Letter from Prison: Oyu Tolgoi underground mining project helped Mongolia to avoid financial default, by Ex-PM

Former PM of Mongolia, Saikhabileg

I, Ch.Saikhanbileg, writing you this letter from incarceration unit no.461.

People who have never entered this prison probably will not understand misery of spending days behind barbed wire in crammed small room of the prison unit and suffering physical and emotional pain.

If really embezzled funds and committed crime, will deserve state punishment. However, it is frustrating to sit like this  for exercising one’s right given by Constitution and moving mega project needed for the country.

By moving Oyu Tolgoi underground mining project, first of all, Mongolia was able to avoid from budgetary, financial default which were to occur by end of 2016 and not discussed now. Oyu Tolgoi construction work ensures more than half of  current 5% economic growth of the country (3%). Number of Mongolians worked in Oyu Tolgoi that fell to 3000 has increased to 14 thousand and more than 1000 businesses and 41 thousand people given opportunity to expand their business. Foreign investment that reached minus 200 million dollars in a year increased to 1.5 billion dollars and Oyu Tolgoi underground mining investment accounts two out of every three dollars of this investment.

If did not move forward this project in 2015, we would have lost 400 million dollars revenue each year. Most importantly, if did not move forward in 2015, underground mining production can’t start in 2020. If did not start at that time, it became clear based on current political situation, most optimistic or fastest date for underground mining would have been 2025 or furthermore. Would have lost at least 5-10 years or more. 

Now, multiply it with 400 million dollars per year. This is just part of revenue to lose If our decision was not made. No one asks about this and no one is held accountable in Mongolia.

As PM, I have received task to move forward Oyu Tolgoi underground mining project from public. About 450 thousand people voted via SMS and 60% wanted to start this project soon.

Parliament already made 2 resolutions and tasked government to start Oyu Tolgoi underground mining project. During lengthy negotiation, Gov’t discussed this issue several times and then authorized relevant officials to sign Financing plan.

It is very special that the decision to move forward this project was made during coalition gov’t comprised of all political parties and forces represented in parliament. Then, it was officially presented to Parliament and answered questions of all interested lawmakers.  

After  the coalition gov’t changed, also answered questions of relevant lawmakers during Fall session of 2015.

In addition, Parliamentary minority demanded dismissal of government in Jan, 2016 based on this issue and majority of the parliament lawmakers decided gov’t should not be held accountable about issue of moving forward Oyu Tolgoi underground mining project. In another word, Parliament dedicated sufficient time for this issue and expressed its position.

I must mention something here. Moving forward Oyu Tolgoi underground mining project  and how to move it, are purely policy issues and Political decisions. Settlement of payment of this project and estimation of cost and whether to accept financial report etc were issues of political decision to be decided within the executive governance. 

If  government resolution and decisions were not complying with laws, it is said in article 45.2 of the Constitution and other laws that Gov’t or parliament will revoke these./At that time, Parliament didn’t experience this kind of issues/. 

In another word, according to Constitution, no one else but legislative and governance institutions will determine right or wrong of policy or political decision. If this main authority is transferred to judicial authority, power sharing principle will be lost and it will truly shift into constitutional crisis. 

In developed countries of America and England, there is established principle that judiciary do not review issues with political characterization.

For example, what if next parliament that don’t know  circumstances of 2017 decides to investigate right or wrong of Political decision to implement IMF program in Mongolia and receive 2.7 billion dollar loan in 2017 or not to implement it as gold, coal and copper price is on the rise and budget revenue is improving?  Will judiciary determine right or wrong?  Whom will they also detain and imprison?

Recently, PM of Mongolia said he will soon present political decision to move forward Tavan Tolgoi project. Can parliament support it unanimously with one voice?

Or ask judiciary to step in in case of disagreement?  Will imprisonment continue afterwards?   Oyu Tolgoi underground mining issue is exactly like these two issues. We can’t leave issue that continued through three parliament to three judges! 

If judiciary began to determine right or wrong of Political decision, we will have political prisoners n Mongolia again. Today, two PMs of Mongolia and former Finance minister  and relevant officials are deprived of their freedoms and imprisoned for making political decisions.

Therefore,  I’m delivering my request and opinion for you through this open letter.

One. For  Battulga, President of Mongolia, M.Enkhbold, Speaker of Parliament, Khurelsukh, PM of Mongolia and all cabinet and parliament members:

Two former PMs are imprisoned and became living victims of “Vyshinsky”theory for making political decision and exercising their full authority given by Constitution and performing their official duty. 

I ask you to pay attention to this issue as members of National Security council. (Vyshinsky was Procurator general of Soviet Union in 1930s who developed theory to extract confession from accused)

Politicizing, debating, hearing in parliament according to party caucus in Parliamentary hall and making political decision based on majority and minority votes, is one of the main authority provided under Constitution. Today, issue for legislative and executive governance to transfer its full authority deliberately or accidently to third governance has been emerged. Furthermore, it has become issue whether Parliament and government can decide big political and economic issues independently without outside interference. 

Not court, but parliament must decide right or wrong of the issue. I ask all parliament members to have common and strict position about this issue regardless of party and coalition affiliation.

I hope that Parliamentary working group set up to investigate Oyu Tolgoi issue will not be one-sided. I ask them to meet with members of working group that participated in the negotiation and listen and clarify their position in offices rather than in prison before making final conclusion.

Two. For Zorig, Chief justice of Mongolian Supreme Court, Enkh-Amgalan, chief state procurator and Enkhjargal, chairman of Anti-corruption agency:

I trust that you all have no desire or interest to transfer many complicated political issues usually discussed in parliament hall to district court and mix with politics. Therefore, I ask you to hold concrete position to prevent emergence of this kind of problems.

People imprisoned about this issue stated many times that they did not or will not run away and do not hold any official position and can’t commit crimes and shall respect law enforcement organizations and will fully cooperate. 

However, decision to extend imprisonment of these people have been made. Therefore, ask you earnestly to reconsider your punishment and imprisonment decision which is not understandable for society and us and which will not bring any result and make relevant decision.

I’m 100% confident that no official of Mongolian state did not take bribe for starting Oyu Tolgoi project and continuation of the project from large open and controlled company. I state responsibly that I will be responsible for any penalty if this has happened.

Three. All media organization, journalists, newspaper, magazines, TV, radio and online sites and thousands of active social media users:

I  come for investigation without completing cancer treatment of my younger brother when I was summoned by court out of respect for Mongolian state. 

I didn’t talk outside of court when I was imprisoned for 30 days without any need. I have been questioned only once about this issue during my 1 month imprisonment. 

Of course, like other  human beings, I want to keep peace of my old father, and hug and kiss my wife and children and especially my youngest daughter that believes her dad is in hospital and waiting. 

However, this is not just issue of me and other 4,5 people imprisoned here. 

This is about whether Mongolia will political prisoners, whether fundamental principles of Constitution is shaking, whether Parliament and government can operate normally, can it make decisions to implement large projects and programs that will bring development and whether what kind of society yours and our children will live.

As someone who truly believes that those who uphold humanity, justice and rule of law is more than those hired to defame others, I ask you earnestly to support continuation of Oyu Tolgo project which brought positive impact for the nation and economy without any hindrance and increase its benefit for Mongolia through your news reports, interviews and programs and posts, twitter.

Respectfully,

Ch.Saikhanbileg, 28^th PM of Mongolia, May, 2, 2018.     

Translated by Moninfo News Service

Read More

Origo Partners Investee Moly World Has Mining Licence Cancelled

LONDON (Alliance News) - Shares in Origo Partners PLC fell Thursday as it as the subsidiary on an investee has had its mining licence cancelled in Mongolia.

Origo shares were trading at USD0.25 on Thursday, down 12%.

Origo said Mongol Resource Corp, a subsidiary of its investee Moly World, received notification from Mongolia's Mineral Resource Authority purporting to cancel the licence issued nine months ago.

Moly World, Origo added, is seeking legal counsel to protect its rights.

The company said it believes the action has impaired the value of its investment in Moly World, which on its most recent valuation was USD3.9 million.

By George Collard; georgecollard@alliancenews.com

Copyright 2018 Alliance News Limited. All Rights Reserved.

Source:Alliance News

Read More

Warning of possible fire hazards in Mongolia

Due to increased dryness, there is a risk of fire hazards in the country.

There have been warnings of possible fire hazards in the North-West parts of Mongolia on 7th of July and 8th by the India Meteorological Department (Met).

Places like Darkhad Depression, Zavkhan River, Khuren Delgod, Altai, Khangai, Khuvsgul, Khentii Mountain Range, Ider, Tes and Terelj River valley are warmer by 3 degrees to reach 2 degrees Celsius during the night. The temperatures are between 15-20 degrees during the day.

Great Lakes Depression, Orkhon-Selenge Basin and in the Gobi region temperatures are 8-13 degrees in the night, 25-30 degrees in the day, 4-9 degrees in the night and 21 to 26 degrees in the day. 

Because of these higher temperatures and low rainfall, the weather has become a lot more dryer than normal. This could potentially lead to forest fires. The country does not have the financial resources to combat such a crisis. These fires would also damage the natural habitats.

Temperatures in the eastern part of Mongolia should be relatively normal.There will be occasional rainfall and wetness in the eastern provinces of Mongolia. 

Source:India Meteorological Department

Read More

Xanadu Mines focused on large new copper-gold discovery in Mongolia

The recent discovery hole at Zaraa intersected 606 metres at 0.36% copper and 0.32 g/t gold.

Xanadu Mines Ltd (ASX:XAM) has three projects located within two of Mongola’s porphyry copper belts.

Its flagship asset is the 76.5% owned Kharmagtai Copper Project in the South Gobi region of Mongolia where the company is aggressively drilling out a major new copper-gold discovery.

While the exploration focus is rightfully on Kharmagtai, Xanadu also owns the advanced Red Mountain Copper Gold Project and early stage Yellow Mountain Copper Project.

An emerging cluster of porphyry deposits at Kharmagtai

The Kharmagtai project hosts three porphyry deposits within a largely under-explored porphyry copper-gold district.

During April, Xanadu discovered another porphyry centre, Zaraa, with the first hole intersecting 800 metres of mineralisation.

Zaraa, the focus of aggressive exploration, is showing strong early potential to add to the project’s JORC resource at the Stockwork Hill, White Hill and Copper Hill deposits.

As of March 2015, the JORC resource measured 203.4 million tonnes grading 0.34% copper and 0.33 g/t gold for 1.5 million pounds of copper and 2.2 million ounces of gold.

Porphyry copper deposits typically occur in clusters and recent exploration at Kharmagtai has revealed the project could host multiple additional porphyry-style deposits.

READ: Xanadu Mines intersects over 800 metres of near-continuous copper and gold

The discovery diamond hole KHDDH462 drilled at the Zaraa porphyry was terminated in mineralisation at 1,386.4 metres depth.

The hole intersected over 800 metres of near-continuous copper and gold mineralisation making it the longest exploration intersection of gold and copper recorded by Xanadu at Kharmagtai.

Xanadu’s managing director and CEO Dr Andrew Stewart said: “While Kharmagtai already is one of the world's most exciting new copper and gold discoveries, hole KHDDH462 is consistent with our long-held view that the Kharmagtai mineralised system contains significantly more gold and copper than we have delineated to date under JORC standards.

“We are particularly pleased to see this outstanding intersection in hole KHDDH462, right where our geological modelling predicted.

“Our strategy is clear: to add tonnes and grade to the existing resources by discovering additional high-grade deposits within the Kharmagtai Copper-Gold Project."

As at early-May 2018, two diamond rigs were drilling two step out holes to the discovery hole at Zaraa.

Wider step-out holes will be drilled aiming to discover copper-gold mineralisation closer to surface and to aid in delineating the size and shape of the porphyry system.

19 porphyry targets to test at Kharmagtai

Four new porphyry centres have now been discovered by Xanadu under shallow cover east of the existing resources.

The current strategy is to test all 19 targets identified before focusing exploration on the highest quality porphyry centres.

Growing global demand for new copper projects

The emerging Kharmagtai project is being advanced during a period of growing demand for new copper projects.

Market commentators continue to point to struggling supply from current operations and a weak pipeline of new projects coming online.

BMO Capital Markets in April 2018 said the world’s top copper operations in 2007 are producing 10-15% less today than 2007 and the trend is expected to continue.

Demand for copper is expected to remain strong given China’s infrastructure goals will require copper and it is an important metal in electric vehicles.


Xanadu Mines moves to expand copper resources as global supply shortfall threatens

Source:http://www.proactiveinvestors.com.au

Read More

IMF to conduct its fourth review of Mongolia’s EFF enrollment

International Monetary Fund (IMF) staff and officials from the Ministry of Finance held an official meeting to discuss preparations for the fourth review of Mongolia’s enrollment in an extended fund facility program, GoGo Mongolia reports.

In March, the IMF’s Executive Board discussed a report on the third review of the EFF program, and issued financing of 30.55 million USD to Mongolia.

If the EFF program continues successfully, the GoM will receive $434.3 million in financing from the IMF over the course of three years. Since the program's inception, the IMF has provided $152.8 million in financing to Mongolia.

After the third review of the EFF program, Deputy Managing Director of the IMF Mitsuhiro Furusawa underscored, “Mongolia's economic indicators demonstrated more positive signs than previous estimates, owing to a high demand for raw materials in the international market.

A substantial increase in budget revenue and improved budget control helped to reduce the budget deficit considerably.”

Source:Gogo.mn

Read More

Mongolian Copper Corporation (MCC) claims win in round two battle against Mongolian government over Erdenet mine

But the company expects the Mongolian government to persist in its efforts to nationalize the lucrative copper mine.

Local courts in Mongolia have ruled that attempts by the Mongolian government to take over the 49-percent stake in the Erdenet copper mine controlled by Mongolian Copper Corporation (MCC) were illegal.

The company is clearly chuffed about the success, declaring victory in a press release published on Thursday (May 3).

“Attempts to nationalize the Mongolian Copper Corporation’s shareholding in the Erdenet mine in March 2017 and again in January 2018 have been ruled illegal by the administrative court in Ulaanbaatar,” the release declares.

“The judgment in favor of MCC is the fourth time the government’s expropriation attempts have been deemed illegal,” it also says.

The government has now made two attempts to gain control of Erdenet, first by a parliamentary resolution in 2017 and again in early 2018. Both attempts were deemed illegal in court and later upheld.

However MCC said it expects the government to appeal against the decision, and is considering its own legal actions.

“MCC is taking legal advice on commencing possible international arbitration proceedings,” Chairman Mukhbaatar Myagmar said in a statement.

Erdenet, which is one of the largest copper mines in Asia, was constructed as a joint venture between Mongolia and the Soviet Union in 1978. MCC purchased 49 percent of the mine in 2016 from Russia.

It’s no wonder the government and the company are bickering over ownership. According to government sources, the mine produces 530,000 tonnes of copper concentrate a year — a number that alone places Mongolia near the top 10 copper-producing countries in the world.

Ownership is currently split between MCC and the Mongolian government, which hold 49 percent and 51 percent, respectively.

The fight is set to go on into yet another round; a Mongolian government spokesman told Reuters that the decision by the administrative court cannot challenge a February ruling by the constitutional court that MCC never had the right to purchase its stake in the first place. MCC has not acknowledged that ruling.

Mongolia is well positioned to cater to China, but according to Myagmar, efforts by the Mongolian government to nationalize assets will damage Mongolia’s potential as a copper supplier globally.

“If this kind of thing happens again, no-one will come to Mongolia,” he said in a January interview.

The Mongolian government also owns a 34-percent stake in the Oyu Tolgoi copper-gold mine in Southern Mongolia. Its joint venture partner, Canadian company Turquoise Hill Resources (TSX:TRQ), reported production of 38,000 tonnes of copper concentrate in Q1 2018. The mine is expected to produce between 125,000 and 155,000 tonnes of copper for all of 2018.

Source:Investingnews

Read More

UN Special Rapporteur Urges Mongolia to Raise Standards on Water and Sanitation Services

STORY HIGHLIGHTS

The UN Special Rapporteur on the human rights to safe drinking water and sanitation called on the Government of Mongolia to do more on water and sanitation access to meet the standards set by the SDGs.

His report highlights existing disparities between nomadic, rural and urban populations, and between apartment-dwellers and those who live in ger, traditional yurts that usually lack sewage connections rely on mobile water sales for drinking water.

He notes that sufficient access to water for nomads’ personal consumption and livestock could help prevent large-scale migration into cities and rural towns.

20 April 2018: The UN Special Rapporteur on the human rights to safe drinking water and sanitation has called on the Government of Mongolia to do more to meet the water and sanitation standards set by the SDGs. He notes that sufficient access to water for nomads’ personal consumption and livestock could help prevent large-scale migration into cities and rural towns.

His report highlights existing disparities between nomadic, rural and urban populations, and between apartment-dwellers and those who live in ger, traditional yurts that usually lack sewage connections, and that rely on mobile water sales for drinking water.

In a statement issued at the end of his 12-day official visit to Mongolia, Special Rapporteur Léo Heller emphasizes that the SDG targets on water and sanitation access (targets 6.1 and 6.2, respectively) aim to provide “universal safely managed services,” a higher level of ambition than was previously set under the Millennium Development Goals (MDGs), which aimed only for “improved services.” Heller calls for prioritizing the provision of drinking water and sanitation services, noting that only one-quarter of the Mongolian population receives water supply direct to their premises, and just 13% of have sewerage connections.

Other recommendations from Heller are to prioritize menstrual hygiene programmes in schools and dormitories, establish a government body to coordinate water and sanitation policy across relevant ministries, and provide the public with information on water quality. He highlights the need for clearer procedures on disconnecting water services, noting that doing so because of people’s inability to pay would constitute a human rights violation.

Mongolia did not achieve the MDG target of halving, by 2015, the proportion of population without sustainable access to safe drinking water and basic sanitation.

Heller’s final report will be presented to the UN Human Rights Council when it convenes its 39th session in September 2018. In 2017, he reported to the Council on water and sanitation services in Mexico. He was appointed to the position of Special Rapporteur in November 2014. [Heller’s Statement] [SDG Knowledge Hub story on Heller’s Mexico report]

Source:UN Media

Read More

Chinese Embassy donates Cyrillic version of Buddhist classics to Mongolian library

ULAN BATOR, May 2 (Xinhua) -- The Chinese Embassy in Mongolia has donated a modern Mongolian Cyrillic version of a Tibetan Buddhist classic to a library in the country's north.

The sutras of 410 volumes of the classic "Kangyur and Tengyur" were handed over to the director of Central Library in the northern province of Darkhan-Uul, at a ceremony in the capital Ulan Bator attended by a number of officials from both countries.

"China and Mongolia are friendly neighbors connected by mountains and rivers," Chinese Ambassador to Mongolia Xing Haiming said during the handover ceremony.

"In recent years, cultural relations between the two countries have grown. Today's event is part of efforts to strengthen bilateral relations in the cultural sector," he added.

"This is a great gift to us from the people of China. We are grateful that our young people are able to read the wonderful scriptures in their mother language," said the library director Mr. D.Tserendavaa.

Last year, the Chinese Embassy to Mongolia donated the same books to the Department of Philosophy and Religion at the National University of Mongolia.

Source:Xinhua news agency

Read More

Mongolia launches literacy festival across country

ULAN BATOR, May 1 (Xinhua) -- Mongolia has launched national literacy festival under the theme of "National Script-Independence" across the country, the Ministry of Education, Culture, Science and Sports said Tuesday.

The four-day festival is co-organized by the Ministry of Education, Culture, Science and Sports, Department of Culture and Arts, National Library, National Council on Language Policy and National University.

The annual event will witness a series of seminars, cultural exhibitions and meetings to display and promote the literary history of the landlocked Asian country.

Also, competitions relating to traditional literature, language and calligraphy will be held nationwide.

Mongolia began holding the festival annually since 2003.

Source:Xinhua news agency

Read More

Mongolia’s anti-corruption agency under threat

ollowing recent calls for the resignation of the head of Mongolia’s leading anti-corruption body, Transparency International urges the president of Mongolia to stop undermining anti-corruption efforts nationwide and cease threats to fire the country’s top watchdog.
Formed in 2007, the Independent Authority against Corruption (IAAC) investigates cases of corruption across the country according to Mongolian law. Yet, the agency is under increasing political pressure from government officials who point to the country’s poor performance on the Corruption Perceptions Index (CPI) and hold the IAAC responsible for low national scores.
“Mongolia’s poor score on this year’s CPI underlines the need to strengthen anti-corruption efforts nationwide, not weaken them,” said Delia Ferreira Rubio, chair of Transparency International. “The CPI should not be used as a bargaining chip by the president to undercut the authority of national, independent anti-corruption agencies.”
According to national law, the head of the IAAC is required to serve a six-year term, with the present leader slated to be in power until the end of 2022. However, since its inception in 2007, the IAAC has changed leadership three times, with no single leader finishing a full term.

The need for an independent agency

Well-financed and independent anti-corruption agencies, like the IAAC, can be strong weapons in the fight against corruption. However, these agencies need support from national governments, including the judiciary and law enforcement systems in order to be successful. Above all, agencies need independence; they need to establish credentials as independent investigators dedicated to fighting corruption both inside and outside government.
Anti-corruption agencies, including the IAAC in Mongolia, often emerge in the context of corruption scandals. The agencies are formed through broad political consensus and are regarded by most stakeholders as the ultimate response to corruption. However, in general, these agencies can also find themselves at the centre of political controversy if they decide to investigate those in power.

Examining Mongolia’s CPI score

Earlier this year, Transparency International released the 2017 CPI, which scores and ranks 180 countries and territories by their perceived levels of public sector corruption on a scale of zero (highly corrupt) to 100 (very clean). With a score of 36, Mongolia scores poorly on this year’s index, highlighting how corruption is a serious problem across the country.
Specifically, the index draws on 13 surveys and assessments from independent institutions specialising in governance and business analysis, covering experts’ opinions and the views of businesspeople. The score for Mongolia was aggregated from nine data sources.
Transparency International Mongolia was not involved in the data collection or score calculation process for the CPI. Based in Berlin, the secretariat for Transparency International calculates the index independently, and the score calculation approach is designed to be non-political and non-partisan.
Despite this, recent reports in Mongolia have painted an inaccurate picture of the index’s methodology and results. The CPI has been criticised in Mongolia as a reflection of the poor performance of the IAAC. However, the CPI is not an adequate tool to measure the performance of any institution in a country, including the IAAC. Instead, the CPI looks at the general perceptions in a country. In fact, any interference with the proceedings of autonomous anti-corruption agencies could potentially backfire, resulting in additional negative perceptions and even lower CPI scores.
To truly tackle corruption in Mongolia, and throughout the Asia Pacific region, governments must strengthen anti-corruption rules and policies, punish corrupt individuals, support activists who demand accountability and denounce corrupt acts as soon as they occur.
For more information about the Corruption Perceptions Index and its methodology, visit: https://www.transparency.org/news/feature/corruption_perceptions_index_2017#resources 

For any press enquiries please contact


Jen Pollakusky/Michael Hornsby    
E: press@transparency.org
T: +49 30 3438 20 666

Source:Transparency International

Read More

India, Mongolia to enhance bilateral trade, investments

India and Mongolia today discussed economic cooperation in areas such as infrastructure development, energy, services and IT and agreed to explore possibility of launching direct air connectivity between New Delhi and the Mongolian capital Ulaanbaatar.

India and Mongolia today discussed economic cooperation in areas such as infrastructure development, energy, services and IT and agreed to explore possibility of launching direct air connectivity between New Delhi and the Mongolian capital Ulaanbaatar.

External Affairs Minister Sushma Swaraj during a joint media briefing with Mongolian Foreign Minister D Tsogtbaatar after the 6th Session of the Indian-Mongolia Joint Committee on Cooperation here said the two countries agreed to explore ways to identify new areas of cooperation in all sectors of mutual interest and to enhance bilateral trade and investments.

Swaraj, the first Indian foreign minister to visit the resource-rich country in 42 years, said India sees Mongolia as a factor of stability in East Asia and believes that Mongolia's social and economic development is important for peace and prosperity in the region.

During the Indian-Mongolia Joint Committee on Cooperation, the two sides discussed pressing global challenges, particularly the scourge of terrorism and agreed to collaborate bilaterally and in international arena to thwart the designs of those who extend support to terrorist outfits.

The two sides also reviewed the progress in the ongoing collaborative projects, including the refinery project selected by the Government of Mongolia for implementation with the support of USD one billion Indian Line of Credit.

"We directed our officials to coordinate follow up action on each side for the expeditious implementation of these projects. Our strong political ties must be complemented by commensurate levels of trade, economy and investment," she said.

"Today, India has emerged as one of the fastest growing large economies in the world. With its rich natural resources and strong aspiration for development, Mongolia can be an important partner in India's growth story," she said.

Swaraj, who arrive here yesterday on a two-day visit, said collaboration for the ongoing refinery project is in recognition of this fact.

She said Mongolia is not only India's strategic partner but also a spiritual neighbour.

"We share long historical links. Mongolia is well known in India for the valour of her kings and her strong Buddhist heritage. India was among the first countries, outside the erstwhile Communist bloc, to establish diplomatic relations with Mongolia," she said.

Swaraj said in the six decades of the partnership between the two countries, the bilateral relations have grown from "strength to strength".

"This is reflected in our widening and deepening strategic partnership today, based on the common ideals of democracy and freedom, and enriched by mutual respect and trust."

She said Prime Minister Narendra Modi's "historic visit" in 2015, the first ever by an Indian Prime Minister to Mongolia, provided a fresh impetus to the bilateral relations and qualitatively raised the level of the engagement.

"We also agreed that we should make all efforts to maintain and accelerate the momentum of our interaction in all areas."

She said that in tandem with the countries' "ever growing" engagement, India and Mongolai will have more frequent visits now on at Foreign Minister's level.

Calling upon the Mongolian business community to "seize economic opportunities arising out of "India's growth", she said the two countries have agreed to remove institutional and logistical impediments to boost trade, tourism and people to people contacts.

"In this regard, we also agreed to explore possibility of launching direct air connectivity between our two capitals," she said.

In the meeting, they discussed economic cooperation in areas such as infrastructure development, energy, services and IT.

She said that India is committed for capacity building programmes for the people of Mongolia, including in areas such as, training in English language and IT.

She said India looks forward to more students from Mongolia visiting the country for pursuing vocational education and training under the Indian Technical and Economic Cooperation programme, also known as ITEC, and through scholarships offered by the Indian Council of Cultural Relations.

"We would encourage students from Mongolia to pursue studies in Indian art, music and culture which would further reinforce our cultural links," she said.

In view of the two countries' common Buddhist heritage, she said, India also encourage students from Mongolia to visit the country for further study and research in the field of Buddhist studies.

Swaraj will participate in a special event to commemorate the birth centenary of the Venerable 19th Kushok Bakula Rinpoche, who was not only an eminent Buddhist leader, but also the longest serving Ambassador of India to Mongolia.

The event will mark his contribution to the promotion of Buddhism in Mongolia and to the deepening of civilizational and spiritual bonds between the two countries.

She said India and Mongolia share a bond of peace through Buddhism.

"As we tread the path of developing our partnership; I am sure, the teachings of Lord Buddha will continue to guide us," she said.

India and Mongolia have close cooperation in trade and economy, science, health, agriculture, culture, education, communication and tourism. The two countries are also working closely to ensure security and curbing international crimes and terrorism.

The total trade between the two countries amounted to USD 25.6 million in 2016.

Source:Press Trust of India (PTI)

Read More

Mongolia, Singapore on shortlist of summit hosts

Mongolia and Singapore are on the shortlist of locations for a widely anticipated summit between U.S. President Donald Trump and North Korean leader Kim Jong-un, a source with knowledge of the decision told the JoongAng Ilbo on Tuesday.

“European countries such as Switzerland and Sweden were mentioned up until now, but they have been excluded because it was determined to be difficult for North Korean leader Kim Jong-un to physically get there,” the source said. “The United States and North Korea are holding final negotiations to choose between Singapore and Mongolia.”

The decision could be reached as early as this week, the source said, but at the request of Pyongyang, an official announcement might be pushed off until details including the date and agenda are finalized. Trump and Kim are expected to meet in May or June in the first summit between an American and North Korean leader.

According to the source, the European countries are difficult to reach nonstop aboard the Chammae-1, a private North Korean jet converted from a Soviet aircraft. While the plane could have a layover, Pyongyang was said to have not desired this.

The 1970s-era Chammae-1 can only fly stably for up to around 5,000 kilometers (3,100 miles). Stockholm, which was under consideration, is around 7,200 kilometers from Pyongyang, and Zurich is about 8,500 kilometers away.

“North Korea hasn’t let go of its attachment to holding the summit in Pyongyang,” the source said, “but in the case where the United States doesn’t want this at all, it has come around to the idea of reviewing Mongolia as a location. North Korea has the notion that Mongolia is a friendly country.”

Sandwiched between China and Russia, Mongolia has hosted so-called track-1.5 talks involving current North Korean officials and academics from Western countries. It is an especially desirable location for North Korea because Kim can travel there by rail on his bulletproof train.

While the United States has friendly relations with Mongolia, it has pointed to inadequate infrastructure in the capital of Ulan Bator and is pushing for Singapore.

“The U.S. government had excluded countries with personal interests from the list of candidates, including South Korea, Japan and China, and afterward looked for Southeast Asian countries that simultaneously met various conditions, which is why Singapore was selected,” the source said.

This suggests Singapore best fulfills Washington’s standard in terms of infrastructure and security - and Trump’s desire to have a glamorous location for the first U.S.-North summit.

“Since President Trump desires to leave his historic mark through the North-U.S. summit, he wants a country that can best draw the attention of the entire world,” another source close to the White House said. “Based on that criteria, Mongolia could be a choice that does not satisfy Trump.”

Singapore is also a relatively neutral country with a North Korean and American embassy. A flight from Pyongyang to Singapore takes around 6 hours and 30 minutes, and the distance is 4,700 kilometers, within the range of the Chammae-1.

The Trump administration has put great significance on selecting a venue for this historic summit. South Korean locations such as the border village of Panmunjom, Seoul and Jeju were ruled out because they are “already being publicized through the inter-Korean summit” scheduled for Friday, another source close to the White House said, and Trump doesn’t want to appear to hand over leadership on the North Korea issue to South Korea.

BY KIM HYUN-KI, SARAH KIM [kim.sarah@joongang.co.kr]

Source:Korea Joongang Daily news portal

http://mengnews.joins.com/amparticle/3047354

       

Read More

Indian foreign Minister arrives in Mongolia for 1 day visit

Ulaanbaatar [Mongolia], Apr. 24 (ANI): External Affairs Minister (EAM) Sushma Swaraj on Tuesday arrived in Mongolia's capital city Ulaanbaatar, after wrapping -up her China visit.
Swaraj was received by Deputy Foreign Minister of Mongolia B Battsetseg.
This is the first visit of an Indian External Affairs Minister (EAM) to Mongolia in 42 years.
During Swaraj's visit to Mongolia, she will hold bilateral talks">talks with her Mongolian counterpart Damdin Tsogtbaatar.
The minister will co-chair the 6th round of India-Mongolia Joint Consultative Committee (IMJCC) meeting with Tsogtbaatar, covering a range of issues including, inter alia, political, strategic, economic, educational and cultural ties. The last meeting of IMJCC was held in New Delhi in 2016.
According to the reports, Swaraj will also deliver the keynote address at the Kushok Bakula Birth Centenary Celebrations in Ulaanbaatar.
Earlier in the day, Sushma Swaraj attended the Shanghai Cooperation Organisation Foreign Ministers' meeting in Beijing. (ANI)

Read More

Mongolian anti-corruption agency arrests 2 ex-PMs amid mine probe

ULAN BATOR, April 11 (Xinhua) -- Mongolian law enforcement officials on Wednesday confirmed the arrest of two former prime ministers as part of an investigation into abuse of power involving a large mining deal.

They have been investigated by the Independent Agency Against Corruption (IAAC), the country's top anti-corruption body, in the large mining deal signed between the government and Anglo-Australian mining giant Rio Tinto.

The agency detained Bayar Sanjaa, prime minister when Mongolian government signed the original 2009 investment agreement, as well as Saikhanbileg Chimed, prime minister when the financing arrangement of the deal was revised in 2015.

The prosecutor's office in the capital, Ulan Bator, said the two have been arrested Tuesday evening for charges of abuse of official power for preferential treatment in the investment agreement to develop the Oyu Tolgoi mine.

Earlier, the IAAC has arrested other former officials including a former finance minister and a former head of tax authority.

Currently, financing arrangements of the mining deal are under investigation by the IAAC and a parliamentary working group.

Source:Xinhua news agency

Read More

Mongolia mining corruption probe snares former PM

Saikhanbileg Chimed the highest-ranking official implicated in investigation

By Lucy Hornby in Beijing, China

A Mongolian investigation into allegations of corrupt mining payments has ensnared a former prime minister who has been asked to return from the US to answer prosecutors’ questions. 

 Saikhanbileg Chimed, prime minister for two years until 2016, is the highest-ranking official to have been implicated in the probe, which dates from revelations in the leaked Panama Papers of transfers to a Swiss bank account in the name of Bayartsogt Sangajav, the former Mongolian finance minister. Swiss authorities froze the account in January. 

 Over the weekend, Mongolian authorities arrested Mr Bayartsogt and two other former officials with ties to Erdenes Mongol, the state-owned holding company set up to contain Mongolia’s shares in mining projects including the Oyu Tolgoi copper mine and the Tavan Tolgoi coking coal deposit. 

They also requested Mr Saikhanbileg return from the US. Mr Saikhanbileg could not be contacted for comment. 

Turquoise Hill, the Canada-listed subsidiary of Rio Tinto which is developing a $5bn underground stage of the Oyu Tolgoi mine, has previously said it received a request for more information by the Mongolian anti-corruption authorities. 

 The request for information concerned the “possible abuse of power by authorised officials” during the negotiation of the 2009 Oyu Tolgoi investment agreement, shortly after Rio took over negotiation of the Oyu Tolgoi project from Ivanhoe Mines, the original developer. 

 Mr Saikhanbileg signed the agreement to develop the second, underground phase of the mine, which economists said was necessary for the Mongolian government to meet its budgetary commitments. Negotiations over the first phase of the giant mine were also fraught, with rancour on both sides and repeated changes to Mongolia’s mining investment regime, once the most liberal in the world. 

 Swiss prosecutors have said the investigation was not directed against Rio or its employees. Rio Tinto declined to comment on Tuesday. 

 “The Mongolian government and public is slowly beginning to build up capacity to analyse its relationship with Oyu Tolgoi and with Rio Tinto as an investor and to ask questions about that relationship in the process,” said Julian Dierkes, an expert on Mongolian civil society at the University of British Columbia. 

 Mr Saikhanbileg’s departure from office in 2016 was marred by the contentious $400m purchase of nearly half of the giant Erdenet copper mine in Mongolia’s north from Russian holding company Rostec, which returned the entire mine to Mongolian ownership.

Erdenet long had symbolic value as the Soviet Union’s most important investment in Mongolia but has been plagued by allegations of mismanagement and corruption. The previously unknown private company that bought the stake, Mongolian Copper Corp, is fighting the Mongolian government’s decision in February 2017 to nationalise the stake bought from Rostec.

Bayanjargal Byambasaikhan, former chief executive of Erdenes Mongol, told the Financial Times in 2016 that the holding company would have trouble establishing control over the state’s share in Erdenet due to the complexity of the politics surrounding that mine. Mr Byambasaikhan was one of the people arrested this weekend. 

 In a statement on Tuesday, the Business Council of Mongolia, an organisation chaired by Mr Byambasaikhan, noted that he had returned to Mongolia from a posting at the Asian Development Bank in 2010, after the 2009 investment accord for the Oyu Tolgoi mine. “The BCM Executive Committee has full confidence in Byambasaikhan’s integrity,” it said.

Source:Financial Times

Financial Times

Read More

Signing of Japanese ODA Loan Agreement with Mongolia: Supporting reforms in Mongolia under an international aid framework with the aim of economic and fiscal reconstruction

On December 5, the Japan International Cooperation Agency (JICA) signed a loan agreement with the Government of Mongolia in Ulaanbaatar, the capital city, to provide a Japanese ODA loan of up to 32 billion yen for the Fiscal, Social and Economic Reform Development Policy Loan.

The economy of Mongolia depends heavily on the mineral resource sector, which accounts for 20 percent of the country’s gross domestic product (GDP) and 90 percent of exports, which are primarily coal and copper. Due to a drop in the prices of minerals, which are major exports, a slowdown in the economy of China which purchases 80 percent of the exports from Mongolia, a drop in foreign direct investment caused by restrictive investment policies and other such factors, the GDP growth rate dropped from 17 percent in 2011 to one percent in 2016. Fiscally, the country faces such challenges as increasing domestic infrastructure expenses, and rising social welfare expenditures due to inadequate controls on payees. Such factors pushed the fiscal deficit-to-GDP ratio to 17 percent in 2016 while the public debt-to-GDP ratio grew from 33 percent in 2011 to 88 percent in 2016, making reforms toward economic and fiscal reconstruction priorities.

Given these circumstances, an international aid framework totaling approximately 5.65 billion dollars was created in 2017 by the International Monetary Fund, the World Bank, the Asian Development Bank and others. With the aim of economic and fiscal reconstruction in Mongolia as a part of the international aid framework, the project will support reforms by the Government of Mongolia in three areas: stable macroeconomic management, the promotion of helping the socially vulnerable and enhancing economic growth.

Specifically, the project will support reforms such as those aimed at strengthening fiscal discipline in the area of stable macroeconomic management. In the area of the promotion of helping the socially vulnerable, the project will support reforms directed at targeting subsidies to the socially vulnerable and improving their living environment, and in the area of enhancing economic growth, the project will support the stimulation of foreign direct investment through improvements to the investment environment and reforms aimed at economic diversification.

The project will support mid- to long-term reforms from such a macro perspective, contribute to the short-term reduction in the fiscal burden of Mongolia, and contribute to fiscal, social and economic stability.

Two years have passed since the launch of the Sustainable Development Goals (SDGs) adopted by all UN member countries, including Japan and Mongolia. This project aims to accomplish the core SDG principle of “leaving no one behind,” through providing support to the socially vulnerable such as the improvement of living conditions in ger (yurt) districts where many poor people live. In addition to strengthening economic growth, the project will, through collaboration with various other projects being carried out in Mongolia, lead to improvements in social welfare and health care systems and address urban environment issues, especially air pollution in Ulaanbaatar. All these comprehensive areas of support cover the three dimensions of sustainable development (economic, environmental and social) that will be put into practice in the project.

1. Terms and Amount of Loan

Project title	Amount (million yen)	Annual interest rate (%)		Repayment period (years)	Grace period (years)	Procurement
		Project	Consulting services
Fiscal, Social and Economic Reform Development Policy Loan	32,000	0.8		20	6	General untied

2. Executing Agency
Ministry of Finance
Address: Government Building 2, S. Danzangiin gudamj 5/1, Ulaanbaatar 15160, Mongolia
Phone: +976-51-26-02-47

3. Planned Implementation Schedule
(1) Completion of project: December 2017 – with completion of the loan disbursement
(2) Issuing of letters of invitation for consulting services: No hiring of consultants is planned for this project.
(3) Tender announcement of initial procurement package for international competitive bidding on project construction: No work in conjunction with international competitive bidding is planned for this project.

Read More

IMF Reaches Staff-Level Agreement on the First and Second Reviews of Mongolia’s Extended Fund Facility

End-of-Mission press releases include statements of IMF staff teams that convey preliminary findings after a visit to a country. The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board. Based on the preliminary findings of this mission, staff will prepare a report that, subject to management approval, will be presented to the IMF's Executive Board for discussion and decision.

• Mongolia’s economy is recovering and GDP growth is now projected at 3.3 percent this year and 4.2 percent in 2018, reflecting buoyant external conditions and improving confidence. Key targets have been achieved.
• Important structural reforms are underway to lay the foundations for long-term growth and break the boom-bust cycle. The key near-term focus is supporting the authorities’ policies to strengthen the banking sector and enhance fiscal policy making.
• The IMF welcomes the authorities’ commitment to continue the reform momentum to cement the long-term benefits.

An International Monetary Fund (IMF) staff team led by Mr. Geoff Gottlieb visited Ulaanbaatar from October 18-30, 2017 to conduct discussions on the first and second reviews of the three-year Extended Fund Facility (EFF) arrangement approved on May 24, 2017, in an amount equivalent to SDR 314.5054 million, or about US$434.3 million (see Press Release No. 17/193).

At the conclusion of the visit, Mr. Gottlieb made the following statement:

“The economy is growing more strongly than expected, with GDP growth likely to reach at least 3.3 percent this year on the back of strong coal exports, a robust recovery in services, and a return of confidence following the approval of the $5.5 billion IMF-supported package. Growth is expected to become more broad-based in 2018 as the domestic economy revives, but there are downside risks to the coal sector.

“Performance under the program has been positive, with all quantitative targets met. Fiscal results have been better than expected, supported by stronger revenues and tight expenditure control. The overall fiscal deficit is likely to be 7.5 percent of GDP this year compared to 17 percent in 2016. The authorities’ proposed 2018 budget is in line with the revised program that envisages a deficit of 6.5 percent of GDP. The authorities have committed to save half of any revenue overperformance should it materialize, thus helping to reduce borrowing and ensure debt sustainability. The remainder would be used to fund productive one-off spending in line with the government action plan. Both this year and next, the authorities have allocated a one-time bonus to civil servants. Net international reserves have improved, and the authorities have rolled over the sovereign bonds maturing in 2017 and 2018 at attractive interest rates, removing a key risk to the external position.

“The authorities have moved ahead with their ambitious structural reform agenda, which will help to sustain growth over the medium term, promote diversification and competitiveness, and mitigate the boom-bust cycle. The rehabilitation and strengthening of the banking system is underway: the results of the comprehensive Asset Quality Review are expected in mid-December; important legal reforms are being drafted to strengthen the financial system; and improvements to the regulatory and supervisory framework are under way.

“On the fiscal side, steady progress is being made in strengthening tax administration, tax policy, and budgetary controls, including through the establishment of a fiscal council and a high-level working group on tax policy. It is important that the reform momentum is maintained in 2018 to cement the long-term benefits of such policies on promoting inclusive and sustainable growth. In this regard, it is encouraging that the commitment of the new government to the program policies remains strong.

“The authorities and the team have reached staff-level agreement on the completion of the first and second reviews under the EFF arrangement, which is subject to the approval of the IMF Executive Board.

“The team thanks the authorities for their cooperation, constructive dialogue, and hospitality during its stay in Mongolia.”

IMF Communications Department

MEDIA RELATIONS

PRESS OFFICER: TING YAN

PHONE: +1 202 623-7100EMAIL: MEDIA@IMF.ORG

Read More

Mongolia to tidy up debt profile

By Frances Yoon

HONG KONG, Oct 20 (IFR) - The Government of Mongolia (Caa1/B-/B-) plans to buy back foreign debt due next year and issue new bonds to address its short-term maturities and complete a turnaround from last year's economic crisis.

The sovereign has announced tender offers for its US$500m 4.125% January 2018 bonds and Rmb1bn (US$152m) 7.5% June 2018 Dim Sum notes. If completed, the buybacks will leave it with no major foreign debt maturities until 2021, according to Thomson Reuters data.

If successful, the plan will leave Mongolia in better shape than last year, when government overspending and declining commodity exports left it at the risk of default. The country was forced to pay 10.875% to issue a US$500m five-year note in March 2016, at the time the highest yield on any sovereign bond since 2011.

The latest buyback comes amid a much-improved economic backdrop. The International Monetary Fund earlier this year approved a US$5.5bn bailout to relieve debt pressures and maintain stability in the local currency, the tugrik.

A recovery in coal exports also helped drive demand for its US$600m sovereign bond this March, allowing the new-money component to price more than 300bp inside the 2016 deal.

As of the end of September, export revenue more than doubled from the same period in 2016, National Statistics Office data showed.

Moody's expects higher real GDP growth and for foreign reserves to recover to US$1.7bn this year from US$1.2bn at the end of May.

The IMF estimate for the overall fiscal deficit is 10.6% of GDP this year, and the actual deficit will likely be lower than this, according to Moody's.

"Mongolia has emerged from the brink of default," said Anushka Shah, a credit analyst at Moody's. "Government revenues are materially up. It's been a good year for them. They are also likely to surpass some of the targets set by the IMF after the loan. What might happen is that the government will have to revise targets based on the performance so far."

MARKET PERSPECTIVE

The proposed issue comes amid a rally in Mongolia's outstanding bonds. Mongolia's 8.75% 2024s were trading at 112.958/113.625 to yield 6.26%, near their tightest level since issue, while its US$1bn 5.125% December 2022s, its largest outstanding issue, were also trading at a record low 5.58%, according to Tradeweb.

"Mongolia's bonds have tightened across the curve, reflecting the demand for emerging-market debt which continues to be strong," said another banker on the deal. "There have been some investors sitting on the sidelines and missing out on the rally, who are now quite keen to pick up bonds."

The banker added that demand was expected to be healthy, given that the curves of emerging-market peers, such as Vietnam, Pakistan and Sri Lanka, have become very tight.

Still, Mongolia has a long way to go to improve its fiscal position. The resignation of the cabinet last month reflects the country's political instability, which does not bode well for the IMF's requirements to implement policies to improve its fiscal position and structural reforms over a three-year period.

Newly appointed Prime Minister Ukhnaa Khurelsukh has asked the IMF to disburse about US$38m in funds after the programme's suspension in mid-September.

"External fragilities remain. Their external borrowing needs are still one of the highest. So, when rates rise, there's a risk that they face limited market access and this could raise debt servicing needs because of its material portion of external debt," said Shah.

The proposed 144A/Reg S notes have initial ratings of B-/B- (S&P/Fitch).

Credit Suisse, Deutsche Bank and JP Morgan are joint lead managers and joint bookrunners for both the tender offer and proposed new issue.

Source:Reuters

Read More