Delegation of the European Union to Malaysia

MONGOLIA - Weekly press review 18 October 2021

19/10/2021 - 03:37
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COVID-19

As of 18 October, the total number of confirmed cases reached 498 903, the total number of recovered patients was 485 895 and the total number of COVID-19 related deaths was 1 556 E-Mongolia (In MNG). COVID-19 interactive dashboard is available in Mongolian and English.

Vaccination: As of 18 October 2 253 761 people have received the first dose of the vaccine, 2 136 063 people received the second dose E-Mongolia (In MNG) and 367 183 people received the third dose. MoH

39 international flights scheduled for November: flights are being conducted to Seoul, Frankfurt, Tokyo, Almaty and Istanbul. Unuudur (In MNG)

45 international flights scheduled for December: flights are being conducted to Seoul, Frankfurt, Tokyo, Almaty, Nur Sultan and Istanbul. Unuudur (In MNG)

Mongolia’s mortality rates rise by 15.8% during pandemic while birth rate fell by 4.5%: Statistically, there are 17-18 thousand deaths per year reported in Mongolia. However, mortality rate by 1 900 deaths since beginning of 2021. As of 11 October 2021 There have been 326 738 infections and 1 450 coronavirus-related deaths reported in the country since the pandemic began. News

Hospitals are overrun with COVID-19 patients: Hospitals are operating 41% over their capacity and struggling to keep up with the rising demand for beds, resulting in critical staffing shortages. As of today, there are 30 to 70 patients per doctor and 120 to 130 patients per nurse. News (In MNG)

EU - Mongolia

Sustainable fashion: Mongolia has adopted a standard for sustainable textile production. Small and medium sized wool and cashmere producers who abide by the standard will contribute to greening the sector. The standard covers for example rational use of natural resources, animal rights and labour protection. The standard was developed with the STeP EcoLab project. Pierre-Yves Lucas, the cooperation team leader at the Delegation of the European Mongolia, has expressed that the STeP EcoLab project contributes greatly to a sustainable cashmere and wool industry. Switch-asia

Young Entrepreneurs: A Business Competition amongst social entrepreneurs and young people took place under the All for YOUth, YOUth for all project, that is implemented by Caritas Czech Republic and co-funded by the European Union and the Ministry of Foreign Affairs of the Czech Republic in partnership with the Mongolian Youth Council and Center for Citizenship Education. After 10 business got to pitch their ideas to a committee 3 winners were selected. Montsame

Speaker meets delegation of Italian parliament: Speaker G.Zandanshatar thanked the delegation of the Italian parliament led by Mr. Ettore Rosato for visiting Mongolia in aims of expanding the cooperation between the two countries despite the challenging circumstance of the global pandemic. During the meeting, the sides exchanged views on expanding bilateral trade as well as economic, political, and cultural cooperation. montsame

Opening of the Mongolian Honorary Consulate in Italy and The Mongolian Agriculture Ministry visits Italy: A delegation from the ministry of Food, Agricultire and Light industry has paid a visit to Italy at the invitation of IMAGRO and Italprogetti. An agreement on Darkhan leather and hide complex development was discussed. Paolo Bonetti was appointed Honorary Consul of Mongolia to Lombardy region. There is hope that the Honorary Consulate will contribute to the protection of Mongolians in the region and develop economic cooperation between the countries. Montsame and Montsame

Awareness raising of the situation for young people with disabilities: Through an EU-funded project Caritas Czech Republic announce a small grant competition for local NGOs to address the issue of visibility and inclusion of young people with disabilities in Mongolia. Caritas

Vocational Education for Disabled People: The School of Vocational Education and Skills at the Mongolian National Rehabilitation Vocational Training Center aim to provide specialised training in professions such as chef, baker, tailor, carpenter etc. With the support of the European Union the school is in process to introduce three new professions such as service worker, e-service person and clerk. Mongolia Focus

EBRD and EU support Mongolian Flour producer’s exports: Due to the traditional diet in Mongolia flour has become an important stable food. Oeg Flour LLC, a flour producer in Mongolia, has broadened its business and began exporting internationally with business expertise from the EBRD and the EU. Through advice from the EBRD the company could modernise and thus re-establish itself on the Mongolian market and also enter the Chinese market. EBRD News

World Bank presents the second assessment of Mongolia’s Public Expenditure and Financial Accountability Report conducted between December 2020 and June 2021. The World Bank conducted first PEFA assessment in 2015. The second assessment measured progress in the country’s fiscal policy and financial management system based on 31 indicators. 12 showed progress compared to the previous assessment. Measures have been taken over the past three years to improve the fiscal system. eu delegation worldbank DNN (In MNG)

Asia Pharma LLC joins ‘Blue Ribbon’ programme: The aim of the ‘Blue Ribbon’ programme is to enhance and improve a member company’s corporate governance, financial and structural management, thus providing support in achieving their strategic goals. Zsuzsanna Hargitai, the EBRD’s Managing Director of Central Asia, and Bayarjargal G, CEO of Asia Pharma LLC, have signed the letter of ‘Blue Ribbon’ programme and H.E. Axelle Nicaise, EU Ambassador-designate to Mongolia has participated and congratulated Asia Pharma on their new venture. montsame

EU-funded project hands over 132 pieces of medical equipment to the Ministry of Health: Under the European Union funded ‘Recovering Together’ project, implemented by World Vision, the Ministry of Health is provided with 132 pieces of medical equipment: Oxygen concentrator-72 pcs, Automatic infusion pump-30 pcs and Syringe driver-30 pcs in response to COVID-19 pandemic. montsame

Political and Internal Developments

Two new ministries to be established: the Ministry of Development Policy and Economy and the Ministry of Digital Development. The proposed Ministry of Development Policy and Economy will oversee development policies and improve public-private partnerships, while the Ministry of Digital Development will execute digital transformation goals set at 90 percent completion by 2024 under the Digital Nation agenda. The government has included the necessary expenses for these ministries in the proposed 2022 state budget. parliament.mn

MPP candidates win in parliamentary by-election: The General Election Commission convened today and approved a resolution acknowledging the victory of candidates Ts.Iderbat (received 17,264 votes or 73.03 percent of voters that participated in the by-election polls in Khentii aimag) and E.Batshugar (received 28,537 votes of 51 percent of voters in capital city’s Songinokhairkhan district) in the parliamentary by-election. The resolution has been presented to the parliament today on October 18. All the votes received through the polls had been hand-counted. Montsame

First assembly of All Judges of Mongolia takes place: All levels of judges are attending the assembly that should take place once in four years. The State Great Khural (Mongolian Parliament) adopted the revised Law on Courts in January 2021. The purpose was to ensure a fair and independent judicial system in Mongolia. The assembly will hear the report of the Judicial General Council and the assembly will also discuss and approve General Procedures for allocation of judges and court members in charge of receiving, allocating cases, claims, complaints and requests, reviewing and resolving cases and disputes. The judges did select members of the Judicial general Council (JGC) and the Judicial Disciplinary Committee (JDC). A total of 16 Judges were nominated for the five positions of the JGC and ten judges were nominated for four positions of the JDC. The remaining positions are nominated by the parliament. The UB post

A demonstration of stuffed bunnies: 330 stuffed bunnies have demonstrated at Sukhbaatar square in central Ulaanbaatar as a part of a public awareness campaign to stop violence against the girl child. According to a study, on average 218 girls aged 8-17 became victim of sexual abuse and rape and nearly 3 500 teenage girls give birth annually. News

Government of Mongolia responds to Rio Tinto’s statement on cost overruns: Rio Tinto has stated that the cost of the Oyu Tolgoi underground mine exceeded USD 1.45 billion due to ground conditions and investment costs for Mongolian workers. Last week, the CEO of Rio Tinto said that the commissioning of the Oyu Tolgoi underground mine project may be delayed again. Minister of Justice and Internal Affairs Kh. Nyambaatar responded by stating, “Rio Tinto needs to provide a substantiated explanation as to why the cost has been exceeded. The reasons identified by outside experts will be considered as the main factors contributing to the cost overruns.” According to the Financial Times, there have been no effective talks on the project and no real progress has been made so far. Bloomberg (In MNG).

Mongolia to establish forestry agency: Mongolia will establish an independent forestry agency next year to combat desertification. The Prime Minister of Mongolia made the announcement while introducing national budget plans for 2022 to the parliament, saying that the new agency was part of the cabinets efforts to support the “Billion Trees” tree planting campaign. Only 7.9% of Mongolia’s surface is now covered by forests and 77% of Mongolia’s total territory has been affected by desertification and land degradation, according to the country’s Ministry of Environment and Tourism. Xinhuanet

Foreign Policy

China to increase Mongolian coal imports: Prime Minister of Mongolia held an online meeting with the Prime Minister of China, Li Keqiang. They exchanged views on some major joint projects and agreed to actively work to bring trade turnover between the two countries to USD 10 billion. The prime ministers reached an agreement to resolve the issue of 4 575 containers of Mongolian cargo delayed at Tianjin Port before the winter and agreed to immediately let the delayed coal shipments at the Gashuunsukhait border crossing point pass the border. The prime ministers expressed their willingness to work to actively involve private enterprises in projects aimed at creating opportunities for energy production and export, as well as reducing traffic congestion in Ulaanbaatar. The two sides reaffirmed their commitment to advancing the Mongolia-Russia-China Economic Corridor program. Bloomberg (In MNG)

Speaker of State Great Khural meets FAO Country representative: The chairman spoke about the country’s main goals of increasing non mining exports and diversifying the economy as stated in the Vision 2050, a long term policy document previously approved by the State Great Khural (Parliament). The Chairman also specified the importance of the participation of the food agriculture and light industries in ensuring these goals and objectives. Montsame

Foreign Ministers attends CICAs Sixth Meeting of Ministers of Foreign Affairs: The Mongolian Foreign Minister attended the Sixth Meeting of the Conference on Interaction and Confidence Building Measures in Asia (CICA). Minister and deputy minsters of foreign affairs from 27 member states including Russia, India, Qatar, Bahrain, Kyrgyzstan, Belarus and Uzbekistan attended the meeting and exchanged views on how to cooperate in the new post-pandemic society, to recover and intensify social and economic activities and to ensure regional security and stability. Montsame

Progress of feasibility study for the Russia-China gas pipeline project at 60 percent: The feasibility study is being conducted with the length of the gas pipeline to pass through the territory of Mongolia as 966.8 km. As engineering studies are necessary to be carried out in order to ensure preparations for the construction work, policy support is required from the Government. montsame

Economy

Loan Agreement between Mongolia and AIIB approved: The two sides signed a loan agreement for a COVID-19 vaccine delivery plan, approved with a 21 million USD soft loan from AIIB, on July 21, 2021. Implemented under AIIB’s COVID-19 Crisis Recovery Facility, the Support for COVID-19 Vaccine Delivery in Mongolia Project will provide the government with immediate financing support to purchase safe and effective vaccines against COVID-19, contributing to the containment of the pandemic in the country and supporting its economic and social recovery. the ubpost

Mongolia’s coal export fell by 40%, crude oil rose by 56% in 2021: In the first nine months of the year, Mongolia’s total trade turnover reached USD 11.5 billion and the foreign trade balance showed a surplus of USD 1.3 billion. Copper concentrate exports reached USD 2.3 billion, accounting for 36% of all exports of key commodities. In the first nine months of the year, Mongolia exported 12 million tons of coal, decreasing by 40% from the same period last year. Crude oil exports increased by 56% year-on-year to 3.7 million barrels in 2020. Ikon (In MNG)

Rising prices for construction materials expected to put pressure on the State Budget: According to the price index released by the Ministry of Construction and Urban Development, the price of construction materials will increase by 1.45% this year. According to a study of rising construction material prices, new housing prices are rising by 20% when material prices are rising by 40%. In 2020, the average price of housing per square meter was MNT 2.5 million, but it has reached MNT 2.7 million this year. Montsame (In MNG)

Repo financing of MNT 160 billion (EUR ) disbursed to commercial banks: The banks will issue loans of up to MNT 3 billion (EUR ) with a term of two years and an interest rate of 10.5% per annum to small and medium-sized enterprises, individuals, and non-mining exporters in accordance with criteria approved by the Governor of the Bank of Mongolia. News (In MNG)

Bank of Mongolia purchased 15 tons of precious metals in 2021 decreasing by 2.2 tons from the same period in the previous year. Last year, the Bank of Mongolia purchased a record high of 23 tons of precious metals and is expecting to purchase 20 tons of precious metals in 2021. The Bank of Mongolia’s average purchase price for one gram of gold was MNT 162900 (EUR ). Bloomberg

Inflation increased to be 9.6% nationwide: Nationwide, consumer goods prices increased by 9.6% compared to previous year. It was influenced by food prices which increased by 15%, transportation price increased by 17%, housing price increased by 7%, and medicine price increased by 6%. Inflation increased by 9.9% in Ulaanbaatar. mongolia.gogo

PM: Budget of MNT 18 trillion (EUR 5 billion) presented to parliament for the very first time: The 2022 Budget focuses on expanding the economy and strengthening the public-private partnership. Furthermore, the budget also focuses on supporting the processing industry and the sectors of tourism and IT alongside mining, underlined the Prime Minister. The Government aims to not only put launch underground mine operations by advancing the talks on Oyu Tolgoi, but also accelerate the projects such as the construction projects for the oil refinery as well as the Tavan Tolgoi power plant and Erdeneburen hydropower plant. The 2022 state budget bill estimates equilibrated revenue to be at 33.7% of GDP, and expenditure to be at 38.8%, with a deficit of 5.1% of GDP. montsame

Commentary:

Rio Tinto caught red-handed: While Rio Tinto has not provided concrete responses to the findings of the independent experts, Rio Tinto started to publicize their position on major global media outlets such as mining.com and financialtimes.com stating that “One of the factors that contributed to the US$1.45 billion cost overrun is the increase in investment costs for Mongolian workers.” In other words, while Rio Tinto initially explained “Cost overruns and project delays were due to ground conditions,” pointing at an inanimate object, they are now blaming their Mongolian workers. Outraged by the statement, the executives of Oyu Tolgoi’s mine workers’ trade union submitted a letter of demand to Kh. Amarjargal, Country Director in charge of Rio Tinto’s operations in Mongolia. Rio Tinto really seem to have been caught red-handed as an international team of experts refuted their explanation that “The cost overrun and delay to commencement of operations are due to unforeseeable ground conditions.” Backtracking from that explanation, they have now come up with a new excuse that “it is because of the large number of Mongolian workers.” Suppose desperate times really do call for desperate measures. montsame

Mongolia’s new president won’t affect ties with Russia: In September, Khurelsukh made a virtual appearance at the Eastern Economic Forum in Vladivostok. In his remarks at the forum, Khurelsukh noted that Mongolia supports both Putin’s foreign policy vision of the Greater Eurasian Partnership and Chinese President Xi Jinping’s Belt and Road Initiative. Khurelsukh also mentioned the possibility of a free trade agreement between Mongolia and the Russia-led Eurasian Economic Union. So far Mongolia’s only free trade agreement is with Japan. Yet concerns over Mongolia’s plans to build river dams that may impact the fragile natural environment of areas across the border in Russia’s eastern Siberia remains an irritant in Russian–Mongolian relations and is likely to continue under Khurelsukh. Partly because of Russian pressure, Mongolia halted projects to build hydropower plants on the Egiin Gol and Shuren rivers — tributaries of Selenga river which feeds into Russia’s Lake Baikal. Still, Mongolia has launched the construction of a dam on the trans-border Uldza river. The dam is needed to divert water for mining projects in Mongolia’s southern Gobi region. The Uldza dam, if completed, may disrupt the ecology of the unique Torey Lakes in Russia’s Daursky Reserve, a UNESCO World Heritage Site. Despite Moscow’s concerns, Mongolia’s Foreign Minister Battsetseg Batmunkh made it clear that the country will not abandon its ambitions in hydropower and dam construction, which Ulaanbaatar views as a path to energy self-sufficiency. eastasiaforum

Mongolia's missing millions: What happened to a decade long mining boom: The Pandora Papers made headlines throughout Mongolia, with the revelations going viral on social media. The country's two major political parties, the ruling Mongolian Peoples' Party and the opposing Democratic Party, however, have thus far remained silent on the issue. According to a report by the World Bank, Mongolia has produced $28 billion worth of mineral outputs since 2004. Of this, taxes and royalties amounted to nearly $9 billion in the past 15 years, while the government has borrowed $8.7 billion, mostly by leveraging its mineral revenue. Of that amount, as of 2019, $200 million remained saved as deposits in the Stabilization Fund and the Future Heritage Fund. Today, mining accounts for nearly one-quarter of GDP, and mineral exports represent 26% of fiscal revenue, up from 10% in the early 2000s. Surveys have revealed deposits of coal, copper, gold, rare earth minerals and uranium worth an estimated $2.75 trillion. For a country with a population of 3.3 million, that is enough to make everyone a near millionaire. But due to unequal access to opportunities, the boom-bust cycle, and corruption, most Mongolians have been unable to benefit. The country's poverty rate of 28% and wealth gap remain unchanged from early 2012. asia.nikkei

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Prepared by Paula Vestlund and Sodnomsambuu Gantuya

Delegation of the European Union to Mongolia

ICC Tower, 9th floor, Jamiyan Gun Street 9

1st khoroo, Sukhbaatar district, Ulaanbaatar

https://eeas.europa.eu/delegations/mongolia_en