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Wednesday, July 6, 2011




Mongolia Briefing is a magazine and daily news service about doing business in Mongolia. We cover topics relating to the Mongolian economy, the market in Mongolia, foreign direct investment and Mongolian law and tax. It is written in-house by the foreign investment professionals at Dezan Shira & Associates


Finance

Update on the Law on Customs Duty Exemptions and VAT

By Elena Fehrbach

On June 7th, the Parliament of Mongolia has reviewed the Law on Exemption from VAT and the Law on Exemption from Customs Duty. The following additional regulations which are directly related to the Laws have been approved:

  1. Regulation “Addition to the Parliament Decree”. According to the Regulation, import of new buses and trolleybuses produced not more than 1 year ago, models with 24 seats/48 passengers capacity will be exempt from VAT and will be subject to zero percent customs duty. Regulation is effective from 1 January 2014 to 31 December 2016. Continue reading
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Update on the Allocation of the Government Bond

By Elena Fehrbach

Jun. 14 – Mr. N. Altankhuyag, the Prime Minister of Mongolia, has provided an updated decisions related to the allocation of the Government Bond, also known as the Chinggis Bond.

According to the resolution of the Government of Mongolia and the Policy Council of the Chinggis Bond, US$50 million will be spent to build Thermal Power Plant at Tavan Tolgoi coal mine with capacity of 450 megawatts. The start up of the Plant is expected in 2017. Continue reading

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Major Rating Agencies Downgrade Mongolia’s Banking System and Business Environment

By Elena Fehrbach

May 25 – Moody’s Investor Service (MIS), a subsidiary of Moody’s Corporation has just released its assessment of the Mongolia’s banking system. According to the report, MIS has assigned negative outlook for the banking system in Mongolia for the period of 12 to 18 months. MIS has supported the negative assessment by a number of reasons that in summary can be described as “challenges in managing the demand from rapidly growing economy.” Continue reading

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Mongolian Agricultural Stock Exchange Launched

By Elena Fehrbach

Apr. 10 – Agricultural Stock Exchange has been officially launched in Mongolia on 5 April. At the beginning, the Stock Exchange will function in a testing mode trading cashmere in Sukhbaatar, Khentii and Dornod provinces of Mongolia. On an opening ceremony, O. Magnai, director of the Agency for Fair Competition and Consumer Rights of Mongolia noted, that the launch of Stock Exchange is a big step forward bringing the agricultural sector to a new level, a truly game changing point for the agricultural sector of Mongolia. Continue reading

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New Securities Law Allowing Dual Listings to be Passed in Mongolia

By Elena Fehrbach

Apr. 10 – The new draft of the Securities Law has just been introduced for the discussion at the spring session of the Parliament which started on April 5. The suggested draft has been in the process of revision for more than 1 year and is expected to become a game- change regulation allowing dual listing. Continue reading

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Bank of China is Officially Established in Ulaanbaatar

By Elena Fehrbach

Feb. 25 – Bank of China has officially opened its branch in Ulaanbaatar. The official opening ceremony took place in Ulaanbaatar and was attended by Wu Banguo, the Chairman of the Standing Committee of the National People’s Congress of China. Chinese representative was invited to visit Mongolia by Z. Enkhbold, the Speaker of the Parliament. The official establishment of Bank of China in Mongolia is aimed to strengthen and intensify the economic relations between neighbors in the most strategic sectors, such as mining, construction, infrastructure and finance. Continue reading

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Mongolia’s Trade Statistics for Q1 2012

Apr. 18 – Mongolia’s trade turnover reached US$2.34 billion in the first quarter of the year, according to the Mongolia national statistics office that released its social and economic review for the first three months of 2012.

In the first quarter of the year, Mongolia traded with a total of 113 countries. Exports have made up US$883.8 million while imports stood at US$1.46 billion.

By March 2012, total external trade turnover increased by US$511.7 million (or 28 percent), of which imports increased by US$370.1 million (or 34 percent), and exports by US$141.7 million (or 19.1 percent) against the previous year. Continue reading

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Mongolia May Face Financial Crisis

Mar. 6 – The European debt crisis may lead to a financial crisis in Mongolia, according to a report released by the World Bank last week.

A global economic slowdown may lead to a sharp drop in mineral prices, which will greatly impact the Mongolian government’s revenue, as it is highly dependent on mineral resources.

“Sharply rising government spending is the root cause of overheating: government spending rose by 56 percent in 2011 and is budgeted to rise by a further 32 percent this year, fueled by sharply rising resource revenues,” the report says. Continue reading

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