Mongolia – a key to regional connectivity www.news.mn

Back in June 2016, Mongolia, Russia, and China signed an agreement to implement an Economic Corridor comprising 32 projects, 13 of which are in the sphere of infrastructure. Related to this is the proposed Economic Corridor, which is one of the six routes in China’s Belt and Road initiative; it is also in alignment with Mongolia’s Development Programme, and the Eurasian Economic Union, which is driven by Moscow.

China’s booming new Silk Road trade hits $1.34 TRILLION www.rt.com

China’s trade with countries participating in its ambitious Belt and Road Initiative (BRI) has been expanding and totaled 9.27 trillion yuan ($1.34 trillion) in 2019, customs data shows.
It has outpaced the country’s aggregate trade growth by 7.4 percentage points, according to the data.

Government sets out to boost agricultural exports www.montsame.mn

Ulaanbaatar /MONTSAME/. At its meeting of today, Cabinet resolved to announce 2020 as a year to increase exports.

Mongolia exports 36.4 mln tons of coal in 2019 www.xinhuanet.com

Mongolia exported a total of 36.4 million tons of coal in 2019, according to data released by the Mongolian Customs General Administration (MCGA) on Tuesday.

UK in Mongolia 2019: a year of achievement in strengthening and advancing our bilateral relations www.montsame.mn

Ulaanbaatar/MONTSAME/. The British Embassy Ulaanbaatar reviews the year of 2019, highlighting success in UK-Mongolia bilateral relations with a number of impactful visits, including by the Mining, Energy and Education Ministers to London and UK Asia Minister to Mongolia, along with numerous projects and events. A press release of the embassy reads,

"Our top priorities in 2019 were deepening our trade/investment and political relationship and supporting democracy and economic development in Mongolia, particularly in education, anti-money laundering, media freedom, combating climate change, illegal wildlife trading and conservation. As a sign of our long-term commitment to Mongolia, we also moved into brand new Embassy offices in the Shangri-La complex, right at the heart of Ulaanbaatar!

We kicked off the year by organising the memorable GREAT train journey on the famous Trans-Mongolian route to celebrate the culmination of our 55th anniversary year in Mongolia and to highlight business and historic links.

We organised a number of trade-related visits, including a visit to Mongolia by our Trade Commissioner, along with trade missions to the UK to promote UK/Mongolia trade. We also supported and promoted UK investments in Mongolia, in particular Rio Tinto’s investment in the strategically important Oyu Tolgoi project.

In July, the British Embassy funded attendance by three Mongolian investigative journalists at the first global “Media Freedom” conference jointly organised by the British and Canadian governments in London. Global leaders, representatives from the media industry, journalists and civil society gathered there for two days. Media freedom is fundamental to democracy, as highlighted by one of the Mongolian participants, CH.Bolortuya, editor-in-chief of Ikon.mn, who reported that the conference helped everyone to understand media freedom is not only about journalists, but also a human right relevant to everyone.

In order to support Mongolia’s work to meet its Financial Action Task Force (FATF) recommendations, we organised a study visit to the UK by experts from the Mongolian Ministry of Foreign Affairs, Central Bank of Mongolia, Financial Regulatory Commission, General Intelligence Agency and Ulaanbaatar City Prosecutors Office. These officials met UK counterparts from the National Crime Agency, Bank of England, Treasury and Foreign Office among others, where they learnt about the UK’s experience implementing FATF recommendations, regulating the financial sector, tightening financial supervision and implementing and enforcing sanctions. We will continue this support in 2020 to enable Mongolia’s removal from the FATF grey list as soon as practicable.

The British Embassy has worked closely with Mongolia over many years to help tackle the illegal wildlife trade, the impacts of climate change and to support conservation. This support continued in 2019. The government of Mongolia’s “Wildlife Trade and Disease Expert Meeting” on 23-24 September, a commitment made by Mongolia at the 2018 London Wildlife Summit, was part sponsored by the UK. The UK’s Head of International Species Conservation attended and acted as rapporteur. The meeting convened North-East Asian experts who agreed to establish an ongoing sub-regional dialogue on transboundary wildlife conservation and management. The Zoological Society of London also launched its ‘Mongolia’s Silent Steppe II Report: Mongolia’s Wildlife Crisis-Ten Years Later’’ in the margins of the conference with support from the Embassy.

On climate change, we supported the launch of the Mongolian Ministry of Environment’s ambitious new greenhouse emissions reduction target (Nationally Determined Contribution) in November. The Ministry presented plans for climate change mitigation and adaptation priorities and sustainable development to over 300 stakeholders including high-level decision makers, representatives from government, the private sector, international partners, academia and the media. Climate change is an immediate and critical challenge. The UK plays a leading international role to address this issue and will drive urgent coordinated action as the host of 2020’s most important gathering on climate change: COP 26 in Glasgow in November.

The UK’s third “Inspire Me” education festival took place in September at the White Rock centre in Ulaanbaatar. Over 2000 visitors to the festival were introduced to various British educational institutes and universities who promoted their world-class education programmes. We also hosted an education-focused visit to the UK by members of the Education Standing Committee of the Great Khural to further promote our links in this important sector of co-operation.

In October, Mrs. Heather Wheeler, UK Minister for Asia, made her first official visit to Mongolia. The Minister met ministers and senior officials from the ministries of Foreign Affairs, Environment, Education and Mining and held wide-ranging discussions. Minister Wheeler also opened our new Embassy office.

With the UK leaving the European Union at the end of January and seeking to expand relationships all around the world, we will also increase our co-operation with Mongolia. We will have many more visits and events to look forward to in 2020, starting with attendance at the Education World Forum in London by Mr.Baatarbileg, Minister of Education, Culture, Science and Sports in January. We plan to have more senior level visits in both directions this year.

Also in January, we will launch an air pollution awareness campaign jointly organised with the UK Alumni Association. This will focus on the importance - especially for children - of wearing anti-pollution masks. Masks will also be distributed to school children who are living in the most polluted areas of the city.

We would like to thank all of our Mongolian partners and government organisations for making 2019 a successful year and we are looking forward to working with you all in 2020 to further strengthen the UK-Mongolia relationship."

British Embassy Ulaanbaatar

Mongolia joins the ADDIS Tax Initiative www.addistaxinitiative.net

The Addis Tax Initiative (ATI) is pleased to welcome the newest ATI member Mongolia and acknowledge their commitment to increasing domestic revenue mobilisation (DRM) towards sustainable development. The Addis Tax Initiative continues to grow, now including 25 partner countries, 20 development partners and 16 supporting organisations.

MoF introduces benchmark prices for mineral products www.zgm.mn

The Ministry of Finance (MoF) introduced the benchmark prices for mineral products to be exported in January. Particularly, the price of zinc per ton was estimated the same as the London Metal Exchange (LME)’s price of December, equalling USD 2,273.41. The price of copper stands at USD 6,062 per ton. Analysts at Goldman Sachs, Morgan Stanley, and Standard Chartered are optimistic about the outlook for 2020. The main consumer China’s demand may grow 2.6 percent this year, according to Citigroup. The Ministry of Finance estimates that in January the price of fluoride concentrate to be at USD 406-415 per ton and fluorite ore at USD 264-324. Mongolia is the third-largest exporter of fluorite in the world after China and Mexico. Demand is likely to continue to rise along with the price, reports Baylag Jonsh LLC, a fluorite exporter. The price for iron ore with a 60 percent concentration is estimated at USD 78.98. According to Bloomberg Intelligence, Iron ore prices are likely to drop in 2020. Experts predict an increase in supply of Brazil and Australia this year. Demand for steel is likely to decline following the slowdown in Chinese economic growth; analysts say that is a signal of reduced iron ore consumption. The price for raw coal is assumed to be USD 106.87 per ton, weak coking coal USD 76.95, and lignite coal USD 68.12. The price for processed coking coal comprises USD 114.55, according to the MoF. The supply of coking coal is projected to grow in 2020. Bloomberg Intelligence estimates that the extraction of large Australian deposits will increase and exports by 15 million tons by 2020-2022. Mongolia's coking coal export is expected to reach 39 million tons in 2020 and 44 million tons by 2021, analysts at Bloomberg Intelligence have anticipated.

Sweet beverage spending equals 70% of the health budget www.zgm.mn

Mongolians spend MNT 522 billion on 210 million liters of sweet beverages annually, which equals 70 percent of the Ministry of Health’s budget. During a panel discussion on the Consumption of soda: Health impact, data on the interdependence between sweet food and illness of Mongolians had been presented. According to a survey that included about 2,052 children in the country, the consumption of juice was higher among young children. As of today, 381 ml of sweet drink is consumed per capita, with 88 percent of total production being domestic and 12 percent of imported products. Domestic beverages, which are several times cheaper than imported ones, are encouraging consumption of so-called “liquid candy” to grow. Researchers concern over increasing obesity in children and adults due to sweet drinks in recent years. A survey conducted by the Mongolian National University of Medical Sciences (MNUMS) found that 90 percent of parents who provide sweet juices to their children know they are wrong. Of these, 83 percent of them said that they knowingly buy because of the advertisement.

Shadow economy fluctuates at 9.2-15.7 percent of GDP www.montsame.mn

Ulaanbaatar /MONTSAME/. The National Statistical Office of Mongolia released a report on research made on the informal economy of Mongolia between 2015 and 2018. The report shows that the share of shadow economy in the country’s GDP has been fluctuating at around 9.2 – 15.7 percent in the last decade.

FMO provides USD 100 Million syndicated loan to XacBank www.zgm.mn

The Dutch Entrepreneurial Development Bank (FMO) has arranged a USD 100 million syndicated loan to XacBank, one of Mongolia’s leading universal banks. The five-year tenor of the loan will strengthen XacBank’s long-term funding base and allow the bank to further grow and expand in its focus areas in retail, micro and small and medium enterprises (SMEs). XacBank is actively engaging with the MSME sector with a focus on the underbanked segment, which matches well with FMO’s strategy to support economic and diversified growth in the country. As a leading impact investor, FMO supports sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs. FMO believes that a strong private sector leads to economic and social development and has a close to 50-year proven track-record of empowering people to employ their skills and improve their quality of life. Linda Broekhuizen, Chief Investment Officer of FMO said, “The financing signals FMO’s long-term commitment to the Mongolian market and we are proud to collaborate in this large syndicate with our international financing partners OFID and IBEC. XacBank fulfills an essential role in providing finance to the underserved micro and SME segments in Mongolia contributing significantly to job creation as well as diversification of the Mongolian economy.” FMO commits USD 65 million and in addition mobilizes funding from diverse international financing partners: The OPEC Fund for International Development (OFID) commits USD 25 million and The International Bank for Economic Co-operation (IBEC) commits USD 10 million. “XacBank has a strong focus on MSMEs, Green Finance and retail customers as a part of its mission to create sustainable growth in the banking and financial sector of Mongolia. As we expect Mongolian economic growth to slightly decrease from 6.9 percent to 6.3 percent and despite facing challenging macroeconomic conditions in 2020, USD 100 million syndication loan to XacBank shows FMO’s high confidence and commitment to Mongolia and XacBank,” commented Tsevegjav Gumenjav, CEO of XacBank.