Wednesday, April 23, 2014

Mongolia Brief April 22, 2014 Part III

Income and asset statements of Parliamentarians released
April 22 (UB Post) All state servants including the President, governmental and parliamentary officials annually declare their income and asset statements. The Independent Authority Against Corruption (IAAC) has recently united the income and asset declaration of a total of 239 state servants and released the information publicly.

The following article highlights who in the Parliament, Government and National Security Council had more income in 2013.
President of Mongolia Ts.Elbegdorj:
The total 2013 income of the President was 59,516,890 MNT and the income of his family was 6 million MNT. The President owns one apartment, 23 horses, 5 cows, 30 sheep and 15 goats. He has valuables worth 635 million MNT and keeps 75, 744,000 MNT in his account. According to his declaration he does not own any vehicles, but he has invested in several companies including Mushtaag LLC, Ankh-Erdene LLC, Liberty Institute, Asu LLC, Jenco tour bureau Co. LTD., etc.
Speaker of the Parliament Z.Enkhbold:
Speaker Z.Enkhbold earned 86 million MNT last year, while the members of his family earned 20, 499,000 MNT. He declared that he owns two apartments one horse and has no vehicles in his name.
Prime Minister N.Altankhuyag:
Total income of the Prime Minister in 2013 was 318 million MNT, while his family members earned in total 160 million MNT. According to his declaration he owns two apartments, as well as two cars including a Lexus-470 and a Lexus-570. He saves 114 million MNT in his savings account.
Vice-Speaker of the Parliament, Member of Parliament R.Gonchigdorj:
Last year his income was 50 million MNT. His family earned 8.5 billion MNT. According to the IAAC report he owns 3 apartments and has a savings account with 165 million MNT.
Vice-Speaker of the Parliament, Member of Parliament L.Tsog:
His annual income was 20 million MNT, while his family’s was 25 million MNT. He has two apartments, worth altogether 310 million MNT. Also he owns two vehicles including Toyota Mark – II and Toyota FJ Cruiser.
Vice-Speaker of the Parliament, Member of Parliament M.Enkhbold:
M.Enkhbold declared in his income statement that he earned 43 million MNT a year and his family earned 22, 964,000 MNT. He owns two apartments, a Toyota Land Cruiser – 200, a Mercedes Benz S – 320. Also he has 350 horses and 50 of them are racing breed horses. M.Enkhbold has valuables worth 190 million MNT and saves 276 million and 228 thousand MNT in his account.
The following members of Parliament had the most individual and family income in 2013.
Member of Parliament and Minister for Foreign Affairs of Mongolia L.Bold:
Minister L.Bold is the MP with highest income in 2013. Last year he earned in total 33 billion 139 million and 788 thousand 640 tugriks individually and declared that he has no family income. His income has notably increased in 2013, while in 2012’s statement he declared that he earned 208 million MNT. In terms of assets, he owns three apartments, four horses and has 31 billion 527 million MNT in his account.
Member of Parliament J.Enkhbayar:
He is the MP with the second highest income with 3 billion and 72 million MNT. According to his statement, his income in 2013 decreased by a billion compared with 2012. His family income in 2013 is estimated at 24 million 870 thousand MNT. However, he declared that he has no apartment. He owns valuables worth 100 million MNT and has 3 billion MNT in his savings account.
Member of Parliament D.Zorigt:
 D.Zorigt has been listed in third place with 2013 annual income of 2 billion 47 million MNT, while in 2012 he declared that he earned 459 million MNT. His family’s income is estimated at 140 million MNT. In terms of the real estate, he owns three apartments and keeps valuables worth 750 million MNT. In his savings account he keeps 93.5 million MNT. Also he has declared that he has 10 billion MNT debts to be collected from Odod LLC, Erdenejas and ASU LLC. D.Zorigt has loaned 4 billion MNT from the Trade Development Bank, invested in 15 companies and holds shares worth over 5 billion MNT.
Member of Parliament, Energy Minister M.Sonompil:
Minister M.Sonompil’s income has not increased that significantly in 2013. In 2012’s income statement he declared that he earned one billion 107 million MNT, while in 2013 he earned one billion 120 million MNT. This time the minister declared that he has no household or family income. He owns one apartment, a Lexus-470, Hummer-H2 and breeds 50 sheep and 20 horses. Also he has valuables worth 100 million MNT and saves 15 million MNT in his account. He owes 5 billion MNT to Khaan Bank.
Member of Parliament B.Garamgaibaatar:
He earned 1 billion 27 million MNT in 2013, which is double the amount of his 2012 income. His family income of last year was 1 million 740 thousand MNT. B.Garamgaibaatar has two apartments, saves 30 million MNT in his accounts and invested in four companies, according to the IAAC report.
Member of Parliament, Minister for Education and Science L.Gantumur:
Minister L.Gantumur was the MP with lowest income in 2013. Last year he earned 18 million MNT while in 2012’s statement he declared that he earned 244 million MNT. His family income in 2013 was 57 million 920 thousand MNT. Although, he is the minister with lowest income he has the most apartments. He has more apartments than the richest MP L.Bold. In total he owns four apartments and cars including Nissan Teana, Hyundai Sonata – 5. Also he has 110 horses and saves 11 million MNT in his account, according to his income and asset declaration statement.
Member of Parliament M.Zorigt:
MP M.Zorig earned over 3 billion MNT in 2012, while his income of 2013 was 19 million 776 thousand MNT. He has one apartment, one car and 23 horses. According to his statement he owns 9 million MNT in his account.
Member of Parliament N.Nomtoibayar:
N.Nomtoibayar’s income decreased in 2013. In 2012 he had an income of 820 million MNT, while in 2013 he earned only 19 million 776 thousand MNT. He owns two apartments and holds 13 million MNT in his account. However, he has six cars, including four Mercedes, a Lexus – 570 and a Land Cruiser, which altogether cost 950 million MNT.
Member of Parliament Ya.Sodbaatar:
He passed 2013 with an income of 19 million 776 thousand MNT. His income increased by 3 million MNT in 2013 in comparison with the previous year. Even though he earned low individually, his family income is estimated at 494 million 480 thousand MNT. He has two apartments and holds shares in six companies.
Member of Parliament L.Enkhamgalan:
L.Enkhamgalan earned the same income as N.Nomtoibayar and M.Zorigt. This MP, who runs his own business, declared he has no household income. He owns three apartments and two service places and drives a Land Rover and Range Rover. Also he owns valuables worth 1.6 billion and 540 million MNT. Inter International Group company owes him 2.7 billion MNT. 
The family of MP O.Sodbileg was the family with the highest income – 990 million MNT. In 2012 his family income was estimated at only 9 million MNT. O.Sodbileg individually earned 28 million 600 thousand MNT. He has one apartment and two Mercedes.
Family of Parliamentarian S.Bayartsogt had an income of 975 million MNT in 2013. Also Parliamentarian S.Sarangerel’s family earned 491 million MNT. One of the families whose income was notably increased in comparison with 2012, is D.Battsogt’s family. His family had 80 million 789 thousand MNT income in 2012, while last year it became 487 million 700 thousand MNT. 
There are nine female members in the Parliament. L.Erdenechimeg is leading them with an annual income of 500 million MNT. After her, the parliamentarian D.Oyunkhorol was listed second with an individual income of 260 million 878 thousand MNT and a family income of 252 million 777 thousand MNT. Third place goes to Minister of Culture, Sports and Tourism Ts.Oyungerel. She and her household income are estimated at 353 million MNT altogether. Female parliamentarians with the lowest incomes are D.Arvin and S.Oyun. 
Most of MPs declared that they have livestock. The member of the Parliament with the most cattle is D.Bat-Erdene. He breeds 400 goats, 450 horses, 70 cows and 3100 sheep. While, MP D.Battulga declared that he has only one horse.
Meanwhile, MP Sh.Tuvdendorj has the most pigs. He has five horses and 356 pigs.

B.Ser-Od wins silver at 16th Nagano Olympic Commemorative Marathon
April 22 (UB Post) Mongolian runner B.Ser-Od won a silver medal at the 16th Nagano Olympic Commemorative Marathon on April 20.
The marathon was organized in two categories for men and women, at the distance of 40 km each. Ukrain’s Serhiy Lebid won the marathon, completing the distance in 2:13:56. B.Ser-Od completed the distance in 2:14:04 and was followed by Taiga Ito of Japan. Russian runner Alina Prokopeva won the women’s category with 2:30:56.
The Nagano Olympic Commemorative Marathon is an annual marathon road race, which takes place in middle of April in Nagano, Japan. It is an International Association of Athletics Federation Bronze Label Road Race competition. The Nagano Marathon has races for both elite and amateur runners. It is named in honor of the 1998 Winter Olympics, which were held in Nagano.

‘Three Friends’ television series launches
April 22 (UB Post) “Three Friends” Mongolian comedy series premiered on April 18 on Education TV. “Three Friends” is based on a Korean comedy serial with the same name.
The comedy series stars notable Mongolian actors and actresses from Emotsi Production, the youngest comedy producers of Mongolia.
The comedy series will show long-lasting friendship, funny fights for love and young people’s life. “Three Friends” will be aired on Education TV every night at 22:10 p.m.

The Philippines’ Gambit in the South China Sea
April 22 (UB Post) The Mark News
By Jay L. Batongbacal
Tensions between China and the Philippines spiked in March when a small civilian boat was confronted by a Chinese Coast Guard vessel about 100 miles from the Philippine coast. The boat was trying to bring soldiers, food, and water to a grounded Philippine Navy ship on Second Thomas Shoal, which serves as the Philippines’ last line of defense against further Chinese incursions into its waters in the South China Sea (SCS). The incident took place just two days before the Philippines submitted its Memorial in a case filed before an arbitral tribunal established under the 1982 United Nations Convention on the Law of the Sea (UNCLOS).
Documented by journalists on board the small boat, the incident further proves that China has established an undeclared and paramilitary blockade against Philippine ships in the SCS. In 2012, China effectively took over the Scarborough Shoal, which is located well within the Philippine exclusive economic zone (EEZ). This Second Thomas Shoal incident is the latest flare in the ongoing contest for portions of the SCS. It marks China’s increasingly provocative movements against its maritime neighbors.
China’s regional adventurism in the SCS is a product of its impressive economic growth and aspirations to be a major maritime power. Its economy relies greatly upon maritime trade, and the SCS contains vital sea lanes needed to transport everything from fuel and raw materials to manufactured goods. Its coastal regions also host hundreds of Chinese fishing communities. The Chinese leadership must prove to these communities that the benefits of its economic growth are not funneled exclusively to coastal metropolises like Shanghai. To protect its massive trade interests and demanding fishing population, China is investing heavily in its military and civilian maritime assets to enhance its capability to project its naval might, as well as its fishing fleets.
While such provocative acts may be seen as rational from the perspective of an aspiring maritime power (its moves are basically patterned after the U.S. sea-power doctrine), China also claims almost the entire SCS as its exclusive waters. It no longer hides its intention to dominate this strategic maritime region. In December, a Chinese documentary entitled Journey to the South China Sea, released by the state-run CCTV-4, proudly revealed that since 2007, China’s maritime law-enforcement agencies have confronted its neighbors’ ships in dangerous games of “chicken,” reminiscent of U.S.–U.S.S.R. naval rivalries during the Cold War.
China claims the vast SCS waters on the basis of a creative reinterpretation of its history, which denies the long existence and equally legitimate rights and interests of its smaller Southeast Asian neighbors. Chinese records notwithstanding, the SCS has historically been an international maritime commons, while the energy and fishery resources in adjacent portions of the SCS comprise the historical and natural heritage of states like the Philippines, Malaysia, Brunei, Indonesia, and Vietnam. These countries also have exclusive rights to such portions, recognized in the modern international law agreed upon by all states (including China) and expressed in instruments like the UNCLOS.
From the Philippines’ perspective, China began to deny it its long-standing access to the sea. In 2010 and 2011, China actively protested and interfered with offshore petroleum exploration just 50–100 miles from the Philippines’ west coast. In 2012, the actual taking of Scarborough Shoal in response to a Philippine attempt to arrest Chinese fishermen for harvesting coral and endangered species only demonstrated that China fully intended to deprive the country of its western EEZ and continental shelf. It did not help that the Chinese media also openly circulated hawkish proposals of “small wars” against its neighbors to retake the SCS by force.
With its back against the wall, the Philippines could do little but seek the support of its long-time ally, the United States, to dissuade China’s increasingly assertive and dangerous maritime incursions. It also had to take a huge risk by unilaterally launching an international arbitration against China. It did so in the hope that international law affords a more equitable venue for the protection of its maritime rights and interests against the seemingly unstoppable expansion of its powerful neighbor.
China is steadfast in its refusal to participate in the arbitration, and it remains to be seen if the Philippine gambit will succeed or fail. A decision could have a major impact on the future of the contested maritime region, which is also a strategic nexus of global trade routes and a vital gateway between the Indian and Pacific Oceans. While the present dispute is between the Philippines and China, the outcome may decide whether the South China Sea will remain part of the global commons or be taken from the rest of the world. With precious little with which to challenge its giant neighbor, the Philippines can only hope that fortune truly favors the bold.
Jay Batongbacal is the Director of the UP Institute for Maritime Affairs and Law of the Sea at the University of the Philippines. He was a member of the technical team that defended the Philippines’ claim to a continental shelf beyond 200 nautical miles in the Benham Rise Region, made in a Submission filed with the Commission on the Limits of the Continental Shelf (CLCS).

Artist brings the homeless to 976 Gallery with “Existent and Nonexistent”
April 22 (UB Post) Artist E.Lkhagvadorj unveiled his second solo exhibition “Existent & Nonexistent” at 976 Art Gallery on April 21.
Member of Global Artist Pension Trust and recipient of the Grand Prix from the Tiger Translate International Competition, young emerging talent, E.Lkhagvadorj was born in 1987 in Ulaanbaatar city. In 2002, he began studying at Rajiv Gandhi Arts and Industrial Design School then entered the School of Fine Arts at the Mongolian University of Arts and Culture in 2005, graduating in 2010. During his academic years, he experimented with abstract, surrealist and photo realist paintings, improving his techniques and compositions and searching for his own style.
In 2010 E.Lkhagvadorj began producing black and white hyperrealist paintings, depicting homeless people who lived in the underground pipes and garbage dumps of Ulaanbaatar city. Their alienation from society and the extremely hazardous conditions they live in had greatly affected artist E.Lkhagvadorj. He depicted the everyday lives of homeless people on the garbage dumps and various drunk-men, sleeping on the streets and in market places, to appeal to the society at large.
He spent a long time exploring their conditions and often interviewed them and asked their permission to take their photographs. When he started first producing work in his own style, he could not pick colors other than black and grey. The filthy faces and clothes of the homeless people and their gloomy lives were too somber to be expressed in other colors. To speak out directly, artist E.Lkhagvadorj picked the hyperrealist style for his works.
As his main characters are completely isolated and separated from customary society, artist E.Lkhagvadorj set the goal to let people from these different worlds meet each other through his work, with no fear and disgust. In daily life, most of us pretend not to see them or are afraid of facing drunken men sleeping on the street or the homeless collecting waste food and bottles from the garbage. Artist E.Lkhagvadorj questions if these people do in fact exist in our society through his solo exhibition “Existent & Nonexistent”, which is being held at 976 Art Gallery from April 21 to May 7.
E.Lkhagvadorj was a recipient of a grant from the project “Promoting Democracy through Art”, by the Mongolian Contemporary Art Support Association and the US State Department in 2013. He was also awarded with the Grand Prix from the Korean-Mongolian Joint Exhibition at the Mongolian National Modern Art Gallery in 2011 and the Third Best Work Title from the North East Asian International Art Exhibition, Changchun China. His artworks have been exhibited in the most prestigious museums and galleries in his home country and also in Hong Kong, China, Korea, Germany and Australia.
In 2012, “Asian Art News”, famous international magazine, published a four page article and information about the artworks of E.Lkhagvadorj.

The gains of higher taxes
April 22 (UB Post) Parliament has submitted a draft amendment for the Excise Tax and Mineral Resources Law. The amendment states that any taxation in foreign currency must be made in Mongolian currency. An amendment was made according to the law of 2009 where it states that all tax and payments must be in Mongolian currency. However this law has not been followed in previous years. With the USD rate reaching 1771 MNT, why the sudden decision to implement the law at this time? The interesting fact about this draft is that the rate of USD against MNT to be used is the rate of January 2012 – 1450 MNT – which is lower by 300 MNT than the current rate. The excise tax is imposed on alcoholic drinks, tobacco, fuel, diesel and vehicles.
If Parliament passes the amendment as a draft, producers and importer will pay a lower tax than the current one. I have a suspicion that behind this there are Parliament members who will benefit from these kinds of tax cuts.
MPs in the business sector
For a while, H.Battulga, the Minister of Industry and Agriculture, initiated the idea to prohibit promoting candidates to Parliament who run alcohol businesses. Unfortunately, he has been overwhelmed by members who have a conflict of interest. There are many MPs who produce, import, run services and sell tobacco and vodka. For instance, everyone knows MP G.Batkhuu is the owner of APU and Ulaanbaatar Spirits. Moreover MP L.Enkh-Amgalan owns a specific share of the Spirit Bal Buram, subsidiary of MCS, and Tiger. Ts. Dashdorj, Member of the Mongolian People’s Party, has Mongol So Tobacco. D.Ganhuyag, the Minister of Mining, sells vodka and alcoholic drink through the chain stores of Everyday and his Sansar Bridge imports vodka from Japan. M.Sonompil, the Minister of Energy, runs Chinggis chain restaurants and beer business.
There are more than two ministers in Parliament that run such kinds of business. It is obvious that they made an amendment according to their own interests. There will be an even longer list if we add MPs who own bars, pubs, restaurants and commercial centers.
Working with the rate difference
When Parliament passed the state budget for this year, they considered USD rate at 1380 MNT. But in reality, it has increased to almost 1800 MNT. The deficit from the difference is uncertain. In addition, to transfer USD into MNT, they considered an optimistic budget. Draft makers said “When USD rate increases, the entities’ tax load increases too, conversely, when it declines it impacts negatively on the budget income.” Although, when they consider the tax amount, they estimated it very low. This will be a golden opportunity for businessmen who want to work on rate differences and enhance their businesses.
Last year, Parliament passed the Law on Tobacco Supervision, after which the number of small shops decreased and people smoked less in public places such as pubs and restaurants. In order to decrease the usage of vodka and tobacco, the excise tax must be higher. However the current situation is shameful because MPs are using economic levers and giving votes in favor of their own personal interests. Honestly, at this time, the opposing party mustn’t sit quietly. Maybe there are MPs who have such businesses among the opposing party as well, which is why they don’t speak out. Our only hope is that there will be many honest MPs who can stand up and reject this draft amendment.

Erdene commences drilling at Altan Nar Gold Project
April 22 (UB Post) Canada-based Erdene Resource Development Corporation announced that it intends to issue, by way of a non-brokered private placement, up to 4,062,500 units at a price of 0.16 USD per unit for gross proceeds of up to 650,000 USD.
Each unit will consist of one common share of the company and one-half of one common share purchase warrant, with each whole common share purchase warrant entitling the holder to purchase one common share of Erdene at a price of 0.24 USD for a 24 month period from the closing date.
Net proceeds of the Private Placement will be used for exploration of the Company’s metal projects in Mongolia, including drilling at the company’s 100 percent owned Altan Nar gold-polymetallic project, to commence in late April. The Private Placement is expected to close on, or before, May 2nd 2014, and is subject to certain conditions, including, but not limited to, the receipt of all necessary approvals including the approval and acceptance by the TSX. All securities to be issued pursuant to the Private Placement will be subject to a four month hold period from the closing date. A finder’s fees may be payable on a portion of the financing.
Altan Nar Gold Project – Drill Program
Altan Nar exploration results, announced in January this year, included multiple, high grade gold, silver and base metal zones. Follow-up drilling is expected to commence in late-April and will include 10 drill holes totaling approximately 1,000 meters. The drill program will test continuity of these high priority targets, some of which have yet to be drill tested. Erdene field crews were mobilized to site the first week of April. Detailed surface work is underway, including higher density geochemical sampling, mapping, and an expanded induced polarization survey. This work will provide a greater understanding of the extent of the multiple mineralized structures identified to date and provide a stronger base for designing a more extensive follow-up resource delineation drill program.
Targets included in) the drill program will be the Discovery Zone, Union North, Union South, Maggie, Northbow and Southbow. The following section and enclosed maps provide additional details on each target.
Erdene Resource also announced that it has closed its non-brokered private placement financing with the issuance of 2,000,000 shares to Teck Resources Limited at a price of 0.175 USD per share for gross proceeds of 350,000 USD. All securities issued pursuant to the Private Placement are subject to a four month hold period. No commissions or finder’s fees will be paid in connection with the Private Placement.
This fulfils Teck’s 2014 equity investment obligation pursuant to the Strategic Alliance between Erdene and Teck announced by Erdene on April 11th, 2013. Net proceeds of the Private Placement will be used for exploration of the Company’s Teck-Alliance projects in Mongolia, including the Khuvyn Khar copper porphyry project where additional geophysical and geologic mapping programs will be completed during the second quarter.

Mongol Skill 2014 competition showcases Mongolia’s vocational education
April 22 (UB Post) -Mongol Skill 2014 winners to qualify for the WorldSkills Sao Paulo 2015-
The first round of the Mongol Skill 2014 competition took place on Monday with over 20 teams competing. The second round will be held in May.
Winners of the competition will attend a three-month specialized training in South Korea before representing Mongolia at the WorldSkills Sao Paulo 2015, one of the biggest vocational education events in the world, with over 1,000 competitors from 60 countries.
WorldSkills membership is required to take part in the event and the admission fee is 27,000 USD. The government of Mongolia agreed to pay the fee.
The Ministry of Labor and Mongolian Builders’ Association are jointly organizing the Mongol Skill vocational event for the second time.
Teams challenge their skills required for seven vocational professions. These include skills required of a builder, tile setter, welder, chef, electrician, joiner and lathe operator.
The organizers of the competition aim to set a new benchmark for vocational centers, improve study environments and teachers’ skills, and most importantly, improve competency of Mongolian vocational workers in the global market.

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