National Development and Innovation Committee developed main directions of 2011. The advantage of this document is that it would ensure greater efficiency in utilization of financial resources based on the local index. Ch.Khashchuluun, Chairman of the National Development and Innovation Committee has more on the issue.
Election year leverages greater investment spending
Q: The local index was developed very first time in Mongolia. What changes can be expected in the countryside?
Ch.Khashchuluun: Local development level indicated by 85 indicators. Previous indications used few indicators. Plus it was developed by aimag and soum level. The investment to the countryside will be made based on this index and Ministries are updated with this direction. As the result, a Ministry shall pay attention on the lower level index of aimags and shall cut unnecessary investment in return.
For example, in some aimags don’t have hospital, but in other aimags use resource building palace or cultural center. This brings unbalanced living standard throughout the country. It is a clear example that the resource is misused in aimags.
Q: Shall it bring change or differences of salary in the countryside, depends on their regional index?
Ch.Khashchuluun: It is mainly focused on the fiscal and economy resource. Salary in remote aimags could be considered, but it will be decided as part of the regional development policy. It is targeted to correctly resolve social issues through index within short time span.
Q: Shall monetary policy will be implemented?
Ch.Khashchuluun: As for 2011, situation looks like in this way. Our economy suffered deep crisis two years ago. The state implemented policy of reviving economy through increasing its spending. Therefore, the budget expanded because of increased investment. In 2011, this pace shall be maintained. It is the eve of election year; therefore, we should expect investment in electoral districts. But, in the future, budget expansion shall be limited. Because, budget shall not exceed 50% of GDP. It will harm private sector, without leaving enough space to grow.
Industrial Complex Plan is ready
Q: Copper Smelting Factory, Oil Refinery, Energy Plants are planned. What is the status of the industrialization program?
Ch.Khashchuluun: Blueprint version of Industrial Complex Building program was completed. At the first level, Sainshand Industrial Park will be built. Its infrastructure is ready, neighbouring oil, copper concentrate, iron ore and coal deposits.
Selection work of general consultant of the Heavy Industry Complex Building project was launched November 15 2010. Six companies expressed their interest and submitted their profile and bid for the project. Now, evaluation committee started its work. As the result, we expect to kick off huge industrialization campaign work in next year.
Q: Did domestic companies made proposal?
Ch.Khashchuluun: Domestic companies are difficult to compete for such selection. Except Erdeent, Darkhan, there is no experience for us to build such huge industrialization, especially for the private sector.
Q: Do we have sufficient oil reserve to build oil refinery?
Ch.Khashchuluun: Now, Mongolia stands on the 33rd place in the world with its oil reserve. Explored reserve can support our 200 years of supply. Oil price would increase in the future. Therefore, German technology of extracting oil from coal would be interesting for such project.