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

· Lately world economic condition has encountered difficulties and has come face to face to even more difficult challenge. Economists and officials say that there is possibility of new crisis and new difficulty

· IMF officials this week officially have stated that probability is increasing that financial crisis that is starting in some European countries might expand and growth in major economies might slow down. Some economists stress that this crisis could be even more prolonged

· How can Mongolia overcome double challenges in such difficult times? How to keep fast growth that has only started along with improving livings standards of people?

· Economy will deviate if a link in chain of favorable, competitive economic environment, investment, economic growth, jobs and poverty reduction will break

· Greek example clearly illustrates us that budget accumulation in principle has its limitations and borrowing capacity too has its own ending

· The only way to keep fast growth is to have an economy with sustainable growth and competitiveness and that encourages productivity and investment based on our advantages. If we firmly adhere to these views we can overcome double challenges.

· As a policy we view that it is absolutely necessary to commission into full production OT and TT projects already started and start other mining projects

· The next issue to pay attention to an issue of industrialization and processing. State will support and implement CTL plant. Work has started on Sainshand industrial hub, new railroad and iron ore mines in Darkhan/Selenge region. Decision has been made to build in Mongolia petroleum refinery. Those decisions will be made concrete business.

· Negotiations are ongoing to make Mongolian stake in UB Railways 51%

· III campaign of virgin lands will be continued and agricultural products import dependency will be eliminated, meat exports will be aimed at

· Government will actively support Thermal power plant No.5, major power source in Gobi region and other infrastructure works

· In coming year we plan to increase salaries 2 times in total by 50%

· In coming year we have estimated to issue to senior citizens and citizens with developmental difficulty 1 million MNT in cash, to all the rest to choose from options of 1 million MNT value

· We have submitted the budget to fulfill the promises to people and expand great productive development

From: Dale Choi, Frontier Securities [mailto:This email address is being protected from spambots. You need JavaScript enabled to view it.]

Sent: Monday, October 10, 2011 7:52 PM

To: 'Dale Choi, Frontier Securities'


According to Media Office of Government of Mongolia( 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.


Dale Choi

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