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BUSINESS COUNCIL of MONGOLIA NewsWire
www.bcmongolia.org [email protected]
Issue 217 – April 13, 2012
NOTE „SUPERMARKET PRICE COMPARISON‟ and „INFLATION‟
IN ECONOMIC INDICATORS SECTION
NEWS HIGHLIGHTS:
Business
Mongolia to unveil fur and cashmere trademark;
Mongolia unlikely to intervene on SouthGobi-Chalco deal;
OT defends against environmental criticism;
MMC contracts for services and supplies with MCS Mining;
Energy Resources agrees to sell thermal coal to Chinese SOE;
Companies with product share agreements with Petroleum Authority;
Mongolian Growth Group exploring possible MSE listing;
Golomt rated “B+” rating by S&P;
Mobicom unveils new phone made for frontiers;
Outotec brings Mongolian mine workers to Finland for education;
GE Energy introduces on-site services for transformers;
5th Corporate Governance Forum in Ulaanbaatar on 7 May.
Economy
Social economic data released;
Tugrug’s strength grows with coming of spring;
Mongolia to export 100,000 goats to Kyrgyzstan;
National Emergency Commission to supply animal feed to herders;
Energy windfalls;
Oyu Tolgoi raises environmental concerns;
Government announces National Electricity Network;
New railway firm to focus on rail development;
Foreign investment into Mongolia in 2011 totaled nearly USD 4 billion;
Mongolian universities leave graduates unfit for employment;
NSO projects three million Mongolians by 2017;
Scientist finds new medicinal value in mare's milk;
Commodity exporters need to manage price swings, says IMF;
Standard Bank sees spot gold above USD 1,790;
Chinese rare-earth companies form industry association;
North Korean rocket launch caused Asian airlines to reroute flight plans;
Chinese inflation rises;
IMF to report dwindling Chinese current account surplus;
Analysts continue debate between HSBC and official statistics;
Mongolia vs. eBay.
Politics
Officials arrest N.Enkhbayar, Mongolia’s third president;
Uncertainties remain to framework of summer elections;
Start of Parliament’s spring session delayed;
Preparations underway for new Securities Law;
New Securities Law to usher in a new day;
Strife rattles MPP;
Speaker calls for strategic deposit label for Khushuut;
Policymakers ponder limitations on alcohol;
Kyrgyzstan and Mongolia establish closer ties during president's visit;
Meet the next U.S. Ambassador to Mongolia;
The last of the nomads;
Russia's resurgence through Central-Asian cooperation. *Click on titles above to link to articles.
SPONSORS
Khan Bank Eznis Airways
Kempinski Hotel Khan Palace Mongolian National Broadcasting
Mongolian Star Melchers Breakthrough PR
Asia Pacific Securities Oxford Business Group
BUSINESS MONGOLIA TO UNVEIL FUR AND CASHMERE TRADEMARK Mongolia is set to introduce the Tansag Shirhegt (translation: Mongolian Luxurious Texture) trademark for its fur and cashmere wool items to earn recognition for producers of these items in the world market. About 80 percent of Mongolia's cashmere and fur products are exported, however, the actual producers are never recognized as these items are exported through international channels. To address this issue, the Ministry of Food, Agriculture and Light Industry (MFALI) proposed to develop a trademark and logo for the Mongolian fur and cashmere industry, in association with the Mongolian Fur and Cashmere Union and Agricultural Marketing and Brand Development project of the Asian Development Bank. The name and logo were decided after discussion with more than 60 fur and cashmere producers in Mongolia, said B. Batsetseg, head specialist at the Light Industry Strategy Implementation Department of the MFALI. He called cashmere the ―king‖ of textiles and said the logo would reflect that thought.
The new trademark and logo will be introduced to the world during the 81st International Textile Organization of Congress, scheduled in New York from 7 to 9 May.
Source: Fibre2fashion MONGOLIA UNLIKELY TO INTERVENE ON SOUTHGOBI-CHALCO DEAL Reports indicate that the Aluminum Corporation of China Ltd.'s (Chalco's) majority acquisition of SouthGobi Resources Ltd. will go without any objection from Mongolia's government. Chalco has made an offer for a takeover bid of up to 60 percent interest at CAD 8.48 (USD 8.49) a share. The Chinese firm alerted SouthGobi to a so-called ―lock-up agreement‖ that would transfer 57.6 percent of major shareholder, Ivanhoe Mines Ltd. to Chalco. The transaction will not require Mongolian approval because the share transfer will take place in Canada. Mongolia is likely in favor of the deal as Ivanhoe Mines said it would use the proceeds from the deal for to help finance the development of the Oyu Tolgoi copper and gold mine, a deposit of great strategic importance to the country. Chalco has reportedly has had interest in Mongolian assets for years, seeking to go beyond its core aluminum and bauxite business into base metals and energy. The deal may also be a strategy developed by Chinalco, Chalco's parent company, and Rio Tinto PLC. Chinalco holds a 12.9 percent stake in Rio Tinto, which has indicated an interest in shedding some of Ivanhoe Mines' assets following its majority acquisition of the Oyu Tolgoi developer. Ivanhoe Mines has stated that the deal would be subject to all statutory and regulatory approvals, including the Investment Canada Act and Competition Act. Approval must also come from China as well as Chalco's shareholders. With a 13.7 percent stake in SouthGobi, China's sovereign wealth fund has the right of first refusal for Ivanhoe Mines' shares, but is expected to permit the deal. ―As far as SouthGobi and Mongolia are concerned, the transaction is beneficial...,‖ said Chief Market Strategist Dale Choi of Frontier Securities. He went on to quote Chalco's commitment to a long-term investment in Mongolia's coal sector and to prop up SouthGobi as a leader in Mongolia's coal industry.
Source: Frontier Securities OT DEFENDS AGAINST ENVIRONMENTAL CRITICISM In the face of controversy surrounding its operations, Oyu Tolgoi LLC has insisted that it has conducted extensive research to ensure the proper management and use of water reserves for its world-class copper and gold project due to begin operations in 2013. The company has received complaints from organizations such as Oyu Tolgoi Watch that its operations will disrupt the herding patterns of Mongolia's nomads and drain the Gobi Desert of its sparse water resources. "We Mongolians treat water as a jewel," said Oyu Tolgoi representative G. Erdenetuya. "We have to use water in order to gain profits and to run Oyu Tolgoi's operations as it is considered crucial to the future development of Mongolia. The most important thing is to use water economically and wisely." Erdenetuya said water management was a chief concern of the company, and so it would make use of equipment that consumes water sparingly. She also explained how the company conducted hydro-geological research from 2003 to 2005 and 2007 to 2008 that covered a landmass of 100 to 150 kilometers away from the project site. Researchers found three water reserves at Gunii Khooloi, Galbin Gobi, and Nariin Zagiin Khondii. The company eventually decided to take water from Gunii Khooloi, which is situated 35 to 70 kilometers away from the mining site. For every 100,000 tons of ore processed, 696 liters of water per second will be consumed, said Erdenetuya. Mongolian laws restrict the company from using any more than 870 liters per second. Erdenetuya said the water resources at Gunii Khooloi would be enough to allow the company to operate for the next 40 years, consuming 20 percent of the entire water reserve. Additionally, 80 percent of all the water used would be recycled for further use, while the remaining 20 percent would be lost due to evaporation and saturation.
Source: Zuunii Medee MMC CONTRACTS FOR SERVICES AND SUPPLIES WITH MCS MINING Mongolia Mining Corp. (MMC) has announced several related transactions with controlling shareholder MCS Mining Group Ltd, the mining arm of MCS Ltd. The total consideration payable by MMC will be about USD 22 million. MCS Mining agreed to provide MMC engineering, procurement and construction management (EPCM) services for new school, kindergarten, and dormitory complex in Tsogttsetsii Soum of Umnugobi Aimag, as well as perpetration services for the construction of mining equipment workshop at the
Ukhaa Khudag mine. MCS Mining has agreed to supply 4,500 tons of bitumen for construction of paved road between Ukhaa Khudag and the Baruun Naran project. The firm said it would also supply MMC with services such as an energy supply upgrade.
Source: ETnet ENERGY RESOURCES AGREES TO SELL THERMAL COAL TO CHINESE SOE Energy Resources LLC, a subsidiary of Hong Kong-listed Mongolian Mining Corp. (MMC) has agreed to supply China Datang Overseas Investment Co., Ltd. with thermal coal produced for 10 years. MMC has agreed to supply China Datang with between 500,000 and 2 million tons annually of the thermal-coal byproduct known as middling. Both agreed that the value would be based on market prices subject to periodic review. Datang is one of the leading state-owned power generation enterprises in China, specializing mainly in power production and supply, power related coal-mine development and production as well as related professional technical services. MMC hopes that the agreement will expand long-term relations with its end-use customer, and will further diversify its revenue sources.
Source: Mongolian Mining Corp. COMPANIES WITH PRODUCT SHARE AGREEMENTS WITH PETROLEUM AUTHORITY The Petroleum Authority has listed the companies it holds product share agreement with. They are: PetroChina Daqing Tamsag, Chinese invested company operating in three oilfields: Toson Uul – XIX, Tamsag – XXI, Buir – XXII Dongshen Gazryn Tos, Chinese invested company conducting exploration in two oilfields: Tsagaan els – XIII and some parts of Zuunbayan XIV or contracted field with No 1997 Sheyman Resources Mongolia, Canadian invested company conducting exploration in oilfield: Nyalga – XVI China Golden Sea Petroleum, Chinese invested company conducting exploration in oilfield: Tariach – XV Petro Matad, registered as Isle of Man entity conducting exploration in oilfield: Matad – XX DWM Petroleum AG, Swiss invested company conducting exploration in oilfield: Tsagaan Els – XIII and Zuunbayan – XIV Zong Hen Yu Tang, Chinese invested company conducting exploration in oilfield: Galba – XI NPI, conducting exploration in oilfield: Khukh Nuur XXVIII Central Asian Petroleum Corp. Limited, company conducting exploration in oilfield: Bogd – IV, Ongi – V MCS Holding, Mongolian company conducting exploration in oilfield: Borzon – VII Sansar Geology Khaiguul LLC, Mongolian company conducting exploration in oilfield: Tukhum – X Khoid and Tsaidam – XXVI Magnai Trade, Mongolian company conducting exploration in oilfield: Bayantumen – XVII
Source: Business Mongolia MONGOLIAN GROWTH GROUP EXPLORING POSSIBLE MSE LISTING Real estate and financial services entity Mongolia Growth Group (MGG) is currently exploring the possibility of a listing on the Mongolia Stock Exchange (MSE). ―We are currently exploring having our company listed on the MSE. Naturally, this is a detailed process and there are lots of considerations needed,‖ said Harris Kupperman, Chairman and Chief Executive Officer of Mongolia Growth. ―A MSE listing would of course be a long-term goal of ours.‖ Although the exchange has jumped about 300 percent in total capitalization since 2010, Kupperman mentioned that MSE is currently facing problems with liquidity. The market suffers from outdated trading technology, he said. However, with the help of the London Stock Exchange Group, the MSE is in the process of modernization. Harris often compares Mongolia to Kazakhstan a few years ago in terms of growth expectations. ―The stock market was up 2,600 percent between 2002 and 2008, and real estate and wages were up several times as well,‖ he said. ―I think Mongolia will eventually catch up to places like Qatar and Kuwait.‖
Source: Seeking Alpha GOLOMT RATED “B+” RATING BY S&P Standard & Poor's Rating Services (S&P) has assigned it ―B+‖ long-term issue rating to a proposed offshore issue of senior unsecured notes by Golomt Bank of Mongolia (B+/Positive/B). The rating on
the notes is subject to S&P's review of the final issuance documentation. Moody's Investors Services has recently announced that all four of Mongolia's top banks, including Golomt, were subject to a possible downgrade to put them in line with Mongolia's sovereign rating by Moody's, as per the credit rater's new policy.
Source: Reuters MOBICOM UNVEILS NEW PHONE MADE FOR FRONTIERS Mobicom Corp. has introduced its latest phone to the public, the Iridum 9575 (also called the Iridum Extreme) to its lineup of mobile phones. Using the earlier released Iridum 9555 model as a basis for development, Mobicom boasts that this latest edition has added rough and tumble durability, important features given Mongolia's fierce and undeveloped terrain. The new model features protection against dirt, dust, jolting, bumps, as well as extra protection against water and rain, according to the standards of the U.S. military. The phone also has GPS and SOS signaling, and a speaker loud enough to counter wind noise. It also has the ability to creating wifi hotspots at heights of 40 to 60 meters. Additionally, the use of GPS to determine one's location is optional, while other models need it turned on to receive service. Activating the SOS function will send an emergency signal every five minutes. This technology first became popular after a rock climbing team set for Mount Everest decided to make use of it. Keeping with this tradition, Mobicom has opted to donate this latest generation of phone to avid rock climbers.
Source: Udriin Sonin OUTOTEC BRINGS MONGOLIAN MINE WORKERS TO FINLAND FOR EDUCATION Cooperation between the Finnish mining technology company Outotec and the Mongolian government has brought 15 Mongolian students to Finland to study metallurgy. The Mongolian students will receive three months worth of training at the Aalto University. Outotec will finance their tuitions and fees, meals, and accommodation. ―I hope to increase the knowledge base that I will need in the future,‖ said Kh. Davaatseren, who is a recipient of one of the scholarships. He added, ―I also plan to try out traditional Finnish foods and the sauna‖ Outotec is investing EUR 200,000 in the study module. Chief technology officer Kari Knuutilae explained that for the company this is a question of a long-term investment. Outotec has already sold mining equipment to Mongolia, but thus far has not run any large projects here.
Source: Helsingin Sanomat GE ENERGY INTRODUCES ON-SITE SERVICES FOR TRANSFORMERS GE Energy, a subsidiary of General Electric Co., now offers on-site transformer rewind services that can provide extra high-voltage rewinds of up to 1,000 megavolts and 500 kilovolts through its Industrial Solutions business. It is also offering internal repairs on the field. ―Shipping large damaged transformers to repair facilities around the globe can be difficult and costly, often taking up to three months to complete the process and generating transportation costs that easily exceed USD 1 million each way,‖ said John Engstrom of GE Energy's transformer services. The on-site rewind service provides a team of dedicated technicians with transformer expertise directly to the site of the rewind or repair. Once on site, technicians construct a temporary facility equipped with double-insulated fabric walls and an interlocking composite floor designed to withstand the weight of even the largest transformer.
Source: Mining Magazine 5TH CORPORATE GOVERNANCE FORUM IN ULAANBAATAR ON 7 MAY The 5th Mongolia Corporate Governance Forum will be held 7 May in Ulaanbaatar. The event will feature speakers such as Prime Minister S. Batbold and Ch. Khashchuluun, Chairman of the National Innovation and Development Committee. The key points for discussion include corporate governance in private companies, the reform process for corporate governance, and its role in the financial sector. There will also be time devoted to the Capital Market Development Initiative.
Source: Corporate Governance Development Center
ECONOMY SOCIAL ECONOMIC DATA RELEASED Consumer price index
The national consumer price index in March 2012, increased by 2.2 percent compared to the previous month, 7.6 percent compared to the beginning of the year, and 15.3 percent compared to same period of the previous year. The increase in national index compared to the previous month was mainly due to 6.7 percent increase in food and non-alcoholic beverages. Unemployment The number of unemployed reached 50.1 thousand at the end of March 2012, reflecting an increase of 9,300 persons, or 22.8 percent, compared to same period of the previous year. External trade External trade balance showed a deficit of USD 164.7 million in March 2012, compared with a deficit of USD 145.9 million dollars in March 2011. Compared to same period of the previous year, the deficit increased by 18.8 million US dollars or 12.9 percent. Total external trade turnover increased by USD 511.7 million dollars, or 28.0 percent, of which imports were up by USD 370.1 million, or 34.0 percent, and exports up by USD 141.7 million, or 19.1 percent, compared to same period of the previous year. Industrial output In the first quarter of 2012, the total industrial output increased by MNT 37.7 billion, or 8.9 percent, to MNT 460.6 billion (at 2005 constant prices) compared to same period of the previous year. State budget Current revenue of the General Government Budget amounted to MNT 1.045 trillion and current expenditure reached MNT 862.5 billion. Thus, the budget equilibrated current balance was in surplus of MNT 182.8 billion Social welfare In the first quarter of 2012, social welfare pensions and benefits allocated to 53,700 persons, showing an increase of 2,500 persons, or 4.8 percent. Total amount of the allocated fund increased by MNT 390.7 million, or 4.7, percent compared to the same period of the previous year. Of the MNT 180.6 billion distributed by the Human Development Fund to 2.6 million people (with double counting) in the first quarter of 2012, 2.5 million people, or 98.9 percent, were those receiving the cash benefit of MNT 21,000, 2,900 persons, or 0.2 percent, were those receiving MNT 70,000, and 13,780 people, or 0.9 percent, were those receiving MNT 10,000. Freight and passenger In the first quarter of 2012, 4.5 million tons of freight and 914,900 passengers (double counting) were carried by railway transport. Compared to same period of the previous year, the number of carried freight rose by 919,800, or 22.8 percent, and the number of carried passengers rose by 61,200 persons, or 7.2 percent. In the first quarter of 2012, 876.9 tons of freight and 147,100 passengers (double counting) were carried by air transport. Compared to same period of the previous year, the number of carried freight increased by 472.7 tons, or 2.2 times, and the number of carried passengers rose by 46,400 persons, or 46.0 percent.
Source: News.mn TUGRUG‟S STRENGTH GROWS WITH COMING OF SPRING Cyclical trends and the bond offering issued by the Development Bank of Mongolia have helped bring renewed strength of the tugrug. The tugrug is seeing much brighter days with exchange rates below USD 1,310 this month. The official exchange rate to the Mongolian tugrug has appreciated 6.5 percent from one year ago, and 1.2 percent in the last five days, said J. Bataa, a head of foreign exchanges at the Bank of Mongolia. What looks like what should be a depreciation due to a few factors is actually appreciating the local currency. Total external trade deficit and the rate of growth of imports are twice as high as exports, with the deficit amounting to USD 409.4 million, said Bataa. With more foreign currencies coming in than leaving, the next foreign exchange flow is in the negative, with import consumption growing. Yet, Bataa added, expectations are high on the foreign exchange market for greater supply and demand. First, the beginning of spring normally brings a regular spike to the tugrug's value. The successful sales of the Development Bank of Mongolia and Mongolia Mining Corp.‘s debt offerings have also effected greater expectations. The Development Bank's also has restrictions that prohibit a bank from exceeding 40 percent of a bank's own equity, ensuring that the foreign exchange coming in from the bonds issuance will be protected from conversions.
Source: Unuudur
MONGOLIA TO EXPORT 100,000 GOATS TO KYRGYZSTAN Mongolia is ready to export about 100,000 cashmere goats to Kyrgyzstan. The deal is part of a number of agreements kicked off during President Ts. Elbegdorj's official visit to Kyrgyzstan last week. According to a press release by the Kyrgyz Agriculture and Melioration Ministry, the agreement was made during a meeting between the Kyrgyz minister Askarbek Zhanybekov with Mongolian colleague T. Badamzhinay. Mongolia has shown interest in the Kyrgyz merino breed of goats as well. The Mongolian party said it would also like to cooperate in the food industry, irrigation, and establish joint enterprises.
Source: 24.kg NATIONAL EMERGENCY COMMISSION TO SUPPLY ANIMAL FEED TO HERDERS The National Emergency Commission's (NEC) is considering selling hay and fodder from government reserves at a lower price to prevent animal loss throughout Mongolia's rural regions. Some 3,904 tons of hay will be given as aid to Arkhangai, Bayankhongor, Bayan-Ulgii, Bulgan, Gobi-Altai, Uvurkhangai, Tuv, and Uvs Aimags. The government will sell 1,696 tons of fodder at a subsidized price as well. A difference of MNT 857.2 million worth of animal feed will be supplemented by the government. The NEC is a part of the spring projects for Mongolia's rural regions. Last autumn 1.2 million tons of hay were prepared nationwide, and 954,000 tons has been used thus far.
Source: News.mn ENERGY WINDFALLS Coal production continues to rise in Mongolia amid the ongoing development of large mining projects aimed at increasing regional demand, yet the energy sector has also began exploring greener alternatives. Located 64 kilometers southeast of Ulaanbaatar, the USD 100 million Salkhit wind farm project is a joint project between Newcom LLC and General Electric Co. and is expected to deliver 168.5 kilowatts per hour of electricity. The 1.56 million-square kilometer country has the potential to generate 2.6 terawatts of renewable energy per year—about one-quarter of global electricity demand. As the country's potential as a green-energy center for Asia rises, it is already becoming a regional leader in fossil fuel supply. The Mongolian Coal Association has predicted that coal export volumes will reach 50 million tons by 2015 and 100 million tons by 2025. Energy-hungry China will be a prime customer, with coal imports from Mongolia expected to reach 30 million tons by 2015. A ton of coking coal from Australia costs China around USD 185 compared with USD 62 when imported from Mongolia. When Tavan Tolgoi comes online in 2014, Russia, Japan, and South Korea are other potential destinations for the country's coal. However, bottlenecks are forming due to infrastructure limitations. ―We need to improve our infrastructure if we are to be competitors in the coal market. The first coal shipment to Japan has been sold for USD 280 per ton. The transportation cost was USD 170 per ton. Our transport costs make it difficult.... Coal is a product with a massive physical size; its profits are heavily dependent on its transportation costs.‖ Furthermore, mining projects are expected to create a surge in domestic demand. Mongolia's seven main coal-fired power plants have an installed capacity of 856 megawatts, but aging equipment makes production quite less. Demand is expected to hit 1,600 kilowatts by 2015, with supply only reaching 800 kilowatts. Prophecy Coal Corp. has stepped in to help fill that gap with its 600- megawatt power plant. The government has also confirmed that an oil refinery is on the way to begin production in 2015.
Source: Oxford Business Group OYU TOLGOI RAISES ENVIRONMENTAL CONCERNS Buried in the Gobi Desert, Mongolia's economic future rests on a massive mining project called Oyu Tolgoi. The copper and gold mine operated by Oyu Tolgoi LLC, co-owned by Ivanhoe Mines Ltd. and the government, is expected to contribute 30 percent of the country's gross domestic product (GDP)—an estimated USD 13.28 billion in 2018—when it starts full production. But the economic boon is also, for some, an environmental nightmare, as the project will allegedly soak up valuable water resources in the already-arid Gobi.
―There are very few who are happy with the mine's presence,‖ said D. Sukhgerel, executive director of the organization Oyu Tolgoi Watch. ―The mine and its infrastructure corridor have taken away the best pasture land from the local community. While reports vary, the mine plans to use up to 920 liter of water per second. Oyu Tolgoi has said it would consume 696 liters a second, however. Oyu Tolgoi is expected to be one of the world's largest copper mines, with about 250 kilometers of mining tunnels. It's the centerpiece of Mongolia's booming mining industry—dubbed ―Minegolia‖--that has fueled and otherwise minor economy in recent years. For the nomadic herders who roam the region, water scarcity means constant relocation as they search for sustenance for their livestock. But relocation is not always tenable, even for nomads, according to a 2011 U.S. Agency of International Development (USAID) report. The project's developers do not understand the practice of herding and the need to follow livestock to pastures and waters, said the report. Rio Tinto PLC, the majority stakeholder in Ivanhoe Mines, however, maintains the mines will have ―zero impact‖ on local water sources, pledging to use a non-replenishable groundwater aquifer called Gunii Khooloi, which can reportedly support the mine for roughly 40 years using less than 20 percent of its capacity. ―Oyu Tolgoi is making a huge effort on a number of fronts not to take any of the water from the existing supplies,‖ spokesperson Illtud Harri said, adding that the mine has conducted environmental assessments in the region since 2003.
Source: Toronto Star GOVERNMENT ANNOUNCES NATIONAL ELECTRICITY NETWORK The Electricity Network of the Central Region has changed its name to National Electricity. The decision was made during a cabinet meeting on Wednesday. Currently Khuvsgul, Bayankhongor and Sukhbaatar Aimags, and the Zamyn-uud border checkpoint are all connected to the central electricity network. The company opted to change its name to reflect its growth to all corners of the country. The Electricity Network of the Central Region supplies electricity to 90 percent of Mongolia's energy consumers.
Source: News.mn NEW RAILWAY FIRM TO FOCUS ON RAIL DEVELOPMENT A recently established government railway firm will focus primarily on infrastructure development, as opposed to Mongolian Railway's focus on transportation, said a government transportation official. ―A legislative add-on was made to enable free competition in railway transportation,‖ said J. Bat-Erdene, state secretary of the Ministry of Road, Transportation and Urban Development (MRTUD). Mongolian Railways came out of the jointly owned Mongolian-Russian railway company, Ulaanbaatar Railroad. It focuses on transportation by supplying railway cars and equipment for track repair. The new firm Base Structure of the National Railway will hold ownership of the railroads it builds. President Ts. Elbegdorj has made an urgent request to hasten the pace of infrastructure development. The project will begin with two phases this year.
Source: UB Post FOREIGN INVESTMENT INTO MONGOLIA IN 2011 TOTALLED NEARLY USD 4 BILLION Last year foreign investment into Mongolia's private sector reached USD 3.8 billion, of which 80 percent was directed toward the mining sector. The Oyu Tolgoi project alone received 63 percent of all investment, totaling USD 2.4 billion. The total sum of acquisitions made by foreign enterprises reached USD 1.64, which included deals for 27 coal mines. The largest purchase made last year was Banpu Public Company Ltd.'s outright purchase of Hunnu Coal Ltd., the operator of several mines in Mongolia for USD 493 million. Another noteworthy deal was acquisition of QGX's Baruun Naran coal mine for USD 464 million plus additional compensation to be determined. This year's figures are expected to be even greater than last's. So far in 2012, Mongolia has seen announced investments deals worth over USD 1 billion involving SouthGobi Sands, Xanadu Mines, and Modun Resources.
Source: Zuunii Medee
MONGOLIAN UNIVERSITIES LEAVE GRADUATES UNFIT FOR EMPLOYMENT While the number of university graduates is on the rise, many are still finding it difficult to find work. Of the 40,000 graduates last year, only one-third found employment. Both students and parents have complained that the problems of poor training and rising tuition fees are hindering graduates. The government has said that some of the reasons for unemployment comes down to poor decisions made by students for their education. The Ministry of Education, Culture and Science found that last year of the 34,000 graduates from university, 14,000 had degrees in social science and studies such as journalism, business management, law, and economics. However, backgrounds such as these are reportedly unmarketable in today's job market. There are also too many people looking for employment in the same professions. Last year saw 4,000 teachers graduate compared with 4,000 students graduating with degrees in engineering and construction. There is also an excess of unqualified graduates, leaving the companies needing highly-skilled and young staff with few acceptable choices, exacerbating unemployment.
Source: Undesnii Shuudan NSO PROJECTS THREE MILLION MONGOLIANS BY 2017 The National Statistical Office (NSO) reported that the population of Mongolia is expected to reach three million by 2017 and 3.9 million by 2040. This forecast was developed by the NSO in 1963 and is used for the government's socio-economic plans. The forecast reflects the growth of the number of people by putting forward multiple-path hypotheses based on the country's birth and mortality rates, in addition to migration tendencies. According to the forecast, the median age of Mongolians will grow older beginning 2040, reaching 34.5 or 33.3 years according to two models.
Source: Montsame SCIENTIST FINDS NEW MEDICINAL VALUE IN MARE'S MILK Professor Yuri Sinyasky from the Kazakh National Nutrition Academy said that mare's milk contains important nutrients that can also help cancer sufferers recover from a dose of chemotherapy. A national and traditional product of Mongolia as well, mare's milk is fermented by Mongolians and known as airag. ―Mare's milk has high stimulating properties and increases immunity, so it can be used as a base for these products,‖ Sinyasky said. Horses play a central role in the national culture of Kazakhstan and its traditionally nomadic neighbors: Kyrgyzstan, Mongolia, and Turkmenistan. Kumis, as airag is more widely known by around the world, is a popular traditional drink and horse meat is widely eaten. Many scientists have said that mare's milk can be compared to milk from a woman in many nutritional aspects and that it may be better for nourishment than milk from a cow.
Source: Telegraph COMMODITY EXPORTERS NEED TO MANAGE PRICE SWINGS, SAYS IMF Although, commodity exporters, such as Mongolia, have benefited from the run-up of commodity prices over the past decade, risks remain great and the coming opportunities are worrisome, according to the International Monetary Fund (IMF) in its World Economic Outlook. Commodity exporting countries remain vulnerable to commodity cycles. Sudden changes in global activities typically have a dramatic impact on commodity prices, and effect commodity-based economies, said the IMF. The global international organization recommended that exporting nations save extra earnings from commodity price spikes, while employing those funds when prices are less favorable. In cases of permanently higher revenues, the IMF encouraged the use of greater public investment and lower taxes, which would boost output and welfare over the long term. ―In general, the optimal fiscal response to temporary commodity price swings is a countercyclical one, although multilateral considerations may soften this recommendation,‖ said the report. ―Exporters should save commodity-related revenue increases during upswings, whether the upswings are driven by demand or supply, and use these buffers during downswings to smooth volatility.‖ It added that changes to production elsewhere may also offset prices, so a multilateral perspective may call for a ―less countercyclical fiscal policy response.‖
Source: Frontier Securities STANDARD BANK SEES SPOT GOLD ABOVE USD 1,790
Standard Bank has forecast a gold price of over USD 1,790 an ounce for 2012. ―Over the short term, we concur with the caution evident in the current futures market and ETF positioning,‖ the bank said in a note to clients. However, the bank said it expects the prices to move higher, most likely in the second half of 2012.
Source: Mining Weekly CHINESE RARE-EARTH COMPANIES FORM INDUSTRY ASSOCIATION China on Sunday set up a rare-earth industry association in a move to speed up consolidation of its sprawling industry that has drawn fire for what overseas trade partners call unfair export quota. China, which controls some 97 percent of rare-earth production, last year decided to drastically constrict the amount of rare-earths extracted and exported, leaving nations and manufactures looking for new places such as Mongolia to extract the key ingredients to many high tech gadgets and alternative energy equipment. The association, with 155 members across the country, will report to the Ministry of Industry and Information Technology, which regulates rare-earth production. Baotou Steel Rare Earth in China's autonomous Inner Mongolia region, Rising Nonferrous in Guangdong and China Minmetals are among 13 heavy-weight members. Su Bo, an industry vice minister, said Beijing wanted to shake up the industry by phasing out small smelters, giving big players a great stake in the supply of rare-earth metals and boosting environmental protection. ―China will continue to clean up the rare-earth industry, expand rare-earth environmental controls, strengthen environmental checks, and implement stricter rare-earth environmental policies,‖ Su said. The European Union, the United States, and Japan complained to the World Trade Organization (WTO) last month that China is illegally choking off exports of rare-earths to hold down prices for its domestic manufacturers and pressure international firms to move operations to China.
Source: Chicago Tribune NORTH KOREAN ROCKET LAUNCH CAUSED ASIAN AIRLINES TO REROUTE FLIGHT PLANS Airlines from Japan, South Korea, Indonesia, and the Philippines have been rerouting flights to avoid the trajectory of North Korea's Eunha-3 rocket, which Pyongyang says was blasted off this Friday morning. South Korea and Japan are two of the few portals to Mongolia. ―We believe that the rocket fell apart several minutes after the takeoff,‖ said Kim Min-seok, a spokesman for South Korea‘s Defense Ministry. He said the assessment of both the South Korean and American intelligence monitors was that ―the North Korean missile launching has failed.‖ Despite its geographic proximity to North Korea, China had not indicated what precautions it had taken, or how it intended to respond. As the rocket was expected to fly over the Yellow Sea, which separates the Korean peninsula from the Chinese coast, flights between Beijing, South Korea and Japan could have been affected. South Korean defense officials say, based on a similar North Korean launch in 2009, the rocket could have been accurate enough not to require shooting down. A senior security official said it would be technically very difficult and a ―waste of ammunition‖ to fire at it. Officials in both Washington and Seoul fear North Korea could follow its rocket launch with a third underground atomic bomb test.
Source: Financial Times, New York Times CHINESE INFLATION RISES Consumer prices rose 3.6 percent in March compared with a year ago, from 3.2 percent in February. That's a move in the wrong direction, and higher than the 3.3 percent consensus forecast. Food prices rose 7.5 percent year-to-year, with sprouting vegetable prices as the main contributor. China economists still have muddy shoes from the last bout of food-price inflation. Once again there will be a rush to explain March's rise as a seasonal blip driven by problems with the latest harvest. The proximate cause of March's inflationary rise might be a shortage of vegetables. But the underlying cause is the massive increase in the money supply in the past three years, and rises in wages that means more of that money is ending up in consumers' pockets. March's uptick in inflation might not be sustained. Growth in the money supply has now come down to 13 percent from a high of 29 percent at the end of 2009. A negative reading on the producer-price index suggests upstream inflationary pressure is limited. That means the government still has room to ease policy, and will probably do so if data on gross domestic product and industrial output due later in the week disappoints. The government can still move to support growth, but it will get some inflationary scratches along
the way. Source: Wall Street Journal
IMF TO REPORT DWINDLING CHINESE CURRENT ACCOUNT SURPLUS The International Monetary Fund will ―be significantly reducing‖ its medium-term outlook for China's current account surplus, according to people familiar with the matter, a move which will give Beijing ammunition against critics who say that it keeps the renminbi artificially cheap to support its exporters. A change in the IMF's forecast ―would certainly erode the analytical underpinning for the case that the renminbi is substantially undervalued,‖ said Eswar Prasad, a former senior IMF official in China. The IMF forecast adjustment will reflect the vastly altered state of China's trade relations since the global financial crisis and catches up with forecasts made by other economists. China's surplus peaked at nearly USD 300 billion in 2008, but has consistently fallen since then as the U.S. and European economies have weakened, while Chinese domestic demand has expanded quickly. Its trade surplus was USD 155 billion last year and most analysts expect it to decline again this year. The Chinese government on Tuesday reported that the country's trade surplus in the first quarter, when it is traditionally weak, was a mere USD 670 million. This ―supports our view that the days of one-way appreciation of the renminbi are close to being over,‖ said Shen Jianguag, economist with Miznhu Securities. This is an important development since the current account balance as a percentage of gross domestic product (GDP) is one of the most widely used gauges of whether a currency is fairly valued. China's current account surplus hit 10.1 percent of GDP in 2007, extremely high for a large country and held up as evidence that Beijing's currency policy was a cause of the global economic imbalances. However, the surplus fell to only 2.7 percent last year. The IMF last forecast that China current account surplus would be 7.2 percent in 2015—it is this figure that will revise down next week.
Source: Financial Times ANALYSTS CONTINUE DEBATE BETWEEN HSBC AND OFFICIAL STATISTICS In March China's purchasing managers index (PMI) surged to 53.1—its highest level in a year—while HSBC's measure fell to 48.3. A reading over 50 means factory activity increased, while one below points to contraction. ―The economy is just sucking wind right now,‖ said one senior Chinese auto industry executive. ―It's clear there's a slowdown under way, but whether that gets much worse or not depends on three things—Europe, the [domestic] real estate market and whether the government boosts infrastructure investment again.‖ China's manufacturing sector is less export-orientated than it was at the onset of the financial crisis in 2008, but it remains heavily dependent on trade. Many economists see a recession in Europe, its single largest export market, as a key risk to Chinese growth this year. During the global financial crisis in 2008, as the Chinese real estate market wobbled and exports plummeted, Beijing launched a huge economic stimulus package, channeling trillions of renminbi worth of bank loans into infrastructure projects to boost growth. New roads, airports, railways and apartments sprang up across the country, and the manufacturing sector quickly rebounded from its slump. Some economists believe Beijing is likely to repeat that trick this year, albeit on a smaller scale, by loosening monetary policy and stimulating growth through new infrastructure projects. Largely in expectation of this, many analysts have recently upgraded their gross domestic product (GDP) growth forecasts, with consensus falling somewhere between 8 and 9 percent for the year, compared with 9.2 percent in 2011. Yet the government's official gross GDP growth target has been lowered to 7.5 percent for the year, the first time it has been less than 8 percent in seven years. China is expected to release first-quarter GDP figures on Friday, with expectations that the world's second-largest economy grew 8.4 percent in the first three months compared with a year ago. Many analysts agree, however, that on this occasion HSBC's production manager index is probably closer to the market than the official reading.
Source: Financial Times MONGOLIA VS. EBAY
*Click on titles above to link to articles.
Source: Foreign Policy
POLITICS OFFICIALS ARREST N.ENKHBAYAR, MONGOLIA‟S THIRD PRESIDENT Mongolia's third president, N. Enkhbayar, was arrested today around 8 a.m. According to E. Amarbat, head of the Investigation department of the Anti-Corruption Agency, the agency decided to proceed with the arrest of Enkhbayar yesterday on 12 April 2012 by request of the Sukhbaatar District court. Amarbat said the Anti-Corruption Agency had been investigating Enkhbayar for one year and several times ordered him to to testify. ―But Mr.Enkhbayar never came,‖ he said. Police tried to arrest Enkhbayar last night at around 9 p.m., but Enkhbayar‘s party‘s members intervened and supporters protested. In the early morning, police returned and arrested Enkhbayar by force. It appears as though the former president left his home unexpectedly and impromptu, as in videos he can be seen being escorted without wearing shoes by out-of-uniform police. An unnamed unofficial source said Enkhbayar is now in a detention center in Tuv Aimag. Enkhbayar served as prime minister from 2000 to 2004, the speaker of Parliament from 2004 to 2005, and then President of Mongolia from 2005 to 2009. He served with the Mongolian People's Revolutionary Party (MPRP), which later became the Mongolian People's Party (MPP). He later left the MPP to form a new party also called the Mongolian People's Revolutionary Party.
Source: www.news.mn UNCERTAINTIES REMAIN TO FRAMEWORK OF SUMMER ELECTIONS Citizens have complained to the Constitutional Court that some provisions pertaining to the Law on Elections, which passed on 15 December 2011, violate the Mongolian Constitution and the Law on Parliament. The election law instructs that 48 MPs shall be elected depending on the votes coming from electoral districts, while 28 others will be selected by the party, with the number of seats based on the proportional vote. The court ruled in favor of those complaining and said the law was a violation. In a meeting members of the Mongolian People's Party discussed the decision and decided they would not appeal. Party members also agreed that they still prefer that state and local elections should be held on different days because there would not be enough time or resources to meet the requirements of the new law while tallying votes for both elections at the same time.
Source: Udriin Sonin START OF PARLIAMENT‟S SPRING SESSION DELAYED
Parliament has postponed the start of its spring session. MPs S. Erdene, D. Zagdjav, and Ch. Ulaan proposed a delay to the start of session, gathering a majority decision from Parliament. The delay postpones what would have been a debate on a package of laws concerning environmental laws. The extended break from Parliament would give the standing committee for the elections law more time for its development, said MPs. Before the last session of Parliament ended, policymakers received two different versions of the Law on Elections, to which Parliament has asked the two be integrated into one.
Source: Undesnii Shuudan PREPARATIONS UNDERWAY FOR NEW SECURITIES LAW The cabinet is currently preparing the Law on Securities for submission to Parliament. Reported total capitalization of 3.2 trillion in February and 2.1 trillion in November last year is an indicator of significant growth to the Mongolian Stock Exchange (MSE). The new draft law aims to align the capital exchange in Ulaanbaatar with the growth experienced in the market, improve stock market regulations and inspections, and protect the interest of the public and investors.
Source: Montsame NEW SECURITIES LAW TO USHER IN A NEW DAY After more than six years of consideration, Parliament is expected to adopt a new Securities Markets Law later this year to replace the existing law, which will be a major step in Mongolia's recent efforts to bring its capital markets up to world-class standards. Coinciding with the law are the efforts of the London Stock Exchange (LSE) Group to leverage the London market team's experience and resources with the aim of modernizing the MSE and transforming it into a first-class market. This includes nominations by the LSE to some of the Mongolian Stock Exchange‘s (MSE's) board of directors and the use of the London exchange‘s own management to supplement the knowledge and experience of their Mongolian counterparts. Additionally, the LSE is providing market technology software licensing and training, in addition to training programs for the MSE staff, regulatory authorities and other market actors. It is also offering assistance on how the MSE could be privatized. In line with the anticipated benefits from the LSE partnership, the draft of the new Securities Law affords a number of improvements over the existing law and more fully reflects prevailing international standards. One key deterrent to secondary listings in Mongolia is that the current law requires a company issuing securities in Mongolia to be registered in Mongolia, which would require the company to observe all Mongolia laws. The new law does not require companies to register in-country, and expressly permits a company who has listings abroad to list and trade on Ulaanbaatar's exchange as well. Other enhancements include more explicitly defined various securities market terms, clearly laid out broker, dealer, and underwriter responsibilities, and strengthened transparency requirements. Once this law is adopted, hopes are that Mongolia will become even more enticing as a location for foreign investors and for Mongolian companies and foreign-listed companies with a Mongolia nexus considering a public offering or dual listing. To be sure, a number of foreign-listed companies have assets or operations in Mongolia and would thus appear suitable candidates for a secondary or tertiary listing in Mongolia, including Mongolian Mining Corp. and Mongolia Energy Corporation Ltd. (both listed in Hong Kong), Prophecy Coal Corp. (listed in Toronto), SouthGobi Resources Ltd. (listed in Hong Kong and Toronto), Aspire Mining Ltd. and Xanadu Mines Ltd. (both listed in Australia), and Petro Matad Ltd. (listed on the LSE).
Source: The Deal STRIFE RATTLES MPP A heated discussion broke out during a meeting of the Mongolian People's Party this week over the fulfillment of promises made from the last election. Party members demanded that MPP Chairman and Prime Minister S. Batbold ensure that the promises made during the 2008 election be fulfilled. Specifically, they argued that the MNT 1.5 million promised to citizens must be delivered. A majority of members agreed that the MPP's reputation is at stake, and it should not be tarnished by the failings of the Prime Minister. Criticism centered around the fact that foreigners dominate Mongolia's mining sector and the country's leaders are selling out their nation. One MP, O. Chuluunbat said he no longer recognized his party and spoke a list of his grievances, while MP. Ts. Davaasuren directed his attacks
specifically at the prime minister. Ch. Ulaan was the most active, criticizing the slow pace for decision making in regard to the Tavan Tolgoi project. During a break from the meeting, party members agreed to hold a news conference to discuss the promises. However, because the meeting ran until the next day and beyond, the press conference was postponed. Other matters for discussion were the Law on Local Elections and an unspecified dispute between MP H. Battulga and Minister Ts. Nyamdorj.
Source: Udriin Sonin SPEAKER CALLS FOR STRATEGIC DEPOSIT LABEL FOR KHUSHUUT The Parliament Speaker has sent an official letter to government imploring that the Khushuut deposit in Khovd be declared a strategic deposit. Citizens from the area have attempted to rally support to label the Khushuut deposit a strategic one through the media. Following this, government ordered that research be done on the deposit, in addition to gathering facts about the possibilities for developing infrastructure there, such as roads, power stations and coal processing plants. The Khushuut Mine is currently operated under Hong Kong-based Mongolia Energy Corporation Ltd. (MEC) with support from Leighton Asia ltd.
Source: Zuunii Medee POLICYMAKERS PONDER LIMITATIONS ON ALCOHOL Parliament has discussed a new law that would ban the advertisement of alcohol products. The law's development was led by President Ts. Elbegdorj and introduced by the head of his office, D. Battulga. "The projects concerning the Amendments against Alcoholism and the Prevention of Alcoholism and its Control are being introduced to collect proposals from public and professional organization," said Battulga. The initiative focuses on the control of the supply of alcohol products, set limits to its consumption, and put in place greater provisions to health and social services. Present during the discussion were representatives of the Ministry of Food, Agriculture and Light Industry (MFALI), the Ministry of Health, the Ministry of Social Welfare and Labor, the General Police Department, the World Health Organization (WHO), and the international non-government organization Doctors without Borders. All representatives in attendance threw their support behind the project, while making suggestions for additions and omissions to the law.
Source: Udriin Sonin KYRGYZSTAN AND MONGOLIA ESTABLISH CLOSER TIES DURING PRESIDENT'S VISIT Mongolian and Kyrgyzstan have released a joint declaration following President Ts. Elbegdorj's official visit to Kyrgyzstan last week. Official talks between the presidents of Mongolia and Kyrgyzstan have strengthened friendly relations and confirmed their desire to push forward mutually beneficial cooperation. The officials discussed issues concerning the development of diplomatic ties, expressed mutual satisfaction with the level of bilateral talks, and affirmed their commitment to deepen cooperation to common interests. Elbegdorj and the Kyrgyz officials agreed that Mongolia and Kyrgyzstan have deep similarities in terms of opportunities to develop their political structures. As chair to the Community of Democracies, Mongolia promised to support Kyrgyzstan's efforts to strengthen its democratic governance and establish transparency within government in addition to public participation. There was also agreement to the widening of cultural and humanitarian cooperation, in addition to support to universities, and scientific and cultural centers. The Kyrgyz delegation threw its support behind the proposal of establishing an international think thank that would focus on the issues landlocked countries faced, as proposed by Elbegdorj last fall to the international community. It also promised to support Mongolia in its endeavor to become a participating state in the Organization for Security and Cooperation in Europe (OSCE).
Source: Montsame MEET THE NEXT U.S. AMBASSADOR TO MONGOLIA Piper Campbell was nominated by U.S. President Barack Obama as the next U.S. Ambassador to Mongolia on 5 March. Campbell is a longtime director of Gibraltar Industries, which manufactures and distributes building
materials. A native of Buffalo, New York, she once said her participation in a summer exchange program to Japan ―definitely set me onto this career path in diplomacy.‖ Campbell earned a Bachelor of Science in Foreign Service with a certificate in Asian Studies at the Georgetown University School of Foreign Service in 1988, and a Master in Public Administration at the Harvard University Kennedy School of Government in 1999. She worked briefly for an organization promoting trade between Western New York and Canada prior to joining the U.S. Foreign Service in 1989. She began her career as a consular and administrative officer at the embassy in Manila, Philippines, followed by a stint as a general services officer providing support to the three U.S. missions in Brussels, Belgium (the European Union, NATO, and Belgium). Campbell served in the U.S. State Department Operations Center from 1994 to 1995, and in the International Organizations Bureau from 1995 to 1998. Campbell helped the U.S. Agency for International Development (USAID) establish an office in Eastern Slavonia, Croatia, in 1998. In 1999, Campbell covered Asian issues and Security Council reform at the U.S. Mission to the United Nations in Geneva, Switzerland, from 2002 to 2006. Campbell then served at the Embassy in Phnom Penh, Cambodia, first as deputy chief of mission, starting September 20, 2006, and then as chargé d‘affaires from 2008 to 2009. Back in Washington, Campbell served as chief of staff to Jack Lew, the deputy secretary of state for Management and Resources, until being named consul general at the U.S. Consulate Generate in Basrah, Iraq in July 2011.
Source: Allgov THE LAST OF THE NOMADS In Mongolia, this century is proving to be an era of fast and furious change. Modernization, a new economic system, opportunities in mining, and the effects of overgrazing and climate changes are nudging an ancient nomadic culture to adopt a more urban, settled lifestyle. Herders distinguish between three different types of so-called dzuds, the particularly harsh winters with excessive snowfall that sometimes leads to widespread animal deaths. This year's was considered a ―glass dzud,‖ where the ground froze solid under a thick layer of snow, prohibiting animals from grazing. With temperatures reaching -40 to -60 degrees Fahrenheit throughout January, it was the coldest winter in local memory, and animals both froze and starved to death. Many said this year was even worse for them than the notorious dzud of 2010, in which almost 8 million heads of livestock, or 17 percent of the entire country's animals, died and the government of Mongolia declared disaster status. More parents are sending their children to be educated in the city, hoping they will not have to work as herders when they grow up. If what these herders promise holds true, the ancient nomadic culture of Mongolia will be seriously reduced within a generation's time. Perhaps such a change is necessary—humanity has and always will evolve, and adapt to new era, technologies, and philosophies.
Source: Huffington Post RUSSIA'S RESURGENCE THROUGH CENTRAL-ASIAN COOPERATION Central Asia, after the Soviet disintegration, has become one of the most important regions, not only for the Asian continent but also for global geo-politics. The region is rich in minerals and natural resources. With an attractive overall gross domestic product in excess of USD 160 billion (not including Mongolia), the region is an attraction to energy sector investors and global policy makers. Key regional players, especially Russia, have maintained good ties with Central Asian states. Uzbekistan serves as the primary buffer for Moscow and Asia. It is also an important element of Moscow's energy network. Kazakhstan, on the other hand, holds an important and strategic position for Russia as it acts as a conduit to access Central Asia. The border shared among both the states is as long as 5,000 miles and is mostly unguarded, making it important that stability remains there for Russia. Tajikistan maintains an anomalous position for Russia. Having a border with Afghanistan, it acts as an important state both for the United States and Russia. Russia, for long, has also bore drug trafficking in its territory from Afghanistan via Tajikistan. Furthermore, the recent affiliations of Taijik leaders towards the United States have made the situation critical for Moscow. Yet, Russia provides the largest employment market for Taijik workers. Turkmenistan acts as a buffer for Russia, separating it from the violence in Afghanistan and Pakistan. With its rich resources of natural gas, it has remained an area of interest not only for
Russia but also the United States. If a proposed gas pipeline, from Turkmenistan passing through Afghanistan to Pakistan and even India, goes according to plan, Turkmenistan would get another conduit for its gas exports that would directly impact the Russian economy and would benefit U.S. investors. Finally Kyrgyzstan has a number of bases and military installation that help it keep checks over foreign maneuvering in the region. Russia provides economic assistance to Kyrgyzstan through refined energy supplies, aid, and soft loans.
Source: Pravda __________________________________________________________________________________
ANNOUNCEMENTS 2ND COALTRANS MONGOLIA IN ULAANBAATAR ON 23-24 MAY The 2nd Coaltrans Mongolia will be held from 23 to 24 May at the Chinggis Khan Hotel in Ulaanbaatar. Having overtaken Australia to become the largest exporter of metallurgical coal to China at the end of 2011, the Mongolian coal market continues to establish itself as a competitive producer in the global coal markets. This event will explore the development of coal projects in the country and offer insight into what level of influence Mongolia will have over the future of coal prices. Guest speakers include Graeme Hancock, Chief Operating Officer of Erdenes Tavan Tolgoi, and Dr. G. Battsengel, Chief Executive Officer of Mongolia Mining Corp. BCM is a Supporting Organization for the event. For more information visit coaltrans.com/mongolia or email [email protected] __________________________________________________________________________________ REGISTER NOW FOR MONGOLIAN MINING DIRECTORY-2013 Mongolian Mining Directory-2013 which provides information database for Mining companies, investors, suppliers, service companies, government and non government organizations will be published for the fourth year to commemorate the 90th anniversary of the Mongolian mining industry. The MMD is distributed free of charge to international and domestic mining companies, international conferences and exhibition, embassy offices in Mongolia and foreign countries to investors. BCM is a Supporting Organization of the MMD and welcomes Mongolian mining industry participants who are interested in advertising their products and services in Mongolian Mining Directory-2013. For more information please visit: www.mining.mn, www.mongolianminingdirectory.mn or call +976-7011 5590. __________________________________________________________________________________ “MM TODAY” on MNB-TV, Fridays at 18:30 [TONIGHT] BCM is pleased to announce Mongolian National Broadcasting continues its cooperation with BCM on ―MM Today‖. This English news program is aired every Friday for 10 minutes and is scheduled for 18:30 tonight! Tune in to watch this program that reports stories from today‘s BCM NewsWire. __________________________________________________________________________________ “BSPOT” ON B-TV, MONDAY TO FRIDAY AT 18:20 B-TV (Business TV) now telecasts a 10-minute English-language news program called BSPOT every evening from Monday to Friday at 18:20, taking most of the stories from the BCM NewsWire. __________________________________________________________________________________ POSTINGS ON BCM‟S ENGLISH WEBSITE 'PRESENTATIONS' AND 'MONGOLIA REPORTS' SECTIONS AND BCM‟S MONGOLIAN WEBSITE „PRESENTATIONS‟ AND „NEWS‟ SECTIONS The new ‗Presentations‘ section on BCM‘s Mongolian website can be reached via link to bcm.mn/itgeluud. Several presentations already posted include 9 from Coal Mongolia in February 9-10, 2012. As a key component of BCM‘s Mongolian website, ‗News‘ section, articles from the Government‘s ―Open-Government.mn‖ site are regularly posted. On BCM‘s English website, ‗Resource, Presentations‘ section, for your review are two presentations from BCM‘s March 26 monthly meeting, 12 presentations on Mongolian entities at Mines and Money Hong Kong 2012 on March 21-23, 11 presentations from Coal Mongolia 2012 on February 9-10, 7 speeches from the Mongolian Investment Summit on December 8-9, 2011 in London, several speeches at the Risk Management Forum on November 8 co-organized by BCM and Mandal Insurance,
speeches at Discover Mongolia 2011, and speeches from all BCM‘s monthly meetings in 2011-12. Also on BCM‘s English website, ‗Resource, Mongolia Reports‘ section, please note the detailed results of BCM‘s NewsWire survey of March 2012; Executive Summary of the Mongolian Real Estate Report 2012 by M.A.D. Investment Solutions; Mongolia – the World Bank Country Survey 2011; Welcoming remarks by Jim Dwyer, BCM at Mongolia Investment Summit 2011 Hong Kong, Mining Journal Supplement for Mongolia, October 2011; Polit Barometer-May 2011 from Sant Maral Foundation; and Mongolia‘s Mining Services Cluster 2010, Professor Michael E. Porter, Harvard University, The Microeconomics of Competitiveness. We are now posting some news stories and analyses relevant to Mongolia to BCM website's ‗Mongolian Business News‘ as they come, instead of waiting until each Friday to put them all together in the weekly NewsWire. The NewsWire will, however, continue to be issued on Friday, and will incorporate items that are already on the home page, so that it presents a consolidated account of the week‘s events. __________________________________________________________________________________ NETWORK WITH BCM The Business Council of Mongolia (BCM) has expanded its reach to your favorite social networks. Keep up to date on the latest business deals in Mongolia and how the climate for investment is improving each day with BCM. Add BCM on Facebook at http://www.facebook.com/pages/THE-BUSINESS-COUNCIL-OF-MONGOLIA/129826330435540 to read the latest announcements and comment on events carried in the NewsWire with the community. Hear breaking news and announcements as they happen when you follow BCM on Twitter at http://twitter.com/#!/bcMongolia. Connect with BCM on Linked-in to join the diverse group of professional contacts creating a better business environment in Mongolia today. Of course for news information, interviews, and announcements regarding our organization, visit the official BCM website at bcmongolia.org and bcm.mn. __________________________________________________________________________________
ECONOMIC INDICATORS
SUPERMARKET PRICE COMPARISON
INFLATION Year 2006 6.0% [source: National Statistical Office of Mongolia (NSOM)] Year 2007 *15.1% [source: NSOM] Year 2008 *22.1% [source: NSOM] Year 2009 *4.2% [source: NSOM] Year 2010 *13.0% [source: NSOM] Year 2011 *10.2% [source: NSOM] March 31, 2012 *15.3% [source: NSOM] *Year-over-year (y-o-y), nationwide CENTRAL BANK POLICY RATE December 31, 2008 9.75% [source: IMF] March 11, 2009 14.00% [source: IMF] May 12, 2009 12.75% [source: IMF] June 12, 2009 11.50% [source: IMF] September 30, 2009 10.00% [source: IMF] May 12, 2010 11.00% [source: IMF] April 28, 2011 11.50% [source: IMF] August 25, 2011 11.75% [source: IMF] October 25, 2011 12.25% [source: IMF] March 19, 2012 12.75% [source: Mongol Bank] CURRENCY RATES – April 12, 2012 Currency Name Currency Rate U.S. dollar USD 1,307.11 Euro EUR 1,712.97 Japanese yen JPY 16.22 British pound GBP 2,077.52 Hong Kong dollar HKD 168.34 Chinese yuan CNY 207.16 South Korean won KRW ` 1.14 Russian ruble RUB 43.81 Disclaimer: Except for reporting on BCM‘s activities, all information in the BCM NewsWire is selected from various news sources. Opinions are those of the respective news sources.
