these trying times, pawn shops see a lot more activity.
Pawnshops operate in almost every corner of the city as they lend money to people pawning small items such as gold, jewellery, their traditional silver bowls, antiques and laptops. Lately, shoes and mobile phones have been added to their list of items able to be used as collateral. According to the National Statistical Office, about 560 operational pawnshops are registered in the city as of last year. People are pawning their items that might be valuable to pawnshops at 9-14 percent monthly interest in order to afford their food. Pawnshops' services are based on simple short-term lending, unlike complicated bank loans. In the past, pawnshops operated in small one-window rooms. Nowadays, they have expanded, and people stand in rows and long queues awaiting service. The "Nachin Zaan" credit service centre has more employees than some smaller banks now. People seeking loans from pawnshops are exceeding people who are trying to get bank loans. The owner of the "Erkhes" pawnshop said that their operations used to take off during holidays or at the beginning of school terms in the past, but the number of customers have increased significantly these days. He said, "People seek out pawnshops out of inevitable necessity in order to not sleep on an empty stomach. Otherwise, there would be no need to pawn their belongings at all. To me this is a telling sign of how the economy is."
The majority of the middle class have taken out some kind of bank loan, so they are seeking non-banking financial institutions or pawnshops as a result of the unavailability of further loans.
Banks have tightened their lending policies, and people have no option other than to turn to high-interest loan services. An expert on non-banking financial institutions said that it is mostly people who have had issues with their paperwork when dealing with commercial banks or people who have had an experience with unfavourable loans seek these kinds of non-banking institutions. As for non-banking financial institutions, they provide loans up to 40 percent of the price of the immovable asset used as collateral.
Interest rates are around 3-5 percent depending on loan conditions. These kinds of institutions start their operations after analyzing people's financial demands, and the reason why they are unavailable to get standard bank loans.
By looking at this example, we can see that one man's loss is another man's gain. Some people pawn their belongings to have food for the night, but behind them are many people who are living on six slices of bread per day with nothing to pawn. Interviews with such destitute people were printed in our previous issue. The time to develop a policy that can find the source of these issues and save our people from poverty is long overdue. After all, though we cannot place all the blame on them, a big part of the reason for this crisis is the misguided policies drawn up by our reckless policymakers.
Main objective of Koosen is to develop human ingenuity
June 26 (GoGo Mongolia) It has been three years since the adoption of the Koosen training system in Mongolia which was established in 1961 in Japan. Koosen stands for high level vocational school accepts students of 15 years of age and trains them for five years.
Koosen training played an enourmous role in development of the Japanese infrastructure af the World War II. In 1962 there were 12 Koosen schools opened with state investments and only in three years the number of schools reached 43.
Koosen accepts middle school graduates and trains for the next five years. The first year allows the students to concentrate more on general education and with second year the vocational credits are being added to the curriculum.
During our visit to the Mongol Koosen school established under Institute of Technics and Technology first year students displayed their works made with copper and Dudu cars.
For the creation of those students would come up with model and with the help of the teacher produce the products. Moreover, students would produce equipment to manufacture their own products.
Teachers at Koosen believe that in order to prepare skilled engineer students have to start with the simplest things such as hand work with wood and steel. Besides teaching the theoretical side of engineering students at Koosen have the advantage of having hollistic experience of everything they were taught.
In this era of smart devices and advancements in technology sector one might be thinking why there is need to study simplest models. Good basis and wide understanding of the item will benefit in further development of the advanced devices and leverage its development.
In Koosen school students are not rushed to choose their majors and in their first year students are given more general knowledge on electric engineering, bio engineering, mechanical engineering, construction engineering.
Therefore, after receiving different courses students are more inclined to do better choices towards with skills they are more interested in and are able to major starting their second year at school.
Another upside of the Koosen training is the focus given on improving teamwork skills among its students. If at the welding class first students do their tasks by themselves, next task focuses on a team work.
Students are put into competition through the teamwork skills.
KOOSEN IN MONGOLIA
First initiatives to establish Koosen School in Mongolia was in 2008 and the first students were received in 2013. Koosen school brings many advantages into Mongolian society and economy through the penetration of "Creative" mind development.
To name few interesting facts related with Koosen training, in Japan a Koosen graduate receives up to 30-40 job offers from giants such as Sony, Panasonic, Toyota and the list extends far. Japanese companies have high interest in hiring Koosen graduates.
Famous Koosen graduates are Matsushita Konosuke, Founder of Panasonic and Honda Sooichiro, Founder of Honda. Mongolia started sending its youth to Japan for Koosen training since 1990 and there are now over 200 skilled engineers.
If one is interested in studying at Koosen one should apply after graduating 9th grade and the graduates who are usually 20 years old have complete engineering skills and are ready for the job market, or one could choose to study for two more years and earn Bachelor Degree.
INTERESTING EQUIPMENT USED IN KOOSEN TRAINING
There are two intersting equipment that have to emphasize here which are used in Mongolian Koosen training.
Ichigo Jam
Suppose everyone knows of Raspberry Pie. Then there is Ichigo Jam developed by Japanese. This one is used by Japanese in their training as it has many advantages.
It is very affordable /USD 8/ and let's students understand programming in a very simple way, that it can even be operated by a 8 year old. With being affordable students are not affraid to ruin the materials and are more creative in their modellings and therefore are more inclined to do more and gain more experience.
Sanwa analog tester
Sanwa analog tester is used in classes as being simple and very low level tester.
Same as Ichigo Jam this tester comes unassembled and students learn to assemble them and use for their work.
Mongolian Koosen is definitely gives the feeling that skilled engineers are being prepared who will lead the future technological advancement in Mongolia. Moreover, the school is planning to launch courses on bio engineering as well.
Dilemma: Where should Mongolia place $2 million Chinggis Khaan sculpture
June 22 (infomongolia.com) Former Minister of Defense, MP D.Bat-Erdene has bought the sculpture of Chinggis Khaan by Russian artist Dashi Namdakov by 2 million US dollars for the Mongolian government to promote tourism and highlight Mongolian culture.
State Great Khural (parliament) of Mongolia will discuss draft law to free Chinggis Khaan's sculpture from custom duty soon.
Now, Mongolian government must decide where to locate great leader's sculpture as citizens of Ulaanbaatar started to make a rumor about sculpture location. Some say it will be located at Chinggis Khaan Square replacing the sculpture of General Sukhbaatar, a Mongolian patriot.
Spokesman of Capital City Governor's Office said to journalist: "For locating a sculpture one must get permission from local authority. Governor's Office hasn't received any request for locating Chinggis Khaan's sculpture in Ulaanbaatar city or replacing the sculpture of General Sukhbaatar so far".
It was considered that Chinggis Khaan's sculpture will be located at Grand Maitreya City Project as a main idol.
Police Launches Website for Complaints
June 22 (news.mn) The City Police Department launched a site (www.service.police.gov.mn) from, in order to let people control and check their complaints and their calls to police. The site, which started operating on 15th June, gives an opportunity to make police organization open to public, to receive police calls of crime online, and to check their calls.
When a policeman comes to a household, he will hand a control sheet which contains his rank, full names, signature, and registration number. Also, the person who made the a call, will receive information regarding the crime registration number, details for the department dealing with the crime as well responsible bureau name, and contacting phone numbers on his or her cell phone. Besides, people can monitor the case and see who solved the cases when in what way by entering this site.
Sheep shearer, cattle herder and milk woman Sevjid Damdin talks about raising six children in the homeland of Ghengis Khan
I was born on the great steppes of Mongolia, the nation of Ghengis Khan.
I have worked as a sheep shearer, cattle herder and milk woman. I am a mother of six children. During the socialist time I won the Motherhood medal.
I wish good luck to all mothers. We mothers are all the same and we are doing good things to make our children turn into good people. In this way, we are leading the world. We never teach bad things to our children.
Sevjid Damdin, mother of Mongolia
June 29 (ABC) This is part eight of Mama Asia, a long-form journalism series in which Sally Sara meets 12 inspirational Asian women.
If you ever want to film a Mongolian version of The Sound of Music, Dadal is your place. It looks like a little bit of Austrian countryside that got lost - rolling green hills, lush meadows, polite little flowers, groves of trees, dairy cows grazing and birds singing.
Dadal is not far from Mongolia's border with Siberia - one of the harshest places on earth. But, the summers here are heavenly. The sun shines from four in the morning until almost 10 at night.
Mongolians believe this is the place where their heroic former leader Ghengis Khan was born; no-one knows for sure. But this whole district is sacred: the fence around the local waterhole is covered in bright blue scarves left by pilgrims, who believe Ghengis Khan used to drink there.
I was sure I was drinking holy water but instead I have a glass of homemade vodka in my hand and a whole hut full of people waiting for me to drink it.
I take a fake swig. There is a disappointed groan. I try again - there are smiles when the locals can see I've sent it down the hatch. I'm then given a big bowl of warm homemade cream and a spoon. This is hospitality Mongolian-style.
Sevjid Damdin is waving her hand, signalling for me to drink and eat more. She says the local vodka has been knocking over foreign guests for generations.
"The Russians called it tricky water. It tastes like water at first, then it comes to your stomach and then sometime later you suddenly feel drunk," she says.
Sevjid is small and strong, with the build of a hard-working woman. She can still fit into the clothes she wore on her wedding day, 35 years ago - she tries them on every year or so just to be sure. Her face is lined from years spent outside in the brittle winters and strong sun. But her eyes are bright and friendly.
Sevjid is the matriarch of this big, rambling family. Her rosy-cheeked granddaughter sits on her lap. Her husband, Vaani, wears an Andy Cap hat and a warm grin. His long sideburns and weathered skin frame his face. He spends much of his time outside, fixing motorbikes, or brushing the family's prized racehorse, Brown Stallion.
The inside of the hut is smoke-stained and cluttered. Calendars from years past still hang in the kitchen. Layers of wallpaper peel back to reveal chipped paint.
Sevjid grew up in Dornod province, in the far east of Mongolia. Her parents were farmers and hunters. They were kind and loving but as a small girl Sevjid spent most of her time at her neighbour's house - the home of a young childless couple.
She can't really explain it but she felt more comfortable with the childless couple than her own parents. So she left home when she was five years old.
"I just knew that I wanted to be their child. My parents were angry with me but I just ignored that. I went to that family and stayed with them and so I had two mothers and two fathers then.
"I think this is destiny or something. When I was three years old I just started knowing that I wanted to be their child. We lived close by. My adopted parents, they didn't have any children. They had a little daughter but she passed away, so they liked me very much. When I was getting to five years old, I just knew that I had to go there.
"After I came to them, they had a new child, a son. They were very happy and they love us very much. They just taught us right and wrong.
"My adopted parents never cut the relationship with my real parents, they let me go and visit my real family. During special holidays or weekends, he let me go and see my mother and father. I still have a very good relationship with my real family, I'm very spoilt."
Sevjid's granddaughter, Ariuntsetseg, sits quietly while we talk, studying her grandmother's fingers one by one. She's only a toddler but she is already allowed to roam freely outside when she wants to. Sevjid encourages her to explore and have adventures - the more dirt she has on her face and hands, the better the day.
"Our people say, 'Let children be children' otherwise they cannot think freely. Little children should be able to learn everything their own way. Don't tell them, 'you can't do this, stop this and sit here and be quiet'. We are against that one. We say, 'Let them be free'.
…
Sally Sara is an award-winning ABC journalist who has reported from more than 30 countries, including Afghanistan, Iraq, Sierra Leone and Zimbabwe.
Link to full article
Green Gold Project: Report calls for swift action to reverse pasture degradation in Mongolia
June 23 (Swiss Agency for Development and Cooperation) A comprehensive study on the state of Mongolia's rangelands has found that 65 percent had been altered, with 40 percent of the sites monitored requiring more than three years to recover. Seven percent suffered highly persistent degradation or desertification.
The "National Rangeland Health Assessment Report", presented to the Mongolian government at a workshop held on May 28, summarises the results of a six-year research project carried out by the National Agency of Meteorology and Environmental Monitoring, the National University of Life Sciences, the Academy of Sciences, the Agency of Land Affairs, the Geodesy and Cadastre and SDC's Green Gold Project.
"Addressing rangeland health is an important issue given that it is the backbone of one of Mongolia's strategic sectors and will ensure national food security and employment creation in rural areas," said Minister of Food and Agriculture R. Burmaa in her opening address at the workshop.
According to the report, the primary challenge to sustainable livestock production in Mongolia is the decline in rangeland health in many parts of the country.
Causes and Solutions
The trends of significant climatic warming, declining levels of precipitation and increasing livestock numbers pose a risk of further rangeland degradation, particularly in the central and northern parts of Mongolia.
The report suggests that grazing management practices associated with healthy pastures should be maintained in some areas, whereas in other areas management practices should be altered to promote perennial grass recovery, a reduction in the dominance of degradation indicator plants, and control soil erosion.
A new, comprehensive approach focused on the sustainable production of meat, fibre and other environmental goods and services was required. However, livestock numbers in excess of pasture carrying capacity remains the primary barrier to sustainable livestock production.
According to the report, increases in livestock numbers are likely to intensify and further exacerbate rangeland degradation. However, there were ample opportunities for changes in management practice and policy that improved rangeland health, that enabled adaptation to climate and land-use change in the long term, and that secured the future of pastoral production and food security in Mongolia. However, it was vital to act decisively and promptly before those opportunities were lost.
According to the report: "A vast majority of monitoring sites, representing more than half of Mongolia's rangelands, suggest that changes to grazing management could result in recovery or progress toward recovery within 10 years."
Download the full report (PDF, Number of pages 66, 2.2 MB) in English
To find more about the project, please visit: www.greenmongolia.mn
Artisanal Mining Project: Mongolia's progress in ASM formalisation receive international praise
June 24 (Swiss Agency for Development and Cooperation) International artisanal and small-scale mining (ASM) communities are impressed with the progress that has been made in the formalisation of Mongolia's ASM sector in the past decade, so much so that Mongolia's experiences are now regarded as achievements for their counterparts in Latin America, Asia and Africa.
"I've visited many artisanal and small-scale mining sites all over the world," said international ASM expert Felix Hrushka.
"For the first time ever, I was given a security briefing on an ASM site. This happened during my recent trip to TsagaanTsakhirt's underground mine operated by an artisanal miners' NGO in Bayankhongor province."
International validation of Mongolia's efforts in the ASM sector took place at the international ASM Knowledge Hub symposium on 10-11 June, 2015, in Ulaanbaatar, organised by the Ministry of Mining of Mongolia and Mineral Resource Authority of Mongolia in partnership with SDC's Sustainable Artisanal Mining (SAM) Project.
More than 60 delegates from 18 countries representing small-scale miners, ASM civil society organisations, ASM and other development projects, governmental and non-governmental organizations, international ASM experts, academia and research institutions took part in the event.
Creation of Knowledge Hub
Based on the success of the formalisation of the ASM sector, Mongolia is taking an important role in establishing an international knowledge hub - a space for sharing and exchanging knowledge and feedback among national and international ASM communities and stakeholders.
The SAM Project is supporting the establishment of a knowledge hub within international ASM communities, believing it is important for Mongolia's ASM organisations to be linked to their global partners in order to help further develop the sector.
"I believe we achieved our goal of identifying the key and interested players in the future knowledge-sharing network. We wanted to see what Mongolia's ASM organisations would offer the global ASM community and gain from their partners worldwide," said SAM Project Director Patience Singo.
"We succeeded in bringing together some of the world's leading experts in the artisanal mining sector, and we exchanged a great deal of best practices and lessons learnt."
One of the major achievements within the ASM sector in Mongolia has been the cooperation between the artisanal and small-scale miners and large-scale mining companies which has resulted in safe and legal workspaces for miners.
"In 2007, I had the opportunity to visit Mongolia's artisanal mining sites. Back then, it was illegal and quite chaotic, and there was no legal framework to regulate the sector," said African Mineral Development Centre advisor Salvador Mondlane.
"But I'm quite impressed with the work that has been done in formalising the sector. Mongolian artisanal miners are now legally recognised. I congratulate the Mongolian Government and ASM communities for their incredible partnership."
Mongolia to have its own international search and rescue team
June 23 (infomongolia.com) National Emergency Management Agency (NEMA) of Mongolia and United Nations have held Asia-Pacific Earthquake Response Exercise on June 22, 2015 in Mongolia.
Disaster Preparedness Department Director of NEMA B.Uuganbayar said: "Our country doesn't have a legal environment for receiving international humanitarian aids. Therefore, a draft law on disaster prevention with certain articles dedicated to receiving and sending international humanitarian aids is being prepared based on experience of other countries".
Mongolia is member country INSARAG (International Search and Rescue Advisory Group) and intends to create an own international USAR (urban search and rescue) team.
INSARAG is an international organization that operates under UN and aims to establishes standards and classification for international USAR teams. According to INSARAG External Classification (IEC) system, international USAR teams are classified as light, heavy and medium, and NEMA will have medium team (50-60 members).
As international USAR teams are deployed in disaster-affected foreign countries, team should be well equipped and its members must have good language skill, and mental and physical training.
With this in mind, NEMA of Mongolia have started the training of own team by sending first 20 specialists to China for training at the end of June. After the preparation, UN specialists will be invited to examine first Mongolian international USAR team.
Measles cases on the decline
June 23 (gogo.mn) According to the announcement made by the Infectious Disease Research Center the cases of measles have decline in comparison with two weeks ago.
As of June 22nd total of 435 patients are being treated of measles of which 91 have accute condition and 22 are being treated at the intensive care unit.
The number of the patients at the Infectious Disease Research Center has declined by 58 and the number of the calls for possible measles cases has decreased as well.
There were 17,771 cases of the possible measles cases registered since the outbreak of the disease and only 797 were proven by the lab tests.
M.Urantsetseg sets highest score for world judo ranking
June 24 (gogo.mn) IJF (International Judo Federation) renewed the world ranking of its athletes.
According to the renewed ranking released on June 21st G.Boldbaatar and M.Urantsetseg from Mongolia topped in their weight categories respectively.
Male athlete ranking was topped by Avtandili Tchrikishvili from Georgia with 3080 points.
Female ranking was topped by M.Urantsetseg from Mongolia with 3378 points.
Points collected by M.Urantsetseg sets new high for the world ranking.
Below is the ranking of the Mongolian judokas. /Note: as per first 21 places/
Male
-60kg
G.Boldbaatar with 2290 points leading
D.Amartuvshin with 1573 points at 8th place
G.Kherlen with 946 points at 16th place
-66kg
D.Tumurkhuleg with 1732 points at 3rd place
-73kg
S.Nyam-Ochir with 1068 points at 16th place
Kh.Tsagaanbaatar with 1060 points at 17th place
-81kg
O.Uuganbaatar with 836 points at 20th place
-100kg
N.Tuvshinbayar with 885 points at 21st place
Female
-48kg
M.Urantsetseg with 3378 points leading
G.Otgontsetseg with 1044 points at 13th place
-52kg
M.Bundmaa with 849 points at 18th place
-57kg
D.Sumiya with 1856 points at 3rd place
-63kg
Ts.Munkhzaya with 988 points at 10th place
-70kg
Ts.Naranjargal with 1317 points at 9th place
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