Friday, July 18, 2014

Mongolia Brief July 17, 2014 Part I

Mid-Term Strategic Partnership Development Program to Establish with Russian Federation Discussed
July 17 ( At the Cabinet meeting of Government held on July 16, 2014, one of the issues discussed was "Mid-Term Strategic Partnership Development Program" to establish between Mongolia and the Russian Federation.

Following the revision it was agreed to negotiate with Russian part and exchange opinions on some issues, after which to re-submit to the Cabinet meeting obliged by Foreign Minister of Mongolia L.Bold.
Within the scope of this Program, outlook for trade and economic cooperation between Mongolia and Russia in the next five years would be determined and clarified. In addition, cooperation in political, defense, security, law enforcement and humanitarian areas as well as partnership in regional and international spheres would be reflected comprehensively in this Program.
During the President Ts.Elbegdorj’s visit to Shanghai on May 20 and Prime Minister N.Altankhuyag’s visit to St. Petersburg on May 23, 2014, Mongolian leaders mentioned to establish the Program during the meeting with the President V.V.Putin and the Russian side accepted the proposal positively.
Mongolia and the Russian Federation established the Friendly Relations and Partnership Agreement on January 20, 1993 and Strategic Partnership in 2009.
Strategic program consideredMontsame, July 17

Board Members of Development of Bank of Mongolia Changed
July 17 ( At the Cabinet meeting held on July 16, 2014, three Board Members of the Development Bank of Mongolia were released from duties on their own requests and new members were appointed.
The freed members of the Board are:
- Former State Secretary at the Ministry of Finance D.Battur,
- Executive Director of Khadgalamjiin Daatgal (Deposit Insurance) Corporation B.Lkhagvasuren,
- Executive Director and Secretary General of Mongolian Bankers Association B.Naidalaa.
Newly promoted three Members of Board of the Development Bank of Mongolia are:
- Director of Supervision Department at the Bank of Mongolia (Central Bank) D.Ganbat,
- Director of Budget Expenditure Division at Fiscal Policy and Planning Department, Ministry of Finance, O.Khuyagtsogt,
- Acting Director of Public Administration and Management Department at the Ministry of Economic Development R.Baasanjav.
Also, during the Cabinet meeting, it was resolved to retire Director of Economic Partnership and Aid Policy Department at the Ministry of Economic Development D.Boldbaatar.
The Development Bank of Mongolia, which is a subject of the state-owned entity, was established on July 20, 2010 by the Government decision with specific functions to finance big projects and programs carried out nationwide, and Chairman and Board Members of the Development Bank are appointed and released by the Cabinet decision.

Four roads financing resolved
Ulaanbaatar, July 17 (MONTSAME) The cabinet meeting on Wednesday decided to issue some 29 billion togrog from the Development Bank for financing a construction/renovation of four auto roads in the UB city.
It will be a part of the Government and the UB city’s 2012-2016 action platform, according to which 212 km auto roads will run and 350 km will be renovated/expanded.
The cabinet also resolved that the money will be paid back to the Bank by a way of putting 20 billion with an interest to the government’s budget in 2015 and 8,6 billion with an interest—to the city’s budget of the same year.

Austrian Vamed Engineering to Implement Five Projects as Executor Company in Health Sector of Mongolia
July 17 ( The Governments of Mongolia and the Republic of Austria had established Financial Cooperation Agreement for the purpose of providing financing by the latter part on concessional terms to implement some joint projects in a health sector of Mongolia on November 28, 2011.
Nevertheless, the effective period of the Financial Cooperation Agreement is due to end this month and some difficulties to select executors for joint projects have been arisen on timely basis. Therefore, in order to accelerate some projects to be funded from the 40 million EUR soft loans provided by the Government of Austria, the Government of Mongolia decided to establish direct contracts with executors and afterwards accepted some proposals from the Ministry of Health.
Th e Ministry of Health of Mongolia submitted five projects and promoted the name of an executor company, where at the Cabinet meeting held on July 16, 2014, it was agreed to select Vamed Engineering GmbH & Co. KG, an Austrian company, as an executor and to establish financing agreement entrusted by the Minister of Finance Ch.Ulaan and Minister of Health N.Udval representing the Government of Mongolia.
The five projects will be implemented in financing to renew equipment at National Cancer Center of Mongolia, equipment modernization at Maternal and Child Health Research Center as well as equipment modernization and human resources capacity building projects at the State Central First Hospital.
During the Intergovernmental Committee Meetings between Mongolia and Austria held in 2010 and 2013, the Ministry of Health of Mongolia was obliged to study proposals on above projects submitted by the Vamed Engineering Company as an executor, which were reflected in the Protocols to implement. Moreover, the UniCredit Bank Austria AG officially announced to provide an export loan to Vamed Engineering GmbH & Co. KG.

Foreign Minister of Canada to Pay First Official Visit to Mongolia
July 17 ( The Minister for Foreign Affairs of Canada Mr. John Russell Baird will be paying an official visit to Mongolia on July 23-25, 2014.
At the Cabinet meeting held on July 16, a draft guidance to adhere by Mongolian part during the visit of Foreign Minister John Baird was discussed and agreed to be ratified by Prime Minister N.Altankhuyag.
This is the first visit to be carried out at Canada Foreign Minister-level and considered with high significance. During the visit, Foreign Minister J.Baird will be received by the Prime Minister of Mongolia N.Altankhuyag and Deputy Speaker of the State Great Khural (Parliament) R.Gonchigdorj, who is a Chairman of Mongolia-Canada Parliamentary Group. Also, the two Foreign Ministers of Canada and Mongolia will hold an official talk and a meeting with Mining Minister D.Gankhuyag is also included in the program.
Canada and Mongolia have a cooperative bilateral relationship, which includes significant Canadian investment interests in the mining sector of Mongolia, where both sides are seeking to expand bilateral and multilateral ties, and the diplomatic relations between Mongolia and Canada were established on November 30, 1973.
Foreign Minister of Canada to visitMontsame, July 17

Speaker leaves for Ovorkhangai
Ulaanbaatar, July 17 (MONTSAME) The Chairman of the State Great Khural Z.Enkhbold has left for Ovorkhangai aimag to make a working tour.
The Speaker will attend the 90th anniversary of the aimag’s Baruunbayan-Ulaan soum, located 185 km from the aimag's center.
After Ovorkhangai, Mr Enkhbold will work in Bayan-Olgii aimag to pay tribute to the worshipped Altaikhan and Tavanbogd Mountains, will get acquainted with a construction of “Taishir” and “Dorgon” hydropower stations.
While the Speaker is absent, his work is to be run by his two Vices R.Gonchigdorj and M.Enkhbold.

Chinese leader Xi Jinping to visit
Ulaanbaatar, July 17 (MONTSAME) The President of the People’s Republic of China Mr Xi Jinping is expected to visit Mongolia this August.
The cabinet meeting on Wednesday approved a summary of the first meeting of the Mongolia-China council for mineral, energy and infrastructure cooperation, and then considered as necessity to oblige N.Batbayar, the Minister of Economic Development and a head of the council for Mongolian side, to ensure that a preparation for the visit is made by related Ministries and agencies.
In addition, an order was given to this Minister to work out and realize a plan of measures in line of the meeting and to present it to the cabinet.

Mongolian national football team to compete for the 2015 East Asian Cup
July 17 ( Mongolian national football team is to participate in the preliminary regional competitions for the 2015 East Asian Cup, the football championship of East Asia, which will be held at the National Training Center of Guam on July 21-27, 2014.
The 2015 EAFF East Asian Cup is the 6th edition of this regional competition and will be held in China in 2015.

MIAT Airlines to Open Direct Flight to Singapore from September 2014
July 17 ( The National Flag Carrier MIAT Airlines JSC announces to conduct a direct flight between Ulaanbaatar (UB) and Singapore from September 20, 2014.
The company’s recent new route opened was between UB and Frankfurt, which is effective from last June 19th, so this time MIAT plans to commence destination to island country in Southeast Asia.
Singapore is one of the original Four Asian Tigers and has a highly developed market economy, where tourism also forms a large part of the country's economy and the main tourist destinations are:
Universal Studios Singapore
Marina Bay Sands and Resorts World Sentosa casinos
Adventure Cove Waterpark™
Gardens by The Bay
Merlion Park
Wave House Sentosa
Marine Life Park™
River Safari
Art Science Museum
Songs of the Sea
Singapore Flyer

Cabinet meeting in brief
Ulaanbaatar, July 17 (MONTSAME) The cabinet meeting Wednesday selected new members of the Representative Leading Council of the Development Bank of Mongolia (DBM) after it had discharged some administrative officials.
Accordingly, the new appointees have become a director of the Monitoring Department of the Bank of Mongolia (BoM) D.Ganbat; a chairman of the Budget Expenditure Section at the Ministry of Finance O.Khuyagtsogt; and an acting head of the State Administrative Management Department of the Ministry of Economic Development R.Baasanjav.
Founded on July 20 of 2010 by the cabinet decision, the DBM is a state-run legal subject with a special function to finance the biggest projects and programmes for a development of Mongolia. By the law, members of the DBM’s Representative Council members and head are appointed or discharged by the government.
- At the cabinet meeting the same day, the Minister of Industry and Agriculture Sh.Tuvdendorj presented some state-owned real-estates to be auctioned. Then, obligations were given to Tuvdendorj and to D.Tsogtbaatar, a head of the State Property Committee (SPC), to run the auction in accordance with related laws and regulations, taking into account proposals of the cabinets.
- The General Authority of Customs introduced to the cabinet works done in first six months of 2014, in conjunction with the Year of Activating Information Exchange and Increasing Joint Responsibilities. According to the report, the customs revenue rose by MNT 70.8 billion or 10.2% in the first half of this year against 2013, and import declined by 12.5%.

Credit rating of Golomt Bank falls
Ulaanbaatar, July 17 (MONTSAME) The Standard & Poor's Ratings Services reported Wednesday that it had re-stated and lowered Golomt Bank’s long-term issuer credit rating to "B" from "B+" and affirmed its short-term issuer credit rating as "B". The outlook is negative, which reflects Standard & Poor’s view that economic risks in Mongolia could increase over the next 12 months and pressure the ratings on the bank.
According to the rating agency, Golomt’s ratings downgrade is to reflect the lowering of the sovereign credit rating on Mongolia (B+/Stable/B) in April 2014, while the ratings on the bank were suspended. The ratings on Golomt no longer benefit from extraordinary government support because the bank's stand-alone credit profile of 'b' is close to the sovereign rating on Mongolia.
In its report, the rating agency has stated that “the Golomt management has focused on its future development, after resolving corporate governance issues among the bank's major beneficiary shareholders and the bank management in 2013. The bank is also strengthening its internal control procedures and policies to address corporate governance and risk management issues identified in 2013".

Stock exchange news for July 17
Ulaanbaatar, July 17 (MONTSAME) At the Stock Exchange trades held Thursday, a total of 3,360 shares of 17 JSCs were traded costing MNT 11 million 227 thousand and 557.00.
"E-trans logistics” /1,490 units/, "Baganuur” /580 units/, "APU” /501 units/, "Arig gal” /196 units/ and "Mongol savkhi” /150 units/ were the most actively traded in terms of trading volume, in terms of trading value--"Bayangol hotel” (MNT four million and 350 thousand), "Baganuur" (MNT two million and 494 thousand), "APU” (MNT two million 003 thousand and 901), "Shivee ovoo” (MNT 744 thousand) and "Gobi” (MNT 554 thousand and 200).
The total market capitalization was set at MNT one trillion 685 billion 050 million 654 thousand and 672. The Index of Top-20 JSCs was 16,337.57, decreasing by MNT 882.92 or 4.80% against the previous day.

Press release: Oyu Tolgoi - update on production and operations
July 16 (Oyu Tolgoi) - 140,000 tonnes of concentrate produced in second quarter, 2014 -
Ulaanbaatar, Mongolia - Today, Turquoise Hill Resources, released its quarterly production report, providing an update on production and performance relating to Oyu Tolgoi, which coincided with the first anniversary of commencement of concentrate shipments.
Between April and June 2014, Oyu Tolgoi produced 140,000 tonnes of concentrate, bringing total production so far this year to 242,900 tonnes.
During the quarter, concentrate sales increased significantly driven by ongoing improvements in customer logistics and marketing. As a result, sales exceeded production, resulting in an inventory drawdown for the quarter.
Oyu Tolgoi President and CEO, Craig Kinnell, said: “Today’s quarterly production and sales figures show that we are making the Oyu Tolgoi mine stronger as we continue on our path to becoming a safe, sustainable, profitable, and internationally competitive business.
“Last week’s anniversary was a true milestone for Oyu Tolgoi - and Mongolia - as we celebrated the first anniversary of shipment of product.
“Oyu Tolgoi’s employees have achieved a tremendous amount this year, and we are excited about taking the mine forward. I have great confidence in what we have achieved; we have sown the seeds to create a safe and thriving partnership, developing one of the best ore bodies in the world”.
As well as focusing on production and increasing shipments, Oyu Tolgoi continues to improve performance in a number of areas:
·         Water recycling has now reached 86.4 per cent, meaning Oyu Tolgoi reuses each drop of water more than five times. This makes it one of the very best copper mines in the world for water efficiency, using less than half the water per tonne of ore processed than average copper mines worldwide.
·         A five-year investment of more than US$126 million in education and training has been completed with more than 13,000 Mongolians benefiting from the programme.
·         More than 200,000 seedlings have been planted, ready for ongoing rehabilitation in the South Gobi. Stringent monitoring of local water supplies continues, with ongoing development of new water sources for local people and animals.
·         The Oyu Tolgoi workforce is 92 per cent Mongolian.
·         Following the connection of Khanbogd with permanent power last year, Oyu Tolgoi plans soon to build a road from the mine to the soum centre. This is expected to act as a catalyst to help Khanbogd thrive, driving growth and providing more options for Oyu Tolgoi’s employees to live locally with their families.
Oyu Tolgoi’s latest production figures can be found below. Further information can be found in Turquoise Hill Resources’ production report, and Rio Tinto’s quarterly update.
Link to article

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