Business: Mongolia slips 3 places in corruption ranking; SouthGobi begins exporting coal to China; Khan Bank support to distressed herders; Khan Resources to build power line to Dornod mines; Trade teams to attend Ohio festival; Ivanhoe cash award for Paralympics medalist; The art of marketing art; Another meeting on responsible mining; Tour of uranium mine sites.
Economy: Mongolia moves up to be ranked the world’s 62nd freest economy; Russia hints it will lower petrol export tax; Tourist arrivals grow 35% in 7 years; Mongolia asks EU to extend preferential status; ADB aid for 3-year food program; Central Bank head signs agreements in Russia; Harvesting slower than usual; No decision on wage raise.
Politics: New Cabinet takes office; Profile of D. Zorigt; Bayar’s task list for colleagues; Ministers identify priorities; No mention of mining law in Parliament agenda; Bayar on 10-day visit to the USA; MNT 1.5 billion to be spent on local election; Training for local judges; No more troops for peacekeeping in Iraq.
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MONGOLIA MOVES UP TO BE RANKED THE WORLD’S 62ND FREEST ECONOMY
Mongolia's economy is 62.8 percent free, according to The Heritage Foundation and the Wall Street Journal 2008 assessment, which makes it the world's 62nd freest economy. Its overall score is 3 percentage points higher than last year, mainly reflecting improved scores in four of the 10 economic freedoms. Mongolia is ranked 10th out of 30 countries in the Asia-Pacific region, and its overall score is slightly higher than the regional average. By implementing trade liberalization and fiscal reforms that include lower tax rates, Mongolia showed the most improvement in the region, moving up to "moderately free" from "mostly unfree" in the 2007 Index.
The 2008 Index of Economic Freedom covers 162 countries across 10 specific freedoms such as in trade, business, investment, and in property rights. Mongolia enjoys high levels of fiscal freedom, financial freedom, business freedom, investment freedom, and trade freedom. The top income and corporate tax rates are moderate. The average tariff rate is also moderate, although non-tariff barriers (such as customs corruption) have undermined the government's policy of liberalization. Commercial registration and licensing are efficient, but closing a business takes longer than it should. Inflation is fairly high, but the government has eliminated almost all of its price supports and market distortions. Mongolia has very weak property rights, the Index finds. The judicial protection of these rights is still weak, and judges often do not validate previously agreed contracts. The judiciary is also hampered by corruption.
Mongolia’s scores in the individual sectors are: Business Freedom - 71.1%; Trade Freedom - 81.4%; Fiscal Freedom - 85%; Freedom from Government - 71.7%; Investment Freedom - 60%; Financial Freedom - 60%; Property Rights - 30%; Freedom from Corruption - 28%; Labor Freedom - 62.4%.
MONGOLIA SLIPS 3 PLACES IN CORRUPTION RANKING
Mongolia has slipped three places, from 99th in 2007 to 102nd, in this year’s Corruption Perceptions Index (CPI), launched by Transparency International (TI) in Berlin on Tuesday. The CPI score indicates the degree of public-sector corruption in a given country as perceived by business people and country analysts and is a composite index, drawing on different expert and business surveys.
The 2008 CPI scores 180 countries (the same number as the 2007 CPI) on a scale from zero (highly corrupt) to ten (highly clean). Score changes in the Index are rarely rapid, and at 3.0 Mongolia’s score remains the same as in 2007, but its confidence range has expanded to 2.6 - 3.3 from last year’s 2.8 - 3.3.
Denmark, New Zealand and Sweden share the highest score at 9.3, followed immediately by Singapore at 9.2. Bringing up the rear is Somalia at 1.0, slightly trailing Iraq and Myanmar at 1.3 and Haiti at 1.4. Countries that are behind Mongolia include Ukraine (134), Kazakhstan (145), Russia (147), Tajikistan (151), Azerbaijan (156), and Uzbekistan (166).
After taking charge of their portfolios on Saturday morning, some of the new ministers spoke briefly about their priorities.
Yo.Otgonbayar: All the many employees in the education sector must be kept motivated and in good training. Our literacy level and educational standards were things to be proud of but we have been slipping in the last 10-15 years. This has to be arrested.
D.Zorigt: Both parties have pledged to give every Mongolian a share of the wealth from the country’s mining resources. People are waiting to see how the promise is implemented. We have to start work in the strategic mining sector without delay. The first thing to do is to approve amendments to the Mining Law.
Lu.Bold: Defense sector reforms were started in 1996 and these have to be continued. The army has to be modernized and made more professional.
T.Badamjunai: I shall work hard to minimize food import. Mongolia should attain self-sufficiency in vegetables and most other agricultural products within two years. We also have to create more jobs in light industry, and the private sector must be encouraged to take up the challenge.
S.Lambaa; The health insurance system has to be overhauled in keeping with the forces of the market economy. There is much scope for introducing modern technology in the health sector.
T.Gandi: My main job will be ensuring an equitable distribution of the mining wealth, after ascertaining that it keeps flowing. Social insurance benefits have to be distributed correctly, so that those who really need them can be identified and allowed easy access. We also have to generate enough worthwhile employment so that young Mongolians do not have to go abroad to work.
S.Bayartsogt: Inflation is the biggest challenge. My success will be measured by how well I can control inflationary forces.
Kh.Battulga: The railway network has to be expanded to meet the increasing demands of trade and industry. We should also develop other urban centers and dissipate the pressure, both of population and facilities, on Ulaanbaatar.
PROFILE OF D. ZORIGT
The new Minerals and Energy Minister, D. Zorigt, was born in Ulaanbaatar in 1971 and is the youngest of the Ministers at age 37. He earned degrees in International Relations in Moscow and Australia, and in Law in Japan. He speaks Chinese, Russian and English. After working in the Ministries of External Affairs, Finance, and Industry and Trade, in 2007 he became Executive Director of Erdenes MGL, a 100% state-owned company.
Later, he worked as secretary of the working group that drafted the amendments to the Minerals Law and the revised agreements for the Tavan Tolgoi and Oyu Tolgoi projects. Before the June election he took over as campaign advisor to S.Bayar and Su.Batbold in Sukhbaatar district.
Married and with two daughters, Zorigt is also the guardian of the two daughters of his younger brother D.Badraa, who was assassinated when he was chairman of the Financial Regulatory Authority.
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