MONGOLIAN CURRENT BUSINESS AND ECONOMIC GIANTS: THEIR INFLUENCE

MONGOLIA TOOK A GIANT STEP FORWARD IN TERMS OF POLITICAL REFORM IN 1990 – DUE TO THE MONGOLIAN DEMOCRATIC UNION’S HUNGER STRIKE, MONGOLIA HAS SEEN A RATHER SUDDEN CHANGE OF ECONOMIC SYSTEM AND INFRASTRUCTURE SINCE 1990 WHEN THE NATION MADE A GENERALLY PEACEFUL TRANSITION FROM A COMMUNIST STATE TO A FREE MARKET STATE.

SINCE THE TRANSITION, MANY PRIVATE COMPANIES EMERGED, AS WOULD BE EXPECTED OF A NEWLY BORN DEMOCRATIC COUNTRY – THE MOST CRUCIAL ONES BEING IN THE SECTORS OF TELECOMMUNICATIONS, MINING, FUEL, OIL, AND ENERGY.

MAK

Mongolyn Alt (MAK) Group is the third largest business in Mongolia, according to the annual Top 100 companies created by the Mongolian National Chamber of Commerce and Industry. The company owns several mines throughout Mongolia, with some projects in-development: Naryn Sukhait coal mine, Eldev coal mine, Tsagaan Suvraga copper, and molybdenum mine and Aduunchuluun brown coal mine.

The company also supplies construction materials, limestone quarry, and a quicklime plant.

In 2002, MAK established a joint-venture with an Inner-Mongolian company Qinhua-MAK Nariin Sukhait LLC. Throughout this coal exporting joint-venture to China, the company has built a 35 kilowatt power line from the Chinese border to the Nariin Sukhait coal mine, a 56 kilometer paved road from the Nariin Sukhait coal mine to the Mongolian border Shiveekhuren.

In 2011, MAK has contributed to the 2012 budget with 6.6 billion MNT, and Qinhua-MAK Nariin Sukhait submitting 1.1 billion MNT to the State Budget.

APU JSC

APU, or “arkhi, pivo, undaa” literally meaning vodka, beer and soft drinks, was established in 1924.
According to The Report: Mongolia 2012, the company has 55% market share in beer and 58% markets share in vodka and it is continually increasing by the year. APU has the largest distribution network in Mongolia, with over 6,000 distribution locations.

The company employs some 800 people. APU exports its products to China, Korea, Japan, and Germany.

Erdenet Mining Corporation

Erdenet Mining Corporation is an open-pit copper, gold and molybdenum mining site, a joint venture between Russia and Mongolia, based on Soviet explorations made in 1950s. Russia owns a 49% stake of the company while Mongolia owns the remaining 51%.

It first began producing copper in 1976, and since then, the company states, that the total output of the mine has reached nearly 440 million m3. As of 2010, the company employs 5,000 Mongolian workers.

In 2011, the company contributed nearly 400 billion MNT to the 3.3 trillion MNT State Budget of 2012.
As of 2011, Erdenet Mining Corporation supplies 1% of the world’s total copper demand, while also supplying 0.7% of total molybdenum in the world market.

Erdenet City, where the mine is located, is a mining town, progressively developed as the mine grew over the years. Closure plans of the mine are already in motion, and secondary income methods are being developed by the EMC as the town may suffer financially and ultimately be abandoned once feasible resources at EMC are depleted.

These methods include a possible tourist attraction – the mining site itself; and through its profound and rich history of founding and establishment during the Communist regime, the company announced in November 2011 that a museum is to be built in the city.

As the Ambassador of Russia in Mongolia B. A. Govorin noted at the 30th Anniversary of EMC, throughout the years the company helped maintain the relationship between Russia and Mongolia through mutual economic benefit through EMC.

MCS Group

MCS was founded in 1993 as a small energy consultant; today it stands as the second biggest company in Mongolia in terms of contribution to the Mongolian economy and social responsibility.

With 15 subsidiaries, it has a diverse area of operation in the Mongolian economy such as energy infrastructure, mining, cashmere production, food and beverages, information communications, property development and general services.

Currently, the MCS Group employs over 3,000 employees. According to the International Finance Corporation summary, MCS group will create permanent full time jobs for over 500 people each year with an additional 1,000 indirect jobs through its contractors over the next 3 years.

MCS Group is among the top tax-payers of Mongolia, winning consecutive awards and recognitions from the Mongolian Government since 1999. They include Best Company of the year, Best Tax payer of the Year, Best Corporate Social Responsibility. The company has remained at the second place in Mongolia’s Top 100 companies since 2005, behind only Erdenet Mining Corporation.

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