Interview with Chairman of cabinet secretariat of Mongolian government: There are three options to pay back the 580 million Euro loan

Mongolia is due to pay back 580 million euro bond in coming March. However, government doesn’t have this money. Therefore, it is said that authorities are going to borrow money from other countries and pay back this big debt. 

However, so far, there are no countries that agreed to lend soft loan to our country. We interviewed Munkhbat Jamiyan, chairman of the cabinet secretariat.

-Mongolia is due to pay back 580 million Euro loan in March. What are possibilities to pay back this debt?
-Mongolian economy is experiencing difficulties. It will be hard to make cash payment. There are three options to pay back this loan. First, cash payment, secondly, to postpone it in some way, third, officially announce that can’t pay back. Of course, it is understandable that first and third options are hard for Mongolia.
/Mongolian/ economy have little capacity to bear the cash payment. If /we/ announce that can’t pay back the debt, it will create most difficult condition for any country. Therefore, /we are/ discussing that second option is most appropriate option that suits current economic condition of Mongolia.
However, currently, no final decision has been made. Soon, Head of IMF will come and official meeting will be held. Then, decision whether to accept IMF program will be finally made within this month.
-How this 580 million Euro loan was spent?
-You’ve seen results of recent inspection of Development bank and its situation.The loan was spent for financing of programs and projects of last 4 years. The result of checks at Development bank are presented to the Parliament and disclosed to public through media.
Government disclosed the 200 page inspection report for the public.

-          So, is it correct to understand that the 580 million euro is misspent?

-Actually, /spending of/ bond money and loans of Development bank are serious issues that violated laws. Working group set up by the parliament are checking the results. According to our information, , working group of law enforcement agencies to investigate the Development bank and the ministry related bond and other loans have been set up. Therefore, the issue will be resolved under this framework.
There were many issues at the Development bank that violated laws and related to poor discipline during last 4 years. Because of these issues, Mongolian economy is as it is now. Ended up unable to pay back the loan.

-Recently, Speaker of the parliament visited Russian Federation and Arabian countries. Russia said “ loan purpose is unclear and therefore, can’t give loan” to Mongolia’s request of loan?

-I don’t know about this issue.Media is writing about it in various ways.  However, needs foreign investment, loan and assistance in order to improve the economy. Therefore, Government is working through its channel in many directions. It is true that we accepted a country with much debt burden such as repayment of Chinggis Bond, loan of Chinese People’s bank. Now we are working on to solve this issues.

-So, are talk about about delaying the loan already started?

-This issue can’t be decided by one day talk. Probably will be decided after many meetings, talks and negotiations.

Source:Mongoliin Medee newspaper and 


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