Mongolia Minute
All Bets on Black.
The Economic Intelligence Unit forecasts Mongolia to be the second fastest growing economy in the world in 2012 with a 14.8% GDP growth rate. This is second only to Macau at 15% driven by an insatiable appetite for gambling while also being a primary destination for money leaving the Chinese mainland. The Mongolian bet has been on the large reserves of black coal with the country surpassing Australia last year as the largest global exporter of coking coal to China and it is growing at an accelerating pace. Goldman Sachs is the latest company to bet on Mongolia announcing a 5% interest in one of the largest Mongolian commercial banks (TDB) this week. We would wager this is only the first of many further publicly announced investments made by global investors seeking exposure to a stable investment climate with rapid growth.
The London Stock Exchange (LSE) remains convinced by the strong fundamentals in Mongolia. The CEO of the LSE will be in Ulaanbaatar on March 6th to reiterate the LSE’s commitment to Mongolia and review the early accomplishments in the first year of a three year management contract with the Mongolian Stock Exchange (MSE) at an LSE/MSE investor forum.
The multi-billion dollar Tavan Tolgoi coking coal IPO on the MSE with GDRs on the LSE is around the corner in May together with a host of other companies that will begin trucking their coal into northern China. With Rio Tinto’s world-class $20 billion Oyu Tolgoi copper project set to begin production in late 2012, we wouldn’t be surprised to see more money being bet on red. Junior copper explorers are increasing their exploration budgets to all-time highs and there is a widespread believe that there will be a new major discovery along the Tien Shan Copper Belt in the short to medium term.
It is possible to get exposure to Mongolia through MSE-listed equities, public international equities or private investments and we anticipate more interest in Mongolia as the country begins a long period at the top of global growth leagues.
Source : rescap
The Economic Intelligence Unit forecasts Mongolia to be the second fastest growing economy in the world in 2012 with a 14.8% GDP growth rate. This is second only to Macau at 15% driven by an insatiable appetite for gambling while also being a primary destination for money leaving the Chinese mainland. The Mongolian bet has been on the large reserves of black coal with the country surpassing Australia last year as the largest global exporter of coking coal to China and it is growing at an accelerating pace. Goldman Sachs is the latest company to bet on Mongolia announcing a 5% interest in one of the largest Mongolian commercial banks (TDB) this week. We would wager this is only the first of many further publicly announced investments made by global investors seeking exposure to a stable investment climate with rapid growth.
The London Stock Exchange (LSE) remains convinced by the strong fundamentals in Mongolia. The CEO of the LSE will be in Ulaanbaatar on March 6th to reiterate the LSE’s commitment to Mongolia and review the early accomplishments in the first year of a three year management contract with the Mongolian Stock Exchange (MSE) at an LSE/MSE investor forum.
The multi-billion dollar Tavan Tolgoi coking coal IPO on the MSE with GDRs on the LSE is around the corner in May together with a host of other companies that will begin trucking their coal into northern China. With Rio Tinto’s world-class $20 billion Oyu Tolgoi copper project set to begin production in late 2012, we wouldn’t be surprised to see more money being bet on red. Junior copper explorers are increasing their exploration budgets to all-time highs and there is a widespread believe that there will be a new major discovery along the Tien Shan Copper Belt in the short to medium term.
It is possible to get exposure to Mongolia through MSE-listed equities, public international equities or private investments and we anticipate more interest in Mongolia as the country begins a long period at the top of global growth leagues.
Source : rescap
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