Prime Minister S.Batbold: Each aimag needs meat and milk processing factories, the Government will support it

Last August, Prime Minister S.Batbold visited to over 60 soums of seven aimags, traveling over 5600 kms. Shortly after his working visit to countryside, he made some statements towards business and economy development of Mongolia. His answers are still important to his next measures in the year of 2010-2011, therefore, team consider that his statements are still valuable for predicting the Government actions in the near future.

Q: How do you conclude this official working visit to countryside?

S.Batbold: I travelled this long to meet with people of Mongolia and get updated with their needs and challenges. In return, I explained and presented my Government’s policy and actions to people in the countryside. People of Mongolia have better feeling towards their living and local administrations are preparing for another winter. The Government has same opinion on creating workplaces in the economy with people. The Government has been taking many activities and measures in creating workplaces. Most obviously, Oyu Tolgoi, Tavan Tolgoi projects, Railway building, industrialization and construction of housing projects will create many workplaces.

We shall pay much more attention on this part. Technical Vocational Education Training Centers shall train and prepare many young people, converting average young man into a skilled worker. Local authorities shall pay attention on organizing activities to arrange trainings for its people. I gave special order to related ministries: Ministry of Education, Culture and Science, Ministry of Social Welfare and Labour, Ministry of Mineral Resources and Energy, Ministry of Roads, Transportation, Construction and Urban Development, and local authorities to pay attention on this work. I will personally review the order.

Q: What measures are expecting in developing SME in the countryside?

S.Batbold: SME is another alternative in creating workplaces. The state shall play important role in supporting and regulating SME. When we pick up one thing, we usually spend unnecessary investment and effort. As for cashmere industry, number of preliminary processing factories is several times bigger than those factories produce final product. It says that related ministries and agencies shall conduct detailed research and study on this side to produce final report on the perspective of the industry. The Government allocates over ₮30 billion for SME even we are experiencing financial crisis. If we combine budget of foreign and domestic funding on SME, it reaches over ₮100 billion in the last two years. We have demand to develop SME of Mongolia further and increase our funding on this sector.

The Government of Mongolia is discussing with the Japanese Government on acquiring the second phase soft loan of $50 million. The Government is paying more attention in brining soft commercial loan with less interest rate and longer term from foreign banks to SME sector. I warned to the local authorities that their success in management will be shown in decreasing poverty through creation of workplaces. Also, I gave order to create detailed database for the local community and its people. In doing so, the Government can plan based on this detailed statistics and outcomes.

Q: Herders’ comment was mostly on the low price of animal raw material. The Government stated that it will focus on the meat and milk processing which is the main source of living of country people. What do you plan?

S.Batbold: This is the second most important question set forth by the local community. Mongolia had 44 million livestock and lost 9.1 million of it during the last severe winter, leaving over 10 thousand families without animal. The Government took many measures and the last one was the program of providing animal to families with budget of₮ 3 billion. Actually, strengthening and intensifying countryside campaign was commenced within the program “Mongol Mal (Animal)”. The main comments from local people were that they couldn’t process meat, market price is low and transportation cost is high, so allowing traders (merchants) to manipulate the market. Therefore, the Government’s action shall focus on bringing suppliers and end users closer or eliminating the gap between them, on the other hand.

As part of regulatory measures, agriculture and meat exchanges were established. Processing factories for meat and milk shall be established. In relationship with this work, the Government started talks of getting $200 million soft loan for its animal husbandry sector. If we can build such factories in every aimag center, the Government can bring market to the doorway of herders. Also the Government is seeking to establish such factories through soft loans and distributing shares of those factories to the herders. Even I had some thoughts to establish state owned company in charge of meat and milk market and its sales.

Q: During trip, you visited to Taishir hydropower plant. Its management said that it will become fully operational in the near future. Do you think it is possible?

S.Batbold: Infrastructure and energy is the key issues of the west region of Mongolia. There is no sustainable and regular electricity resource in Gobi-Altai and Zavkhan aimags. Yes, I visited to Taishir hydropower plant. It is ready to start its trail operation to produce electricity. Road building is also as much important as electricity. Therefore, I think, these works shall be intensified. I decided the issue of vertical road line in west region of Mongolia, during this visit. The Mongolian Government signed MOU with its Chinese counterpart on the funding of this vertical road line.

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