While presenting the latest “Mongolia Economic Update,” World Bank Country Manager for Mongolia, Taehyun Lee, noted that “Mongolia’s economy stays resilient but faces rising uncertainty.”

He further explained, “Protecting macroeconomic stability and vulnerable households from potential prolonged external shocks, while diversifying the economy and boosting its competitiveness, remain key pressing priorities.”

According to the latest Mongolia Economic Update, Mongolia’s economy is projected to grow at 5.0% in 2026, as mining and agricultural output normalizes following a strong 2025 performance.

Despite trade disruptions and elevated geopolitical tensions, Mongolia’s economy expanded by 6.9 % in 2025. Growth was driven by a strong rebound in agriculture and solid mining performance, particularly copper production at Oyu Tolgoi, a key national mine. These growth drivers helped offset weaker coal activity. Other sectors experienced mixed performance, with strong growth in construction and manufacturing, while trade and services moderated.

Senior Country Economist for Mongolia, Jose Luis Diaz Sanchez, highlighted, “Strong export earnings and resilient household incomes kept consumer spending high. Combined with higher food and energy prices, these factors pushed inflation up from an average of 6.8% in 2024 to 8.6% in 2025. Over the medium term, growth is projected to average approximately 5.5% in 2027-2028, supported by large infrastructure projects and sustained domestic demand.”

Country Economist for Mongolia, Undral Batmunkh, elaborated, “Risks to the outlook are tilted to the downside. Globally, trade uncertainty and a prolonged Middle East conflict could weaken external demand, disrupt mineral exports, raise production costs and consumer prices, and slow growth. Domestically, stronger-than-expected fiscal spending could boost growth in the short-term but may widen external imbalances and increase inflation.”

The report highlights the importance of strengthening economic resilience and supporting diversification. It calls for addressing persistent infrastructure gaps and advancing critical mineral development to enhance competitiveness, alongside efforts to strengthen disaster preparedness and climate resilience. In this context, the report’s special chapter examines how the clustering of firms and workers in Ulaanbaatar raises productivity and creates opportunities. It also shows, however, how growing urban congestion may limit these gains. This highlights the need to improve urban efficiency and promote more balanced spatial development across the country.

Published Date:2026-04-12