Mongolia News Summary for December 05, 2024
The following news articles are the opinions of their authors and publications. They are presented here as translations for informational purposes and do not necessarily represent the opinion of Mongolia Strategy Center or its members.
Today's Stories
Politics
- Citizen's Representative Assembly: Approved the Capital's 2025 Budget Plan
- The Draft of the 2025 State Budget Will Be Submitted to the Parliament
- Child benefit, salary and pension increment will not be reduced, the 2025 budget will be submitted to the parliament today
- G.Damdinyam: It has been observed that the Minister of Food, Agriculture, and Light Industry distributes funds to his close associates
- The Municipal Council Approves the Closed City Budget with Tax Increases from 2025
- The Resubmitted 2025 Budget Reduces Deficit by 1.4 Trillion and Omits 'Cultural Vouchers' While Adding 7.9 Billion for Cancer Hospital Infrastructure
- Discussion on Corruption and Conflict of Interest in Granting Building Permits
- B. Javkhlan: Next year's budget expenditure will be reduced by 1.4 trillion, and the cultural rights document will be removed
- Supreme Court: Reviewing the Development Bank Case Decisions
- Review of Development Bank's Lower Court Decisions Ongoing
Economy
- Arab Business Persons Interested in Investing in Halal Meat and Wheat Production
- KhasBank Signs $50 Million Financing Agreement with Asian Development Bank
- D.Batlut: Can 'Oyu Tolgoi' Pay 5% and 'Erdenet' Pay 20% in AMNAT?
- D. Tegshbayar: Only Five Out of 99 State-Owned Companies Are Profitable
Diplomacy
- Silent Agreement with the Eurasian Economic Union Poses a Threat
- The Embassy of Mongolia in Seoul Issues a Warning
- Prime Minister L. Oyun-Erdene Met with the Crown Prince of the Kingdom of Saudi Arabia
- Prime Minister Oyun-Erdene Meets with Saudi Arabia's Crown Prince to Discuss Cooperation
- Agreements Made to Accelerate Mongolia-France Cooperation on Major Projects
- Mongolian Delegation Participates in the International Criminal Court Assembly
Infrastructure
- Resolution Passed to Increase Fees Related to Vehicles and the 2025 Budget of the Capital
- Meeting Held for Training of Metro Engineers and Specialists in Ulaanbaatar
- Singapore's Urban Planning Experience to be Adopted
Environment
- 30% of the Territory Faces High Risk of Severe Winter Conditions
- 50% of the country's territory is at risk of a harsh winter
Innovation
- Study the Experience of Developing the Digital Economy
- Amendments to Some Laws for a Paperless Government
Politics
Citizen's Representative Assembly: Approved the Capital's 2025 Budget Plan
Published: 2024-12-04 | Translated from: news.mn
Today, the Citizen's Representative Assembly of the capital met and approved the capital's 2025 budget plan. Authorities explained that the reason for discussing the city's budget in a closed session was due to an electrical issue in the hall, which made live broadcasting impossible. In the previous session, the majority of representatives supported holding an extraordinary meeting on December 4 and adjourned. During the presentation of the 2025 budget plan to the Assembly, city Mayor Kh. Nyambaatar stated, "The base income and expenditure for the capital's 2025 budget are calculated at 3.2 trillion tugrik. The capital's budget is not providing revenue to the state budget, and 60.3 billion tugrik is allocated to the capital from the local development integrated fund. The 2025 budget framework statement of the national consolidated budget projected GDP growth at 8% and consumer price growth at 6% for the next year. The capital's budget plan was posted on the website starting November 15, and citizen feedback was collected through the website from April 15 to June 15. Additionally, an open discussion involving over 400 citizens from nine districts was organized, resulting in 147,135 submissions being prioritized and included in the budget plan. The capital's budget aims to concentrate revenues of 3.8 trillion tugrik in 2025, which is an increase of 648 billion tugrik or 20.2% from last year and 30.4% higher than expected performance. This growth is significantly influenced by increases of 210.9 billion from corporate income tax, 251.9 billion tugrik from personal income tax, 107.7 billion from property tax, and 351.1 billion from non-tax revenues. Tax revenues represent 85.9% or 3.3 trillion tugrik of the capital's budget income, while the remaining 14.1% or 541.9 billion tugrik is to be generated from non-tax sources. Additionally, a total of 1.3 trillion tugrik will be allocated for current expenses, 1.7 trillion tugrik for capital expenses, 78.3 billion tugrik for debt service repayment, 327.2 billion tugrik for securities repayment, and 14.1 billion for financial support for three remote districts. The 2025 budget plans to implement 4.6 trillion tugrik in capital investments, including 1.5 trillion from the capital's investments, 153.2 billion tugrik from the Capital Road Fund, and 24.1 billion from the Local Development Fund, financing a total of 97 new projects, 68 ongoing projects, and 263 projects with 2.9 trillion in intermediary financing. The rate of vehicle and self-propelled machinery taxes has not changed for 14 years. Increasing tax rates within the legal framework will positively impact improving the city's road network, reducing congestion, maintaining and upgrading roads, and updating technology. With proposed changes to the vehicle tax law next year, official taxes are planned to increase by 2-3 times, and road usage fees by 5 times, raising the road fund's income by 151.5 billion tugrik," he said.
The Draft of the 2025 State Budget Will Be Submitted to the Parliament
Published: 2024-12-04 | Translated from: gogo.mn
The regular meeting of the government was held, and the following issues were discussed and resolved. Decisions were made to discuss and submit to the Parliament the draft law on the 2025 State Budget of Mongolia, amendments to the Social Insurance Fund Budget Law of 2025, amendments to the Health Insurance Fund Budget Law of 2025, and other draft legislation related to these draft laws. Included in the budget are customs revenue of 174.0 billion, social insurance and health insurance contributions of 25.0 billion, domestic goods VAT of 112.3 billion, personal income tax of 21.1 billion, corporate income tax of 50.3 billion, and other income of 12.0 billion tugriks. The balanced revenue and aid amount for 2025 is projected at 33.5 trillion tugriks, or 35.2% of GDP, with total expenditure and net loans matching this amount. The overall fiscal balance is projected to be without deficit, with the basic balance at a 3.5% surplus of GDP. Budget expenditures such as child allowances, health and social insurance funds, interest payments, salaries, and state employee allowances remain unchanged, while current expenses and capital investments are to be reduced by 0.8 trillion each, and foreign loan use by 0.7 trillion tugriks, totaling a reduction of 2.3 trillion tugriks. Operating costs of budget entities will be cut by 10-100%. These include deferrable expenses like furniture, equipment, travel, office supplies, and fuel. Moreover, it is planned to halt or defer programs and activities that have not yet started. As for investments, deferred projects remain unaltered, but funding for projects without contracts as of December 2 will be postponed, regional development investments will be reprioritized for phased implementation, and funding for some feasibility studies, major repairs, and equipment will be reduced by 20%. However, budget projects have added major repairs to the Cancer Hospital and preliminary work for "Cancer Hospital 2." The total revenue of the unified budget is reduced by 394.7 billion tugriks in connection with the reduction of budget investments and expenditure. This includes customs revenue of 174.0 billion, social insurance and health insurance contributions of 25.0 billion, domestic goods VAT of 112.3 billion, personal income tax of 21.1 billion, corporate income tax of 50.3 billion, and other income of 12.0 billion tugriks.
Child benefit, salary and pension increment will not be reduced, the 2025 budget will be submitted to the parliament today
Published: 2024-12-04 | Translated from: itoim.mn
Yesterday evening, the Ministry of Finance presented the draft budget law for 2025 to the parliamentary groups of the two parties. Specifically, Minister of Finance B. Javkhlan presented to the MPP group, while State Secretary J. Ganbat presented to the DP group regarding the 2025 draft budget. Today at 14:00, the government will hold a meeting to discuss the draft Budget Law for 2025 and submit it to parliament. As the Prime Minister is on assignment, he will participate in today's meeting remotely. Following the President's veto of the entire 2025 budget law, there is a need to reduce budget expenditures by 1.9-2.4 trillion MNT. The MPP group has decided not to cut salaries and child benefits provided to citizens. Therefore, next year, the six percent salary increase for public servants and child support allowances will remain unchanged. Additionally, the budget presented by the Minister of Finance includes plans to reduce expenditures by 833 billion MNT, with a reduction in the use of foreign loans by 211.6 billion MNT, totaling more than 1.4 trillion MNT. Changes in the budget balance include an increase of the balanced balance by 1.9 trillion MNT and the basic balance by 1.7 trillion MNT. Meanwhile, budget income will decrease by 0.5 trillion MNT, current expenses by 1.4 trillion MNT, state budget investments by 0.8 trillion MNT, and foreign loan usage by 0.2 trillion MNT. A total reduction of 2.4 trillion MNT is proposed, which includes 1.4 trillion MNT from current expenses, 0.8 trillion MNT from capital expenditures, and 0.2 trillion MNT from foreign loan usage, as presented to the party groups. Today's government meeting will finalize the budget proposal before submitting it to parliament.
G.Damdinyam: It has been observed that the Minister of Food, Agriculture, and Light Industry distributes funds to his close associates
Published: 2024-12-04 | Translated from: ikon.mn
During today’s meeting of the Standing Committee on Budget, the draft resolution of the National Audit Office's 'Approval of Audit Topics for the Upcoming Year' is being discussed. During this, Member of Parliament G. Damdinyam stated, "We need to discuss the state funds. The Ministry of Food, Agriculture, and Light Industry seems to be a welfare ministry. Its major programs come into the budget in package amounts. Has there been an audit on how this budget is being spent? It has been observed that the minister distributes funds from the funds to his close associates. An audit should be conducted on the special funds of the Ministry of Food, Agriculture, and Light Industry. There have been discussions that a single related entity has collected more than its fair share from the Farmers Support Fund. If you separate and audit each sector, nothing big is apparent. But if you look at all the funds from the ministry, it's horrifying," he said. In response to his question, Chief Auditor D. Zagdjav stated, "Aside from special funds, state fund transactions are carried out without any audit. Discussions will emerge if there is no audit of state fund transactions. For example, in Russia, which I know well, there is a separate state fund control office. Within the audit, the state fund is economized. However, we don't have such an office in our country. If it's included in future audit topics, we can conduct audits. There hasn't been an audit on special funds recently," he replied. Financial Audit Department Director and Senior Auditor T. Naranchimeg also added, "Since the Agricultural Support Fund of the Ministry of Food, Agriculture, and Light Industry was dissolved and became a corporation, financial audits with negative conclusions are conducted annually. However, on the Small and Medium Enterprise Support Fund, limited opinion assessments are provided. There are risks in those funds," she added in response. Warning: Media organizations (Television, Radio, Social, and Websites) must mention the source (ikon.mn) when using our information in any form, either fully or partially.
The Municipal Council Approves the Closed City Budget with Tax Increases from 2025
Published: 2024-12-04 | Translated from: itoim.mn
The Municipal Council convened today at 10:00 a.m. to discuss the draft budget for 2025 of the capital city. However, the meeting was not broadcast live on the official channel of the Municipal Council and the budget for 2025 was approved behind closed doors. When queried, the press office of the Municipal Council stated, "It is true that the meeting was held and the budget was approved as scheduled." In 2025, the capital city of Ulaanbaatar is expected to collect revenue of 3,807.6 billion tugriks. Of the total revenue, 87.8% or 3.3 trillion tugriks are projected to come from tax revenue, and the remaining 465 billion tugriks from non-tax revenue. Most importantly, along with the city's budget, resolutions to increase the rates of Road Usage Fees and the Automobile Excise Tax were introduced. Consequently, with the approval of the city budget, from January 1, 2025, the Automobile Excise Tax will be increased threefold and the Road Usage Fees will be increased fivefold.
The Resubmitted 2025 Budget Reduces Deficit by 1.4 Trillion and Omits 'Cultural Vouchers' While Adding 7.9 Billion for Cancer Hospital Infrastructure
Published: 2024-12-04 | Translated from: isee.mn
The 2025 budget proposal, which initially drew criticism from members of the Parliament, was entirely vetoed by President U. Khurelsukh. Although it was decided to discuss the President's veto using an expedited procedure, Parliament did not support it. Therefore, the government has been forced to entirely cancel the 2025 budget proposal and resubmit it. Within this framework, Finance Minister B. Javkhlan has submitted a bill to amend the Budget Law, and Parliament has urgently discussed and approved it. Now, the 2025 budget proposal will be resubmitted to Parliament. Finance Minister B. Javkhlan stated, "The 2025 budget proposal was extensively discussed for over 70 days with fair coverage in Parliament. Therefore, there is no need for further discussion. Amendments will be made and resubmitted based on the fundamentals of the budget submitted on September 1, as well as the President's veto and instructions from Parliament. It is unnecessary to recollect figures from scratch. The bill will be prepared and submitted in a simplified manner." Thus, there is an expectation that amendments demanded by the President and Parliament will be resubmitted promptly today. Yesterday, after working hours, the government provided information regarding the resubmitted budget to the caucuses of the Mongolian People's Party (MPP) and the Democratic Party (DP). Specifically, Finance Minister B. Javkhlan provided a general overview of the 2025 budget proposal to the MPP faction, while the Secretary of the Ministry of Finance, J. Ganbat, gave a similar presentation to the DP caucus. However, members of the DP caucus expressed frustration over receiving very general information and demanded a presentation of detailed amendments. In response, the Ministry of Finance indicated that detailed information would be presented after the budget is formally submitted. Sources also reported that there was a similar atmosphere in the MPP caucus meeting. The previously rejected budget proposal, which was passed with a 1.9 trillion deficit, largely covered increased salaries for public servants and defense sector workers, as well as newly increased costs for law enforcement agencies, according to Finance Minister B. Javkhlan. At yesterday's briefing to the MPP and DP factions, it was presented that "the planned 6% salary increase for public servants tied to inflation for the upcoming year will be canceled to reduce expenses." It was explained that the state budget will be reduced by 833 billion, while the utilization of foreign loans will be reduced by 211.6 billion, amounting to a total reduction of over 1.4 trillion. Further, changes to the budget balance will increase the balanced budget by 1.9 trillion and the basic balance by 1.7 trillion. This means the budget is effectively being balanced without deficits. The revenue is estimated to decrease by 0.5 trillion, while current expenses will be reduced by 1.4 trillion, state budget investments by 0.8 trillion, and foreign loan utilization by 0.2 trillion. The budget revenue is expected to drop by 33.3 billion, with Customs revenue decreasing by 544.3 billion, Social Security and Health Insurance contributions by 174 billion, and Domestic Goods VAT revenue by 137 billion. While child benefit payouts of 1.6 trillion, the Health Insurance Fund of 2.3 trillion, the Social Insurance Fund of 5.9 trillion, interest payments of 1.3 trillion, basic salaries of 5.4 trillion, public servants' 36-month benefits, rural stabilization allowances, and various other mandated pensions totaling 17 trillion will remain unchanged, 1.4 trillion will be cut from current expenses, 0.8 trillion from capital expenses, and 0.2 trillion from foreign loan utilization. Additionally, while ongoing projects will remain unaffected, financing for 2025 projects without contracts as of December 2, 2024, will be postponed by 158.2 billion, regional development investments will be reprioritized and 517.9 billion will be cut, funding for certain feasibility studies and major maintenance will be partially reduced by 61.1 billion, and equipment financing will be cut by 20% or 83.6 billion. The budget resubmission accounts for an addition of 7.9 billion for major repairs and infrastructure works for the "Cancer Hospital Building 2." Consequently, certain programs and measures, including changes to related laws, will be halted or postponed. These include the following: - Cultural Vouchers - 18 billion - Active Living Support Costs - Film Arts Support Costs - Training and Seminar Costs - Transport Services - Healthy Active Living - Council, Committee, and Commission Members' Fees - Creative Industries in Culture.
Discussion on Corruption and Conflict of Interest in Granting Building Permits
Published: 2024-12-04 | Translated from: gogo.mn
The Anti-Corruption Agency discussed whether there is any corruption or conflict of interest in the issuance of building permits. The Anti-Corruption Agency participated in the "Building Activity Special Permits: Change and Reform-2024" discussion and presented a report. S. Bayartsetseg, an officer and commissioner in the agency's Prevention and Public Awareness Department, presented on "Preventing Corruption and Conflict of Interest in the Building Permit Process," discussing issues such as the involvement of member companies, electronic systems, relevant rules and regulations, detected conditions, and the workflow of granting building permits from start to finish. A discussion on these issues was held. B. Terbish, a senior officer and senior commissioner in the Prevention and Public Awareness Department of the Anti-Corruption Agency, participated as a panelist in a sector discussion on "Bringing Permit Issuance to the International Level and Making Basic Conditions More Flexible." He proposed suggestions such as improving the supervisory system placed by the sector ministry on the building permit issuance process, introducing international practices of granting permits to specific projects rather than legal entities, updating related procedures, and avoiding decisions related to membership during the discussion. Source: Anti-Corruption Agency
B. Javkhlan: Next year's budget expenditure will be reduced by 1.4 trillion, and the cultural rights document will be removed
Published: 2024-12-04 | Translated from: itoim.mn
The government convened today at 14:00 to discuss the draft law on the 2025 Budget and decided to submit it to the State Great Khural (Parliament). Due to the President's complete veto on the 2025 budget law, there arose a need to reduce the budget expenditure by 1.9-2.4 trillion. In the draft budget that is set to be re-submitted, the deficit will be reduced by 1.4 trillion by eliminating the "Cultural Rights Document" and adding 7.9 billion to the infrastructure for the Cancer Hospital building. Additionally, it was proposed to cut expenses allocated for supporting cultural rights such as film arts, training, seminars, transportation service board, council, commission member salaries, and cultural creative production.
Supreme Court: Reviewing the Development Bank Case Decisions
Published: 2024-12-04 | Translated from: news.mn
The criminal case hearing of the Supreme Court's supervisory stage is reviewing the case involving the Development Bank, which implicates 80 individuals and four legal entities, contained in 540 case folders, based on the protest by the prosecutor and the complaints filed by 41 defendants and their lawyers. The judicial panel will listen to the appeals and legal arguments submitted by the defendants, lawyers, and prosecutors on December 2-3, 2024. Thereafter, from December 4, they will move to the deliberation room to review the rulings of the first instance and the appellate courts. The announcement of the decision by the supervisory stage court will be made separately on the official website of the Supreme Court of Mongolia. In the previous day's meeting, participants discussed issues within the 41 complaints submitted by the prosecutor, defendants, and their lawyers, causing the court session to recess at 18:50. On the second day of the court session, a total of 32 participants, consisting of prosecutors, lawyers, and defendants, presented their opinions and explanations; 31 in person and 1 online.
Review of Development Bank's Lower Court Decisions Ongoing
Published: 2024-12-04 | Translated from: gogo.mn
The Supreme Court of Mongolia is currently reviewing the decisions of the lower and appellate courts regarding the Development Bank case. In a hearing at the criminal division of the Supreme Court, the case involves 80 individuals and 4 entities, linked to 540 volumes of documents. The court is hearing the prosecutor's objections and complaints from 41 defendants and their lawyers. During the sessions, the court will consider the defendants', attorneys', and prosecutors' objections, complaints, legal conclusions, and proposals. The court panel will deliberate in chambers to review the previous decisions of the lower and appellate courts. The date for announcing the Supreme Court's decision will be published on the website of the Supreme Court of Mongolia. Source: Supreme Court of Mongolia
Economy
Arab Business Persons Interested in Investing in Halal Meat and Wheat Production
Published: 2024-12-04 | Translated from: gogo.mn
During Prime Minister L. Oyun-Erdene's working visit to the Kingdom of Saudi Arabia, Deputy Prime Minister T. Dorjchand met with major business persons of the country. During the meeting, they provided information about the economic policy and investment environment of the Joint Government and exchanged ideas on increasing trade and investment between the two countries. Business persons from Saudi Arabia expressed their keen interest in cooperating in the energy, agriculture, and mining sectors. The government reported that they showed particular interest in investing in renewable energy, halal meat, wheat, and mineral sectors. It was mutually agreed to establish a council of business persons through the two countries’ Trade and Investment Organization and the Chamber of Commerce and Industry to collaborate together.
KhasBank Signs $50 Million Financing Agreement with Asian Development Bank
Published: 2024-12-04 | Translated from: ikon.mn
KhasBank has signed a financing agreement with the Asian Development Bank (ADB) to receive $50 million to support micro, small, and medium enterprises (MSMEs) and climate change mitigation projects. Of this financing, $40 million will be provided by ADB, and $10 million will be provided by the Canada Climate Fund for the Private Sector in Asia (CANPA). At least 70% of the funding will be allocated to projects that mitigate and adapt to climate change, while the remainder will support MSMEs, particularly loans for women entrepreneurs. Bhargav Dasgupta, ADB's Vice President for Market Solutions, stated during the signing ceremony: "It is crucial to create a sustainable economy with a large green finance market to achieve Mongolia's goal of net-zero greenhouse gas emissions. ADB, in its capacity of working towards climate change mitigation and adaptation in the Asia-Pacific region, is partnering with KhasBank to support this critical sector, which in turn enhances economic growth and resilience against climate change." G. Tsegjav, CEO of KhasBank, emphasized, "KhasBank has continually supported businesses contributing to the resilience of Mongolia against climate change and the development of sustainable financing. This partnership with ADB offers us opportunities to propose long-term, low-cost financing options for green businesses and MSMEs, thereby contributing to Mongolia's sustainable and inclusive economy." The CANPA, administered by ADB, was established in 2024 with a funding of 360 million Canadian dollars by the Government of Canada. It aims to support private sector projects focused on climate and environment in the Asia-Pacific region while enhancing gender equality. The funding provided to KhasBank marks CANPA's first financing initiative. Since its founding in 2001, KhasBank has been committed to supporting MSMEs and developing sustainable finance mechanisms, making it one of Mongolia's leading banks, providing reliable financial services to over 1 million customers through 72 branches nationwide. ADB was established in 1966 with the goal of creating a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while reducing poverty. It is an international organization with 69 member countries, encompassing 49 regional members.
D.Batlut: Can 'Oyu Tolgoi' Pay 5% and 'Erdenet' Pay 20% in AMNAT?
Published: 2024-12-04 | Translated from: news.mn
The meeting of the Budget Standing Committee of the State Great Khural discussed the draft resolution on approving the audit topics. During this meeting, the issue was raised about why a state-owned enterprise pays several times higher AMNAT (mineral resource use fee) compared to a foreign-invested company. It was questioned whether the National Audit Office has conducted a review and made any conclusions on this matter. Member of Parliament D.Batlut stated, "The 'Oyu Tolgoi' company paid 372 million USD in AMNAT from 2010 to 2022. This is over a total of 12 years, under a stabilization agreement. Yet by September 30 of this year alone, the 'Erdenet' plant paid 615.2 billion MNT, which is equivalent to 180 million USD, calculating it by 20%. Mongolia has a unified legal framework. Why is the law applied differently to state-owned companies compared to foreign-invested companies? The state-owned company is bearing the burden as they say, 'it's easy to shear a gentle camel.' There is a need for the salaries of the staff working there to be at the same level as those in mining companies and for technological upgrades. Why hasn't the audit organization made conclusions on this matter? Have they checked anything? Due to the unequal AMNAT, the rights and interests of employees at the 'Erdenet' plant are seriously violated." Leading auditor of the National Audit Office, G. Naranchimeg responded, "Our state audit organization conducts audits of state organizations. We do not audit foreign-invested companies." Member of Parliament D.Batlut continued, "It is said to be impossible for foreign-invested companies. If 'Oyu Tolgoi' pays 5% AMNAT, while 'Erdenet' pays 20%, how is this possible? 'Erdenet' has already paid 180 million USD in the first nine months of the year, while 'Oyu Tolgoi' pays 372 million USD in 12 years. Is this acceptable?" Chairman of the Budget Standing Committee, Ts. Davaasuren concluded, "The audit report on the 'Oyu Tolgoi' company was conducted because 34% of it is owned by the state. Since the audit conclusion was submitted confidentially, we will arrange for you to review it in confidence."
D. Tegshbayar: Only Five Out of 99 State-Owned Companies Are Profitable
Published: 2024-12-04 | Translated from: ikon.mn
Today, a discussion about improving the role, participation, and oversight of independent members of the Boards of Directors of State-Owned and State-Involved Companies and publicly traded companies was held at the "Blue Sky" hotel. As of June 2024, 51 companies' Boards of Directors are operational, including those implemented by representatives of the Cabinet Secretariat, Ministry of Energy, Ministry of Finance, Ministry of Mining and Heavy Industry, Ministry of Construction and Urban Development, Ministry of Food, Agriculture and Light Industry, and Erdenes Mongol LLC. Out of the 458 board members, 148 are independent and 310 are state representatives, according to T. Bayar-Erdene, Head of the State Property Management and Coordination Department of the State Property Policy Department. STATE-OWNED / STATE-INVOLVED COMPANIES BOARD MEMBER STATISTICS: - Ministry of Energy: 104
- State Property Policy and Coordination Department: 68
- Ministry of Road and Transport Development: 11
- Cabinet Secretariat: 22
- Ministry of Finance: 20
- Ministry of Mining and Heavy Industry: 5
- Ministry of Food, Agriculture and Light Industry: 23
- Ministry of Environment and Tourism: 1
- Ministry of Justice and Home Affairs: 2
- Other ministries and agencies: 55
The views of participants on the independent activities of state-owned companies' board members are presented here. "43 percent of 99 companies are in high-risk debt" 1. D. Tegshbayar, an independent board member of "Erdenes Tavan Tolgoi" JSC: The procedure for the appointment of independent members was approved by the government in 2023. It is regulated by laws related to the securities market, corporate laws, state and local property laws, and procurement laws. In other words, we have sufficient legal frameworks on this front. But how is the implementation going? Only five out of 99 state-owned companies are operating profitably. 43 percent of these companies are in high-risk debt situations. It is linked to appointing state representatives without providing guidance from above and ensuring accountability, thereby not allowing independent members to operate independently. Today, many state-owned companies are operating without any profit, effectively becoming organizations that sustain a group of people. We do not lack legal regulation. We are adding new laws in this direction. In my view, there is little hope for improvement by enacting new laws. If we resolved our current issues, ensured transparency, and increased public participation and oversight, it would be more effective. "Board members are not being selected through open competition, they are directly appointed" 2. Deputy Chief of the Cabinet Secretariat D. Tsolmon: The entity implementing the shareholder rights will set the compensation level for their board members. For companies operating profitably, it will consider the scale of the company, profitability, and private sector compensation standards. For companies operating in public infrastructure and social sectors, it will set salaries according to appropriate categories within the state service as proposed in the legislative bill. Moreover, it is regulated that board members will not enjoy benefits beyond salary and bonuses. In case of political appointments: A professional, independent board is a key factor in improving the performance and efficiency of a company. Board members must enhance oversight of executive management and make policy decisions professionally. Therefore, the requirement for board membership is entering with a high threshold. Currently, there is no open recruitment process. Direct appointments are being made, which is heavily criticized for being dependent on political influence. The legislative bill is changing this. The main ideological focus is on forming a professional, independent board. "Currently, state-owned companies in Mongolia are operating without regulation" 3. T. Zend-Ayush, Professor of the Graduate School of Economics: Who determines the independence of independent members in Mongolia? Are these members truly independent? After many years in one organization, they may no longer be independent. Secondly, how independent are the decisions made by independent members on the board? Especially in state-owned companies, members representing the state always vote based on instructions. If six of the nine members are state representatives, can the three independent members truly remain independent? Boards should conduct their evaluations annually, ideally with assessments done by external professional organizations. Currently, state-owned companies in Mongolia are operating without regulation. Even though they claim to regulate under corporate laws, in reality, these laws do not specifically address state-owned enterprises. Warning: Media organizations (TV, Radio, Social, and Websites) must refer to the source (ikon.mn) when using our information in any form, either fully or partially.
Diplomacy
Silent Agreement with the Eurasian Economic Union Poses a Threat
Published: 2024-12-04 | Translated from: itoim.mn
Mongolia is negotiating a free trade agreement with the Eurasian Economic Union, which includes Russia, Kazakhstan, Belarus, and other member states, to import over 300 types of goods and products tax-free by December, according to the government's plans. However, there is a danger that this agreement will limit the growth possibilities for small and medium-sized enterprises in construction, food, and agriculture that produce similar types of goods and products. Specifically, discussions are underway to supply the majority of agricultural products (all meat, dairy, wheat, flour, vegetables, water, beverages, etc.) to Mongolia without import duties or quotas. Mongolian enterprises, struggling to find their footing, cannot compete with large companies from those countries, which have grown significantly due to substantial state subsidies. Russia is currently facing economic sanctions. How will Western investors perceive a partnership agreement that reduces customs duties at such a time? There is no reason to establish an agreement that disrupts internal production capability for meat, dairy, water, beverages, and causes an increase in imports that further aggravates the trade deficit and harms the country. Local producers are opposing and expressing their dissatisfaction over this situation. Furthermore, this agreement does not align with Mongolia's "Food Revolution" movement, a government initiative aimed at developing the food and agriculture sector and reducing food imports. Previously, the Mongolian Parliament had approved a resolution to fully meet the demand for 19 types of goods domestically. Loans offered to support production will also be ineffective. Therefore, members of Parliament should consistently continue Mongolia's policy to protect the strategically important food and agriculture sector elected by the people, oppose this agreement that allows tax-free import of goods and products, and ensure food safety and national independence. In 2023, the foreign trade statistics of the five countries in the Eurasian Economic Union showed a trade deficit of 2.4 billion USD. Specifically, they supplied goods worth 143 million USD and imported products worth 2.5 billion USD. If the aforementioned agreement is concluded, the trade deficit will undoubtedly increase. When taxes are reduced between large and small countries, the large one tends to profit. The U.S., for example, has imposed tariffs ranging from 25% to 65% on Chinese products to protect its own economy, according to its President's announcement. But in our country, the opposite is happening... Who will protect the true patriotic manufacturers?
The Embassy of Mongolia in Seoul Issues a Warning
Published: 2024-12-04 | Translated from: gogo.mn
The Embassy of Mongolia in the Republic of Korea issued the following warning message on their website. The message states: The President of the Republic of Korea, Yoon Suk Yeol, declared a "state of emergency." In connection with the declaration of a state of emergency, citizens residing in the Republic of Korea are advised to: - Remain calm and patient - Avoid going out as much as possible - Urgently contact the embassy's emergency phone number 010-9595-3464 if there is any information related to the citizens of Mongolia.
Prime Minister L. Oyun-Erdene Met with the Crown Prince of the Kingdom of Saudi Arabia
Published: 2024-12-04 | Translated from: montsame.mn
During his working visit to the Kingdom of Saudi Arabia to attend the 16th session of the Conference of the Parties to the UN Convention to Combat Desertification, the Prime Minister of Mongolia, L. Oyun-Erdene, met with the Crown Prince and Prime Minister of the Kingdom of Saudi Arabia, Mohammed bin Salman Al Saud, on the 3rd of this month, discussing the relations and cooperation between Mongolia and Saudi Arabia. Prime Minister L. Oyun-Erdene congratulated the Kingdom of Saudi Arabia on successfully organizing the 16th session of the Conference of the Parties to the UN Convention to Combat Desertification in their country and emphasized the high importance Mongolia attaches to participating in this session, as it will host the next session. Furthermore, Prime Minister L. Oyun-Erdene introduced the Mongolian Government's action program and objectives for 2024-2028, highlighting the significance of expanding and developing cooperation in sectors such as renewable energy, critical minerals, urban development, agriculture, and environment between the two countries. Crown Prince Mohammed bin Salman affirmed his commitment to expanding relations and cooperation in all sectors with Mongolia, contributing to Mongolia's development. The parties also agreed to cooperate in organizing the 17th session of the Conference of the Parties to the UN Convention to Combat Desertification in Mongolia in 2026.
Prime Minister Oyun-Erdene Meets with Saudi Arabia's Crown Prince to Discuss Cooperation
Published: 2024-12-04 | Translated from: isee.mn
The Prime Minister of Mongolia, L. Oyun-Erdene, made a working visit to the Kingdom of Saudi Arabia during the 16th Conference of Parties to the UN Convention to Combat Desertification, held in the country. Specifically, he met with the Crown Prince and Prime Minister of Saudi Arabia, Mohammed bin Salman Al Saud, to discuss relations and cooperation between Mongolia and Saudi Arabia. Prime Minister L. Oyun-Erdene congratulated Saudi Arabia on successfully hosting the 16th Conference of Parties to the UN Convention to Combat Desertification and emphasized that Mongolia, as the next presiding country, considers this conference very important. Additionally, Prime Minister L. Oyun-Erdene introduced Mongolia's Government Program and objectives for the years 2024-2028 and noted the importance of expanding and developing cooperation in sectors such as renewable energy, critical minerals, urban development, agriculture, and the environment between the two countries. Prince Mohammed bin Salman affirmed his commitment to expanding relations and cooperation with Mongolia across all sectors and contributing to Mongolia's development. The parties also agreed to collaborate in organizing the 17th Conference of Parties to the UN Convention to Combat Desertification in 2026 in Mongolia.
Agreements Made to Accelerate Mongolia-France Cooperation on Major Projects
Published: 2024-12-04 | Translated from: montsame.mn
During the "One Water Summit" held in Riyadh, Kingdom of Saudi Arabia, the Prime Minister of Mongolia, L. Oyun-Erdene, held a bilateral meeting with the President of the French Republic, Emmanuel Macron. During the meeting, both parties expressed their interest in developing cooperation in the mining sector in an environmentally friendly manner and in ensuring water supply and security in the desert-steppe regions. They also agreed to prioritize the implementation of major projects to enhance Mongolia-France cooperation in the near future.
Mongolian Delegation Participates in the International Criminal Court Assembly
Published: 2024-12-04 | Translated from: isee.mn
The 23rd session of the Assembly of States Parties to the Rome Statute of the International Criminal Court is being held in The Hague, Kingdom of the Netherlands, from December 2 to 7, 2024. The Mongolian delegation, headed by the State Secretary of the Ministry of Foreign Affairs, L. Munkhtushig, includes representatives from the Ministry of Justice and Internal Affairs, the National Security Council's office, and the General Prosecutor's Office. The general debate of the assembly includes representatives from 125 member states of the Rome Statute of the ICC, participating at the level of Ministers of Justice, Ministers of Foreign Affairs, Deputy Ministers, State Secretaries, and Ambassadors. On the first day of the assembly, State Secretary L. Munkhtushig delivered a speech expressing Mongolia's position. In addition to the main sessions of the assembly, the Mongolian delegation is participating in more than 10 side meetings and events, according to information from the Ministry of Foreign Affairs.
Infrastructure
Resolution Passed to Increase Fees Related to Vehicles and the 2025 Budget of the Capital
Published: 2024-12-04 | Translated from: ikon.mn
The resolution to increase vehicle-related fees and the 2025 budget of the capital has been approved by the Citizens' Representative Council of the Capital. According to the chairman of the Council, Mr. A. Bayar, during the extraordinary second session, the discussion on the 2025 budget proposal of the capital and the accompanying resolution to increase official taxes on vehicles and road usage fees will continue in a second reading. However, the Citizens' Representative Council's website did not conduct a public meeting on this discussion today. When questioned from an official source, it was confirmed that "Today's meeting at 11:00 approved next year's budget for the capital, and since the resolution to increase vehicle tax and road usage fees was included, it has also been approved. An official statement will be issued." City Mayor Kh. Nyambaatar stated to the public that "Next year, the law for vehicle and self-propelled machinery taxes will have limits increased by 2-3 times, and road usage fees will see a 5-fold increase from the current rates, with the aim of increasing the income and resources of the capital's road fund by 151.5 billion MNT, as included in the budget proposal." According to the source, this resolution was indeed adopted. Regarding the 2025 budget proposal for the capital, he stated, "The base income of next year's budget is calculated to be 3.226.4 billion MNT, and the base expenditure to be the same, with no contributions to the state budget from the capital's budget. The capital's income is planned to comprise 85.9% tax revenue totaling 3.3 trillion MNT and 14.1% non-tax revenue amounting to 541.9 billion MNT. In the total expenditure project, 38.2% or 1.3 trillion MNT will go to operational costs, 48.9% or 1.7 trillion MNT to capital costs, 2.2% or 78.3 billion MNT to loan repayments, 9.4% or 327.2 billion MNT to securities repayments, and 0.4% or 14.1 billion MNT will be designated for financial support to the three remote districts." Meanwhile, the State Audit Office assessed that in the next year's budget proposal for the capital, "there is a one-time budget of 1.6 billion MNT allocated for avoidable and inefficient expenditures. There are opportunities to reduce the capital's budget expenditure by 16.2 billion MNT." Warning: Media organizations (TV, Radio, Social media, and Web pages) must mention the source (ikon.mn) if they use our information in any form either in full or in parts.
Meeting Held for Training of Metro Engineers and Specialists in Ulaanbaatar
Published: 2024-12-04 | Translated from: gogo.mn
In September, a tripartite memorandum was signed between the Ulaanbaatar City Administration, the Mongolian University of Science and Technology, and "Duhua Engineering" JSC for the purpose of preparing human resources for the metro construction project, which is a large-capacity public transportation system, in the capital city of Ulaanbaatar. For the operation and service of the metro, as well as for further construction endeavors of this type, over 600 engineers and technical personnel are needed. Therefore, a "2+2" program has been planned to send students to study for two years at the Mongolian University of Science and Technology and two years in South Korea. The parties held their first meeting within the framework of the memorandum on training metro engineers and specialists. The meeting was attended by U.Baatar, Director of the Integrated Project Implementation Unit for the reduction of traffic congestion in Ulaanbaatar City, Kim Yun Won, Director of Halla University, and related officials led by Professor Min Jun Gi. During the meeting, Kim Yun Won said, "Halla Group was the first in South Korea to undertake the construction of a high-speed rail line. In international cases, other countries often focus primarily on construction work. However, I'm glad that the city's leadership is focusing on preparing human resources to operate the metro after it is put into operation. We will dedicate our strength and capabilities to the work of preparing metro specialists." Source: Integrated Project Implementation Unit for the reduction of traffic congestion in Ulaanbaatar City
Singapore's Urban Planning Experience to be Adopted
Published: 2024-12-04 | Translated from: gogo.mn
Singapore's "Township" planning, including the "community based" concept and its experience in developing satellite cities, attracts the attention of developing countries. Some members of the Parliament of our country working in Singapore, along with the leadership of the Ministry of Urban Development, Construction, and Housing, and urban planners, are getting acquainted with these experiences and engaging in specific discussions. Today, they met with Kong Vi Mun, the head of Singapore's cooperation organization. Both parties expressed their commitment to actively and effectively cooperate in advancing their bilateral cooperation in urban development, construction, and housing in the future.
Environment
30% of the Territory Faces High Risk of Severe Winter Conditions
Published: 2024-12-04 | Translated from: montsame.mn
According to the snow measurement data, the mountainous regions have snow depths ranging from 11 to 22 cm, while some soums in the steppe and desert regions have snow depths of up to 1-10 cm. The risk of severe winter conditions is assessed to be high in approximately 30% of the territory, medium in more than 20%, low in over 30%, and no risk in more than 10%. In terms of aimag analysis, Bayan-Ulgii, Uvs, Khovd, Govi-Altai, and most of Bayankhongor regions face extremely high and high risks, while some soums in Zavkhan, Arkhangai, Ovorkhangai, Khövsgöl, and Sukhbaatar have medium to high risk levels. Follow @montsame.mn
50% of the country's territory is at risk of a harsh winter
Published: 2024-12-04 | Translated from: unuudur.mn
The National Institute of Hydrology, Meteorology, and Environmental Research regularly presents the risk map of harsh winters during the cold season. This year, the Institute has indicated that 50% of our country's territory faces the risk of a harsh winter. Of this, 30% is at very high risk, while 20% is at medium risk. This assessment is based on summer pasture conditions, grazing load, livestock numbers, the upcoming month's weather forecast, and precipitation predictions. Bayan-Ölgii, Uvs, Khovd, Govi-Altai, and most soums (districts) of Bayankhongor could face the highest risk of harsh winters. Some soums in Zavkhan, Arkhangai, Övörkhangai, Khövsgöl, and Sükhbaatar provinces are also included in the high-risk areas. This winter is expected to be colder than the long-term average in most regions. In particular, western and central provinces might see above-average snowfall, potentially worsening winter conditions. Therefore, herders in these mentioned provinces are advised to thoroughly prepare for the winter and spring.
Innovation
Study the Experience of Developing the Digital Economy
Published: 2024-12-04 | Translated from: montsame.mn
In Ulaanbaatar, the Acting Secretary of the Ministry of Digital Development and Communications, P. Altan-Od, met with the European Union Ambassador to Mongolia, Ina Marčiulionytė, and representatives of the European Commission. He stated that "A foundation capable of handling the continuous flow of information and the wave of data is a powerful data center. Particularly, there is a desire to contribute to green development by having an energy-efficient, resource-saving 'Green Data' center. We are eager to share experiences from other countries and collaborate on the development of a feasibility study in this field." "We are also looking for opportunities to promote products and services of Mongolian software developers and information technology business entities in the markets of European Union countries, and to outsource information technology services. Additionally, regarding the launch of a national satellite, our country plans to collaborate with the French company 'Thales Alenia Space' to discuss the loan agreement in the Parliamentary Standing Committee and the plenary session. After the Parliament approves the loan agreement, the governments of the two countries will negotiate further." Moreover, it is planned to revise a package of laws to support digital development starting from next year. In this context, there is a desire to study the good practices and obtain technical assistance related to the policy and regulations of European Union countries on utilizing information created by the government in the private sector and involving data and information in economic circulation. Pēteris Ustubs, Director of the International Partnerships Directorate for Asia, Pacific, and the Near East of the European Commission, mentioned: "Team Europe is implementing a program to support developing countries, focusing specifically on digital economic development. It supports policy and practical solutions for providing technical assistance, and creating a legal environment, as well as organizing training and capacity-building in cybersecurity. Additionally, they aim to initiate satellite cooperation in Central Asia. This project has the potential to be implemented from Central Asia to Mongolia." Regarding the national satellite launch project in collaboration with France, it is possible to study how to link it with Starlink, where unlike Starlink, internet connection stations will reach citizens through cellular providers. This can manage the flow of information internally and create more reliability," reported the Ministry of Digital Development and Communications.
Amendments to Some Laws for a Paperless Government
Published: 2024-12-04 | Translated from: montsame.mn
The Mongolian government is preparing to amend certain laws to facilitate a paperless government system. In 2020, the "E-Mongolia" system was introduced to provide government services to citizens efficiently and without bureaucracy. Currently, it integrates 1,255 services from 86 government organizations online. 85% of citizens access these services via mobile phones, 13% use desktop computers, and 2% use kiosks. However, many challenges have arisen for citizens using the "E-Mongolia" system for digital government services. Private enterprises and commercial banks do not recognize certificates from "E-Mongolia" and insist on paper documentation. Additionally, accessing services for legal entities digitally is more complicated and time-consuming. Issues also exist with uploading passport photos to the "E-Mongolia" system and difficulties faced by Mongolians living abroad. To address these issues, Minister Ts. Baatarkhuu met with officials from the E-Mongolia Academy, the National Data Center, and the General Authority of State Registration. Despite several discussions with banks, they have not recognized digital information from "E-Mongolia." Although banks frequently extract information from the KHUR system, they do not accept "E-Mongolia" documentation. Furthermore, it has been emphasized that digitalizing services provided by courts, prosecutors, and police is challenging. To better serve citizens abroad, it has been proposed to deploy specialized registration officers at diplomatic missions, and kiosks have been deployed in Seoul and Busan, South Korea. UBEG's director U. Boldkhuu highlighted that despite the infrastructure being in place for digital government services, usage remains inadequate. Paper archives still occupy substantial space and consume significant budget resources. It's necessary to amend laws and regulations to turn this digital transition into a reality rather than a slogan and improve citizens' awareness and digital skills. A consistent understanding at the government level is also required. Acknowledging the cybersecurity risks of UBEG's servers containing comprehensive information on citizens, legal entities, and assets, although a budget of 2 billion MNT was proposed, it was not approved. Minister Ts. Baatarkhuu stated that an Oxford University-led assessment of these cybersecurity risks is underway, with results expected by the end of December. Based on this study, future measures will be determined. The government has decided to create a dedicated cybersecurity budget within the state budget. Officials have been instructed to study the situation and present findings at the minister's briefing next week and to collaborate with the Ministry of Justice and Home Affairs on legal amendments. Efforts to reduce the reliance on paper documentation in government interactions have been decided by the Ministry of Communications and Information Technology.
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