Saturday, February 7, 2015

Mongolia Brief January 21, 2015



President of Mongolia Meets Prime Minister of Czech Republic
January 21 (infomongolia.com) On the sidelines of a state visit to the Czech Republic, President of Mongolia Ts.Elbegdorj received the Prime Minister of the Czech Republic, Bohuslav Sobotka on January 20, 2015.

At the meeting, Minister of Foreign Affairs L.Purevsuren, Ambassador Extraordinary and Plenipotentiary of Mongolia to the Czech Republic D.Zumberellkham, Minister of Population’s Development, and Social Welfare S.Erdene, Deputy Minister of Defense A.Battur and other representatives from Mongolia were present. From the side of the Czech Republic, Ambassador Extraordinary and Plenipotentiary of the Czech Republic to Mongolia Ivana Grollova, Foreign Minister Martin Tlapa, Deputy Minister of Defense Daniel Kostoval and other officials were present.
Prime Minister of the Czech Republic Bohuslav Sobotka noted, “First of all, I would like to emphasize the achievements of Mongolia in the last 25 years. I congratulate Mongolia for successfully making the economic transition, because we know how difficult it was. Also, I am glad that our two countries have maintained the close mutual relations until now. We have plenty of information on Mongolia’s economic situation.
Although, the trade volume between our two countries tends to decrease, I believe that this visit will boost trade ties between the two countries”.
President Ts.Elbegdorj noted, “I am glad to pay a state visit to the Czech Republic. Our two countries enjoy friendly bilateral relations established by our senior generations. The year of 2015 marks the 65th Anniversary of establishment of diplomatic relations between Mongolia and the Czech Republic. In anticipation of the anniversary, we shall reconsider and evaluate the achievements of bilateral cooperation and build the plan for the future.
Our both countries enjoy value connection and we both have had a peaceful transition to democracy. On December 10, 1989, the first open pro-democracy demonstration was held in Mongolia and this year marks the 25th Anniversary of the Democratic Election in our country. I am glad to meet the Prime Minister of the Czech Republic on the occasion of this anniversary.
Mongolia is a landlocked country. By signing a transit transportation agreement with our two neighbors, we are paving the way for Mongolia to reach the third neighbors and new trade partners.
At the meeting with President of the Czech Republic, His Excellency, Mr. Milos Zeman, I was given the list of 40 Czech companies that are interested in cooperating with Mongolian entities. I would like to express Mongolia’s readiness to cooperate with them. Also, Mongolia-Czech Business Forum which is scheduled in the frame of the visit, will be fruitful and benefit our business people".
Related:
Mongolian President Receives Czech PMMontsame, January 21

Speaker Meets WB Delegation
By B. Khuder
Ulaanbaatar, January 21 (MONTSAME) The Speaker of parliament Z.Enkhbold Tuesday received a visiting delegation of the World Bank (WB).
The delegation--Satu Kahkonen, the WB director for macro economy and budget affairs, Mathew Vergis, the WB manager for macro economy and budget affairs; James Anderson, the WB country director for Mongolia, and Rogier van den Brink, a lead economist of the WB--shared views with the Speaker on a present situation of Mongolia’s economy.
Present at the meeting were also J.Batsuuri, a head of the Standing committee on economy; B.Bolor, a head of the Standing committee on budget; D.Lhagvasuren, an advisor to the Speaker; officials of the Ministry of Finance and the Bank of Mongolia.

FM Attends Round Table Meeting of IPI
By B. Amarsaikhan
Ulaanbaatar, January 21 (MONTSAME) The Minister of Foreign Affairs L.Purevsuren attended a round-table meeting of the International Peace Institute (IPI) on January 20 in Vienna.
He gave presentation on the Government policies, their implementations, and on the international initiatives proposed by Mongolia. After this, he answered to the questions asked by participating ambassadors and scholars.
Present at the meeting was also the Ambassador Extraordinary and Plenipotentiary of Mongolia to Austria G.Batjargal.

Proposal Submitted to Parliament to Appoint Ambassadors
By B. Khuder
Ulaanbaatar, January 21 (MONTSAME) A deputy head of the Presidential Office B.Togtokhbuyan Wednesday submitted to the Speaker of parliament Z.Enkhbold a proposal on appointing/recalling some Ambassadors of Mongolia.
According to the proposal, L.Galbadrakh has been offered to the post of the Ambassador Extraordinary and Plenipotentiary of Mongolia to the Lao People's Democratic Republic; T.Lhagvadorj--of the Republic of Singapore; Ts.Batbayar--of Republic of Cuba; G.Ganbold—of Republic of India; Ch.Bayarmonkh--of the Arab Republic of Egypt; B.Chuluunkhuu--of Australia; N.Bataa--of Republic of Poland; and T.Togsbilguun--of the Kingdom of Thailand.
S.Sukhbold has been proposed to the post of the Permanent Representative of Mongolia to the United Nations.

Foreign Minister Addresses OSCE Forum
By B. Khuder
Ulaanbaatar, January 21 (MONTSAME) Mongolia’s Minister of Foreign Affairs L.Purevsuren on Tuesday made the opening remarks at this year’s first meeting of the Security Cooperation Forum of the Organization for Security and Co-operation in Europe (OSCE).
In Vienna of Austria, the OSCE Forum on security cooperation is being chaired by Mongolia. In his remarks, Mr Purevsuren presented the priorities Mongolia is adhering to in its leadership, saying that the forum will consider issues of tackling the Ukraine crisis in a peaceful way, combating the international terrorism, and a non-proliferation of nuclear and mass destruction weapons. The forum’s actions will also include a celebration of the 70th anniversaries of the end of the Second World War II, atomic bombings of Hiroshima and Nagasaki, an establishment of the United Nations, and 40th anniversary of the approval of the Helsinki Final Act, a key document of the OSCE, he said.
Noting that Mongolia wants to focus on the cooperation with its Asian partner countries, the Foreign Minister said Mongolia launched the Ulaanbaatar Dialogue initiative on the security in Northeast Asia, and hoped that the 40-year experience and lessons of the OSCE will contribute to these matters.
At the meeting, the delegates congratulated Mongolia on chairing the OSCE Forum and said they will collaborate with Mongolia in it.
The OSCE Security Cooperation Forum is a key unit of the OSCE for considering security issues through military and political directions. Mongolia will lead the Forum until April of this year.

UK to cooperate in Health Sector
By G. Ermuun
January 21 (gogo.mn) Minister of Health and Sports G.Shiilegdamba received Mr Christopher Charles Stuart Ambassador of Great Britain.
Great Britain was one of the supporters of Democratic changes in Mongolia and was one of the main partners in social and especially in health sector, implementing multiple projects and programs.
Ambassador emphasized on projects and programs directed at health sector development In Mongolia for the past 2.5 years. In frame of this cooperation, studies have been conducted at projects to be implemented in Mental Health in Mongolia.
Moreover, Ambassador noted on the upcoming seminar on Eco Projects to promote the Environmentally friendly projects to be held on 5th of February.
Minister G.Shiilegdamba noted on the importance of the joint projects and programs in Health Sector and ensured the full cooperation for the best outcomes. Ambassador Stuart also intorduced on the potential cooperation in Sports as well such as exchange programs of the athletes and more.
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UB to Cooperate with ADB in State-Private Sector Partnership
By B. Khuder
Ulaanbaatar, January 21 (MONTSAME) The Mayor of Ulaanbaatar city S.Bat-Uul Wednesday met Mr Ayumi Konishi, a director-general of the Asian Development Bank for Southeast Asian affairs, and Mr Robert Schoellhammer, the Country Director of the ADB for Mongolia.
Expressing a satisfaction with the cooperation with the ADB in a partnership between the state and the private sector, the Mayor pointed out that the current economic crisis reminds the state that it is important to support the private sector.
The Mayor said Ulaanbaatar intends to establish a corporation based on this partnership because "the city can develop itself and make its economy stable by boosting such a partnership". Then he asked the ADB to give technical assistance for founding this cooperation.
In response, Mr Konishi said he is pleased to report that the ADB will collaborate with Ulaanbaatar in making flexible term investment to the development of the capital city. "We will cooperate with You in a proper exploitation of these investments," he said.

Defense Minister Receives Ambassadors of France and Japan
By B. Amarsaikhan
Ulaanbaatar, January 21 (MONTSAME) On Tuesday, the Minister of Defense Ts.Tsolmon received the French Ambassador Mr Yves Delaunay and Japan's Ambassador Shimizu Takenori to discuss the cooperation in defense sphere and its development.
At the meeting with Mr Delaunay, the Minister expressed his heartfelt condolences for the deaths of French nationals in terrorist operations. After this, the sides discussed joint defense works on the sidelines of the marking of the 50th anniversary of the diplomatic relations between the two countries, happening this year.
At the meeting with Mr Takenori, the Minister noted that the defense relations have been maintaining a significance in the ties between Mongolia and Japan, and expressed his interest in upgrading the current level of this cooperation. The dignitaries also exchanged opinions on the further cooperation.
The Ministries of defense of Mongolia and Japan signed a Memorandum of understanding in 2012 that intensified the development of the defense cooperation. In specific, the MoU improved the all-level interactions and visits, information sharing on the regional security, organizing of consultative meetings, and cooperation in military cadres’ trainings, engineering and military medicine.

MP J.Batzandan Meets EBRD Office Director Matthieu Le Blan
January 21 (infomongolia.com) On January 21, 2015, a Member of Parliament J.Batzandan held a meeting with the Head of Ulaanbaatar Office of the European Bank for Reconstruction and Development (EBRD) Matthieu Le Blan to discuss current collaborative issues and the future cooperation.
The EBRD Office in Mongolia has been operating since 2006 and has resolved to invest a total of 727 million EUR to date. Over the past years, the EBRD made a long-term direct investment and financing of 522 million USD to private entities. Also, implemented 45 projects in mining and its procurement, renewable energy, agribusiness, cashmere, retail trading and financial sectors, introduced Mr. Matthew Le Blanc.
In response, MP J.Batzandan expressed his gratitude on that the EBRD resolves to invest in the Thermal Power Plant No.5 and requested to provide low-interest long-term loans to entities supporting their small and medium enterprises’ businesses.
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MSU Receives New Lab
By B. Khuder
Ulaanbaatar, January 21 (MONTSAME) The Minister of Education and Science L.Gantomor Wednesday attended an opening ceremony of a training and researches laboratory at the Mongolian State University (MSU).
On 138 square meters area, the new lab is to be used for natural sciences lessons and conducting researches.
The lab will give more opportunity to students and teachers to perform advanced scientific works.
During the opening, Mr Gantomor said his Ministry has set a goal to make the MSU a university for researches, and added that a reform almost has completed. "Now, MSU students will do both learning and researching at their lab. We intend to make more investments in improvement of the research environment and conditions," the Minister emphasized.
In the 2013-2014 academic year, some 511.2 million Togrog was allotted from the Minister’s package for enhancing the learning and research laboratory.

"Legal Environment of Labour to Be Modified"
By B. Amarsaikhan
Ulaanbaatar, January 21 (MONTSAME) The Minister of Labour S.Chinzorig worked Wednesday at the 11-11 center to answer the citizens’ questions about the employment and labour.
Firstly he said that policies and a fund on small and medium enterprises have been transferred to the Ministry of Industry. "As for the other policies, our Ministry will continue taking responsibility as directed by the State".
To many questions about a progress expected in the labour and social welfare sector as a result of the trilateral agreement on Labour and Social Consensus the Minister told that he considers this agreement as having shown much better progress, as the Government is taking an active part in this agreement reflecting in it 23 aspects.
The three parties (Ministry of Labour, Trade Unions and the Union of Employers) have reached an agreement on 53 issues.
The Government participated in the agreement prioritizing a public discussion on the national policies regarding the common matters of social security and employment, relieving the pressure on the State Budget in times of economic crisis, preferring to keep workplaces over increasing salaries, pensions and benefits of the state servants, and a use of financial and economic instruments to secure people incomes, he said.
The Minister also explained that this document concerns not only the matters of state servants’ salaries but also addresses the social security and labour issues of all workers throughout the country. The parties discussed this year mainly the pay rise of the private sector employees and agreed on establishing a legal environment where this sector workers receive salaries according to their professional skills and performance and in compliance with the inflation rate and price changes. This agreement also provides a solution that regulates salaries of foreign and national professionals who are working with the same workload to be of same amount. The parties also agreed to establish a legal environment where some exemptions and alleviations are allowed on the income tax in coordination with the minimum level of salaries, he added.

5311 Mongolians are living in Czech Republic
January 21 (gogo.mn) President Elbegdorj has met with Mongolians who live and study in the Czech Republic. In earlier months of 2014, there were 5311 Mongolians in Czech Republic. In 2008, there were 13000, in 2010 there were 5000, while in 2012 there were 4500 Mongolians.
In 2014-2015, five students are studying in Czech Republic with the Government Scholarship.
This year, three students are going to study in Czech Republic. About 300 people had graduated from universities in Czech Republic since 1995, while 30 people had earned degrees.
President Ts.Elbegdorj mentioned about welcoming of 3 millionth citizens and highlighted that the working group to research potential cooperation agreement between Mongolia and Czech Republic on social welfare, has been established. This agreement will be the major improvement on solving social welfare of Mongolians who are living in Czech Republic.
About 20 Mongolian citizens residing illegally in the Czech Republic are pushing for a return to the land, he said. S.Erdene, Minister of Social Welfare has attended in the meeting and reported the work process in the scope of Ministerial policy.
At the end of the meeting, President has taken photographs and recieved complaints and requests from Mongolian nationals.
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Stock Exchange News for January 21
By B. Khuder
Ulaanbaatar, January 21 (MONTSAME) At the Stock Exchange trades on Wednesday, a total of 8,872 units of 16 JSCs were traded costing MNT three million 982 thousand and 829.
"E-trans logistics” /2,288 units/, “Hermes center” /2,283 units/, “Remikon” /2,184 units/, “Merex” /600 units/ and "Genco tour bureau” /398 units/ were the most actively traded in terms of trading volume, in terms of trading value were "Darkhan nekhii” (MNT 612 thousand and 850), "Talkh chikher” (MNT 592 thousand), “Gobi” (MNT 561 thousand and 040), “Aduunchuluun” (MNT 511 thousand and 850) and "Hermes center” (MNT 343 thousand and 540).
The total market capitalization was set at MNT one trillion 402 billion 154 million 152 thousand and 465. The Index of Top-20 JSCs was 14,454.53, increasing 27.90 units or 0.19% against the previous day.

Wrestlers to Compete in Golden Grand Prix in Russia
By B. Khuder
Ulaanbaatar, January 21 (MONTSAME) Freestyle wrestlers of the national selected team will take part in 26th Grand Prix named after Ivan Yarygin, a twice Olympic champion.
The events will run January 23-25 in Krasnoyarsk of Russia. Co-organized by Russia’s Federation of Associated Wrestling Styles, Yarygin’s Foundation and Mayor’s Office of Krasnoyarsk, the competition will attract wrestlers of 15 countries includingRussia, Mongolia, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Latvia, Moldavia, Tajikistan, Uzbekistan and Japan.
Having had recently a 10-day joint training in Russian Buryatia, our national team has 12 female and two male wrestlers. They are coached by Z.Duvchin and T.Sukhbaatar, State Honored Coaches.

IJF Releases Rankings of Judokas
By B. Khuder
Ulaanbaatar, January 21 (MONTSAME) The International Judo Federation (IJF) Tuesday issued the latest update of the world’s top judokas in all male and female weight categories.
Our World champions G.Boldbaatar (men 60kg) and M.Urantsetseg (women 48kg) kept their leadership, with 2,676 and 3,180 points, respectively. Another Mongolian D.Amartuvshin was ranked at fourth place with 1,836 points in the men 60 kg division.
In the second lightest category for men division (66 kg), an international master of sports D.Tomorkhuleg kept his 4th place with 1,710 points. This category was led by a Russian M.Pulyaev with 1,961 points. Two Olympic medalists Mongolians Kh.Tsagaanbaatar and S.Nyam-Ochir were the sixth and eighth, respectively, in the men 73kg.
An international master of sports Mongolian A.Tsolmon kept her 11th place in the women 52kg, having 1,120 points; D.Sumya (women 57kg) was the eighth with 1,444 points, and Ts.Naranjargal (women -70 kg)—the 15th with 940 points.

Mining Sector 2013 Report Compiled
By B. Amarsaikhan
Ulaanbaatar, January 21 (MONTSAME) The national council on the Extractive Industries Transparency Initiative (EITI) called a press conference Wednesday to inform about EITI Mongolia Report 2013.
This council has been compiling these reports since 2006 to indicate the revenues and expenditure of the extractive industries and the legal performances of mining companies. Such councils of the EITI are operating in 48 countries so far. The Mongolian national council is led by the Prime Minister and has a total of 30 members, consisting each of 10 representatives of State organizations, companies and civil society.
According to the report, a total of 1,699 companies, including the registered 1,699 with licenses for minerals, 14 companies with radioactive minerals licenses, and 13 companies with oil product licenses, have been obligated to report. Out of them, 1,198 companies have reported their revenue of MNT 1.5 trillion in a timely manner, amount of which has covered 27 percent of revenue of the State Budget. The Government revenue from the minerals’ sector had been made up of royalty payments (31%), entities’ income taxes (18%), product-sharing agreement stake for Government (12%), and value-added taxes (11%).
Among the above mining companies, some 250 each accumulated to the State Budget tax income of more than MNT 40 million in 2013. Only 20 companies covered 93 percent of the total tax revenue accumulated from the minerals’ sector--Erdenet Mining Corporation (32%), Oyu Tolgoi LLC (13%), PetroChina Dachintamsag (12%), Mongolyn Alt Corporation (8%), and Energy Resource JSC, Tavan Tolgoi LLC, Erdenes tavan Tolgoi LLC, Boroo Gold, Bold Tomor, Eroo Gol and Tsairt Mineral (2-5%).
The State Budget consumed 92 percent of the total accumulated mining revenue, MNT 1.5 trillion, five percent–localities’ budgets, and three percent were given to the State bodies in a form of support and donation, reported the council.
The mining sector activities are becoming more transparent in the recent years. “However, the cooperation agreements of mining companies should be uncovered as well” concluded the Council.
The information for 2014 is being collected to be compiled at the end of this year. The statistic audits have been conducted on the report by Hart Neuers Group from the UK and Ulaanbaatar Auditory Corporation.

Last Week’s Bestsellers
By B. Amarsaikhan
Ulaanbaatar, January 21 (MONTSAME) Internom bookstore introduces the list of best-sold books in its branches between January 12 and 18.
The list was topped by a giftbook called “To My Very Special Mother” by Helen Exley, one of the series of giftbooks regarding the relationships between family members and friends. This was followed by “The Sound of Pulse” by G.Ayurzana, which describes a correlation between the ways of thinking of different generations, and “Lean In: Women, Work and Will to Lead” by Sheryl Sandberg.
The goes a new “Fire on the Steppe” (Volume I: 1900-1915) book by Yo.Otgonbayar MP. The book shows how well the author analyzed and researched the history Mongolia’s turning point when the country declared its sovereignty from the long-reigning Qing, and gave interesting facts.
The other bestsellers were “Green –Eyed Monk” by Ts.Oyungerel, “One Hundred Years of Solitude” by Gabriel Garcia Marquez, “Sorkhugtani” by B.Sarantuya, “365 Days of Hapiness” by G.Naranbaatar, “The Spell for Success” by T.Badamzul, and “Guide to Success” by M.Ichinnorov.

Pope Francis sends telegram to President Ts.Elbegdorj
January 21 (news.mn) According to Vatican Radio, Pope Francis sent telegrams to the head of state of every country his plane flew over during his flight from Manila to Rome, as is customary on a papal journey.
His telegram to head of states and to President Ts.Elbegdorj read as follows: "As I depart from the Philippines, I extend to you, the government and all the people of the nation my heartfelt gratitude. I renew to Your Excellency and the entire country the assurance of my prayers for peace and prosperity."

Mongolian business environment survey carried out
January 21 (news.mn) The American Chamber of Commerce in Mongolia (AmCham Mongolia)  has presented the results of a survey on the business environment in Mongolia. The survey was conducted by the Sant Maral Foundation with the support of USAID.
The survey was conducted nationwide among 1,500 adult citizens from the capital and rural areas outside of Ulaanbaatar. Although the survey was led by a foreign organization, no foreigners took part in the survey. Sources have stated that the survey was very fair and there were no conflicts of interest from the Mongolian side, producing accurate and up to date results.
According to the survey, the private sector is considered the most reliable sector in the Mongolian economy. 
Of those involved in the survey. 66.9 percent believe that today’s business environment is not favorable,  and 22.8 percent evaluated it as favorable. Participants in the survey felt that there have been no positive changes to the business environment and economy during the last six months, and 1 of 5 believed that there will be positive changes in the next six months.  
Mongolians today are more worried about economic difficulties rather than their living environment, pollution, and health.
Fifty percent of all participants thought that the instability of the macro economy, fiscal deficiencies, and foreign debt will unpleasantly influence the development of businesses. 
The following organizations were said to be barriers to business owners in Mongolia: taxation organizations (19.6 percent), local administrative organizations (17.4 percent), and the State Specialized Inspection Agency (11.2 percent).
Aside from these challenges, the most important dilemmas facing the population were unemployment (39.2 percent), poverty (21.9 percent), and inflation (19.1 percent).

What is happening with the Tavan Tolgoi agreement?
January 21 (news.mn) Among issues discussed yesterday at the Cabinet meeting, Advisor to the Prime Minister Ts.Munkhtur was called on to report on the progress of discussions with the selected Tavan Tolgoi investor for development of the mine.
Ts.Munkhtur noted, "Tavan Tolgoi is one of the largest undeveloped coking coal deposits in the world. According to international statistical data, there is one hundred billion tons of coking coal in deposits around the world, of which the coal reserves of Mongolia is only 2 percent, which is not a large amount.
"According to the reserves of coal, China, Russia, Australia, and India are leading countries in coal extraction. Among them, Mongolia is in 15th place."
Australia has mining infrastructure with the capacity to transport and transmit up to 150 million tons of coal, plus they are expanding their railway transportation and seaports, making them an even stronger competitor in the market.  
Russia for example has recently made a huge investment in its mining industry in order to trade 2.2 billion tons of coal. The coal industry is also advancing in Mozambique, Indonesia, and Kazakhstan.
Analysts say these factors warning signs to accelerate policy on bringing Mongolian coal to the global market, otherwise, Mongolia could lose its current standing.  In terms of domestic factors, progress is required to recover and stimulate the economy.
Ts.Munkhtur reported that presently, the agreement with the three-party consortium, selected for Tavan Tolgoi investment under the governance of previous government is still ongoing.   
From the consortium's side, the following requirements have been put forward: to decide on the issue of an investment of 4 billion MNT; to make payments for previous contact work which has been completed; to build a coal processing factory with a capacity to produce 30 tons of coal; the provision of a 150 million USD loan; and to resolve infrastructure issues including railway. 

Davos World Economic Forum launches with Crystal Awards ceremony
January 21 (news.mn) Today, the Davos World Economic Forum opened with an award ceremony for winners of the Crystal Awards for cultural leaders and artists.
Winners of 21st Crystal Awards were Japanese architect Shigeru Ban, Anrea Bochelli- famouns Italian operatic tenor Andrea Bocelli, and Grammy Award winning musician Angelique Kidjo, who is also a UNICEF Goodwill Ambassador and the founder of “Batongo Fund”.   
During the 45th annual World Economic Forum aside from up to date economic issues,  other global issues will be discussed.
More than 2,500 delegates are participating in the World Economic Forum this year. A Mongolian delegation headed by President Ts.Elbegdorj is participating in the five-day forum. 

Parliament of Mongolia Ratifies State Debt in GDP Shall Not Exceed 58.3% in Fiscal Year of 2015
January 21 (infomongolia.com) At the morning plenary session of the State Great Khural (Parliament) held on January 20, 2015, it was heard a first discussion to amend the Law on Fiscal Stability on increasing the percentage of total amount of state debt in the GDP up to 60%.
At the meeting Parliamentarians agreed to make some clarifications on the draft bill and was submitted back to the State Budget Standing Committee. Afterwards, the bill was prepared and discussed at the afternoon plenary session for final hearing, where 90.2% of attended Parliamentarians ratified the Law on Fiscal Stability stipulating the Government is obliged that the state debt in the GDP shall not exceed 58.3% in the fiscal year of 2015.
Mongolia’s current total percentage of the state debt in the GDP is adhered not to exceed 40% and according to the new amendments made in the Law, the total percentage of the state debt will be reduced from 58.3% to 40% in the 2018 fiscal year.
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Ex-Im Composition Reported
By B. Amarsaikhan
Ulaanbaatar, January 21 (MONTSAME) According to the Bank of Mongolia, the share of mineral exports in total exports increased last December by 0.4 points from that of the previous year and reached 89 percent. Exports of coal, copper concentrate, iron ore and concentrate and crude oil have a weight of nearly 78 percent in total exports and 88 percent in mining exports. In addition, these 4 products’ share in the mining exports increased by 2.1 points from that of the previous year, share in the total exports increased by 2.2 points.
As for the imports, by December 2014, 26% of total imports were consumer goods, 40% were capital goods and 22% were fuels. Share of the capital goods in total imports decreased by 4% from against the previous year while the share of fuels stood at the same level.

Four key themes for Mongolia’s future
By Ts. Elbegdorj
January 21 (gogo.mn) The history of my country, Mongolia, has been similar to our terrain – highs as monumental as our mountains, and flatter periods not too different from our rolling plateaus. This is what one would expect from a country with such a long and rich past. But today I can say that we are ready to scale new heights.
Armed with the recommendations from the Forum’s Scenarios for Mongolia project, we have been carrying out bold reforms. So what are they? I would loosely divide them into four areas: stability, transparency, collaboration and diversification.
Stability
In this year’s Global Competitiveness Report, policy instability was ranked as the fourth biggest barrier to doing business; government instability was ranked second. It is clear from these findings that one of the main ways to attract foreign investment is to provide a stable environment for companies. Businesses want predictable and non-discriminatory regulations, and they want to do away with unnecessary administrative bottlenecks.
It is this type of stable environment that we have been seeking to create for investors through our reforms.
Transparency
Each year, the World Bank publishes its Doing Business report, which measures business regulations and how they are enforced. This year’s report identified transparency as one of the most important factors for those looking to invest in a country: “An institutional environment characterized by openness and transparency is of central importance.” Transparency is something that we have been taking very seriously in Mongolia.
Around a year ago, we launched a “smart government” initiative aimed at improving the quality of governance and public administration, and making it easier for those wanting to invest in our country. As part of this initiative, we adopted a budget transparency law – we call it the glass account law. Under this law, public officials must make their expenditure public within seven days of making the spending decision. It invites greater responsibility and openness.
Another example of how we are trying to increase transparency in decision-making is our moratorium on the creation of new state enterprises and limits on government commercial activities. One-third of existing permits and licenses have been eliminated, one-third of them were shifted to private institutions and professional organizations, and the remaining one-third will be made available online.
Collaboration
According to the Forum’s research, “Mongolia’s future depends on engagement with its neighbours.” We are well aware that in a globalized world, no country can succeed in isolation. This is why we have also been actively developing international relations with our neighbouring countries and beyond.
The recently concluded transparency agreement with the United States is one example of this, as is the accord to sign an economic partnership agreement with Japan.
On top of that, in 2014, we held the first ever tri-partite summit with our two immediate neighbours, Russia and China. The summit, which focused on how we can resolve many important economic issues, was an opportunity to boost our relations with these two important countries. It will also lay the groundwork for developing trade relations with our third neighbours.
Diversification
Thanks to our wealth of natural resources and our young and educated population, Mongolia has huge potential. Over the past few years, we have been one of the fastest growing economies in the world. We have the 10th largest reserves of gold, copper and coal. We have more than 51 million livestock and are the second biggest supplier of raw cashmere. We have great opportunities for cooperation in the field of geology, mining, renewable energy, agriculture and tourism.
But as the World Economic Forum noted in their Scenarios for Mongolia report, turning all this potential into reality depends on diversification. We agree. That’s why in 2014 we considerably shifted our inbound investment to non-mining industries such as agri-business, healthcare, manufacturing and tourism. We’ve also diversified in terms of the geographical sources of inbound investment, which now includes South Asia, North-East Asia and the EU on top of our traditional investors from North America and Australia.
This year we plan to carry on with this process of diversification, with an emphasis on manufacturing, and will continue to encourage all types of investment – from portfolio investment to project financing – as well as honouring public-private partnerships.
Looking ahead
All of these reforms are aimed at making Mongolia a country more appealing to investors. Investing in a country takes substantial effort from businesses, and they calculate their risks prudently. Risks associated with confidence, rule of law and the political situation of a host country are of major concern.
We are a democratic country that respects freedom, human rights, the rule of law, accountability and openness. The reforms we have put in place are aimed at securing and reinforcing these traits and sending out a clear message to the international community: “Mongolia is open for business.”

Revenue of 10th Government Building will be funded to expansion of two children hospital
January 21 (gogo.mn) By the order of PM, working group which is  to research on buildings that can be transformed into children hospital and to conduct professional expertise, had established.
The Working Group conducted research on several buildings and reported their professional expertise. Unfortunately, most of buildings were not suitable for children`s hospital. The Minister of Finance assigned the Minister of Health and Sport to start the auction of 10th Government building with its land and to start the construction of Children Hospital expansion by revenues from auction.
G.Shiilegdamba, the Minister of Health and Sport, said that State Property Committee has organising the auction in accordance with regulation. Revenue from auction will be directly funded to increase the number of beds in National Center for Maternal and Child Health and Children Hospital of Bayangol District.
Moreover, the Ministry of Health and Sport estimated the budget on expansion of Children Hospital and increasing the number of beds in National Center for Maternal and Child Health and Children Hospital of Bayangol District and introduced to the PM.

Foreign nationals visa free at Free Zones
By E. Orgil
January 21 (gogo.mn) Today, Legal Standing Committee made discussion on Amendments for Foreign citizen legal status law, State Registration law and Border Port Law.
MP Z.Enkhbold: Foreign nationals visa free at Free Zones at border. How about visa and entry to free zones like Choir that located inside of the border?
Working Group: It is considered to be difficult to control foreigner`s visa free entry to free zones that located inside of border.
Finally, they have decided to enter foreigners to free zones that located inside of border with visa. 
Foreign nationals were allowed visa free entries to ports at Zamiin-Uud and Altanbulag and entry to Mongolian region from free zones foreigners must submit visa at the border. Qualifying foreigners are possible to apply for a visa to enter Mongolia.

906 households to move to apartments in countryside
By B. Erdenechimeg
January 21 (gogo.mn) State Housing Corporation is implementing several housing projects in the countryside in the scope of the previous cabinet program to develop 1000 housing units at every aimag. 11 aimags have started the development of the housing projects.

According to the plan 906 households are to be able to move into new housing apartments within this year. 
Following infographic depicts the housing projects being implemented in aimags.

Private houses may be the next favorite for mortgage loans
By B. Chimeg
January 21 (gogo.mn) Construction companies invest around MNT 2 trillion annually in housing. State budget allocates MNT 170 billion around 5 percent and Capital city budget allocates only MNT 70 billion in construction sector.
State Housing Corporation is planning to receive 2,595 housings in 2015, where it targets the same market as elders, young families, residents with disabilities and low-income households. Residents are sure to be included in the 8% mortgage loans. The establishment of the Capital city Housing Corporation directs its activities towards Ger Area Redevelopment and the residents are sure to be included in 8% mortgage loan program as well. 
This in turn raises worries if private construction companies are to be left outside the possibilities to be included in the 8% mortgage loan program.
As Mayor E.Bat-Uul concerned over the plunging sales of the housings and warns of the potential distressed construction sites.
Moreover, the question whether UB city is to continue to construct 9-15 storey apartments or to focus more on private house constructions.
Mongolian Banking Association sees more attractive to focus more on private houses and suggests new financing tools as 9% mortgage loans. The idea in turn can serve as solution for many problems that UB city is facing starting with fighting with smoke. As they see, although state tries to accommodate Ger Area residents into housings there are another migrants to occupy the freed Ger Area. In this regard, some suggest investing in infrastructure to current ger Areas and support the households to build houses, therefore reducing the expansion of Ger Areas.
In addition, according to the survey there are 54,000 residents in Ger Area able to make the monthly payments for the housing.

MP N.Altankhuyag returned to work
By E. Orgil
January 21 (gogo.mn) After being on sick leave for more than month Ex PM N.Altankhuyag starts his work as MP.
He was on sick leave due to the injury just after handing over his post as PM over a month ago. After handing over his duties as PM to Ch.Saikhanbileg he was allocated new room as an MP at the Government Building. Starting from today his MP room, which was empty for over a month, is occupied starting today.

Eight percent mortgage loan update
By B. Bayartogtokh
January 21 (Mongolian Economy) 70 percent of net construction investments issued by the Central Bank of Mongolia have been allocated to housing mortgage loans at 8 percent. In addition, the bank has given funding to 71 economic entities operating in construction material manufacturing.
The implementation of the Ipotek Housing Loan programme and its  8 percent interest rate have made it possible for households with an average monthly income of MNT 1.3 million to buy an apartment on loan; 64,000 households have obtained the mortgage so far, and pay a combined total of MNT 30 billion each month. The mortgages have led to a tendency among people to maintain stable employment, to ensure their household income and avoid default on their mortgage. 
The Central Bank of Mongolia concludes that the actions it has taken within the framework of its unconventional monetary policy to stabilise the economy have resulted in a reduced inflation rate—from 34 percent in 2009 to 12.65 percent in 2013 and 11 percent in 2014.   

Shuren Hydroelectric Plant project needs near USD 800 million in funds
By A. Burenjargal
January 21 (Mongolian Economy) The World Bank, within the scope of its Mining Infrastructure Investment Support Project for Mongolia, held a recent discussion amongst industry leaders about a feasibility study for the future Shuren Hydroelectric Plant, and the project’s socio-environmental impacts on the Selenge River region. During the discussion, we interviewed G.Gendensuren, a project director. 
How’s progress going on the Shuren Hydroelectric Plant project? 
We have a professional team of eight people working on the project, and progress at this stage is no more than five percent of the total work that must be done until the commencement of the plant. Last year, we developed a draft feasibility study on the proposed hydroelectric plant; after review, the World Bank has deemed this report to be satisfactory for continued project development, and we now have permission to proceed. For the moment, we are preparing the groundwork for the feasibility study and a socio-environmental study, both of which are to begin this spring.        
Russia is fervently opposed to the Shuren Hydroelectric Plant, which has made the project controversial for several years. How does the feasibility study address Russia’s concerns over the environmental management of the project?
Since Mongolia’s Selenge River drains into Russia’s Lake Baikal, and provides 50 percent of the latter’s water supply, there is bound to be trouble. Recent research shows that the water level of Lake Baikal has been decreasing; however, this has not been caused by a change in the river’s flow rate, which is still at its long-term average level, but by a drought beyond our northern border. Therefore, the likelihood of other contributing factors keeps it an open question. Also, there is a need for government organisations to collaborate with scientific institutes and environmental groups. As for Russia, government organisations listen to comments made by scientific research institutes, and it is a common sight among international environmental organisations to stage a protest without looking at research data. Meanwhile, the issue is still in progress and has not arrived at a final decision.       
When will construction commence, and how do you raise funds for the project? 
Construction will commence after the World Bank approves the feasibility study this spring. Of course, construction will require a great amount of money. Preliminary estimates show that we will need USD 700 million to 800 million to complete the work. Now, there are many ways to raise funds, and it is important to set up a project that can attract funds by using every available opportunity. The most important factor is the price of the electricity product. We think the project will be an attractive one for its electricity price in terms breaking even.   
How much do you think the generated electricity will cost?  
It is estimated that the product will cost approximately USD 0.0037 to 0.005 per kilowatt [Is this correct? Don’t use cents.], and there is currently no power plant providing electricity at that low price other than Thermal Power Plant IV. The Law on Renewable Power sets the price of electricity at USD 0.005. So, if we keep on pricing the generated electricity in accordance with the law, then the owner of the plant can be either the government or a private entity. The balance between USD 0.0037 and 0.005 could see a profit. That is all we can estimate for now, however, as this figure might be reduced once we complete the feasibility study.   
How much time will the feasibility study take? 
Preparation of the feasibility study will take 1.5 to 1.8 years. And then the World Bank will review the final draft of the feasibility study. We will be able to start construction only if the World Bank approves the feasibility study. So, it is estimated that if we manage to raise the funds now, the construction work should commence in 2017.
How long will it take the hydroelectric plant to break even? Are there any plans for exports?    
If we assume that 1 kilowatt of electricity will be priced at USD 0.0037, then the hydroelectric plant will break even in 10 to 12 years. The project is not originally intended for export. The central electrical grid of our country already has too many troubles, to the extent that we import electricity from Russia because our central grid does not fully meet our electricity demand in the evenings. Therefore, the proposed hydroelectric plant will be operated to balance short-term electrical load fluctuations, and to satisfy domestic demands by reducing electricity imports.

In 2015, 21 Secondary Schools to Be Constructed in Mongolia under Grant Aid Provided by Government of China
January 21 (infomongolia.com) In October 2014, the Government of Mongolia resolved to finance projects on constructing new secondary schools in Mongolia by the non-refundable aid of 300 million CNY provided by the Government of the People’s Republic of China.
Accordingly, a working group under the Ministry of Education, Culture and Sciences of Mongolia made comprehensive studies and suggested to construct at the first phase 21 schools across the country in 2015, which was introduced at the Cabinet meeting held on January 19, 2015.
The studies were conducted under selective process of the schools in the territory of the capital city that are being operated in three shifts daily, besides, notices were issued by Inspection Agency to shut down schools rather than improving its performance.
The feasibility studies for 21 schools to construct will be developed under one design and in a 2014-2015 academic year, there 22 schools are operating in three shifts, of which 21 in Ulaanbaatar city.
Such large number of schools in Ulaanbaatar is about four thousand children move from provincial regions to the capital city per year and as of today, a total of 26 schools in UB are needed to demolish and construct new ones.

Mongolia Assumes Chairmanship of OSCE Forum for Security Cooperation
January 21 (infomongolia.com) The first 2015 meeting of the Forum for Security Cooperation of the Organization of Security and Cooperation in Europe (OSCE) started on 20 January in Vienna.
Foreign Minister of Mongolia, Mr. Lundeg PUREVSUREN made a statement at the opening session of the Mongolian chairmanship of the FSC. He outlined in his statement the priorities which Mongolia will pursue during its chairmanship. They would include among others the issues related to peaceful settlement of the Ukrainian crisis, combating international terrorism, non-proliferation of weapons of mass destruction. The year 2015 marks a series of anniversaries: the 70th anniversary of the end of the World War II, the 70th anniversary of the use of nuclear bomb in Nagasaki and Hiroshima, the 70th anniversary of the United Nations, the 40th anniversary of the adoption of the Helsinki Final Act, the basic document of the OSCE. As an Asian country Mongolia attaches a particular importance to the cooperation with the Asian Partners for Cooperation. He noted that Mongolia is making every effort to promote peace and security in Northeast Asia, initiating the “Ulaanbaatar dialogue on Northeast Asian security”, and expressed hope that the OSCE’s experience over the past forty years could be an inspiration to promoting security and cooperation in Asia.
Representatives of the OSCE participating States who spoke in the opening session congratulated Mongolia on its assumption of the OSCE chairmanship, and offered their support and cooperation.
The Forum for Security Cooperation is the main body of the OSCE which considers the security aspects of politico-military dimension. Mongolia will chair the Forum during the first trimester of 2015.
- The OSCE is the largest regional security organization which unites 57 participating States from Europe, America and Asia.
This organization aims its activities at preventing armed conflicts, crisis situations, implementing post-conflict restoration. And it conducts its activities within three security dimensions: politico-military, economic and environmental, and human.
- Mongolia became the fifth OSCE Asian Partner for Cooperation during the 12th Ministerial Council Meeting held in Sofia, Bulgaria, in December 2004. On 21 November 2012 it became the 57th participating State or full-fledged member of the OSCE during the 19th Ministerial Council Meeting in Dublin, Ireland.
Later on the same day Minister L.Purevsuren also participated in a roundtable discussion organized by the International Peace Institute in Vienna.
Foreign Minister made a presentation about foreign policy of the Government of Mongolia and on the initiatives put forward by Mongolia in the international arena. Mr. Purevsuren answered interested questions from the Ambassadors and researchers who attended the roundtable discussion. Ambassador of Mongolia to Austria, Mr. Gunaajav BATJARGAL participated at this roundtable event.

President arrives in Prague by train for state visit
By E. Oyundari
January 20 (UB Post) President of Mongolia Tsakhia Elbegdorj and his accompanying delegation arrived in Prague, the capital of the Czech Republic, for a three-day state visit on January 18. They arrived in Prague on a EuroCity train from Berlin.
The Mongolian state officials were officially welcomed by the President of the Czech Republic, Milos Zeman, at the first courtyard of Prague Castle. At the welcoming ceremony, Head of the Czech President’s Office Vratislav Mynar, Foreign Minister Martin Tlapa, Labor and Social Affairs Minister Michaela Marksova Tominova, and Ambassador Extraordinary and Plenipotentiary of the Czech Republic to Mongolia Ivana Grollova were present.
According to the Prague Post, Ts.Elbegdorj traveled in a specially designated first-class car, immediately behind the engine car. Foreign representatives usually fly to the Czech Republic, and an official welcoming ceremony takes place at the government airport terminal. The last time a foreign head of state arrived in Prague by train for an official visit was some 30 years ago.
Talks to develop economic cooperation
After the delegation’s arrival, President Ts.Elbegdorj and Czech President Milos Zeman held a private meeting and made a joint press statement. The counterparts discussed promotion of their countries´ economic cooperation. Zeman handed Ts.Elbegdorj a list of 40 firms interested in investing in Mongolia, reported Czech News Agency. Zeman said Czech firms could mainly participate in the construction of railways and energy projects and in the mining of raw materials.
Zeman and Ts.Elbegdorj first had a private meeting and were later joined by a Mongolian delegation, representatives from Prague Castle (the presidential seat), and the Czech Foreign Ministry. Ts.Elbegdorj invited Zeman to visit Mongolia. Zeman said a date will be set through diplomatic channels, and that he would take along a delegation of businesspeople.
Zeman said Ts.Elbegdorj promised to include cooperation with Czech business people in his country´s prepared action economic plan. “Mongolia´s state guarantee for Czech investments would be an advantage,” Zeman said in a press statement.
Private sector cooperation to be developed
On Monday, President Ts.Elbegdorj met with Milan Stech, the President of the Senate, and Bohuslav Sobotka, Prime Minister of the Czech Republic.
Beginning the meeting Milan Stech briefly introduced the Czech Parliament. The parliament consists of two chambers, the Chamber of Deputies and the Senate. The Senate has 81 members, and two thirds of its members are elected once every two years. The Senate approves draft laws proposed by the Chamber of Deputies. Senators have, together with MP’s, the right to take part in the election of Constitutional Court judges and may propose new laws. However, the Senate does not get to vote on the state budget and is not expected to supervise the executive branch of government directly, unlike the Chamber of Deputies.
President Ts.Elbegdorj thanked Stech for the warm welcome and said, “The 65th anniversary of diplomatic relations between Mongolia and the Czech Republic is occurring this year. Czechoslovakia was the second largest investor in Mongolia after the Soviet Union before 1990, which shows that our counties have a broad relationship. Also, many Mongolian students have acquired an education in the Czech Republic,” and added that he sees opportunities to expand and develop cooperation in the economy, education, mining and infrastructure.
Representatives of the private sector in Mongolia were included in the visiting delegation. President Ts.Elbegdorj mentioned that the Mongolia-Czech business forum would be open to discuss business talks and contact.
In reply, Milan Stech pointed out, “Mongolia is one of the best partners with our country. The Czech Republic is one of three countries in Europe with high industrial development. Czechoslovakia successfully got over the transition period that began in 1989 by attracting foreign investment. For instance, all around the world, at least one part of any car driven is produced in the Czech Republic. Also, a heavy machinery and mechanism industry has developed well in our country.
“Vested Czech companies export their products and have interest in opening representative offices in countries they export to. Mongolia is one of those countries. I believe a pleasant environment and investment conditions have been formed in Mongolia, which will boost cooperation,” adding that he sees cooperation opportunities between parliaments. He also noted that the Czech side will pay special attention to cooperation in the education and health sectors.
In conclusion, President Ts.Elbegdorj thanked him for supporting the project to reintroduce takhi (Przewalski horses) to Mongolian land. Currently, over one hundred Przewalski horses from the Prague Zoo are pasturing in Khustain Nuruu National Park of Mongolia.

Court jails corrupt immigration officer
By M. Zoljargal
January 20 (UB Post) State Senior Immigration Officer J.Puntsag stood trial on Monday and was sentenced to one year and six months in prison for receiving bribery from a Chinese businessman.
The Independent Authority Against Corruption initiated a criminal case for J.Puntsag for a bribery of five million MNT from vice director of China-funded company CRCG on October 2.
An investigation revealed that J.Puntsag released 14 Chinese citizens working in Mongolia with expired visas instead of lawfully deporting them for bribes.
CRCG’s interpreter, Tsatsaa, reportedly conspired with the immigration officer and assisted in the bribery, which was later found during investigation. The suspect woman is also a Chinese citizen who immigrated to Mongolia.
The District Primary Criminal Court No.2 sentenced Tsatsaa to a 960,000 MNT fine, while Vice Director of CRCG who bribed the immigration officer is to face a fine of 9.3 million MNT.

Exploration license applications to be available on January 26
By N. Khaliun
January 20 (UB Post) The Mineral Resource Authority (MRA) will start accepting applications for exploration licenses on January 26.
The MRA reports that they plan to issue exploration licenses for nine million hectares in the western half of Mongolia. Exploration licenses will be issued in accordance with the policy of Mongolia’s infrastructure development, green development policy, and the sustainability of investments.
Exploration licenses will be given for areas covering 31 million hectares (19.9 percent of Mongolian territory), of which 20.9 million hectares (13.4 percent) will be issued by application, and 10.1 million hectares by a selection procedure.
Places prohibited from exploration comprise 71.5 percent of Mongolian territory.
Parliament approved amendments to the law on minerals on July 1, 2014, and the Cabinet determined areas approved for licenses in coordination with Cabinet resolution No. 239, issued on July 28, 2014.
With the aim to keep state actions transparent and open, and limit bureaucracy in state services, a “one window” service will be available for receiving and reviewing applications for the exploration licenses. Application numbers will be given electronically.

Overview of social and economic situation in Mongolia by 2014
January 20 (UB Post) The National Statistical Office of Mongolia released the preliminary results of its social and economic indicators of 2014, which revealed remarkable increases in production of national manufacturing.
The report covers information about various fields within social and economic sectors of Mongolia.
Mining and national production
In the mining sector, molybdenum, gold and copper concentrates, as well as oil extraction hiked by 8.1 to 44.4 percent last year, while the national manufacturing sector has also seen 2.1 to 86.2 percent growth in production, particularly in cigarette, textile, beer, milk, buuz, dumpling, lemonade, soft drink, construction wooden material, vacuum-insulated window, pastry, cashmere ready-to-eat meat products, door, cement, and leather boots.
Population and health
The population growth rate of Mongolia was marked at 2.2 percent, with 82,000 babies being born in 2014, 1,124 of whom were born abroad.
The number of people who checked-in to hospitals for communicable disease treatments saw 10.2 percent decline last year, though patients diagnosed with syphilis increased by 10.3 percent, dysentery cases increased by 16.6 percent, pneumonia increased by 1.5 percent, and trichomoniasis increased by 0.8 percent in 2014, compared to 2013.
Nationwide, 88.7 percent of all herder households in provinces had access to electricity, 76.7 percent had television sets, 40.2 percent owned cars, and 50.9 percent had motorcycle.
Welfare
The Social Welfare Fund provided 142.5 billion MNT worth of pension and welfare to 208,500 individuals in 2014, which is a five percent increase in number of welfare recipients compared to 2013.
Pension and welfare amount increased by 0.4 percent last year compared to the previous year.
The Human Development Fund gave 238.4 billion MNT to 994,100 children under the age of 18 in Mongolia last year.
Economy
Money supply (Broad money or M2) reached 10.6 trillion MNT by December 2014, which shows a 7.2 percent increase compared to November 2014, and a 12.6 percent increase compared to December 2013.
Foreign trade
In 2014, Mongolia traded goods with 139 countries and circulation of total goods in foreign trade was valued at 11 billion USD; 5.77 billion USD in exports and 5.23 billion USD in imports.
Livestock husbandry
A total of 52 million livestock were counted in the national census last year; 23.2 million of which were sheep, 22 million goat, three million horses, 3.4 million cattle, and 349,300 were camels.
The total number of livestock counted in 2014 was 15.1 percent higher than that of 2013, with 6.8 million more.
Agriculture
In the agricultural sector, 518,800 tons of grain, 161,500 tons of potato, and 104,800 tons of vegetable were harvested last fall. A total of 1.1 million tons of hay and 40,300 tons of fodder were prepared for livestock, which all show increase compared to 2013.
A total of 149 herder families were reported to be leading livestock husbandry businesses. Some 37 percent of the families’ members were aged from 16 to 34, while 53 percent of them were aged from 35 to 65. The remaining ten percent were retired residents.
Construction and repair
Construction assembly and overhaul projects cost 2.1 trillion MNT nationwide in 2014. Two trillion MNT was spent on projects of domestic companies, and 6.2 percent were completed by foreign-funded organizations.
Aviation
The aviation sector revenue totaled 239 billion MNT in 2014, which shows a 8.3 billion MNT, or 3.4 percent, decrease compared to 2013.
Climate
The year of 2014 recorded the highest rain and snowfall in Tsagaan-Uur soum of Khuvsgul Province and Orkhon soum of Selenge Province. In December 2014, Umnugovi and Govi-Altai Provinces reported the warmest temperatures of the month with five degree Celsius, while the coldest temperatures were reported in Tsagaan-Uur and Renchinlkhumbe soums in Khuvsgul, with temperatures dropping to minus 41 degree Celsius.
Natural disaster, crimes and accidents
Last year, 27,318 criminal cases have been registered at police departments throughout the nation, which shows a 7.7 percent decline compared to 2013. A total of 11,281 individuals reported injuries and 1,078 deaths occurred related to criminal cases, which shows a 15.1 percent increase in the number of the injured, and 13.6 percent increase in mortality rate caused by criminal cases compared to 2013.
In 2014, 4,928 accidents and natural disasters occurred where 175 people and 15,128 livestock died. A total of 3,454 livestock died due to the foot and mouth disease outbreak.
A total of 4,222 fires broke out in homes, while 281 wildfires were reported in forests last year. Sixty-three earthquakes were reported which were above 3.5 magnitudes.
In total, 32 floods, 25 storms, and 12 thunderstorms occurred last year in Mongolia.

No jobs for puppet masters in Mongolia
January 21 (UB Post) Students who studied theater in Russia through a government initiative have returned home only to realize that their studies were fruitless as there were no jobs for them.
At the Ministry of Education, Culture and Science’s initiative, 10 Mongolian students went to study in St. Petersburg through a government scholarship of the Russian Federation five years ago to become puppet masters.
Teachers of the University Of Theater Arts Of St. Petersburg examined over a hundred students in Mongolia to select the students. The selectees were from Govi-Altai Province, Orkhon Province, Nalaikh District and Ulaanbaatar.
They graduated and came back home last spring. After a long summer vacation, they asked for a job at the Mongolian Puppet Theater only to be turned down as there were no jobs. The theater has only 11 staff members in total and there were no openings on the horizon.
Before the collapse of the “reform” government, the students asked the Ministry of Culture to fund theater and increase job positions and the ministry agreed to expand the theater sector this year. But with all the government spending cuts, their issues will be taking a back seat.
The Ministry of Culture, Sport, and Tourism started many programs to support cultural development, which ties in with theater. They sent 27 students to Russian to study arts and culture in 2010, and after graduation a similar story ensued with no available jobs for the artists.
According to the puppet masters, a theater from Ulan-Ude, Russia offered jobs in late 2014, but they didn’t take them hoping that there would be jobs in their home country by 2015.
Five pullet artists left for Ulan-Ude in January to study for a master degree through a government grant. The other five remain unemployed to this day.
Another artist, opera singer O.Tserenchunt, who studied in Russia, left for Ulan-Ude Theater recently as he didn’t have a chance to work for the State Opera and Ballet Theater of Mongolia. This is a big tragedy of Mongolia.
New artists used to represent Mongolia at international arts festivals and competitions, but now it looks like they have limited options at home.
One problematic issue is that young people aren’t educated in the arts in schools anymore. Since the 1990’s, many cultural organizations for children closed their doors and their facilities became commercial buildings. For example, the Mongolian Stock Exchange building was once Eldev-Ochir Movie Theater for children, the central office of Khaan Bank was the Mongolian Youth Theater, and the National Circus building has become a marketplace.
Source: Unuudur

O.Chuluunbat: Budget cuts should begin from government luxuries and extravagance
January 20 (UB Post) The following is an interview with Economic Advisor to the Prime Minister O.Chuluunbat about some important issues in the economy and the new government.
What are your thoughts on the policy of Prime Minister Ch.Saikhanbileg’s new government?
We can see that the main economic indicators declined substantially last year from some figures. Figures never lie. Foreign investments have stopped. Just two years ago, Mongolia received foreign investment equivalent to over four billion USD, but last year, merely 800 million USD was invested from abroad. The national currency rate has weakened significantly and inflation has increased. All these declines have hurt Mongolia’s reputation, making investors lose confidence in Mongolia. Money is passing over Mongolia because people no longer trust or have the confidence to invest into Mongolia. Economists are talking about how Mongolia is low on capital inflow. It’s all because investors aren’t willing to trust Mongolia. If we earn people’s trust, money will come flooding in. The policy must become suitable for restoring Mongolia’s reputation and investors’ confidence.
The President once criticized that Mongolia unleashes hounds in front of investors after inviting them. Despite all the talk about money, aren’t there too many people against investors among policymakers and lawmakers?
Mongolia renewed the Investment Law to restore confidence. This is a good signal to foreign investors. Now we need to focus on fiscal and monetary policies. These two are the most important financial documents of Mongolia. The new government announced that it will cut nearly a trillion MNT from its spending. This became another positive signal to foreigners.
Where should budget cuts begin from?
Mongolia has lived in extravagance and luxury for the last five years. It has boasted about distributing 800 billion MNT every month to the public. In the end, what has befallen on the economy? Finding out where to begin the budget cut is the most critical issue. It’s best to tighten and reduce the extravagance of the government before correcting untargeted slashing of the welfare. Budget cut should be enforced judiciously and rationally. Ministers, vice ministers, provincial governors, city council members, and provincial administrations are extracting money from the state budget to pay their phone and petrol bills, refurnish their office, and go on unnecessary business trips. These excessive expenses should be trimmed. Budget cuts should also be applied to state budget investments.
How should state budget investments be cut so as to be more beneficial to the economy?
There are tons of ways. Firstly, dismiss “New Soum” project that built 29 culture and arts centers in remote local areas. Soums with less than a thousand residents, who visit culture and arts centers twice a year at most, don’t need these centers. People no longer visit them. Herders settled at the base of mountains have installed antennas and are able to receive as much news as city residents, and watch concerts and films. They can see classical creations and performances of the world through televisions. All these cultural centers are becoming plain old buildings.
I will not accuse the constructor of new schools and kindergartens of being pointless. However, is it necessary to build a two-storey school for 500 children in a soum with less than 100 children? Kindergartens with five children are being renovated with an additional floor, enhancing the capacity to 200 children. Trimming these excessive and understudied extravagances will save up on quite a lot of costs.
Lately, state budget investment has turned into a business instead of resolving social issues. State budget investment is invested on somebody’s business. It should be used to settle social problems.
Cost cuts from government luxury and extravagance may be more effective than trimming social welfare for mothers and children. This year, how will the government trim state budget investments?
This year, 14 sports complexes and swimming pools were drafted to be constructed in remote areas, but we reduced it to two. This will make tremendous amount of savings. As mentioned before, government luxury should be cut. Various business travels of the City Council should be cancelled. Last year, representatives of the City Council travelled to Brazil to watch the World Cup and received countless criticism. Provincial heads and government officials frequently travel abroad under the pretense of studying practices and experience. These pointless travels should undoubtedly be stopped during the current economic difficulties.
Furthermore, the Mongolian monetary policy isn’t quite accurate. It should be fixed into a more accurate and liable policy. I don’t think a policy that declined the currency rate for two years is correct. Foreign investors aren’t investing in Mongolia due to unstable MNT exchange rate. The fiscal and monetary policies are the key economic indicators of Mongolia – they are economic updates that Mongolia provides to investors. We can restore confidence of investors if we use these two tools wisely.
The government is discussing about increasing the debt ceiling. Can you comment on this?
The debt ceiling can be heightened. Expenditure of money that’ll come to Mongolia should be decided and planned first. The debt ceiling shouldn’t be increased if the money attained through loans is spent to increase wages and benefits or to construct buildings in remote areas. It should be invested into the sector that will multiply the capital quickly.
Last year, many Canadian-styled houses were built within the scope of the “new soum” project. If these houses create workplaces, wouldn’t less people move to the capital?
Once again, government extravagance can be observed everywhere. Fiscal overload will not decrease if these extravagances aren’t budgeted and reduced. Why must soum and province heads ride Jeeps? Most soum leaders often visit their children living in the capital with government funds. These excessive extravagances should be stopped. Ten years ago, the state expenditure equaled 100 billion MNT. At the time, we had the same population as now. Yet, the current revenue and expenditure has increased exponentially.
Shine Soum Project is something locals have to resolve. It’s actually a project that local administrations have to execute. Local administrators shouldn’t be demanding the state to construct or finance development of culture and arts centers, schools, and kindergartens. Minister of Education, Culture and Science L.Gantumur should settle budget issues starting from this.
When trying to run mining projects, local administrations chase away the few investors who don’t have military power by racketeering. Other countries welcome investor warmly whereas Mongolia unleashes its hounds and demand money. Locals need to realize that prospects will come to soums where mining projects are implemented. Mongolia can’t flourish if it doesn’t expand its market. Without investors, we can’t become prosperous.
Some Mongolian businessmen aren’t very fond of foreign investors. With such a condition, who would be willing to invest?
Civil servants should be working towards attracting more investors to their local areas, rather than chasing them away. I don’t understand why they want to chase them away and stop their investment. There hasn’t been a single instance when a large mining project hasn’t benefited the economy. Depending on the number of employees on the projects, more people will purchase food and goods from Mongolia. Mongolia will at least supply meat, milk and flour. People can sew gloves and sell. It isn’t only beneficial if you have a share of dividends. Even if the project is operated with a loss, it will provide more jobs, employed workers will establish procurement, and those procurements will create small and medium-sized industries. Producers will pay taxes and the government can develop the economy through various methods and even increase minimum wage amounts.
Also, the government doesn’t need to get involved in every business. Many projects have failed because the government tried to get involved, causing the economy to fall. The government should create the most favorable environment and regulation for businesses. Getting dividends isn’t important. I always mention that 60 percent of the profit of Boroo Gold Company ltd stayed in Mongolia and that 60 to 70 percent on Oyu Tolgoi’s profit will remain in Mongolia.
Many Mongolians are still against Oyu Tolgoi. Even though they don’t do protests for the sake of building more schools and hospitals, they crowd around places that are generating money. What are your thoughts?
Mongolia has no choice but to generate money by circulating its underground resources into the economy. Businesses will halt if money doesn’t flow into mines. Jobs will decrease, lessening income to households. I absolutely don’t understand people cursing and driving investors away. If they’re going to do this, they might as well as provide salaries for thousands of people from their own pockets. They should find us some USD since USD exchange rate is increasing rapidly. These people shouldn’t be shooing away people who bring money when they aren’t able to bring a single dime.
The new government was given the task to combat the economic crisis. What would you recommend for them?
It’s important to assess and analyze correctly. Excessive luxury and extravagances should be eliminated. I guess it’s an agony of the poor. Once poor people see money, they waste it without a thought. Foreigners probably picture Mongolia in this way. This should be put in order starting from now. 
Source: economy.news.mn/content/201599.shtml

Mongolians finish Dakar Rally 2015 with success
By B. Tungalag
January 20 (UB Post) Dakar Rally 2015, a 14-day race through Argentina, Chile and Bolivia, finished on January 18. Approximately 600 drivers and cyclers raced over 9,000 kilometers of roads, tracks and dunes in bike, quad, car and truck categories, but only 200 of them finished the Dakar Rally 2015.
This year, Mongolian-Hungarian joint crew UNIQA SANDLANDER raced in three cars. International Sports Master N.Lkhamaa, who drove car no. 431 along with his navigators B.Byambadelger and B.Surendorj, came in 62nd at the finish line. Mongolians competed in the Dakar Rally in the car category for the first time this year.
Car no. 413, which was coordinated by International Sports Master U.Byambatsogt raced for three days and left the race due to technical hiccough.
Hungarian team leader Sahndor, who drove car no. 355, along with navigator D.Jargalsaikhan of Mongolia, left the race on the 11th day as their car engine failed.
International Sports Master D.Boldbaatar and Ch.Anar competed in the bike category. D.Boldbaatar, who drove bike no.83 finished the race in 45th place. He became the first Mongolian to finish the Dakar Rally last year. This year, D.Boldbaatar advanced his success further.
Ch.Anar, who drove bike no. 117, competed in the Dakar Rally for the first time this year and came in 78th place.

Mongolian boy band S4 passes first stage of Chinese singing competition
By B. Baatar
January 20 (UB Post) Mongolian pop boy band S4 took part in a Chinese international singing competition “You Can” in Beijing.
S4 passed the first stage of the competition, organized by BTV state-owned television, on December 22.
S4 was asked to take part in “You Can” during a concert of Erguna folk band from Inner Mongolia on December 2014.
“You Can” annual singing contest selects top singers and bands in China. Singers and bands from the U.S., Russia, Argentina, Japan, Mongolia and South Korea participated in this year’s competition. According to the rules of the competition, all competitors must sing Chinese songs in the first stage.
The final stage of the competition will take place on January 24 in Beijing, where contestants must also sing Chinese songs.

Revealing the taboo
By B. Narantuya
January 20 (UB Post) Artsit B.Lkhamjav is presenting his solo exhibition, “Taboo”, at 976 Art Gallery. Over 30 paintings are presented in the exhibition, including artwork created between 1961 and 2011.
B.Lkhamjav was born in 1941, in Hovd Province. “Without formal education in art and any knowledge of western-originated modern styles, Lkhamjav started producing his work; creating his very own technique, incorporating surrealist, expressionist and symbolic elements, describing ancient legend and myth, humans, and nature, since 1953,” said artist G.Munkhbolor.
For more than 60 years his artworks were hidden. When society transferred from a socialist and communist regime, his pieces were considered taboo. “When I started to paint abstracts, then I went wrong. I was repressed, and still am nowadays,” he said during his interview. “I don’t know where my artwork leads me. But still, I would live there forever,” he said.
His only aim in life is to be loyal and truthful. He hopes that the modern era will receive his ideas and artwork.
His artworks mainly focus on the theme of Chinggis Khan and are based on the book “The Secret History of the Mongols”. Through his painting “Mother Oulen” he wanted to show the relationship between human beings, nature, and the world.
In addition to painting he also writes poetry and creates woodcarvings. He has been writing poetry since he was 12, and has written nearly 20 books. “These are my favorite things to do. By creating and writing pieces, I obtain realization from them and my brain relaxes.”
When I asked him about the most priceless memory of his youth, he smiled and said, “My wife. She is naturally beautiful. She is the mother of my seven children.”
It doesn’t matter what kind of vision people have, we must respect each other. His artwork will encourage people who struggle to express their thoughts and vision for many years.

Dishonesty won’t get us through an economic recession
January 21 (UB Post) Who is the economic amnesty law dedicated to? If the law is to be approved, authorities believe that the USD exchange rate will decline. As a result of the economic recession and pressures from tax authorities, 54,337 businesses, nearly 50 percent of all registered entities, have gone out of business.
After the election in 2012, to cover their tracks, state officials included some criminal codes in the law that were favorable only to them. This can be seen in Criminal Code 4.1 in the project law. Moreover, if an individual breaks the rules of the bond law denoted in Criminal Code 158.1 of the Criminal Law, the offender will be covered by the amnesty law. It’s a way for the Democratic Party to leave the water without getting wet.
Outside of the government budget, invisible benefits and expenditures are running out of control. Chinggis Bond spending is still hidden. Parliament members asked the Prime Minister to disclose the bond’s spending several times, however, they haven’t had any response. So now, the members have organized a working group to report on bond spending.
The Government of Mongolia implemented some infrastructure projects through the bond. Roads that connected several provinces to the capital city were built, and some crossroads were fixed. Unfortunately, the wider and longer the roads got, the more money went into the pockets of authorities. Some people have extra luxurious lives, while many households are struggling.
Looking at the actions of the Democratic Party, maybe Kh.Temuujin’s idea to build more prisons was right.
According to Criminal Code laws 159.1 and 161.1, individuals who break the rules of the code must be charged up to 100 to 250 times the minimum wage, or be sentenced to up to six months in prison. Unfortunately, all these penalizations will be excused in accordance with the economic amnesty law.
Once the draft of a law serves them, politicians will do and say anything to approve it.
In 2008, the amnesty law was approved by the government. If the government approves the new economic amnesty law, incomes and properties that were never reported will be revealed. Therefore, the taxation process will be applied to the incomes and properties that will now require reporting. As a result, it is likely that fake reports will be arranged without any consequence of penalties.
By implementing collections under the tax law and social insurance law for six months, a total of four to five billion USD was invested in the market during the previous economic recession. The amnesty law was the main way out of the economic decline. But this time, the situation is completely different.
The economy won’t grow even if offshore money, state bribes, and bond spending are increased. That is just the imaginings of the Democratic Party.
Source: Uls Turiin Toim

Pawnbroker loans from Mongolian banks are crippling development
January 20 (UB Post) President of Mongolia Ts.Elbegdorj said at a session of the State Great Khural, “How do we build factories without money and loans? An interest rate of 24 percent per year can’t build factories. Banks in Mongolia are working like pawnbrokers.”
Leading economists agree that it is almost impossible for companies to become self-sufficient, as banks are providing very high-interest loans, like pawnshops. Entrepreneurs are searching for opportunities to take out loans from abroad, or to run businesses abroad, because entrepreneurs here are forced to take on high interest rates and can’t afford to build factories or pay back their debts.
At an interest rate of 24 percent per year, entrepreneurs can’t provide their workers with salaries or benefits. If this situation continues in the future, Mongolia can give up dreaming about development and expanding industry.
Retail businesses were developing in the 1990s. At that time, loan interest rates were high. Retailers bought goods from China and sold those goods in Russia at double the price. That’s why interest rates weren’t such a problem.
Due to the drop in the value of the MNT, loan interest rates have skyrocketed, which makes it rare for businesses to make profits that can cover their interest payments.
Politicians and businessmen have their own banks in Mongolia nowadays, because of the “unhealthy” banking system. Most banks in Mongolia steal from projects and those who are seeking loans. The banks say they have to know more about people’s projects and then deny them loans.
The Mongolian banking sector lacks the international standards to protect their client’s privacy, the ability to maintain customer trust, and the morality to promote and support businesses. A bank must able to safeguard client trust and privacy.
We don’t need to bother dreaming about building huge factories if financial services and interest rates are like this. If there are no factories, Mongolia won’t develop.
The pawnbroker loans of banks are becoming directly tied to social development in Mongolia. Mongol Bank (the central bank of Mongolia) raised its policy interest rate to 14 percent. Now, loans from banks will be limited.
The business sector is worried about taking out loans from abroad because loan interest rates are high in Mongolia. But do foreign banks give loans to Mongolians? The government guaranteed entrepreneurs that they would be able to take out loans from abroad, but now the Mongolian government can’t even guarantee us an old goat.
How to end this situation?
The country’s banks must be united and establish nationwide banking systems that meet international standards and ensure privacy. People running businesses together don’t trust each other, and they often split their property within three years. This is a problem for the Mongolian business sector.
Another way is to bring foreign banks to Mongolia. Pawnbroker interest rates will fall if foreign banks enter Mongolia. The long term interest rates of banks in developed and developing countries is three to four percent a year, and banks of underdeveloped countries charge 20 percent per year. The average interest rate at Mongolian banks has reached over 10 percent per year. In 2013, Bank of China made plans to launch a branch in Mongolia. It is estimated that 500 million USD will enter the Mongolian economy if the branch is launched.
With those funds, Mongolia has the opportunity to build huge domestic factories and invest in its mega projects. Loan interest rates would be more like international banks than those of pawnbrokers.
What is the goal of the nation’s banks? We should think about that concept. A good national bank must offer acceptable conditions to its clients. People should be able to pay low interest rates without pressure.
Mongolia needs to develop, and domestic factories bring about development. Factories bring about production. Loans help to build factories. Loans comes from banks. Let’s think about that.
Source: Dnn.mn

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