Mongolia endures slowest growth in seven years

ULAANBAATAR Feb 16 (Reuters) - Mongolia's economy grew 2.3 percent in 2015, said the National Statistical Office on Tuesday, making it the weakest year since the country suffered delayed effects from the global economic crisis in 2009.
Mongolia's economy has fallen being from the fastest growing in the world in 2011 and 2012 -- 17.5 percent and 12.3 percent, respectively -- due to a lack of investors investing in the resource-rich country and slowed growth in its top trading partner and neighbour, China.
The stagnant economy sets a daunting challenge for the Democratic Party members, who will be fighting to retain control on the government at an election due on June 29.
The growth figure was in line with projections from the World Bank and Asian Development Bank. The International Monetary Fund had projected growth of 4.4 percent.
Nick Cousyn, chief operating officer for Ulaanbaatar-based brokerage BDSec, said the slowdown stems from a combination of falling foreign investment, dwindling commodities prices and repeated delays to launching and completing development projects.
The government has put off further development of its Tavan Tolgoi coal mine since commercial operations launched in 2011, as well a railway that would deliver coal from the mine to China.
"Coal is probably the biggest culprit, and the government's inability to develop the Tavan Tolgoi deposit and the transportation," Cousyn said, adding that shipping by rail was cheaper than by truck, which would cut costs and make its coal more competitive.
Mongolia's two largest export products are copper and coal.
Growth in the country began to falter when a law passed just before the last parliamentary election, in July 2012, made it hard for foreigners to invest in mining.
China, which saw growth fall to its slowest in a quarter decade last year, is also buying up less coal than three years ago, especially for the thermal coal used to power power plants.
Mines in Mongolia also produce coking coal, a key ingredient for steelmaking. Coal exports were down 35 percent in 2015 from the year before.
Cousyn said growth may return to above 10 percent, "but treadline growth for Mongolia in a normal or optimistic commodities environment is in the 7-9 percent range".
The economy's slowdown will likely be a chief point of attack for the opposition Mongolian People's Party, Cousyn added.
"For the Democratic Party to maintain their majority, they're going to have to provide voters with a vision and a plan for future growth," he said.

Source:Reuters
Share:

0 comments:

Post a Comment

Facebook page

Powered by Blogger.

Categories

Advertising in Mongolia An Culture Editorial of the Mongolianviews education Environmental protection Famous Mongolians Foreigners in Mongolia Inner Mongolia Ivanhoe Mines Mongolia agriculture Mongolia analysis Mongolia and Australia Mongolia and Belorussia Mongolia and Cambodia Mongolia and Canada Mongolia and central Asia Mongolia and China Mongolia and Cuba Mongolia and EU Mongolia and Germany Mongolia and Hongkong Mongolia and Hungary Mongolia and India Mongolia and Inner Mongolia Mongolia and Iran Mongolia and Italy Mongolia and Japan Mongolia and Kazakhstan Mongolia and Korea Mongolia and Kuwait Mongolia and Malaysia Mongolia and Nato Mongolia and North Korean Mongolia and Poland Mongolia and Russia Mongolia and Singapore Mongolia and South Korea Mongolia and Taiwan Mongolia and the world Mongolia and Tibet Mongolia and Turkey Mongolia and UK Mongolia and Ukraine Mongolia and UN Mongolia and USA Mongolia and Vietnam Mongolia Banking Mongolia civic society Mongolia crime Mongolia diplomacy Mongolia Economy Mongolia Education Mongolia Energy Mongolia Finance Mongolia Health Mongolia History Mongolia holiday Mongolia in international media Mongolia Industries Mongolia Joke Mongolia law Mongolia LGBT Mongolia medical Mongolia military Mongolia Mining Mongolia Mining Developments Mongolia Mortgage Mongolia natural disaster Mongolia Petroleum Mongolia public announcements Mongolia railways Mongolia Religion Mongolia society Mongolia Sports Mongolia Stamp Mongolia telecommunication Mongolia tourism Mongolia Urbanization Mongolia Wild Life Mongolian Agriculture Mongolian Archeology Mongolian Food Mongolian Gay Mongolian Government news Mongolian History Mongolian Military Mongolian Mining Development Mongolian Movie Mongolian News Mongolian Parliament Mongolian Political news Mongolian Press Mongolian Songs Mongolian Women Mongolian Youth Mongolians abroad Moninfo Opinion Oyu Tolgoi Investment Agreement Photo news Press Release Rio Tinto Tavan Tolgoi coal mine Ulaanbaatar development Weird expatriates in Mongolia

Blog Archive

Followers

Live Traffic