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Resource Nationalism and its impacts to Mongolia, June 15th, 2013

Ernst & Young's global survey of business risk in mining shows clearly how concerns about resource nationalism have increased since 2009. In that year the industry ranked resource nationalism ninth out of 10 risks to doing business; it rose to eighth in 2010 and peaked at the number one in 2012.

"Resource nationalism manifests itself in the following ways: we see increases in taxes and royalties, there are more costly and demanding conditions, such as the 'use it or lose it' policies, social investment requirements increase, restrictions on foreign ownership and requirements for indigenous shareholdings," an industry expert said.

Resource nationalism is occurring in countries as diverse as Canada, Brazil, the UK, India, Iran, Russia and Ghana. Mongolia is not an exception.

The boom in commodity prices also prompted governments to ask what they were getting out of the resources in their countries. But, when mineral prices go down, it does not mean resource nationalism goes away Below are to explain about Impact of political dynamics on prospects for mineral growth in Mongolia especially Impact of resource nationalism on overseas investor confidence (How has Mongolia experienced the effects of reduced inbound investment?) after charting resource nationalism trends globally.

 

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