Tuesday, June 24, 2014

Mongolia Brief June 24, 2014 Part I

Speaker Z.Enkhbold Gives Interview to ITAR-TASS

Ulaanbaatar, June 24 (MONTSAME) The Chairman of the State Great Khural (parliament) Z.Enkhbold Monday gave an interview to Russia’s ITAR-TASS news agency.

He touched issues of the Mongolia-Russia relations and cooperation, including the collaboration between the legislative bodies and parliamentary factions and visa waiving for peoples of the two countries.
Established in 1992, the ITAR-TASS agency has a long-year partnership with Mongolia's MONTSAME news agency. The two established a cooperation contract in December of 2006.

Permanent Rep Presents Letter of Credence

Ulaanbaatar, June 24 (MONTSAME) The Permanent Representative of Mongolia to the United Nations Environment Programme (UNEP) Mr O.Och Sunday presented his letter of credence to the UNEP Executive Director Mr Achim Steiner, in Nairobi of Kenya.
During this ceremony, Mr Och introduced to the UNEP Executive-Director environmental and green development policies the Mongolian government adheres to, also other related measures, and expressed a satisfaction with the Mongolia-UNEP ties. After this the sides exchanged views on possibilities of expanding the relationship.
Mr Steiner expressed a satisfaction with the governmental policy of Mongolia on a green development. He underlined that Mongolia is actively participating in the UNEP Partnership for Action on Green Economy (PAGE), being a good example for others. 

Report on Mongolia’s Foreign Policy Given to Australian MPs

Ulaanbaatar, June 24 (MONTSAME) The Ambassador Extraordinary and Plenipotentiary of Mongolia to Australia Mr R.Bold last week gave a report to MPs of Australia, by joint invitation of the Standing committees on foreign policy and defense and on trade.
His report focused on the foreign policy of Mongolia and on the Mongolia-Australia relations. The Ambassador gave details about key principles of Mongolia’s foreign policy, touched upon problems, and spoke about an essence of the "Third neighbor" policy and the latest situation in the bilateral relations.
The Australian parliamentarians asked the Ambassador about the bilateral ties, regional security and a current situation in Mongolia for investors. Some of them expressed a worry about Mongolian authorities' decision to ban some Australians from leaving Mongolian territory.
The report has become a significant event in terms of giving the latest information about Mongolia, the MPs said. 

Turkish Parliament Speaker Arrives in UlaanbaatarMontsame, June 24

Speaker of Grand National Assembly of Republic of Turkey Visits Mongolia

June 24 (infomongolia.com) At the invitation of Speaker of the State Great Khural (Parliament) Mr. Zandaakhuu ENKHBOLD, the Speaker of the Grand National Assembly of Turkey (Parliament) Mr. Cemil Cicek and other accompanying delegates are conducting an official visit to Mongolia on June 23-26, 2014.
On June 24, 2014, the distinguished guests were welcomed at Chinggis Square by Parliament Speaker Z.Enkhbold and after paying tribute to the Monument of Chinggis Khaan, Speaker C.Cicek left a note on the Guest Book in the Government House.
Afterwards, Speakers C.Cicek and Z.Enkhbold held an official talk, where representing Mongolia Minister of Foreign Affairs L.Bold, Chairman of Mongolia-Turkey Inter-Parliamentary Group at the State Great Khural, MP A.Bakei, Secretary General of Parliament Secretariat B.Boldbaatar were present and the other part was represented by Ambassador Extraordinary and Plenipotentiary of the Republic of Turkey to Mongolia Mr. Murat Karagoz, Chairman of Turkey-Mongolia Inter-Parliamentary Group at the Grand National Assembly, MP Fehmi Kupcu as well as other officials from both sides.
Following the talks, a Protocol on cooperation between the State Great Khural and the Grand National Assembly was inked and Speakers Z.Enkhbold and C.Cicek made a statement to reporters regarding issues discussed and further collaboration not only in legal sphere, but also Turkish investments in education, housing, infrastructure, energy and tourism sectors.
The visit of the Speaker of the Grand National Assembly is being conducted in the scope of celebration of the 45th anniversary of the establishment of diplomatic relations between Mongolia and the Republic of Turkey enacted on June 24, 1969.
Today on June 24, Turkish delegates attended opening ceremonies of “E-Library” and “Publishing House Renovation” projects at the State Great Khural, both implemented under a funding of the Turkish International Cooperation and Development Agency.
Mr. C.Cicek will also visit the Erdenezuu Monastery in Uvurkhangai Aimag and an ancient Turkic findings museum in the Orkhon valley nearby. During his official visit, Speaker C.Cicek will be received by the President of Mongolia Ts.Elbegdorj and meet the Prime Minister N.Altankhuyag and other officials. Link to article

Z.Enkhbold Welcomes His Turkish Counterpart

Ulaanbaatar, June 24 (MONTSAME) Parliament Speaker Z.Enkhbold welcomed Tuesday morning his Turkish counterpart Mr Cemil Cicek on the Chinggis Square.
After the Speakers together with spouses and accompanying them officials paid respect at the monument to Chinggis Khaan, Mr Cicek wrote his impression in the Honor guest book at the State House. Following this ceremony, the two dignitaries began official negotiations. They will also sign an inter-parliamentary cooperation protocol.

MonNOC President Meets Athletes

Ulaanbaatar, June 24 (MONTSAME) A president of Mongolia's National Olympic Committee (MonNOC) D.Zagdsuren and his deputy J.Khatanbaatar received Monday Olympic and World medalists on occasion of the International Olympic Day.
The meeting discussed how these medalists--some 20 people--could promote their contribution to the Olympic Games propaganda, to discover young talents, to give education about the Olympics.
The medalists, who have been receiving life-long allowance, have established a fund to boost the sports here. They thanked the President on his decree about the allowance. 

Bestseller Books Named by Internom

Ulaanbaatar, June 24 (MONTSAME) The “Internom” bookstore Monday named bestseller books at its store from 16 to 22 June.
The "Lean In: Women, Work, and the Will to Lead" by Sheryl Sandberg became the top. Published first in 2013, this book led the chart of bestsellers by the New York Times for 12 weeks, and was the top book for business of the Year. As of present, the book has been translated into 30 languages including Mongolian. It urges women to have own goals and an ambition to lead.
Sheryl Sandberg’s book was followed by “Hidden fires” by Yo.Otgonbayar, which tells about brief history of the Mongolians’ fight for the independence. "The Girl Who Played with Fire" by Stieg Larsson was placed third.
Other bestsellers were "Sorghaghtani" historical roman by B.Sarantuya, “Mongolians: In beginning of 20th century” by O.Batsaikhan, “Bat the Good King” by B.Sarantuya, Oxford English-Mongolian dictionary, "The Man Who Laughs" by Victor Hugo, "Green-eyed monk" by Ts.Oyungerel, and "One Hundred Years of Solitude" by Gabriel Garcia Marquez.

The Second Phase of Tax Reform

June 24 (Mongolian Economy) The first phase of tax reform took place between 2007 and 2012. Its Four 10s Tax Policy (value-added tax, corporate income tax, personal income tax and social insurance tax) helps make Mongolia one of the least taxed nations, not only in Asia but in the world. The government is launching the second phase of tax reform this year through to 2017.
Two discussions were held on May 30 and June 10 this year, involving representatives from the State Great Khural, government and private sector.The former took place at the Citizens’ Hall in the Government Palace under the theme of “Value-added Tax and Commercial Tax.” That event was moderated by S. Bayartsogt, a member of parliament and the head of the working group for tax reform. The latter was themed “Let Us Decide Through Reform” and was organised by the government.
The bill on raising the value-added tax threshold to MNT 50 million is now in active discussion. But it is not clear if the bill is going to be passed by the Khural before the spring session is wrapped up.
According to the government’s main action plan, the current tax reform aims to create a stable tax setting in which tax would meet the principles that are expected to be simple, clear, equal and fair while contributing to the economy and meeting international standards.
Under the 100 Day Action Plan, initiated by the government on May 10 this year, the second phase of tax reform follows laws that have been approved by the State Great Khural on June 6 this year. For example: 
The Law on Exempting Imported Equipment from Customs and Value-Added Taxes aims to support SMEs,
The Law on Delaying Customs and Value-Added Taxes for two years aims to reduce costs during the period of increasing investment, supporting infrastructure work and removing hindrances caused by delays in equipment supply
These laws took immediate effect.
As a part of the tax reform, the following legislations have been submitted to the Khural for approval:
Legislation on Refunding 90 percent of Corporate Income Tax paid by companies with revenue of up to MNT 1.5 billion a year, according to the main action plan by the government. 
An updated version of the Value-Added Tax Law that is expected to be consistent with international standards. The updated version includes raising the VAT threshold to MNT 50 million, clear definitions of some ambiguous legal terms in the current law, and refunding 20 percent of VAT paid by end users.
Based on request by the Mongolian Bankers Association, the Corporate Income Tax Law is to be amended in terms of imposing 10 percent tax on tax payers who are not based in Mongolia and who have purchased bonds from Mongolia’s commercial banks. By approving this legislation, the commercial banks’ loan rates are expected to decrease. 
An updated version of the Accounting Law and Auditing Law aims to reduce operational hindrances for the submission of financial statements by companies. If approved, SMEs and companies would be able to submit their financial statements online once a year and the companies would not necessarily receive audits on their financial statements.
There is also urgent need to reform tax enforcement and the services provided by tax departments. That is why Mongolia’s tax policy is being directed towards simplified tax reporting and tax payment with online tax filing. All tax payers can now submit their tax reports and make tax payments from anywhere and whenever rather than submit paper documents in person at the tax office. 
A brand new agency called the “Tax Debt Prevention Centre” is expected to launch to provide tax payers with information on tax debt and remind them about possible debt-related risks in the future.
The government is adhering to its tax policy not to implement tax hikes or introduce new taxes. Tax laws are to be clear and easy to understand, while the law enforcement is to be simplified. 

North Korean Delegates Visit Mongolia to Exchange Experiences in Tourism Sector

June 24 (infomongolia.com) On June 20-25, 2014, North Korean delegates led by Deputy Director-General of the National Tourism Administration of the DPRK Mr. Mun Tae-gil are conducting a working visit to Mongolia and during their stay in Ulaanbaatar, delegates attended a workshop "Mongolia's Tourism Sector's Development Prospects and Further Policy to Adhere".
The visit is being implemented following up a state visit of the President of Mongolia Ts.Elbegdorj to the DPRK conducted last year that aims to introduce Mongolia’s tourism sector’s policy being carried out, to broaden bilateral collaboration and exchange experiences in the relevant sphere.
On June 23, 2014, the North Korean delegation was received by Minister of Culture, Sports and Tourism Ts.Oyungerel, where parties shared views on broadening cooperation in tourism sector and on the same day, Deputy Minister of Foreign Affairs D.Gankhuyag also held a meeting with delegates.
In the frameworks of the visit, North Korean delegates intend to visit the main tourist destinations of Mongolia, besides to visit the Institute of Finance and Economics in Ulaanbaatar meeting Mongolian private entities to introduce DPRK investment policy in their tourism sector and discuss an issue on training professional personnel.

Minister for Nature, Environment and Green Development of Mongolia, S.Oyun Elected to Chair UN Environment Assembly

June 24 (infomongolia.com) On June 23, 2014, the first-ever and considered historic UN Environment Assembly has been commenced in Nairobi, the Republic of Kenya, where over 1,200 participants, UN 162 member-states and 90 Ministers are attending the Assembly with 40 events.
The event, to continue until June 27, is aimed to discuss governance of environmental law, green economy financial mechanisms, illegal trade in wildlife, environmental sustainable development goals (SDGs) as well as the Post-2015 Development Agenda, including sustainable consumption and production.
In the scope of the United Nations implementation towards environmental issues, the Governing Council of United Nations Environment Programme (UNEP) decided to enlarge the UN Environment Conference into UN Environment Assembly at its first universal session held in February 2013, where all UN member-states are accredited to be member of the Assembly.
Moreover, Assembly members unanimously agreed promoting Minister for Nature, Environment and Green Development of Mongolia, Mrs. Sanjaasuren OYUN to chair the Assembly.
Mongolian delegates attending the UN Environment Assembly introduced the country’s environment and green development policies carried out by the Government of Mongolia and participated in relevant meetings, moreover sharing its experience in the “Partnership for Green Economic Activity”.

Mongolia’s General Department of Taxation Issues Tax Act of 130 Million USD Addressing Oyu Tolgoi LLC

June 24 (infomongolia.com) Today on June 24, 2014, Mongolian finance service and investment management company, “Mandal Asset Management” announced that the General Department of Taxation of Mongolia issued a Tax Act of 130 million USD addressing the Oyu Tolgoi LLC, where the report conclusion says the Company paid less tax and other financial violations in the first phase of the development of Oyu Tolgoi Project.
On the same day, the Oyu Tolgoi LLC released a quick response noting Turquoise Hill Resources’ statement in response to the Mongolian Tax Authority’s Tax Act asserting unpaid taxes, and other financial matters, relating to the first phase of the development of the Oyu Tolgoi project. Oyu Tolgoi LLC does not agree with the report’s conclusions. As stated by our majority owner, Turquoise Hill Resources, the shareholders will work through appropriate dispute resolution processes, in accordance with Mongolian tax law and the Investment Agreement, which may result in international arbitration.
President and CEO of Oyu Tolgoi LLC, Craig Kinnell said, “We regret this development. However, our commitment is to continue to legally operate the Oyu Tolgoi mine and look after the health and safety of our over 6,000 employees and contractors, who are focused on making the operation sustainable, profitable and internationally competitive”.

Six dead, 43 injured in bus accident

June 24 (UB Post) A long-distance bus traveling from Baruun-Urt to Ulaanbaatar reportedly skidded off the road while trying to pass another vehicle and flipped over four to five times, leaving six people dead and 43 people with either severe or minor injuries, at around 7:30 a.m. on Saturday.
Five passengers died at the scene, and one passenger died en route to the hospital. The deceased were three men and three women.
The incident occurred three kilometers from Tsonjin Boldog in Erdene soum of Tuv Province. There were 48 passengers on board and 14 out of the 48 were children from seven months to 18-years-old.
Social media reported that a pregnant woman on the bus suffered a miscarriage due to the crash, however the National Trauma and Orthopedic Research Center (NTORC) doctors confirmed that there were two pregnant women on board and neither of them had miscarriages. They received minor spinal and cerebral injuries and are receiving treatment. Both of them are in stable condition.
All of the injured were immediately transported to the NTORC and 19 people are still hospitalized. Two of them are unconscious in the intensive care unit, eight are in the spinal treatment ward, and nine more are receiving treatment for cerebral injuries.
The bus is owned by local bus operator Daichin Sukh LLC. A working group involving Deputy Minister of Roads and Transportation Kh.Yerjan, delegates of the National Auto Transportation Center, the Sukhbaatar Province Auto Transportation Authority, and Daichin Suikh LLC is working at the scene.

We want a ‘Glass Purse’

June 24 (UB Post) Arguably the most powerful anti-corruption bill was once again put forth to Parliament last Thursday. The Glass Account bill, which was drafted by President Ts.Elbegdorj to increase the transparence of state budget spending, was previously turned down due to a “naming and terms” issue.
If passed, the Glass Account bill would prompt all state and provincial government financed businesses, ministries and agencies to report their spending on their website immediately.
According to J.Tumurbaatar, Deputy Head of the National Property Committee (which will be in charge of implementing the bill if passed) the bill will ensure timely action against improper spending of the state budget and give access to the public on what taxpayer money is being spent on.
“In short, by introducing [the Glass Account] bill, corruption, the abuse of power, and wrongful spending of the budget can be monitored by the public, and timely action can be taken to prevent or create accountablity for such actions… According to today’s laws, the state budget is approved on December 1 of each year, and budget holders report their spending within the first month of the year.
The results of the National Audit of the previous state budget spending is announced while the next year’s budget is being discussed. This means that the public has no way of monitoring spending while it is taking place. But if passed, the law will allow the people to monitor starting from September this year,” he told news.mn.
The Glass Account bill was previously denied by Parliament in late April, after many petty and unproductive debates about its name, and not about its content.
During the Parliament session of April 20, MP and former Justice Minister Ts.Nyamdorj said while discussing the Glass Account bill, “What is a ‘Glass Account’ law? Can a law with such a name exist?
To my understanding, it seems like a law will be stated on glass. What kind of an account is that? I understand that the budget account needs to be more open, but state the names of the countries that have a law with this name.”
During the discussion, it was clear that MPs were determined to touch on all other aspects of the law, expect the most important ones, its implication and necessity. Other MPs echoed Ts.Nyamdorj’s comment about the name of the law.
When asked about why the bill wasn’t approved, P.Tsagaan, the President’s Chief of Staff said, “It is possible that we might have been careless [about formulating the bill], thinking that the law would be passed. This is a law that created a lot of anticipation among the public. But MPs have dropped the law after much criticism of the word ‘glass’. This is a simple concept for everyone. Glass is a transparent material. The word was chosen to symbolize transparent state operations, state budget spending and its public monitoring. But members chose to focus on how it will translate into the languages of the UN. ‘Glass Account’ can be translated in all languages.”
P.Tsagaan also remarked that the interests of some politicians might have influenced the decision, as 90 percent of the public approved of the law in a poll conducted by the Office of the President.
And so, at last, the bill was resubmitted to the parliament, and discussed last Thursday.
The issue of changing the name was once again raised by MP Su.Batbold, who stated, “This law was rejected once before. Members wanted the name changed. Poetically named laws are not necessarily good laws. This ought to be looked into.”
MP D.Demberel complained that the law requires all establishments with state and provincial funding to report their spending online and pointed out that not all settlements in Mongolia have access to the internet, therefore it cannot be accessed by them. He added that it’s the “implementation of the law” that he is most concerned about.
The final decision on the law was postponed and the issue was left at that in Thursday’s meeting.
To me, and to the majority of voters and taxpayers, this law is essential for eliminating corruption, one of Mongolia’s biggest concerns. Mongolia is listed 83 out of 177 in the Global Corruption Perception Index by Transparency International, with only 33 points out of 100.
The social stigma and challenges corruption presents for the people of Mongolia everyday are broad and unavoidable. The Glass Account bill will allow the public to see and judge for themselves whether their tax money, government bonds and loans that taxpayers must pay off, is being spent productively or on ventures that are fruitless, as is so often the case.
MPs are currently concerned about menial, if not irrelevant, aspects of the law, such as its name. In this day and age, when mobile phone services and internet connections can be set up easily pretty much anywhere around the globe, MPs don’t have an excuse in saying that a critical law that will protect the interest of millions cannot be passed because some villages have no internet access.
The fact is that Mongolia needs to eliminate corruption if it is to benefit from its mineral riches, and taxpayers have the right to know how the government is spending their money. The state budget is not the property of ministers or governors, it is the public’s. The state is merely entrusted by the public to act and spend on their behalf for the public good. If state spending reports are made available to the public, the public can judge whether or not their money is being spent wisely.
If businesspeople invest in a company, they have the right to know how the company will spend their investment, and how they will be paid back. The same goes for taxpayers and voters. If a company doesn’t reveal how they spend their money to its investors, nobody will invest. But taxpayers don’t have the luxury of choosing not to pay taxes, we are forced to pay, but we can choose who sets the taxes.
We – the public – need to know how our money is being spent, it is our right.
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