During his working trip to Bayannuur soum of Bayan-Ulgii aimag, Prime Minister L.Oyun-Erdene became acquainted with the progress of the Erdeneburen hydropower plant project.

With the commissioning of the plant, it will become possible to provide the country's western region with domestically produced energy, eliminate the dependence on imported electricity and have a reliable source.

Within the framework of the ‘Revival of Energy’ objective set out in the government’s ‘New Revival Policy’, renewable energy sources including hydro power plant are prioritized. In this regard, works are being carried out to complete the construction of the 90MW Erdeneburen HPP, and launch the construction work for 220MW Eg River hydropower plant.

There are 270 households who currently reside in the area taken as state special-use for the implementation of the Erdeneburen HPP project. In accordance with the Law on Land and accompanying regulations, corresponding officials are working to relocate 270 households in phases between 2022 and 2025. Funding required to relocate 91 households in 2022 has been allocated in the state budget so far.

“The issues on eliminating the dependence on the energy sector and building new energy sources are the priority for Mongolia. One of the several stations, which will have a significant contribution to the energy sector, is the Erdeneburen HPP,” highlighted Prime Minister L.Oyun-Erdene.

The 103rd meeting of International Organizing Committee for World Mining Congress (IOC/WMC meeting) took place last week in Ulaanbaatar, Mongolia.

The meeting was attended by Minister of Mining and Heavy Industry G.Yondon, WMC Chairman Marek Cala, General Director of Erdenet Mining Corporation Kh.Badamsuren, Executive Director of Mongolian Coal Association J.Zoljargal as well as representatives from 15 countries including India, China, Australia and Poland.

In the first part of the meeting, participants were provided information about Mongolia’s export of copper, coal and critical minerals and future trends, India’s investment in mining sector as well as global mining reports.

In the second part of the meeting, Australia’s National Organizing Committee introduced about the preparation process for 26th World Mining Congress to be held in Brisbane in 2023, and Executive Director General of China National Coal Association Su Chuanrong gave a presentation about China’s mining and coal sector development. The participants also heard the report of the sub-committee for new members and the speech of WMC General Secretary Jacek Skiba.

China is planning a state-backed iron ore company to oversee everything from massive mine investments in West Africa to buying the steelmaking material from global suppliers, according to people familiar with the matter.

Top leaders in Beijing have a vision for the new entity to assume broad responsibility for raw materials supplies to the country’s sprawling steel industry, by far the world’s biggest, said the people, who asked not to be identified as the information is private.

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The plan would mark China’s biggest effort yet to tackle what its officials have long argued is the excessive pricing power wielded by miners including BHP Group Ltd. and Rio Tinto Plc. China spent about $180 billion on iron ore imports last year.

The new entity would house outbound investments such as the Simandou iron ore project in Guinea, seen by the China’s leaders as the best route to ease the steel industry’s reliance on Australian ore. It would also ideally become the sole channel for buying imported iron ore from third parties, most of which comes from either Australia or Brazil.

Bloomberg reported in February that China was planning a centralized purchasing platform for iron ore imports. Plans for a new state-owned company to handle iron ore imports and overseas investments were reported by the Wall Street Journal last week and Caixin on Monday.

The plan has been under consideration for years with the backing of senior leaders, the people said. At the very least, it will be a vehicle to consolidate several overseas iron ore investments including Simandou, as well as raw materials purchasing for a handful of China’s biggest state-owned steelmakers.

The establishment of the firm is seen progressing this month after Yao Lin, the chairman of Aluminum Corp. of China and a key organizer of the iron ore firm, left Chinalco. Yao and Guo Bin, executive vice president of China Baowu Steel Group Co., will lead the new company, which will be directly under China’s State-Owned Assets Supervision and Administration Commission, said the people.

China’s State-owned Assets Supervision and Administration Commission and National Development and Reform Commission didn’t immediately reply to faxed requests for comment.

The development of Simandou in Guinea has repeatedly been delayed by legal disputes and government changes in Guinea. The reserve holds one of the world’s largest untapped reserves of iron ore and is divided into four blocks, with 1 and 2 controlled by the consortium backed by Chinese and Singaporean companies, while Rio Tinto and a joint venture between Chinalco and Baowu own blocks 3 and 4.

In June, the gold purchase of the Bank of Mongolia (BoM) was 1,962.6 kg, raising the BoM’s total precious metal purchase of 2022 to 7.9 tons. The figure shows a decrease of 16 percent as compared with the same period of the previous year.

Since the beginning of this year, the BoM branches in Darkhan-Uul and Bayankhongor aimags have bought 490.6 kg and 491 kg of precious metals respectively.

In June, the average price of BoM’s purchase of 1 gram of gold was MNT 193,390.89 last month.

15,000 foreign companies from 113 countries registered as investors in Mongolia from 1990 to 2019, after the country legally allowed foreign investment. China accounted for 50% of foreign investors' enterprises, South Korea for 17%, and Russia for 6%.

South Korean Institute of Mongolian Studies of Danggu University and Mongolian University of Commerce and Industry (MTPU) emphasized investment statistics during a joint scientific conference on the state of trade between South Korea and Mongolia.

Head of the policy and strategy department at the Mongolian National Chamber of Commerce and Industry J. Oyunchimeg presented the business environment of Mongolia, and trade manager of Land Bridge LLC M. Gan-Erdene spoke about the cargo transportation problems between the two countries.

Professor N. Otgonsaikhan from MTPU prresented the advantages and disadvantages of trade, transport mediation, freight transport, taxes and investments between South Korea and Mongolia.

The parties also discussed the fact that the volume of bilateral trade between the two countries does not reach the desired level.

July 18 (Xinhua) -- The Omicron subvariants BA.4 and BA.5 accounted for around 10 percent of new daily infections in Mongolia, according to health authorities.

"First cases of Omicron sub-variants BA.4 and BA.5 were detected in our country late last month," the director of the National Center for Communicable Diseases (NCCD) Tsolmon Bilegtsaikhan said in a statement.

Due to the most contagious Omicron subvariants, the number of new cases is expected to increase in the Asian country, Bilegtsaikhan said, urging the public to wear face masks in public or crowded places.

The country on Monday confirmed 101 new COVID-19 cases, bringing the national tally to 931,458, according to the country's health ministry. Enditem

H&M has announced it is leaving Russia but will temporarily reopen its shops there to sell off its remaining stock.

The world's second-biggest clothing retailer said it was "impossible" to continue its business in Russia due to the Ukraine war.

The decision comes after the Swedish firm suspended all sales in Russia in March, shortly after Russian troops invaded Ukraine in late February.

H&M is understood to have more than 150 stores and about 6,000 staff in Russia.

It has not given a date or timescale for its exit.

"After careful consideration, we see it as impossible given the current situation to continue our business in Russia," said chief executive Helena Helmersson.

"We are deeply saddened about the impact this will have on our colleagues and very grateful for all their hard work and dedication. Furthermore, we wish to thank our customers for their support throughout the years."

Which companies are pulling out of Russia?

H&M is one of many brands pulling out of Russia in recent months. Many have said sanctions imposed after the invasion by Western allies have made trading unviable and in some sectors impossible.

Others have left taking a moral stance on the war, or are responding to pressure from consumers to act.

Prior to it suspending sales, Russia was H&M's sixth-biggest market, accounting for about 4% of group sales in the fourth quarter of 2021.

The fashion giant had been expanding its presence in Russia since starting operations there in 2009, including opening shops under other brand names in its portfolio, Weekday and & Other Stories. Russian shoppers could previously order clothes from the brands Monki and Cos online.

H&M forecast departing from Russia will cost the group about about two billion Swedish Krona.

The retailer's shops in Ukraine have been closed for some time due to concerns over the safety of customers and staff.

Mongolia expects Russia to begin construction of the “Power of Siberia 2” gas pipeline through its territory to China within two years, as Moscow moves to connect its Europe-supplying gasfields to Asia for the first time.

Mongolia’s prime minister Oyun-Erdene Luvsannamsrai told the Financial Times that while the war in Ukraine had clouded planning for the pipeline, he expected construction to go ahead.

The Power of Siberia 2 project has become critical to Russia as it faces the prospect of losing Europe as a market for its gas following its invasion of Ukraine and accusations it has “weaponised” supply to create a price crisis.

“The feasibility study of this project has finished and we believe construction will begin in 2024,” Luvsannamsrai said.

The prime minister also said Rio Tinto’s huge Oyu Tolgoi mine project in Mongolia was on schedule and that the country was making progress in preparations to deal with looming bond repayments.

Power of Siberia 2 will connect Siberian fields that supply Europe — which has pledged to end its dependence on Russia’s state-backed Gazprom — to China, where demand for gas is rising.

Mongolia, which has a population of more than 3.3mn in a vast territory, is landlocked between China and Russia. Luvsannamsrai said that being hemmed in by two “superpowers” at a time of geopolitical stress created complications, but that Mongolia was used to working closely with both.

Ulan Bator signed a memorandum of understanding with Moscow in 2019 to explore the Power of Siberia 2 pipeline, which would carry up to 50bn cubic meters of gas a year through its territory.

Luvsannamsrai said there had not been any significant increase in pressure from Russia to accelerate construction of the line despite Gazprom’s plans to pivot its focus to Asia. Alexei Miller, Gazprom chief, has suggested China will become its cornerstone customer in the future.

Luvsannamsrai said the final route of the line through Mongolia was still being “deliberated”.

The 2,600km pipeline has been predicted to enter service in about 2030, but industry executives believe that could be brought forward given Moscow’s need to find markets for its energy supplies.

Transit fees from the pipeline will help Mongolia’s economy, which was hit hard by the coronavirus pandemic. China, its main trading partner, frequently closed Mongolian export routes as it tried to control the virus.

Luvsannamsrai said he expected Mongolia’s economy to strengthen this year, helped by new rail connections to China that will be used to ship commodities such as coal and copper.

Exports of copper are expected to grow substantially in the next few years as miner Rio Tinto expands development of a huge copper deposit in the Gobi Desert.

The Oyu Tolgoi mine is Mongolia’s biggest source of foreign direct investment and provides thousands of well-paid jobs, but its underground expansion has been beset by delays and cost overruns that have caused bitter rows between Rio Tinto and Ulan Bator.

Last year, Mongolia threatened to halt work on the project, saying it would never receive a dividend from the mine because of the amount of debt taken on to develop it.

Rio in December agreed to write off more than $2bn of loans and interest used by the government to fund its share of total development costs that were on Friday revealed to total $7bn, up from $5.3bn.

Luvsannamsrai, who met with Rio chief executive Jakob Stausholm last week, said he was “confident” the mine was running to schedule, with underground production to start in the first half of next year.

“I believe this will be clear example of how Mongolia can work actively and efficiently with its investors,” the prime minister said, referring to the deal with Rio.

Asked about Mongolia’s foreign debts, Luvsannamsrai acknowledged Ulan Bator had some “issues” to work through, but pointed to a recent deal with Japan for early repayment of a yen-denominated bond as evidence of progress.

He said Mongolia had been “focusing on how we can improve our reputation” in capital markets.

Including the samurai bond, Mongolia has about $1.3bn of bonds maturing in 2023 and $600mn in 2024, but low levels of foreign currency reserves.

“We believe the recent drop in commodity prices is a temporary shock . . . due to the pandemic and the Russian-Ukraine crisis,” Luvsannamsrai said. “We have an optimistic view that copper use and production will not decrease in the future but increase.”

July 18 (Xinhua) -- Mongolia's inflation, as measured by the consumer price index, rose to 16.1 percent in June, the country's National Statistics Office said Monday.

The index rose 1.5 percent from the previous month and 9.5 percent from the end of last year, the office said in a statement.

The statistical agency said the increase is directly related to the higher prices for imported goods.

The office added that there are 373 items in the country's consumer goods and services basket, and more than half of them are imported.

By the initiative of the European Union funded “Sustainable Textile Production and Ecolabelling project (STePEcoLab)”, the “Roadmap for the Sustainable Development of the Mongolian Cashmere Sector - 2030” has been developed in collaboration with relevant ministries, agencies, professional associations and experts. As a result, the government policies and programs, international assistance, and consumer needs and demands have been harmoniously planned, and stakeholders have defined a common vision and a clear path to achieve it. The roadmap supports environmentally friendly production at all stages of value chain - starting from the preparation and supply of raw materials at herder level and promote sustainable consumption until the end of the line.

During the Roadmap launch event, J. Bat-Erdene, Member of Parliament and President of the Mongolian Wool and Cashmere Association (MWCA), emphasized “The wool and cashmere sector, with more than 10,000 employees and 400 million USD in sales, takes the second place after the mining sector by the contribution to the development of the country. The “Roadmap for the Sustainable Development of the Mongolian Cashmere Sector 2030” is the first “sustainable development” document in the light industry sector. The particular importance of this roadmap is the definition of the vision, mission and medium and short-term goals and objectives for the environmentally friendly and sustainable development of the Mongolian wool and cashmere industry until 2030. Representatives of international projects and programs, public and private sectors and professional associations were actively involved in the development of the roadmap, and the MWCA will undoubtedly play a role of a leader and initiator in the implementation of its’ activities in the sector.” in his speech.

H.E Ms Axelle Nicaise, Ambassador of the European Union to Mongolia: “Mongolian cashmere is a unique product and is important not only for the livelihood of herders, but also for the economy and value chain of the country. On the other hand, cashmere production has an impact on the environment. Therefore, we must focus on sustainable cashmere production, with quality over quantity to achieve more with less. If we do not take action now, natural resource will further degrade and pasture deterioration will worsen. The adoption of this ‘Roadmap for the Sustainable Development of the Mongolian Cashmere Sector 2030’ will be an important impetus for environmental protection. Mongolia is a beneficiary of the GSP+, the EU’s preferential trade scheme through which certain products can be exported to the EU-market tariff-free. The textile sector is currently the largest beneficiary of the trade scheme. We are currently in the process of negotiating Geographical Indications (GI) for a comprehensive list of products from Mongolia, among which cashmere is on the top of the list. ‘Uvs Chatsargana’ seabuckthorn berries from Uvs aimag, have been registered in the EU as the first Protected GI from Mongolia. PGI can bring the advantage of increasing the income of local producers, supporting sustainable business, preserving the uniqueness and quality due to the environment and climate, creating new opportunities, opening bigger markets and ensuring customers’ use of quality and standard products. The GI is a socially, environmentally and geographically important indicator. We hope that the beneficiaries of the project will continue to gain from our efforts going forward.”

Mr. G. Batsuuri, Deputy Minister of the MoFALI: “At a time when global consumers value “environmentally friendly and sustainable production-consumption” due to the global warming and climate change, one step towards making wool and cashmere sector of Mongolia a priority has been taken. Within the framework of the EU-funded “Sustainable Textile Production and Ecolabelling project (StePEcoLab)”, a “Roadmap for the Sustainable Development of the Mongolian Cashmere Sector 2030” has been developed. This roadmap identifies where, when, and how each stakeholder in the sector can contribute to better coordination of the Mongolian wool and cashmere industry by 2030. It is a key document for the activities in conformity with the government policies and strategies in the field of agriculture and animal husbandry, and cooperation between herders, producers, research and government organizations, professional associations and international projects and programs.”

Mrs. D. Altantsetseg, Executive Director, Mongolian Wool and Cashmere Association: “In recent years, consumers have tended to buy environmentally friendly and sustainable products. Therefore, we will be fully able to compete in the world market, if we set the main criteria that Mongolian cashmere is of the highest quality, environmentally friendly and sustainable. Mongolian cashmere products are exported to 30 countries around the world. As a result, sales of one trillion and 200 billion MNT were made.

Dr. Ts. Enkh-Amgalan, Chairwoman, National Federation of Pasture Users’ Groups: Climate change and consumer trends in any industry require a clear and intelligent production system that is environmentally friendly, healthy and safe for the human being, and has a traceability system. In this context, having a roadmap for the Sustainable Development of the Cashmere Sector means Mongolia has been renewing its strategy to bring its cashmere production to the world market. Previously, our country was known as a supplier of raw materials to the international market, but now we guarantee distinctive features of the final products.

Sustainable Textile Production and Ecolabelling project (STePEcoLab): The STeP EcoLab project, funded by the European Union and implemented by AVSF, aims at supporting the supply chain and the textile industry in adopting more sustainable sourcing and production practices and simultaneously improving the branding for sustainable products, optimising cost-saving measures and reaching out to climate finance and diversify the portfolio of customers. STeP EcoLab strives to leverage key drivers of sustainable consumption and production in Mongolia by consolidating sustainable and certified raw material sourcing options meeting markets expectations; developing a conducive environment for textile processing SMEs to switch to sustainable production practices; and raising customers’ and consumers’ awareness of Mongolian sustainable textile related initiatives.

P. Narandelger