Saturday, February 7, 2015

Mongolia Brief February 5, 2015 Part III

J.Bayartsetseg: "This is not about Mongolia only, global economy slowed down"
By B. Erdenechimeg
February 5 ( We interviewed one of the participants of Young Global Leader program under WEF J.Bayartsetseg, State Secretary at Ministry of Justice, who was invited to the attend the WEF for the second year.

Which panel meetings did you attend at the Davos 2015? What were the hot topics at the WEF?
WEF organizes Davos summit every year. This is one of the high level events, this year it involved presidents of 40 countries and 2500 delegates attended the summit. The summit expanded over last few years not just in terms of the size, but also in terms of the topics it discusses. It covers wide range like politics, technology and environment besides economic situation. Mongolia started participating in this event since 2000.
For developing countries this event is one of the best opportunities to meet with leaders of developed economies and hold the negotiations in terms of the location, as many leaders gather at one spot at the same time. I guess this is the main benefit for the participants.
Moreover the main objective of Davos is to determine the economic trends for the coming year. That is why participants eager to attend this summit, whether they are businesses or international organizations or leaders of countries. It helps them to navigate their activities in the coming year, as they can find answers to questions like where to invest, where is the most business friendly environment, which sector will see most growth and from which country experience one could learn the most. All this information is available at one place.
Have been included in the Government delegation?
No, I have attended the WEF separate from the Government delegation. There is the Forum of Young Global Leader under the WEF. It does elect youth for one particular year with most contribution in their fields. I have been selected in 2013 and have participated for two years in this summit. There were three participants from Mongolia selected to this program. It is an honor to be a participant in WEF together with world leaders.
What were the main topics discussed at the WEF this year?
The main topic of the Davos 2015 was the Uncertainty, because uncertainty is the main character in every sector such as finance, politic, geopolitics and etc. globally.  Especially the financial crisis is not only attributed to Mongolia. It is global. Our neighbors Russia and China are in the same situation. Leaders of G-8 have given speeches at the opening of the WEF.
Prime Minister of China has acknowledged the slowest growth in 25 years. This is true and this is the economic downturn. But they have determined it as the new normal. If they were accelerating now they are slowing down. If China was the exporting country, now it aims to focus on domestic market as the US and EU markets are shrinking.
US, EU, China, Russia and BRIC countries are being observed globally as the global economy is much dependent on those countries. Everyone is keen on the developments at these markets. Everyone is sure that economic growth will slow down and especially in EU. The main topic of this year’s WEF was on the ways to overcome such economic slowdown.
Another important topic was the safety. President of France Fran├žois Hollande said in his speech that the safety is the essential for everything and that the efforts to ensure the safety is not attributive to one person or just one nation, it is the global matter. The issue of safety is tightly linked with the political uncertainty or the terrorism. It was one of the hugely discussed topics as well.
Last but not least, I want to mention the innovation or the new products and new initiatives. Technological innovation and its economic application were most discussed. CEOs of Google, Yahoo and Alibaba have been present during the WEF. They have explained how their technological advances can be applied for public use.
Which panel meetings did you attend?
Over 20-30 panel meetings happen all at the same time daily until 10PM. I have attended panel meetings on leadership and gender, as those are my topics of interest. Those were significant in terms of introducing the scientific outcomes and interesting researches.
We are currently facing new challenges. Leadership is one the key one that will lead us through the rough times. Leaders with different approach and leadership skills should come up, because we are facing the times, which require totally new leadership approach.
Moreover, leadership is not about one person, now it has more broad and enhanced meaning to it as international leadership. For instance, US has been the dominant political leader up until now. Whereas China is emerging as the new leader, but the question is will Chinese leadership be acknowledged by others. Russia is losing its leadership in terms of geopolitics and who is to replace that.
Many were very critical about organizations such as UN, EU and IMF. Many were criticizing of their leadership and many were accusing them for holding back development and increased level of bureaucracy. They are losing their leadership and that is why many regional institutions have been popping up lately such as ASEAN and African Union being able to solve regional problems at much quicker speed.
All the participants have agreed on 2015 to be risky year and main focus was on the solution for overcoming it through integrated efforts.
What was the response from the International Organizations on criticism?
On one side they have acknowledged, but on the other hand, they said that bureaucracy is one of their traits. For instance, for EU it comprised of over 20 member countries. In order to come up with decision they have to conduct discussions with all of them.
UN is facing financial crisis, they have started restructuring and downsizing as main contributors such as US and EU have decreased their support, many member countries are not paying their taxes, most clear example was WHO. WHO was unable to do anything of big scale on the Ebola outbreak, just because of lack of funds. Private sector played great role in fight with Ebola. But there is still big institution like UN.
What were the discussions at the gender panel meetings?
Current talks are now more directed how the females can be supported and empowered, rather than discussing the importance of female involvement.
Suppose those who are talking about are mostly women?
Male representatives are talking about the involvement of females and those are CEOs. Currently female involvement in politics is at 20 percent globally, while at our parliament it is 11 percent. Every country recognizes this as low and is making efforts to improve it.
At some countries it is obligatory to have female member at the Board of Directors, but this needs to be improved more. It is not just about having a female at the board; she should be seen as the representative of the 50 percent of the population, whether it is at a private business or politics. Female involvement in decision-making process is beneficial, whether it is company or a country.
Representatives of Rwanda have emphasized the importance of female involvement as the moving factor in post massive murder reconstruction and redevelopment.
You have taken part at Davos summit as the participant at Forum of Young Global Leaders. How can one become a part of it? What would be your advice?
About the Young Global Leaders participants should be under age of 40 and be successful in their field of expertise. It involves mainly young leaders from businesses, such as Marissa Mayer of Yahoo, Eric Schmidt of Google to name a few. This program gives a chance to get in touch with those leaders and learn from them.
Another Young Global Leader should nominate one and I would like to say as a voting member I could refer our youth for this program. The program is set to educate and share the experiences through multiple seminars and trainings abroad at universities like Harvard and Yale. I have a right to nominate a candidate for the 2016 Young Global Leader.
How many Mongolian nationals have been selected through this program?
One nominee can attend the Davos for five years. Ch.Gankhuyag of XacBank has completed his term. Before him it was MP S.Oyun. Asashoryu D.Dagvadorj has been selected from Japan, while I was elected in 2013, S.Byambasaihan was elected fro 2014 and U.Ganzorig for this year. But participation at Davos requires passing more criteria.
How is the perception of Mongolia at Davos?
Current image of Mongolia has shifted greatly, there is no need to explain where Mongolia is located or what mineral resources it has. Participants have acknowledged that Mongolia is a democratic and free nation that is on its development path. Many would ask for the opportunities they can enjoy in Mongolia.
We are seen as a potential partner, of course there are problems and issues we need to solve. In comparison to the other East Asian countries, African and some Middle East countries we are far more ahead with development. It is great to hear those things outside of Mongolia.
Last year when we talked with Ch.Gankhuyag he was mentioning that Myanmar would be the next country to attract the investments. Where investment flow is directed for this year?
Due to the uncertainty at many sectors investments will decline. This is not about Mongolia only, global economy slowed down. It is obvious that even for very attractive countries investments will decline.
Many like to ask for definite time or period when the economy will be back on track, when we will see the growth again.
It is not about giving the numbers like in 2018 everything will be good. At Davos many have emphasized that development will be dependent on leaders and organizations leading the regions.
Thank you. 

AmCham Mongolia objects to sentencing of former SGS employees
By Ch. Khaliun
February 4 (UB Post) As reported by Bloomberg, Chairman of the American Chamber of Commerce (AmCham) in Mongolia Jackson Cox said that following the sentencing of U.S. citizen Justin Kapla to more than five years in prison, that discussions of Mongolia receiving aid from the U.S. should be suspended.
Bloomberg reported, “A suspension would be the first direct financial impact felt in Mongolia after a court sentenced Kapla, a native of Elk River, Minnesota, and two Philippine nationals to between five and six years in prison on the charge of tax evasion.
“The Millennium Challenge Corporation, a U.S. foreign aid agency, gave Mongolia 285 million USD over five years in a first agreement that concluded in September 2013. The MCC forms ‘partnerships with some of the world’s poorest countries, but only those committed to good governance, economic freedom, and investments in their citizens,’ according to its website.”
Cox is now calling for the immediate suspension of talks on a second round of aid.
The UB Post spoke to the American Chamber of Commerce in Mongolia for clarification of their statement and AmCham’s influence on the issuing of aid from the U.S., following a backlash of crticism in Mongolian media.
An AmCham representative said, “We didn’t say to cancel aid, but as the representative organization of all U.S. investment companies, we are voicing an objection to the court’s decision, which violates human rights, and suggested postponing the aid for a definite period of time. In other words, we are delivering the message of unhappy U.S. company representatives in regards to the court’s decision.”
U.S. Ambassador to Mongolia Piper Anne Wind Campbell, who attended the trial, has said that there were interpreting problems for the defendants at the trial, and MP Ts.Oyungerel told Bloomberg that the court’s decision was “unjust and unbelievable”.
The U.S. Embassy in Mongolia declined to comment on Bloomberg’s story about the statement from AmCham.

Drug smugglers caught at border
By M. Zoljargal
February 4 (UB Post) Several drug smugglers were caught at Buyant-Ukhaa border checkpoint while attempting to smuggle ice (methamphetamine) to Mongolia in late January and earlier this month.
Mongolian citizen “L” (names redacted) was caught smuggling 20 grams of ice on February 1, while a group of three Mongolians were arrested with intent to smuggle ice and tools for inhalation on January 30.
The Division Against Illegal Drug of the Authority Against Organized Crimes are currently investigating the cases.

Back in the 90s
By B. Narantuya
February 4 (UB Post) Dedicated to the 90th birthday of State Honored Artist, Cultural Merit Laureate, and National Artist G.Odon, an exhibition featuring work that he created during his lifetime is on display at Best Art Gallery, through February 05. Over 120 paintings are presented in the gallery, including sketches, oil paintings, and watercolors.
G.Odon (1925-1996) was born in Dashbalbar soum of Dornod Province. During his lifetime he created many artistic pieces and dedicated his life to art.
All of the works presented in the gallery are from the permanent collection of the Dashbalbar soum museum in Dornod province. Organizers of the exhibition brought his paintings to Ulaanbaatar to celebrate his 90th birthday, and to share the paintings with a larger audience.
“My father gave 55 of his paintings as a gift to the museum of Dashbalbar soum on April 26, 1995. Since that time, a hall was established there under my father’s name, ‘G.ODON’. After my father passed away in 1999, our family gave a total of 103 of his personal belongings to the museum,” said his daughter, O.Nyamaa.
After revisiting his memories of the summer of 1948, spent in the land where he was born, he created the painting “After Work.” The painting became one of his most famous pieces and earned the artist the State Honor prize in 1959 and title of National Artist in 1975.

Tobacco Control Law has been neglected
February 4 (UB Post) Mongolia has finally established smoking areas, nearly two years after the Tobacco Control Law was adopted. Discarded cigarette butts on streets indicate that the Tobacco Control Law is enforced poorly. This is to be expected, as the original law only specified non-smoking areas and didn’t provide regulations for designated smoking areas.
Within the first phase of creating smoking area, smoking cabins have been set up at various locations in Bayanzurkh District; in front of the Wrestling Palace, next to the Bayanzurkh and Officers’ Palace bus stops, and the National Cancer Center bus stop on Nam Yan Ju Street. These new glass-walled smoking cabins look exactly like glass-walled smoking cabins in foreign countries. They are attracting a great deal of attention from passers-by.
Some fascinated passers-by check these vacuum-insulated cabins from the outside and even try to open them, only to find that they’re locked. People in charge of this project have clarified that that smoking cabins are locked because a survey is being conducted among locals, inquiring if the designated smoking areas are necessary. Many would say that the change in policy is being performed in reverse. Normally, surveys are conducted before taking action or establishing projects based on the results of a survey – in this case, smoking cabins. Had proper implementation conditions been created before adopting the Tobacco Control Law, the law would’ve seen different results and standards.
Smoking cabins were established over a month ago. Nobody knows how long the survey will continue, or when smoking cabins will become operational. Lawmakers should’ve created smoking areas during the approval of the law. Then, locals would’ve become accustomed to smoking in only designated areas by now. Some cities believe that smoking tobacco in smoking areas are a fundamental part of urban culture.
The Tobacco Control Law prohibits smoking in several areas. The following is a brief overview of the law’s designation of non-smoking areas.
1. Public transportation
Except in Mongolia, bus drivers don’t smoke inside their vehicles. It is strictly prohibited in other countries, especially when passengers are onboard. Drivers of public transportation vehicles and taxis have special smoking areas. In Incheon, South Korea, people have to pay a high penalty if they smoke inside public transportation. Yet, bus drivers and conductors in Mongolia smoke in buses. Passengers who complain to them about smoking are treated with disrespect. If they argue, the passenger is chased out of the bus.
At the start of the enforcement of the Tobacco Control Law, bus drivers were able to resist smoking in buses for one week. In only a week, the law was forgotten and became ineffective. Every organization engaged in public transportation has a phone number for reporting complaints. Calling these phone numbers is a waste of time, as people receive replies saying,“We can’t supervise those people”. If bus drivers and conductors can’t follow the law, why should locals have to protect the law?
2. Entertainment and public service areas
Entertainment and public service areas are implementing the law better than other locations. The number of people smoking in these areas has decreased considerably. Most bars and entertainment venues have become accustomed tothe law, prohibiting customers from smoking.
3. Passenger transportation stations and trains
The law’s enforcement at passenger transportation stations is very poor because even elders are smoking there.The majority of people are smoking, so the people in the minority aren’t able to complain. No one is monitoring passenger transportation stations and trains.
4. Kindergartens, all schools, school dormitories, and their outdoor spaces
Implementation in these areas is also poor. Numerous students have been caught smoking in dormitories and implementation outdoors is predictably ineffective. Small stores near dormitories and schools sell one or two cigarettes to customers instead of packs, so many students are able to buy a cigarette even when they’re low on cash.
5. Entrances of apartments, elevators, children’s playgrounds, and parks
These areas are too difficult to enforce smoking restrictions. These places are the main venues where people smoke.
This shows that the Tobacco Control Law in Mongolia is completely out of order and unsupervised. Smoking is already widespread in Mongolia, as well asin other countries. Unlike Mongolia, other countries are able to maintain order and regulation for tobacco control because they made everything precise and clear when they first developed their legislation, and they made regulations customary. It’s not too late to become like other countries and have better control over tobacco if we revise Mongolia’s Tobacco Control Law.

MPP issues propositions to overcome the recession
By E. Oyundari
February 5 (UB Post) During its regular meeting, the Mongolian People’s Party group in Parliament discussed a proposal of policies and measures developed by the party to be taken to strengthen the economy, and delivered it to the Cabinet.
The working group to develop the proposal, led by MP Ch.Khurelbaatar, carried out a practical assessment on the economic recession and proposed that the government take certain measures in four directions: stabilize the macro economy, support practical sectors, make legal changes, and address social welfare concerns. In addition, the proposal suggested that the government develop a program within one month to get over the economic crisis and submit it to Parliament.
The growth of Mongolia’s economy in 2011 increased by 17.5 percent, while in the past three years the growth rate has slowed down, falling to 12.3 percent in 2012, 11.7 percent in 2013, and only 6.9 percent in 2014. The MPP says the sudden drop in economic growth was caused by many domestic and foreign factors, however, the main influence was caused by a lack of macro-economic policy, the Government and Mongol Bank supplying a large amount of money into the market, uncontrolled spending of those funds, and reduced foreign investment due to misunderstandings with vested foreign investors.
The party believes that in order to get over the economic recession, Mongolia should alter the current policy on macro economy, stabilize the economy, implement joint policy to increase economic growth, and provide management and correlation of the budget and monetary policy.
With regards to budgetary policy, the MPP proposed supporting domestic production when buying products and services with the state budget funds, to reduce budget expenses by eliminating duplication of jobs and duties of state organizations, to seek ways and methods to increase state budget income, to form a budget reserve fund to pay back bond payments, and to reduce pressure on the budget.
Concerning monetary policy, they suggest increasing the interest rates of Mongol Bank, limiting intervention in the foreign currency market to make the tugrik rate more flexible, ending the program to stabilize prices, and creating easy repayment terms for loans.
To support practical sectors, the MPP believes that the negative influence of the economic crisis on practical sectors should be reduced as much as possible, domestic production and construction should be intensified, strategically significant vested projects should be carried out in order to increase economic growth, state owned entities and organizations should be called on to shift to a savings regime, employment must be preserved, expenses and the cost of products must be reduced, and relevant measures should be taken to support the private sector by improving the business environment.

Mongolian entrepreneurs offered a chance at a free trip to Poland
By Ch. Khaliun
February 5 (UB Post) The journal Mongolian Economy, the Polish Ministry of Economy, and M Promotion Agency are inviting Mongolian entrepreneurs and business owners from the food and mining sectors to take a free trip to Poland to become acquainted with Polish companies.
The main goal of the trip is to advance trade between Poland and Mongolia.
The trip will take place from April 13 to 18, in Warsaw and Krakow, and the travelers will attend a business to business (B2B) meeting with 24 Polish suppliers, visit three of the nation’s biggest companies in the food and mining sectors, and become acquainted with Krakow’s free economic zone.
The travelers will be able to attend interesting cultural events, travel around Warsaw and Krakow, visit famous Polish restaurants, and attend business meetings.
The Polish side will be fully responsible for travel expenses including airline travel from Ulaanbaatar, hotel, transportation, food, the B2B meeting, travel within Poland, and more.
Entrepreneurs interested in the trip can get more detailed information by calling 7011-5476 or 9409-2905, and sending their CV or business introduction letter to
The number of selected participants will be limited.

Metro stations to be built by 2020
February 5 (UB Post) It’s a tricky question whether cars or tortoises can go faster through Ulaanbaatar’s roads. Due to traffic congestion, people are spending too much time on the road, the vast amount of cars affects air and soil pollution, and people are affected negatively by pollution-related health issues. State officials are searching for different ways of getting out of this situation. Traffic congestion didn’t decrease even after the vehicle restriction system was implemented throughout the city. The only way to address the issue is to build metro stations. Most Asia-Pacific countries have included a metro in their public transportation system.
Having a metro for public transportation reduces the amount of noxious gas emissions by up to 30 percent, reduces the number of car accidents which occur, gives citizens the opportunity to live in a healthy and safe environment, decreases traffic congestion by up to 16 percent, and increases the efficiency of vehicles on the road by 25 percent.
With support from the Japanese organization JICA, state officials of Mongolia started research on introducing a metro to the public transportation system in 2020. The project team stated that it needs seven years to add metro to the public transportation system. By 2030, the population of Ulaanbaatar will nearly double compared to the population of 2010, which was 1.1 million. It’s estimated that transportation demands will triple.
In March of 2013, when the research team introduced their report to the City Council, most of the representatives supported the project and a ceremony for the Ulaanbaatar Metro Project was held in June of that year. During the ceremony, City Mayor E.Bat-Uul stated, “Metro is one of the biggest creations that will play an important role in the development of our country. If we add a metro to the public transportation system, our country will become a modern developing country. We can even start to talk about organizing an Olympics in Mongolia.”
JICA and project organizers planned to build 14 stations from Tolgoit to Amgalan, with a distance of 800 to 1,500 meters between stations. It takes approximately one hour by bus to drive 17.7 km in the city, while it takes 20 to 30 minutes by metro. Also, metro has the capacity to transport 20,000 passengers an hour, which is five times more than the bus. The travel time between metro stations will be five minutes and a ticket will cost 500 to 600 MNT per trip.
By 2020, metro passengers in Ulaanbaatar are estimated to number at 300,000, while by 2030 the number will increase to 500,000, stated the project team. The Sapporo roundabout will be the most high-traffic area. Metro lanes are planned for underground and aboveground construction. Building a metro underground is expensive, however, it won’t affect the flow of vehicle traffic. If the metro station construction begins, it will create 156,000 new jobs.
It is estimated that 1.5 billion MNT in funding is required for the construction of the metro. The Government of Japan has officially announced that it would help with a 600 million USD soft loan.
Along with the metro station construction, parking lots and service centers are planned to be built. Thus, it will affect the economy indirectly.
Metro stations in Ulaanbaatar are no longer a dream.
The following is an interview with Deputy Governor N.Gantumur about the Ulaanbaatar Metro Project.
It is possible that Ulaanbaatar will have metro stations by 2020. How is work going in the framework of the project?
In the first stage we asked Japan for an engineering loan, and the Japanese side is ready to loan 47 million USD. Tender will be announced in the fall of 2016. Thus, metro station construction work will begin in 2016. A joint team of three ministries from Japan will come to Mongolia this month to conduct a study.
How much money is planned for the construction of the metro stations?
From last year’s budget, three billion MNT overall is included. From the 2015 budget, state officials are considering including about 1.2 billion MNT. This will be spent for the working team. The Government of Japan is going to give a soft loan of 600 million USD. The duration of the loan’s repayment terms is 40 years.
Will the metro station be commissioned by 2020?
Even though our country is experiencing an economic recession, we are still planning to construct the metro station. Metro is the biggest kind of investment to bring up the economy. Many people will get jobs. It is estimated that the metro will contribute over 300 million USD in taxes to the state budget.
Travel between metro stations will be five minutes. How many metro trains will serve passengers?
It will be clear after the completion of a working plan. Two hundred million USD will be spent on the construction of the metro lanes. It will be four meters above the ground and 15 meters underground. Big complex emporiums will be built along Enkhtaivan Avenue.
Source: Unuudur
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