Government to spent MNT 95 Billion for cashmere sector

Apr 1 • Agriculture, Business, News • 13757 Views • 1 Comment on Government to spent MNT 95 Billion for cashmere sector

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The Cabinet meeting of Mongolian government held on Saturday, March 30, discussed a number of critical issues related to the Cashmere industry, which leading the creation, development and launch of the Mongolian brand.

The Cabinet agreed to spend MNT 95 Billion from Chinggis Bond for advance payment equals to triens of required funding of the project aimed “to renew cashmere processing industry equipment and machinery project” and the Minister of Economic Development was allowed by the government to do the financing MNT 95 Billions to project participants, which had planned to renew the processing machinery in 2013. They aimed to process initial stages of technological flow production, dehair and comb in 2013 and to spin next year.   According to the project proposal once implemented the initiative will restrain export of cashmere raw materials, increase export of value-added product and generate 20,000 new jobs and result in the over 200 knitting and textile small and medium sized factories to be created in provinces.

In 2012, national cashmere processing companies produced the final products with only 40 percent of 3000 tons of raw cashmere, even though industry has the capacity and up to 40% may have been exported to China.  The companies in the cashmere processing sector point to the problems, the high cost of the working capital needed to purchase stocks of raw cashmere and the price competition of traders who export to China in raw form.

Government of Mongolia issued a resolution to support cashmere processing companies as to provide a soft loan for herders and producers. As a result, the whole supply chain of the leather production will be improved, producers will be able to use more local raw materials produced by the herding community, enable to export more value-added products.

Minister of Economic Development, N.Batbayar and Minister for Industry and Agriculture, Kh. Battulga tasked with approving and implementing regulation on soft loan for herders and processors.

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One Response to Government to spent MNT 95 Billion for cashmere sector

  1. Amy says:

    It seems this government intervention may provide a real boost to the cashmere industry in Mongolia.

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