The year 2013 was a challenging year for the mining sector of Mongolia. The setbacks in the mining sector have caused certain turbulence in the wide economy, however, to mitigate these negative implications, the Government has taken some first bold measures toward improvement of the legal and regulatory environment. The example is the ratification of the widely anticipated and watched Investment Law, which has provided investors and the business community in general with explicit answers to some contentious issues and has provided an impetus for further stability and long-term sustainability of the investment and business climate of the mining sector. It should be noted that specific provisions of the Investment Law that safeguard investor interests against any sovereign risks and allow sufficiently long mining tenures to investor in the resource sector have been met with warm welcome of the business community. The implications of such provisions are that any long-term serious investor will enjoy favorable tax regime and conducive in every other way business environment. Moreover, on January 16 the Parliament of Mongolia adopted, through 86.8 percent approval vote, the National Minerals Policy. This landmark document, in the words of the head of the working group that formulated the draft of the law adopting the policy, stipulates that “mineral resource deposits of strategic importance”are deposits producing annually 5 or more percent of GDP. The newly adopted National Policy provides for the establishment of an inclusive Policy Council represented by not only the public sector but also investors, professional associations and civil society, that is mandated with providing practical guidelines and effective support to the implementation of the national minerals policy. It also contains such important provisions as a provision on phased-out systematic implementation of privatization of state owned enterprises through public offering of equity shares, or alignment of environmental rehabilitation and mine closure activities with best international standards.
The formalization of the national policy in the mineral sector is the condition precedent for adequate framework in which Mongolia’s resource sector can operate going forward, in the views of Ministry of Mining ofMongolia. These are specifics of the moment at which “Coal Mongolia-2014”, the fourth international conference of coal investors, will be taking place when it is organized on February 20-21, 2014 The conference will provide insight into such critical issues as favorable changes in the legal and regulatory environment, perspectives of attracting investors into the sector, and ways to strengthen the competitiveness of Mongolia’s coal products.