PRIME MINISTER OF MONGOLIA: ECONOMIC GROWTH WOULD REACH 20% THIS YEAR

According to Media Office of Government of Mongolia(open-government.mn) on October 7,2011, Prime Minister of Mongolia S.Batbold has said in opening speech of autumn session of Parliament among other things

· Few months has been left until start of fourth year of Coalition Government. We view it would be beneficial to sum up results of work of Government for the past period and openly discuss about challenges lying ahead of the country

· We have passed double challenges of world economic and financial crisis in 2008-2009

· Since 2010 major mining and infrastructure projects have been immediately started to be implemented, engine of boosting development has been turned on.

· Economy that had negative growth of 1.6% in crisis, last year grew about 6%. By this year end it is likely that it will reach 20%.

· GDP per capita now is reaching 3000 USD. If economic growth is stable it would be possible to condition to form to reach 5000USD by end of 2012

· Total tax revenues increased 50.3% yoy including customs revenues increasing 1.6 times to 1.23 trillion MNT(about 1 billion USD)

· Unemployment rate is back into single digits 8.7%

· One of the good news is that productive development at first of the strategic deposits - OT has completed 50% mark

· By establishment of OT IA and using bountiful reserves of copper and gold, Mongolia has entered new stage of rigorous economic growth . It would impossible to refuse that that IA turned out to have to important significance to raising reputation of Mongolia on international level. In a future, by implementing the project successfully Mongolia would be able to overcome with little risk possible soon world economic and financial crisis.

· Members of National Security Council( President, Prime Minister and Parliament Speaker) have united position that Mongolia must continue implement OT project and provide support to commissioning it into operations

· We will not say that OT agreement and operations are perfect and superb in all aspects. Government too understands that.

· In near future we work pressuring that OT LLC will work supporting Mongolian suppliers and continue invest into business development initiatives to diversify economy, speed up implementation of duties of investments to develop infrastructure

· Erdenes TT has started extraction and paid to budget 116 billion MNT, it working with aim to export this 1 million tons and 3-4 million tons next year, by 3rd quarter of 2011

· As of September 2011 , 9 new mines have been commission YTD, there are 1207 mining and 2701 exploration licenses and they cover 15.3% of total territory

· It is likely that coal exports will reach 24 million tons in 2011

· Stripping has started for Dalanzadgad-TT-Sainshand-Choibalsan railroad by Mongolian Railways

· As of H1 of 2011 6040 apartments have been commissioned for use

· These works are result of cooperation of President, Parliament and Coalition Government. There is relatively short time left for us to finish what has been started and make a promises a business.


CHIEF INVESTMENT STRATEGIST

Dale Choi

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