The State Great Khural approved the amendment in the law of Mongolia Development Fund in its afternoon session of last Friday. Therefore, 455,1 billion MNT of Mongolia Development Fund will be placed at Combanks.
Combanks can get money from the Mongolia Development Fund based on the fulfilling certain requirements and criteria of the Bank of Mongolia. (more…)
MP and former President of Mongol Bank O.Chuluunbat has his views on the recent developments in the financial sector of Mongolia.
Q: The Budget has loss of 6.1% of GDP. The Ministry of Finance explains that it will cover the deficit from the foreign source. But experienced experts and economists say that foreigners will not give loan to the economy with budget that has loss of 6.1% of GDP. Where to get the deficit fund of 400 billion MNT for the budget?
MP O.Chuluunbat: We haven’t had such a budget in last 8 years. By approving such a budget, we give signal to the world community that Mongolia spends fund without any control and cannot manage its income and expenditure. If the loss is over 5%, the Government shall get rid of its bonds. In this case, it is hard for Mongolia to raise money from the world financial market. Actually we had a chance, but we lost it. There is so much administration cost and investment in countryside. (more…)
Placing 220 billion MNT of Mongolia Development Fund at commercial banks is under strong criticism. About 61.9% of total voters of “Unuudur” daily newspaper readers said it was wrong decision. Let’s find out what is the position of lawmakers in this regard. They answered to the following two questions and are:
1. Do you support the operation of placing some fund of Mongolia Development Fund at commercial banks?
2. How to protect from the risk that may arise? (more…)
Q: Do you comments on the discussion of state budget of Mongolia?
A: The second discussion on the state budget of Mongolia is about to end. I think the State Great Khural shall cancel its resolution on “goat” money. Otherwise, we shall cut children and mothers’ money and allow “goat” money. It is time now to make some cuts in the budget expenditure. When cutting it, we don’t need “cosmetic surgery”, but we need decisive moves instead. Parties must give up their populist promises. Number of agencies must be decreased and even the deputy minister’s post is not necessary. Therefore, the State Great Khural shall revise its resolutions such as “goat” money. (more…)
Mongolian development fund has 455.1billion MNT. This money is stored in Mongol banks private account with an interest of 0.5% a year. The government is planning to locate half of this amount in commercial banks. By doing this the government could make 31.8billion MNT revenue on interest rate. Some of the MPs are against this as they think the history will be repeated. (more…)
The draft law of placing some fund of the Mongolia Development Fund was initiated by MPs N.Batbayar, R.Amarjargal, G.Batkhuu, Ts.Bayarsaikhan, R.Bud, D.Damba-Ochir, G.Zandanshatar, O.Chuluunbat and proposed to the Speaker of the State Great Khural. Some more clarification was made from the initiator.
Q: What was the main reason of initiating this law?
MP N.Batbayar: World financial crisis is affecting countries of the world and countries are taking various measures to handle it. USA allocated 700 billion US$ and it is equal to its 5% of GDP. As for Mongolia, situation in economy is relatively healthy and potential. Therefore, there is a proposal of placing 300 US$ of the Mongolia Development Bank in commercial banks, if compares with USA, proportionally, it is about 200 million US$ for USA. The income from the windfall tax was divided into three different purposes and 1/3 of it or about 300 million US$ was reserved for the securing the domestic crisis. According to the law, it is kept at the Central Bank. Therefore, in order to support commercial banks and fund them, draft law on granting the right to place it at banks to the Government was proposed. (more…)
The Standing Committee on Budget of the State Great Khural has discussed about the budget of year 2009. MPs exchanged their opinions and discussed about the budget of the Mongolia Development Fund. As it is impossible to calculate budget revenue of year 2009, the Ministry of Finance has developed seven alternatives. Standing committee on budget has agreed to pick one of these alternatives to estimate the budget revenues and costs of year 2009. Therefore the Minister for Finance was instructed to finalize the price prediction of copper commodity by tomorrow morning.
Further 205 billion MNT was cut off from the budget expense
The budget modification predicted that copper price will be 6700 US$ in the next year. But, sudden fall of copper price made copper price at 4128 as for October 28 2008. According to this, the Ministry of Finance will amend the budget modification and it is ready to propose to the Cabinet. Mr. B.Batjargal, head of the Budget Policy and Management Department of the Ministry of Finance, has his word regarding the issue. (more…)
According to the resolution No 48 of the State Great Khural, the State minimum reserve of oil product is set at 120 thousand tons or for 2 months consumption in year 2008, 180 thousand tons or 3 months reserve in year 2009. But there is no stock to store the reserve and it is costly to store at the oil product importing companies stock. The oil product importing companies gave notice not available to provide the stock. 30.4 billion MNT is spent to build state reserve, but it is costly operation, therefore, it cannot guarantee the decrease of petroleum price. (more…)
Wasteful budget policy is not yet to end. Subsidy money for children and people has changed its subject and targeted goat this year. Government of Mongolia is to give away 5000 MNT per kilo cashmere, if goat was included in the counting of this year. So basically 3 goats will share 5000 MNT. The Mongolia Development Fund will devote 30.5 billion MNT for goat. (more…)
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