Copy
Daily NEWSWIRE
March 21, 2017
S P O N S O R
Sponsor logo
Sponsor logo
Government

Prime Minister says economic recovery is coming

Summary: Prime Minster J. Erdenebat met with government officials and introduced recent developments and legislation. The PM highlighted that there is one consolidated budget to maintain fiscal discipline to prevent any fiscal irresponsibility and the confusion caused by multiple budgets. The PM announced the results of the government’s measures to revitalize the economy through cutting expenditures from the budget and supporting domestic companies. He highlighted that for the first time since 2012, in preliminary performance estimates, state revenue exceeded 504 billion MNT, the trade deficit turned into foreign trade with revenue of 1.6 billion USD, and for the first time in four years, the foreign currency reserve increased.
 
The PM noted that Erdenes Tavan Tolgoi's debt to Chalco will be fully repaid this month and future revenue from the East Tsankhii Mine will go to the state. The price of Tavan Tolgoi’s coal was 27 USD per ton, but with the government's call for transparency, the price rose to an all-time high of 72.5 USD per ton. The PM also highlighted that Mongolia was able to clear the expectation of default by swapping Development Bank’s 580 million USD Euro bond,  and was successfully able to green light the recovery of the economy and give the go-ahead for investors to return.
 
The Prime Minister strongly reminded government officials to keep tight budgets and not to spend capital on unnecessary expenditures and celebrations. He noted that during these hard times, it is essential for officials to get back on track and for the government to maintain frugality. The PM warned the directors of state-owned companies to keep their businesses profitable, and if they are unable to do so, they should resign and appoint someone who can. The government reduced the salaries and bonuses of executives at state-owned companies. He also encouraged citizens to keep a frugal budget and maintain monetary discipline.

Keywords: Prime Minister, economy   The Official Gazette /page 2/


State-owned factory to be built to process crude oil

Summary: Cabinet convened and voted to establish a state-owned factory to process crude oil. Mongolia imports 100% of its oil and other petroleum products, spending around 1 billion USD annually to import 1-1.2 million tons of fuel. Within the general agreement on a loan between Export-Import Bank of India and Government of Mongolia, the project is to be implemented. The Prime Minister called for a working group to be established to research the technical and financial aspects of the project, as well as the proposed structure and by-laws of the state-owned company that would be established to oversee the factory's operations.

Keywords: crude oil, factory, Cabinet   National Post /page 1/


Economy

3.9 million Mongolian debit cards in circulation

Summary: On average, there are 179,700 transactions conducted with debit cards each day, adding up to 7.7 billion MNT. According to the central bank, in 2016, 65.6 million card transactions for 2.6 trillion MNT between banks took place. On a national level, there are 3.9 million debit cards in circulation, with 70.5% in Ulaanbaatar and 29.5% in the provinces. At the end of 2016, 2.7 million people were using mobile banking (67% of all debit card holders), and internet banking was used by 1.1 million people. As the number of users of internet and mobile banking increases, internet sales are also increasing. In 2016, 278,000 transactions worth 24.7 billion MNT took place. In 1995, Mongolia created a legal framework for non-cash payments, and in 1999, the first Mongolian debit card service was introduced.

Keywords: debit cards, commercial banks, banking system   The Official Gazette /page 11/


Exports and imports increased in January and February 

Summary: According to statistics released by Bank of Mongolia, in the first two months of 2017, exports increased by 34.6% to reach 212 million USD compared to the same period last year. The increased export of minerals was the main factor behind the increase. In the same period, imports increased by 39.5%, equaling 138.9 million USD. The increase was primarily impacted by an increase in the import of oil products. The import of consumer products decreased slightly compared to the same period last year.

Keywords: import, export, Bank of Mongolia   Century News /page 5/


S P O N S O R
Sponsor logo
Sponsor logo
online Story

The remaining debt for Development Bank’s bond has been paid

Summary: The repayment of Development Bank’s five-year 580 million USD Euro Bond has been paid. Last month, 475.9 million USD of the 580 million USD bond notes were exchanged for the government-backed Khuraldai bond. Repayment for the remaining debt was made with 124 million USD raised from the Khuraldai Bond, 104 million USD and around 3 million USD in interest. The demand for the Khuraldai bond is high on the secondary market and the price stands at 108 USD with expectations that it will continue to increase.
 
Now, the Samurai bond has to be repaid. The Samurai bond is a 10-year bond with an interest rate of 1.52%. It was valued at 30 billion CNY (around 300 million USD) and has to be repaid in 2023. As of March 17, the bond price stood at 10.34 USD. The next major bond repayment due is for the 500 million USD Chinggis bond, set to be repaid on January 2018.
 
The successful release of the Khuraldai bond is expected to increase Mongolia’s chance of enrollment in the IMF’s extended fund facility program, which will aid in the repayment of the Chinggis bond. Analysts say the postponement of Parliament’s discussion of the IMF program and amendments required by the IMF for enrollment might damage investor confidence. Parliament is expected to discuss the budget amendments as soon as the regular spring session begins.

Keywords: Development Bank, bonds   www.bloombergtv.mn


SUBSCRIBE
Facebook Twitter LinkedIn Website






This email was sent to <<Email Address>>
why did I get this?    unsubscribe from this list    update subscription preferences
The American Chamber of Commerce in Mongolia · 8F Naiman Zovkhis Building 21 Seoul Street · Ulaanbaatar, 01 14251 · Mongolia