Foreign Minister of Mongolia Battsetseg Batmonkh will pay an official visit to Uzbekistan on March 8-9 at the invitation of Minister of Foreign Affairs of Uzbekistan Bakhtiyor Saidov, Montsame reported.

Battsetseg Batmonkh will meet with the leadership of the government of Uzbekistan, hold official talks with her Uzbek counterpart Bakhtiyor Saidov.

Bilateral meetings are planned with representatives of the ministries of trade, investment, agriculture and transport.

It is expected that the agenda during these meetings will cover the deepening of Mongolian-Uzbek cooperation, including the expansion of trade and economic cooperation and the exchange of views on international and regional issues.

The upcoming visit will be the first visit at the level of a foreign minister since the establishment of diplomatic relations with Uzbekistan in 1992, the Mongolian Foreign Ministry notes.

McElroy is pleased to announce the addition of a new distributor to sell and service fusion machinery in Mongolia.

EES Engineering is based in Khoroo, Mongolia and caters to the country’s fast-growing mining industry.

Munkherdene Sanjdorj, head of Business Development at EES Engineering, said his company was first introduced to McElroy equipment while working with the Oyu Tolgoi Mine in the southern part of the country.

“Our company was founded in 2015, at which time the mining industry in Mongolia was still quite young,” said Sanjdorj. “The core of our business is mining equipment and maintenance, so when we were introduced to McElroy equipment, we were quite excited to get involved.”

“EES, LLC is a new and growing company, and we’re excited to help play a part in their success,” said McElroy CEO and President Chip McElroy.

The company prides itself on promoting the latest technology, services, and equipment to boost productivity, quality, and safety in Mongolia.

“From the start, we (EES Engineering’s ownership) wanted to introduce Western brands to the country, as well as an understanding of the equipment itself,” Sanjdorj added.

“Our mining industry is still in a maturing phase, and local companies still have a lot of room for learning.”

Sanjdorj said the company was also drawn to the service training available for McElroy equipment. Through McElroy University, McElroy offers multiple levels of technician and service training, allowing distributors to maintain the highest standards in terms of quality and reliability.

To join McElroy’s distributor network, companies must demonstrate a commitment to providing the same level of service and support that has been a cornerstone of McElroy since its inception. Distributors understand McElroy equipment and the fusion process and are trained to provide service and support.

“We need to be self-reliant when it comes to looking after our machines,” he said. “In the last three years, when many technicians couldn’t enter the country, we were tested to the maximum. We realized the benefit of self-sufficiency and self-reliance when it comes to maintaining and servicing our equipment.”

Annual camel festival was held in Mongolia’s southern province of South Gobi (Umnugobi), as the country hopes to revive its tourism sector and pass on the camel culture to the next generations.

Hundreds of camel herders and camels across the nomadic country participated in the two-day festival held in the provincial capital city of Dalanzadgad. The “Ten Thousand Camel Festival” event includes camel polo, camel racing, camel parade, camel relay races, camel auction and an exhibition of camel products.

Mongolia has planned more than 90 events, including the camel festival, to attract tourists, declaring 2023-2025 as “Years to Visit Mongolia.”

South Gobi has the largest camel population in the country, accounting for over 30 percent of the national total.

On March 8, at 2:00 PM EST, Secretary of State Antony J. Blinken, along with the First Lady of the United States, Dr. Jill Biden, will host the annual International Women of Courage (IWOC) Awards in an award ceremony at the White House and present awards to each of the eleven 2023 IWOC awardees, recognizing their exceptional courage, strength, and leadership.

The award ceremony will be live streamed on www.state.gov in Mongolia on March 9, at 3:00 AM ULAT.

Brigadier General Bolor Ganbold will be honored for her nearly 30 years of courageous service to Mongolia and the series of firsts she has achieved, which have broken barriers and opened the door for other women to follow. On March 18, 2022, Brigadier General Bolor earned yet another first, becoming the first woman general in the Mongolian Armed Forces. Her experiences as a member of both the United Nations Mission in the Central African Republic and Chad in 2010 and the United Nations Mission in South Sudan in 2013, as well as serving as a Peacekeeping Affairs Officer within the United Nations Department of Peacekeeping Operations, have guided her efforts in seeking to reduce the various barriers that prevent women from fully developing their potential as peacekeepers. Brigadier General Bolor utilizes her current position as the Chief of the Education and Training Directorate of the General Staff of the Mongolian Armed Forces to advance gender equality in all facets of the Mongolian Armed Forces’ organizational structure, activities, and operations.

Attributed to U.S. Ambassador Richard Buangan:

The U.S. Embassy in Mongolia is proud that Brigadier General Bolor Ganbold has been selected as one of 11 women leaders to receive the International Women of Courage Award. It is the most prestigious award given by the U.S. Secretary of State to women from around the world who demonstrate exceptional courage, strength, and leadership in advocating peace, justice, human rights, gender equality, and the empowerment of women and girls, often at personal risk and sacrifice. I hope that her story and the story of other IWOC Awardees will serve as sources of inspiration for women and girls around the world to break gender barriers, advance equality, and build brighter futures for all.

As the first woman general in the Mongolian Armed Forces, BG Bolor has opened the door for women to rise in military ranks that are traditionally reserved for men and paved the path for women in uniform to serve as leaders in UN peacekeeping.

My colleagues and I look forward to following the ceremony online when BG Bolor receives her award from Secretary Blinken and First Lady Dr. Jill Biden at the White House in Washington DC on March 8.

Courageous women inspire a better world. Now in its 17th year, the Secretary of State’s IWOC Award recognizes women from around the globe who have demonstrated exceptional courage and leadership in advocating for peace, justice, human rights, gender equity and equality, and women’s empowerment – often at great personal risk and sacrifice. Since March 2007, the Department of State has recognized more than 180 awardees from over 80 countries. U.S. diplomatic missions nominate one woman of courage from their respective host countries and finalists are selected and approved by senior Department officials. Learn more about IWOC at https://www.state.gov/secretary-of-states-international.../.

Following the IWOC ceremony, Brigadier General Bolor will continue to participate in a two-week International Visitor Leadership Program (IVLP) exchange and connect with American counterparts throughout the United States. Brigadier General Bolor will visit Cleveland and Los Angeles and cultivate relationships with her counterparts to share strategies and ideas to empower women and girls around the globe, in all their diversity.

The International Visitor Leadership Program (IVLP) is the U.S. Department of State’s premier professional exchange program. Through short-term visits to the United States, current and emerging foreign leaders in a variety of fields experience this country firsthand and cultivate lasting relationships with their American counterparts. Learn more about the IVLP here: https://eca.state.gov/ivlp.

Media outlets in Mongolia are encouraged to reach out to PasPress@usembassy.mn email for more information. We also invite you to follow #IWOC2023 and #WomenOfCourage on social media for updates on this year’s awards.

Parliament approved the Law on Regulation Activities of Money Loans and the law entered into force on March 01, 2023. The law aims to register and control legal entities engaged in the operation of money loans granted under the collateral lending procedure. It also applies to a citizen who participates in money-lending activities regularly and for the purpose of making a profit. The Law provides for regulations related to setting the maximum interest rate for loans, paying the loan and its interest, and protecting the rights and legal interests of the client in the operation of money loans.

The Law has defined the following requirements for entities and citizens engaged in money loans;

the amount of capital (cash) of citizens – for loan activities - and the amount of capital contributed by legal entities must not be less than MNT10.0 million,

staff (executive management, managers, and related employees) must have attended training,

possession of a current bank account for cash loan operations,

registration as a taxpayer,

cash register and printing equipment connected to the unified tax system,

a workplace that meets the requirements and standards for the activity (in order to engage in money loan activities under the collateral lending procedure),

the online registration process, and

connection to an electronic database;

Regarding the Law, in cases where the capital contribution of a legal entity engaged in money loan activities is MNT100.0 million in provinces (and more than and MNT300.0 million in the capital), it shall be registered with the Financial Regulation Commission. In other cases, it shall apply to and request registration with the Governor of the aimag, or Ulaanbaatar, respectively. Before the Law enters into force, a pawnshop that has entered into an agreement with the competent authority shall be registered with the relevant registration authority (within one year after the Law enters into force.

The Law on the Regulation Activities of Money Loans includes the following detailed regulations related to money loans. Unregistered entities shall not engage in money loan activities or not make advertising about money loan activities. Registered entities shall set the interest rate at the maximum loan interest rate determined by the Money Loans Policy Council and work according to the calculation of the amount of loan interest and the methodology. Registered entities shall not pledge items registered with the electronic database containing information on lost items. Registered entities shall immediately report suspicious items to the Police.

Registered entities shall deliver the notice of enforcement of the lien to the borrower, and borrowers must pay it within 14 days. If the mortgagor requests, determine the value of the mortgaged item by an expert before selling it. If the entity sells the pledged item, the rest of the income will be paid to the pledgee after deducting the pledge requirement.

The implementation of the Law has the following significance;

empowering legal entities engaged in money loans activities as professional financial participants,

improve service standards,

protect the rights of customers,

prevent citizens from becoming victims of high-interest money laundering,

prevent crime by reducing the act of taking loans against stolen goods, and

combating money laundering and the financing of terrorism.

As soon as the Law comes into force, citizens will have the possibility to check whether an entity is registered with the competent authority when receiving financial services from a legal entity engaged in money loan activities. People will be able to review the terms of the loan and interest rates and minimize any possible risks.

Source: Financial Regulatory Commission

Qatar Chamber hosted on Monday the “Qatar-Mongolian Business Meeting”, which was co-chaired by First Vice Chairman HE Mohamed bin Twar al-Kuwari and Chief of the President Office of Mongolia HE Sodbaatar Yangug, in the presence of many businessmen from both countries.

The meeting touched on ways to enhance cooperation between Qatari and Mongolian businessmen, as well as the investment opportunities available on both sides.

Addressing the meeting, HE Mohamed bin Twar Al Kuwari said that the State of Qatar and Mongolia are linked with good relations, noting that they have a common desire to enhance their relations, especially in the economic and commercial fields.

HE also indicated that Qatar offers an attractive investment environment that introduces many incentives and facilitations that allow full ownership for foreign investors in various economic sectors and activities, in addition to the advanced infrastructure and the economic laws and legislation, assuring that these privileges helped Qatar to become a leading destination for business and investment.

Al Kuwari invited Mongolian companies to invest in Qatar and take advantage of the incentives offered to foreign investors and the opportunities galore in multiple sector, stressing that the Qatar market is promising and welcomes foreign investments.

HE also underscored the Qatar Chamber’s interest in encouraging Qatari businessmen to invest in Mongolia, pointing out that it owns tremendous potential and promising investment opportunities in a diversity of sectors such as agriculture, food, tourism, mining and others.

For his part, Chief of the President Office of Mongolia HE Sodbaatar Yangug praised the good relations between his country and Qatar, stressing that they witnessed considerable growth over the past 25 years, noting that they the Mongolian

Government is keen to develop the commercial and economic relations with Qatar and support the activities of businessmen.

He noted that both countries signed a number of agreements in various sectors, expressing his confidence that these agreements would contribute to facilitating trade and investment between both sides, indicating that the delegation compromise 22 abusinessmen from 13 companies specialized in agriculture, food processig, mining and tourism.

Duuren Tumenjagal, CEO of the Mongolian National Chamber of Commerce and Industry, said that the delegation includes a number of businessmen willing to enhance cooperation with the Qatari side in various sectors, calling Qatari investors to visit Mongolia to learn about the investment opportunities available there.

He delivered a presentation on the Mongolian economy and the investment climate, as well as opportunities in agriculture, tourism, mining, and meat productions sectors.

Canada’s crackdown on Chinese investment in critical minerals will make it harder for miners to produce the metals needed for the global energy transition, according to Ivanhoe Mines Ltd. founder Robert Friedland.

“We’re going to be deprived of all this Chinese capital in all these junior mining companies,” the billionaire mining magnate told a packed auditorium in Toronto on Sunday. “It’s really getting harder out there to be a miner.”

The Canadian government tightened its foreign investment laws in November to clamp down on foreign state-owned enterprises pursuing takeovers or investing in the mining industry. That same month, the government ordered three Chinese firms to divest from a trio of junior lithium explorers.

The new rules create a financial quandary for Canadian miners who’ve relied on China as a reliable source of funding. China has built up stakes in more than two dozen Canadian mining companies, including some of the industry’s biggest names, according to a Bloomberg analysis.

Citic Metal Africa and Zijin Mining Group, two firms closely linked to the Chinese government, hold a combined 39.5% stake in Friedland’s Ivanhoe Mines. Jiangxi Copper Co. owns 18.3% of Vancouver-based copper producer First Quantum Minerals Ltd.

Friedland, speaking at an industry conference hosted by the Prospectors & Developers Association of Canada, said the rules make it “even harder” to produce metals like lithium, copper and nickel when demand for the metals is set to soar.

“We’re going to need a lot more money coming to junior mining. I mean, orders of magnitude more,” he said.

Canada’s new rules don’t identify countries, but the updates are part of a new policy approach toward China, which Prime Minister Justin Trudeau’s government has described as an “increasingly disruptive global power” that disregards international rules and norms.

(By Jacob Lorinc)

Numerous connectivity infrstructure projects are repositioning Mongolia as an energy and transit hub for Northeast Asia

The ongoing transformation of the world order is inevitably affecting the regional subsystems of international relations. Mongolia is the only country in the region that has practically no significant disputes or disagreements with any states. Due to the specifics of its geographical location, its main partners are China and Russia. Ulaan Baatar appreciates the potential for the formation of a multipolar world, free from conflict. Probably, the current geopolitical conditions may both give a new impetus to the development of the country, and, on the contrary, initiate chaos in domestic and foreign policy.

The idea of Mongolia’s vulnerability is however being actively promoted in the West and could lead to some political uncertainty. For example, the UK Guardian stated in May 2022 that due to “Renewed pressure from its authoritarian neighbours, China and Russia, the Mongolian economy is suffering, the standard of living of the population is declining, and the chances of establishing cooperation with the West are decreasing.” However, despite a number of frankly anti-Chinese and Russian articles that have focused on the “nomadic”, freedom-loving spirit of the Mongolian people, which must escape from the “trap”, such ideas have failed to gain traction among locals. Even the protests in December 2022 were caused not by any external factors, but by corruption among the authorities and officials, who together were to blame for both inflation and the everyday difficulties of residents.

Nevertheless, due to the influence of information technologies and the fact that 2/3 of the population is under 35 years old, society willingly adopts liberal values and ideas. One of the most attractive concepts is the so-called third neighbour policy, proposed to Ulaan Baatar by Washington back in the 1990s and aimed at reducing the influence of Moscow and Beijing. The applied proposals of American ideologists include development of the transport industry with the help of Western investment, with co-ownership of the infrastructure built to increase the country’s autonomy and subsequently pressure China and Russia via tariffs impositions and sanctions.

Opening up the mining sector

So far, one of the few examples of this approach being implemented is the project launched by the Australian-British mining corporation Rio Tinto to develop the world’s largest gold and copper deposit, Oyu Tolgoi, in the Gobi desert. The facility is the largest in terms of attracting foreign direct investment and provides several thousand highly paid jobs. Rio Tinto’s investment has already exceeded US$7 billion, which the Mongolian government will not be able to immediately return in case of refusal. Although Ulaan Baatar fears that over-exploitation will cause irreversible damage to nature, the limited extraction of resources will begin in 2023. At the Mongolian Economic Forum 2022, Prime Minister Luvsannamsrain Oyun-Erdene noted the extreme interest in expanding the export of goods, especially copper concentrate and coking coal. The implementation of the government’s plan to privatise some state-owned companies should help attract about US$50 billion in private investment in the energy sector, land-based logistics terminals (“dry ports”), and industrial production. As a result, the volume of exports should grow from US$9 billion to US$20 billion by 2029. It also provides for the establishment of a diversified national wealth fund to stabilise the exchange rate of the Mongolian Tugrik and curb inflation, which will require the assistance of other foreign currencies in addition to the Chinese Yuan and the Ruble.

However, from the Mongolian perspective, these “third neighbours” do not have to be the United States, the European Union or Japan — as India, Iran, Pakistan, the Central Asian nations, ASEAN and South Korea are also showing interest in cooperation with Mongolia.

New transit infrastructure

For several decades, Mongolia only had a railway connection with the USSR, later following the collapse of the Soviet Union with Russia inheriting the route. Almost the entire railway network of the country was created on the basis of the Russian 1520 mm railway gauge, which forced the massive use of trucks in trade with China. However, at present, export opportunities on the Chinese-Mongolian border have reached their limit due to infrastructural restrictions — 13 “dry ports” have already been organised, through which coal, iron ore, and copper concentrate are delivered by road.

The construction of 1435 gauge railways such as those that are widely used in China, according to the plan of the Mongolian authorities, should contribute to the growth of export-import operations throughout the Eurasian space, finally realising their extraction potential and supplying Asian markets with raw materials and finished products.

During the visit of the Mongolian Prime Minister to Beijing in February 2022, agreements were reached on the speedy unification of three routes from the southern Gobi Desert to China. Railways with a capacity of more than 20 million tonnes per year will link natural resource deposits and logistics terminals with China’s Mandal checkpoint in Inner Mongolia. There are even more ambitious plans for laying a trans-Mongolian highway linking the east and west of the country, a plan that would connect Kazakhstan with China via Mongolia.

To increase commercial attractiveness, the Mongolian government permits the transfer of part of the tracks and trans-shipment points in concessions to Chinese and Russian companies. The most important transit links will connect Russia’s Trans-Baikal Territory and Northeast China via eastern Mongolia, and connect the Tuvan Republic in Southern Siberia with China’s Xinjiang Province through western Mongolia. In addition to railways, the construction of high-speed cross-border highways is also under consideration.

Power of Siberia

In 2019, Russia and Mongolia signed a memorandum of understanding on the construction of a trans-Mongolian gas pipeline with a capacity of 50 billion cubic meters per year. The Soyuz Vostok project, part of the Power of Siberia-2 pipeline, is extremely important for Russia in terms of organising an uninterrupted supply of natural gas to Asian markets in the face of difficulties with Europe. Gazprom is currently finalizing the details with the Mongolian and Chinese sides. Beijing is also interested in increasing purchases of fuel from Russia, which, in the face of rivalry with the United States at sea, seeks to strengthen the security of transporting strategically important raw materials through the development of land routes. Similar reasons have stimulated the development of cross-border electricity supplies from Russia to China through Mongolia.

This means that instead of being an isolated land-locked country, Mongolia is developing as a centre of transport communications and the site for the implementation of significant regional multilateral projects.

The Mongolia-China-Russia triumvirate

In July 2022, the Russian Foreign Minister Sergey Lavrov visited Ulaan Baatar. The main topics of discussions were the reconstruction of border checkpoints, the development of free trade economic zones, the supply of petroleum products, as well as the construction of a cross-border gas pipeline as part of the Mongolia-Russia-China economic corridor project. At the Eastern Economic Forum 2022 in Vladivostok, Vladimir Putin discussed the prospects for cooperation with Mongolian Prime Minister Oyun-Erdene, and they confirmed their intention to jointly implement projects in transport, energy and the extraction of natural resources. Also in September 2022, a trilateral meeting of the heads of Russia, China and Mongolia was held in Samarkand. The Russian President emphasised that such a format is of particular importance, as it effectively complements bilateral cooperation and provides high added value for all three countries.

In November 2022, Mongolian President Ukhnaagiin Khürelsükh visited China, where he held talks with President Xi Jinping. Thanks to the removal of Covid restrictions, the volume of bilateral trade in a number of positions, primarily in coal, has tripled. In addition, the Mongolian leader noted that the country’s economic development plans, including the “New Revival Policy” and “Vision 2050” are closely aligned with China’s Belt and Road Initiative and provide for the joint development of cooperation with Beijing in the fields of investment, finance, energy, infrastructure, e-commerce and environmental technologies. The joint statement emphasises commitment to the spirit of the 1994 Treaty of Friendship and Cooperation and the 2014 Joint Declaration on the Establishment of a Comprehensive Strategic Partnership.

The Russian side supports its Mongolian partners in joining the work of the Shanghai Cooperation Organisation, the Eurasian Economic Union and in building mutually beneficial conditions. Beijing has a similar interest. It is worth noting the successful independent initiatives of multilateral formats, such as the Ulaan Baatar Dialogue. Today, a comprehensive and pragmatic approach to issues of cooperation with neighbouring states and a course towards integration into the common Eurasian space are justifiable goals for the Mongolian government.

Source: Andrey Gubin for the Valdai Club

Dezan Shira & Associates have offices in Mongolia, as well as China and Russia. For market and business analysis, corporate establishment, tax advisory and trade compliance issues please contact us at asia@dezshira.com