Mongolia Business and Mongolian Daily Business News

Supply of water electricity is becoming a large problem in the Capital as movement into to the Capital is still increasing at a very high rate. 510 households in Chingeltei District were connected to electricity and improved the electricity supply of another 1000 households in the district. These households are classified as further out the city and they are now provided with fully standard electricity. 8 billion MNT were spent on the work of providing electricity in the outstate Ger district areas of the Capital. This amount was provided by the “Mongolia Development Fund”.

Demparty group at SGK is in meeting now. The party group will discuss several important issues, including hearing of the working group report on Oyu Tolgoi draft agreement. Also, Treasury of the Motherland Fund, presented by the Government of Mongolia, BayanMongol (RichMongolia) Corp., presented by the party group. Also another issue, rated as confidenital, of Law on Mercy and the draft amendment in the law on Budget of 2009 of the Mongolia Development Fund.

During the last Friday session of the State Great Khural, meat reserve issue and amendment of the Law on Mongolia Development Fund was discussed.

In order to improve meat supply, eliminate many broker levels between herders and consumers and prevent price increase, 37.5 billion MNT is planned to allocate for preparing 15,000 tons of meat and keep it at the Mongolia Development Fund as the meat reserve. Standing Committee on Budget discussed this issue and rejected it earlier. Read the rest of this entry »

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. Read the rest of this entry »

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. Read the rest of this entry »

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? Read the rest of this entry »

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. Read the rest of this entry »

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. Read the rest of this entry »

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. Read the rest of this entry »

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.