BUSINESS COUNCIL of MONGOLIA NewsWire

www.bcmongolia.org info@bcmongolia.org

Issue 323 – May 2, 2014

NEWS HIGHLIGHTS:

Business

Mongolia set to resolve mining licenses dispute, says Kincora;

Mongol Mining JV with Shenhua credit positive;

Hong Kong Jockey Club says no plan to be part of Mongolia racing, betting;

Khushigt Valley airport to begin operations in Dec. 2016, says Japan official;

Khan Bank launches nationwide Bancassurance campaign;

EBRD financing Senj Sant cement plant;

Altan Rio debt settlement paves way for EBRD placement;

Firebird Global Master Fund reports transactions in Khot Infrastructure;

Prophecy announces new board director;

FeOre receives extension from bondholders', approval on sale;

Winsway to change name to "Winsway Enterprises";

Mongolia Investment Summit London recap;

NAMBC 2014 AGM Held in Ottawa, April 22-23;

Mongolian scientist speaks at Colorado State;

Talkh Chikher takes “Top Brand” award;

Alstom accepts GE offer but leaves room for Siemens bid.

Economy

Long-term rating on Mongolia lowered to 'B+';

Mongolia downgrade weighs on Chinggis bond;

Fitch: Weakening Mongolian Mining Highlights Risks for Banks;

Mongol Bank: FX auctions, swap agreements, 1-week bills, treasury bonds;

Mongolia requests extension for MNT-CNY swap agreements;

Mongol bank official calls tugrug depreciation “seasonal phenomenon”;

OT dispute weighs on tugrug as capital dries up;

April Sales Managers' Index;

Number of mine workers grows;

UB supports local agriculture;

Mining downturn forces Mongolia to diversify;

Scientists see strong correlation between air pollution and miscarriage in UB;

USAID partners with World Vision for disaster risk management in west;

Mongolia's green power pioneers keep Asian Super Grid dream alive;

Commodities back in favor as a portfolio diversifier;

China plans crackdown on iron ore import loans;

China poised to pass US as world‟s leading economic power.

Politics

Mongolia premier unveils 100-day push to revive economy;

Mongolia to revise mineral law to attract investment;

Parliament discusses economic stimulus initiative;

Mongolia will propose gambling on horse racing to tap China;

DP boots Burmaa for dissenting vote;

MP says he left Justice Coalition due to „Double Deel‟ Law;

Mining Ministry to oversee development of Asgat silver mine;

Saudi Arabia to open Mongolian embassy;

Vietnam, Mongolia boost mutual trust, cooperation;

Corruption authorities open investigation into former Mon Atom director;

Moscow Takes Ukraine, Beijing Takes Mongolia?

ECONOMIC INDICATORS

MSE Top 20 Index by market Capitalization;

Foreign-listed Companies with Mongolian Assets;

Monthly Macroeconomic Overview – March 2014;

Supermarket Price Comparison – April 2014;

Inflation;

Central bank policy rate;

Currency rates.

*Click on titles above to link to articles.

SPONSORS

Khan Bank

International SOS

Invest Mongolia Agency

Mongolian Economy Magazine

Oxford Business Group

Milestone GRP

BCM MEETING RECAP

The BCM meeting on 28 April was held for the first time at Best Western Tuushin Premier Hotel with

Bayanjargal Byambasaikhan in the chair and attended by 120 members and invited guests. Executive

Director Jim Dwyer introduced BCM's new vice director, Amarjargal Bayarmaa. Bayarmaa currently

works with BCM as chairperson of the Environmental Working Group. She leaves her position as

senior carbon finance specialist for Clean Energy LLC.

Dwyer and Byambasaikhan also announced the recently announced Business Summit to be held in

Ulaanbaatar in June.

―The target is to have 150 CEOs of the top Mongolian companies,‖ said Dwyer. ―Obviously

government can explain, hopefully, the amendment to the minerals Law and the removed

restrictions on exploration licenses, and other initiatives we expect to be taken place in the short

term.‖

The event is being organized by the same team behind the Mongolian Economic Forum, the

Economic Policy and Competitiveness Research Center (EPCRC).

The following new BCM members were introduced:

1. The newly opened Best Western Premier Tuushin Hotel offers a wide variety of luxury

accommodation, extensive state of the art conference and banqueting facilities and three high

quality restaurants providing a wide range of fine dining options, with menus and wines from around

the world especially prepared for you by our internationally qualified chefs and sommeliers.

The 25-story, 200-room Best Western Premier Tuushin Hotel is a impressive landmark in the center

of Ulaanbaatar due to its modern design and excellent location close to the Government Palace,

government offices, shopping areas and com¬mercial institutions.

2. Cummins Mongolia Investment LLC, established in 2011, is an exclusive distributor for Cummins

Inc., the world‘s largest independent manufacturer of diesel engines and a global leader in power

generation technology. Cummins takes pride providing sales and exceptional service and support

for Cummins engines, Cummins generators, Cummins Filtration products and related products

serving the varied needs of our customers in Mongolia, such as mining, oil and gas, power

generation, agriculture plus on and off road vehicles.

3. Forbes Mongolia is published under a licensing agreement between Forbes Media LLC and MGL

Capital LLC. The Mongolian edition will be the 33rd local language edition with monthly publication

and Forbes Mongolia will have access to Forbes stories from around the world.

Forbes Mongolia's editorial team will also feature local content on chief executives, tycoons,

philanthropists, investors and aspiring entrepreneurs who are making a difference in the country‘s

economic landscape and society.

4. International Mining Consulting (IMC) LLC, established in 2013, is an independent national

company that offers following services: geotechnical engineering, mine engineering; project

management , contract mining , pre-feasibility studies , training, and consultancy

5. Lewis Marks has lived in Tokyo, Beijing, and Ulaanbaatar since 1977, 1982, 1992, respectively and

conjointly. Marks is licensed to practice law in New York, a board member of CBH Resources,

Australia (zinc/lead mines) since 2002 , a board member of LIM Japan Fund since 2003 , a founding

partner of MIC Global Partners LLC (commodities investment, oil exploration + production in North

America) since 2003, a director and equity partner in CWT Mongolia (copper/oil) , an equity partner

in Bayandari Co. (farming in Selenge and Zavkhan) , and a partner in Rich Resources, Beijing

(commodities).

6. Melbury Capital is a private equity vehicle seeded by the Reuben Brothers and a select group of

family offices. The fund achieves superior returns through tailored, country specific investment

strategies in frontier markets. The Mongolia office is currently developing assets in the mineral

extraction space. Melbury is currently looking to acquire Mongolian assets in the gold sector and is

also seeking to expand deal flow in other sectors.

Environmental Working Group Chair Bayarmaa Amarjargal gave the first presentation of the evening

on BCM's ―Green Office Initiative.‖ BCM has partnered with the Ministry of Environment and Green

Development to introduce to Mongolia's offices internal, self-operated systems for waste collection

and proper disposal.

―The mission is to take a multi-stakeholder approach toward sustainable practices in Mongolia,‖

said Bayarmaa.

Mongolia's solid waste increases by 500,000 a year in Ulaanbaatar, she said. As proper disposal

becomes an increasingly important issue, BCM's Environmental Working Group is working with public

and private offices, such as the Asia Foundation and numerous restaurants to arrange for waste

collection. To further promote this objective, NTV has agreed to play a 30-minute promotion every

two weeks informing the public about the initiative.

Sant Maral Foundation Director Luvsandendev Sumati presented next on the latest Politbarometer,

released in March.

―I was expecting some bad news for government but we didn't see that here,‖ said Sumati, noting

that the government was not heavily criticized despite the declining economic conditions in the

country. ―This situation is not like the spring weather—not volatile. Actually it's extremely

predictable.

The survey found that dissatisfaction with the business environment was still high at 48.5 percent,

but below that of the previous year's 52.7 percent. Government approval, too, was high at 40

percent, but less so than that of Sukhbaatar Batbold's government. People reported that instances

where households had gone hungry was less than that of previous years, but complaints of income

distribution were still high. Citizens' faith was largely in favor of the government to maintain fair

distribution of wealth.

―Our population does not trust private business,‖ said Sumati. He added that this sentiment would

remain as long as the government could afford to subsidize the livelihood of Mongolians.

The final presentation of the evening came from J. Sunjidmaa, corporate and public affairs

manager of Peabody Energy Corp., to discuss Peabody's ―Advanced Energy for Life‖ global advocacy

campaign. ―We see that energy poverty is the number-one crisis. It brings people down—and

society,‖ said Sunjidmaa.

The goal of the campaign was to increase access to low-cost energy while reducing emissions, she

said. The 21st Century coal, she said, is managed to be socially and environmentally friendly.

BUSINESS

MONGOLIA SET TO RESOLVE MINING LICENSES DISPUTE, SAYS KINCORA

Mongolia plans to put a resolution to parliament that will end a dispute between 11 foreign license

holders and the government over the invalidation of 106 mineral exploration licenses, one of the

companies affected, Kincora Copper Ltd., said on Monday.

The dispute is one of several issues, led by disagreements between Rio Tinto and the government

over plans to expand the giant Oyu Tolgoi copper mine, that have soured investor appetite for

Mongolia over the past two years. The 106 exploration licenses were declared void by a Mongolian

court last year after it found the former head of the Mineral Resources Authority guilty of illegally

approving the licenses between 2008 and 2009.

Toronto-listed Kincora Copper Ltd, one of 11 foreign investors affected, said the proposed

resolution was a "win-win" to end the dispute over its two cancelled licenses, on which the company

had to take a CAD 7 million writeoff last year.

"This case has had a major, negative impact on investor sentiment towards Mongolia. And the way

in which the government responds to investor concerns about the revocation of licenses, we hope,

will set a positive and visible precedent as to how future investors will be treated," Kincora Chief

Executive Sam Spring said in a statement.

Source: Reuters

MONGOL MINING JV WITH SHENHUA CREDIT POSITIVE

Moody's Investors Service said Mongolian Mining Corp.'s (MMC) joint venture with Shenhua Group is

credit positive for MMC because the cross-border railway will lower coal transportation costs with

little investment.

MMC announced that it would establish a joint venture with Shenhua Group to build a cross-border

railway to transport coal to China from Mongolia. With MMC currently using trucks to transport coal

to China, transportation costs accounted for 26.7 percent of its costs of goods sold and 22 percent

of its revenue in 2013, said the credit rating agency. MMC will hold 17 percent of the equity in the

consortium, while Shenhua will hold 49 percent and Mongolian companies Erdenes Tavan Tolgoi LLC

and Tavan Tolgoi JSC will each hold 17 percent.

Seventy percent of funding for the Sino-Mongolian Border Crossing Railway will be from loans that

Shenhua will be responsible for obtaining. MCC's investment in the consortium will be smaller than

if it financed all of the railway construction itself, which will alleviate pressure on MMC's liquidity

and allow it to better manage a challenging operating climate, said Moody's.

Source: ETNet

HONG KONG JOCKEY CLUB SAYS NO PLAN TO BE PART OF MONGOLIA RACING, BETTING

The Hong Kong Jockey Club has "no intention of becoming directly involved" in Mongolia's plans to

set up a professional horse racing league and legalize betting.

HKJC chief executive Winfried Engelbrecht-Bresges yesterday played down a report quoting a

Mongolian government minister as saying the nation wanted to establish a "jockey club operation."

"It is very good that another associate member of the Asian Racing Federation is considering

developing horse racing," Engelbrecht-Bresges said. "The ARF will offer its help but the HKJC has no

intention of becoming directly involved.

"I can say categorically there has been no contact with the HKJC from Mongolia regarding Hong Kong

horses racing there, but we will have a chance to talk at the Asian Racing Conference [in Hong

Kong] next week."

Oyungerel Tsedevdamba, the minister for culture, sport and tourism, said, according to a

Bloomberg report: "Our priority is to make the legal environment for a jockey club operation so that

we can have a market share" of the Asian gambling business. Oyungerel added that she hoped to

submit a draft to Parliament within three months. "Our law is heavily based on Hong Kong Jockey

Club rules."

"As a club, we would prefer horses not go to race in Mongolia as we maintain a horse population

sufficient for our industry and participation elsewhere would place a strain on our horse

population," said Engelbrecht-Bresges.

Source: South China Morning Post

KHUSHIGT VALLEY AIRPORT TO BEGIN OPERATIONS IN DEC. 2016, SAYS JAPAN OFFICIAL

The international airport under construction at Khushigt Valley in Tuv Aimag will be operational by

December 2016, said Japan's transportation minister during a visit from 26 to 29 April.

Minister Akihiro Ota led a Japanese delegation to meet with Minister of Roads and Transportation of

Mongolia Amarjargal Gansukh 28 April. The Japanese delegates told Gansukh that they learned from

a briefing on the progress made at the airport, over which Japan is leading construction, that work

was significantly ahead of the schedules and operations could begin by December 2016.

―This international airport is not only a big air transport facility, but is also considered the biggest

economic effective project and landmark.‖

Their visit to Mongolia was partly to meet with the management teams of the air carriers operating

in Mongolia to update them on their progress, said Ota. He also offered Japan's services in helping

to manage the airport. Also during the visit, Ota and Gansukh signed a memorandum of

understanding for cooperation between their ministries.

Source: Info Mongolia

KHAN BANK LAUNCHES NATIONWIDE BANCASSURANCE CAMPAIGN

Khan Bank LLC is promoting its new insurance program by giving away prizes to newly insured

customers.

―Khan Bank invites you to receive insurance services in a convenient way and have the opportunity

to become one of the 409 lucky winners,‖ reads the Source.

Khan Bank offers six insurance products throughout its banking network spanning across the country

with its ―Bancassurance‖ service. The bank is promoting the insurance program launch of a two-

month campaign to end 30 June throughout its 524 branches with a contest giving away prizes to

new customers. Khan Bank will draw the names of 409 customers whom will receive such prizes as a

one-year gift card for petrol fuel, a trip to the countryside, car washes, and car seats covers.

Twenty Khan Bank customers will receive a personal gift from their bank.

Source: Khan Bank LLC

EBRD FINANCING SENJ SANT CEMENT PLANT

The European Bank for Reconstruction and Development (EBRD) is extending a USD 65 million loan

to a Mongolian cement producer to finance the construction of a dry process cement plant.

EBRD is continuing its financial support for Mongolian company Senj Sant, which is building a

greenfield cement plant to meet rising demand generated by the country‘s rapidly growing

economy. The USD 65 million loan is part of a financing package dating from May 2013, which

included a USD 20 million equity investment in Senj Sant.

Senj Sant, which is owned by Monpolymet Group, began construction of the plant in April 2013. It is

expected to have a total capacity of one million tons of cement per year. According to the source,

the dry process used is the most advanced and environmentally-friendly means of production

currently available.

―The EBRD‘s long-term finance, including equity, not only helps us build the first cement plant in

Mongolia using environmentally-friendly dry process, but also supports the company in raising

business standards to international levels,‖ Monpolymet Group Chief Executive Officer Munkhnasan

Narmandakh.

Source: European Bank for Reconstruction and Development

ALTAN RIO DEBT SETTLEMENT PAVES WAY FOR EBRD PLACEMENT

Altan Rio Minerals Ltd. announced that it has now closed the debt settlement that serves as a

prerequisite for a private placement with the European Bank for Reconstruction and Development.

Altan Rio has issued a total of some 20.35 million common shares to settle debt in the total sum of

USD 1.424 million at a deemed price of USD 0.07 per share. Debt in the sum of USD 5,000 that was

originally contemplated in the February 20, 2014 news release was not settled for shares, resulting

in a net reduction of 71,428 shares from the number originally announced. The 20,346,555 shares so

issued are subject to a hold period of four months plus a day, expiring 29 August.

Completion of the debt settlement transaction was a pre-condition to Altan Rio's previously

announced private placement of common shares with the European Bank for Reconstruction and

Development (EBRD) for some 16.7 million shares at USD 0.06 per share. Now that the debt

settlement transaction has been completed, the Source anticipates that, subject to receipt of final

approval from the TSX Venture Exchange and completion of other standard closing conditions, the

private placement with EBRD will close in the first half of May 2014.

Source: Altan Rio Minerals Ltd.

FIREBIRD GLOBAL MASTER FUND REPORTS TRANSACTIONS IN KHOT INFRASTRUCTURE

Firebird Global Master Fund (FGMF) Holdings and Firebird Global Master Fund Holdings II 9 April

announced that each had conglomerated shares from subsidiaries in Khot Infrastructure Holdings,

Ltd.

Firebird Global Master Fund, Ltd. transferred to FGMF Holdings 530,747 common shares of Khot

Infrastructure, while Firebird Global Master Fund II, Ltd. transferred 461,392 shares of Khot to FGMF

Holdings II. Joint actors to each of the Firebird Global holding companies Passin Management

Limited Partnership and Sawkin Family 2011 LLC acquired 126,250 common shares and 500,000

common shares of Khot, respectively, at USD 0.20 per share. James Passin was granted 500,000

options to acquire the same number of common shares in the share capital at USD 0.25 per share.

Firebird New Mongolia Fund, L.P., received an additional 5.36 million common shares in the shares

in exchange for 100 percent interest in Great Hoard Holdings SARL, a Luxembourg entity that holds

75 percent share capital of Ashid Munkhiin Zam LLC.

The securities transfers to FGMF Holdings and FGMF II Holdings were made for the purpose of

company reorganization, reads the Source. The other transactions were carried out by joint actors

were for the purpose of maintaining controlling interest in Khot.

Source: Firebird

PROPHECY ANNOUNCES NEW BOARD DIRECTOR

Prophecy Coal Corp. 23 April announced the appointment of Masa Igata to its board of directors.

Igata has more than 25 years' experience working in Asian financial markets and is the founder and

chief executive officer of Frontier Securities LLC, the first foreign investment bank in Mongolia.

Previously, he was managing director at Nikko Citigroup with a leading role in Japanese equity sales

and investor relations. Igata now focuses primarily on advising resource companies in Mongolia.

Prophecy also announced the appointment of Orgil Sukhee as executive director of Red Hill

Mongolia LLC, which operates the company's Ulaan Ovoo project, effective 21 April 21. Sukhee is a

Mongolian business executive with over 10 years' of successful commercial property development

and management experience in Singapore (Shangri-La Hotel), Russia (CapitaLand), and Mongolia

(MCS Properties LLC).

Source: Prophecy Coal Corp.

FEORE RECEIVES EXTENSION FROM BONDHOLDERS', APPROVAL ON SALE

FeOre Ltd. 25 April announced that it had obtained an extension to the letter of waiver to extend

FeOre's repurchase of convertible bonds on or before 12 May.

Separately, FeOre announced that shareholders approved the sale of Topone Star Investments Ltd,

with the passage made by way of poll as an ordinary resolution.

Source: FeOre Ltd.

WINSWAY TO CHANGE NAME TO "WINSWAY ENTERPRISES"

Winsway Coking Coal Holdings Ltd. said it proposes to change its English name to "Winsway

Enterprises Holdings Limited".

With the view to enhancing the utilization and profitability from the group's well-established

logistics facilities, Winsway plans to evolve its strategy and scope of business from a pure coking

coal operation to a broader-scope operation including thermal coal, iron ore and potentially other

minerals or bulk materials. Winsway also plans to become more of a service provider through a

platform providing a total supply chain solution to the broader market involving small and medium-

sized customers engaged in bulk commodity trading.

―The Board believes the change of name will better reflect the changed and evolving strategy and

scope of Winsway's business,‖ reads the Source.

Source: Winsway Coking Coal Holdings Ltd.

MONGOLIA INVESTMENT SUMMIT LONDON RECAP

Mongolia's most profitable sector, mining, was a key topic of discussion during the first day of the

Invest Mongolia Summit held in London on 1 May. Investors gathered to discuss the improvements

made to Mongolia's regulatory system as well as areas still needing attention.

―President Elbegdorj said: 'Mongolia has made mistakes and must take steps to change regulations"

and did so in part with new Investment Law of Nov 1, 2013. But many points "still sleeping"

including OT Phase II financing, Chalco, 106 mining licenses and Long-name law,‖ said Vice Minister

for Economic Development, Ministry of Economic Development, Chuluunbat. While 11.7 percent

growth in 2013 is still impressive, the country was facing a currency devaluation that was having

serious impacts on U.S. denominated loans and the country's growing budget deficit. Attracting

foreign investment is imperative, said the vice minister, so treating all investors—―local and

foreign‖—equally and fairly was a main priority for the government.

Chris Melville, a partner at Ulaanbaatar-based law firm Hogan Lovells LLP, lauded the government's

new investment law, noting that it was positive that the government recognized the issues with

past legislation and made the necessary corrections. Moving forward, however, Mongolia will have

to focus on ensuring the laws are implemented as they are intended. Norihiko Kato, chief executive

officer of Khan Bank, chimed in on the Investment Law, noting that Mongolia's capital markets were

still underdeveloped as long as there was still no custodian services or inter-banking market.

The fine-tuning of legislation and the time to watch how Mongolia enforces its new laws will mean

that investment to Mongolia will not return overnight, according to Elena Clarici, managing director

of Meridian Equity Partners in the United Kingdom. Advising that cost focus was key for the mining

sector, she said that it was unlikely investors word invest in large quantities in the next 12 months

but the industry could be booming again in three years.

Source: Business Council of Mongolia

NAMBC 2014 AGM HELD IN OTTAWA, APRIL 22-23

The 24th meeting of the North America-Mongolia Business Council was held 22 and 23 April in

Ottawa, Canada.

Mongolia's vice minister of mining, O. Erdenebulgan, delivered a speech introducing a reform policy

being instituted by Mongolia‘s Cabinet Secretariat. Former U.S. Ambassador to Mongolia Pamela J.

H. Slutz gave a report concerning the present economic development of Mongolia while former

Canadian Ambassador Anna Biolik reported on Mongolia-Canada relations.

Erdenebulgan later met with the director of volunteer development agency CESCO, Harris Vindu, for

a memorandum of cooperation between the volunteer group and Mongolia's Mining Ministry. The

memorandum is for the support of sustainable development in Mongolia's mining sector and the

improvement of professional skills. [Original source received correction from Cover Mongolia -ed].

Source: Montsame

MONGOLIAN SCIENTIST SPEAKS AT COLORADO STATE

A science advisor to the Mongolian Minister of Environment and Green Development 29 April

delivered public lectures at Colorado State University (CSU).

Chuluun Togtokh, a Ph.D. who is also science director of the Institute for Sustainable Development

at the National University of Mongolia, discussed concepts for sustainable development for Mongolia

and globally. While making the successful transition to democracy and market economy since 1990,

Mongolia laid down the foundations for prosperity. However, that transition also brought with it

increased poverty and environmental degradation. Committed to reversing this trend, the

Mongolian government has set a goal to become a green civilization—meeting the needs of the

present while safeguarding the planet's resources.

Chuluun discussed what green development looks like in Mongolia and the introduction of his Global

Sustainability Index (GSI) tool for providing synergy in the post-2015 development agenda. The

Mongolian speaker also participated in the Managing the Planet panel on Future Earth on 30 April.

Chuluun has spent the semester as a Visiting Fellow for CSU‘s School of Global Environmental

Sustainability. He has worked closely with researchers in the Natural Resource Ecology Lab in the

Warner College of Natural Resources during his time as CSU.

Source: Colorado State University

TALKH CHIKHER TAKES “TOP BRAND” AWARD

The Mongolian National Chamber of Commerce and Industry (MNCCI) and Intellectual Property

Office 23 April named Talkh Chikher JSC as Mongolia's ―Top Brand‖ in observation of World

Intellectual Property Day that later took place on 26 April. Organized since 2003, the award aims to

promote national manufacturers and their services. Additional awards went to Talkh Chicker's Ta

Chi brand for flour and bread products, Milko LLC's Zuv for dairy drinks, Makh Impex JSC's Nuudel for

meat products, and Khuvsgul Ikh Taiga LLC‖s Ikh Taiga for ―Green Brand.‖

The full list awards are as follows:

• Flour and Bread - Ta Chi (Talkh Chikher JSC)

• Milk and Dairy Products - ―Zuv‖ cream drink (Milko LLC)

• Meat and Meat Products - ―Nuudel‖ (Makh Impex JSC)

• Green Brand - ―Ikh Taiga‖ (Khuvsgul Ikh Taiga LLC)

• Best Packaging and Packed Brand - ―Khujirt‖ water (Gem Khujirt LLC)

• Leather Products - Only One Collection (Zuvkhun Gants LLC)

• Wool and Cashmere Products - ―Mongol Nekhmel‖ (Mongol Nekhmel LLC)

• Trade and Service - ―Orgil‖ Trade Center (Circle LLC)

• Mass Media - ―Family Radio‖ (FM 104.5)

• Communications - G Mobile (G Mobile LLC)

• New Brand - ―Sun Rice‖ (MJ Partners LLC)

• Import Substitution Brand - ―Ariun‖ (Khugjil Trade LLC)

• Best Service - ―Nomin‖ (Nomin Holding LLC)

• Top Brand - Talkh Chikher JSC

Source: Info Mongolia

ALSTOM ACCEPTS GE OFFER BUT LEAVES ROOM FOR SIEMENS BID

Alstom‘s board has accepted a EUR 12.35 billion all-cash offer from General Electric (GE) Co. for its

energy arm, but the engineering group left the door open for a rival bid from Germany‘s Siemens

AG in a sale process that could hinge on French politics. General Electric was the provider of

turbines for Mongolia's first turbine while Siemens was contracted by Erdenes Tavan Tolgoi LLC to

mine the East Tsankhi block of the Tavan Tolgoi coal mine.

Patrick Kron, Alstom chief executive, said: ―The combination of the very complementary energy

businesses of Alstom and GE would create a more competitive entitity to better service customer

needs.‖

But in a statement on Wednesday morning, Alstom said it would set up a committee of independent

directors to review the binding offer by the end of May, giving the time demanded by the French

government to assuage its concerns over jobs at the national champion.

Alstom said the board had unanimously accepted the GE bid, but had also reviewed what it called a

declaration of interest from Siemens. ―Siemens will have fair access to information needed to

make, should it decide to do so, a binding offer,‖ it said, adding that would take into account ―the

interest of all stakeholders‖ in considering a Siemens bid.

Alstom said it would pay GE a break-up fee of 1.5 percent of the U.S. company‘s bid if it decided to

back another offer.

Source: Financial Times

ECONOMY

LONG-TERM RATING ON MONGOLIA LOWERED TO 'B+'

Standard & Poor's Financial Services has lowered its long-term sovereign credit rating on Mongolia to

'B+' from 'BB-' while affirming its 'B' short-term sovereign credit rating.

―We lowered the long-term rating on Mongolia to reflect the country's weakened external and debt

profiles. Weak inflow of foreign direct investment (FDI) and lower exports contributed to a sharp

decline in the country's gross official foreign exchange reserves over the past year,‖ reads the

Source. ―These trends weakened Mongolia's external balance sheet beyond what we had expected

earlier, resulting in increased external risk over the next three years and highlighting Mongolia's

exposure to shifts in FDI. Meanwhile, off-budget spending also raised government debt above levels

we had expected previously.

Although the Source found risk high due to its vulnerability in shifts to foreign investment, increases

in exports and foreign investment are forecasted once foreign investors become more attracted by

the country's ―business-friendly laws‖ and as improvements are made to cross-border transport.

―Mongolia's governance and policy effectiveness is weak, in our view. The government's more

business-friendly investment law approved late October 2013 has been slow in attracting foreign

investors, in our opinion, because of Mongolia's past record in policy shifts. However, we believe

the government is likely to improve policymaking and implementation over the next three years,

which will benefit investments and the economic ties with neighboring countries--Mongolia's key

export destinations and sources of FDI. However, the absence of a majority party in parliament may

constrain the extent of improvements.‖

Mongolia received a stable outlook because of faster improvements in the business environment and

fiscal management against potential shocks in external demand and slower-than-expected FDI

inflows.

Source: Standard and Poor's Financial Services

MONGOLIA DOWNGRADE WEIGHS ON CHINGGIS BOND

Mongolia has been downgraded by Standard & Poor's, further dimming the allure of one of the more

eye-catching bond market debutantes of the emerging markets debt boom.

The U.S. rating agency cut Mongolia's credit rating by one notch to B+, deep in junk territory and

just three notches above grades that are sometimes called "extremely speculative". In 2012

Mongolia issued its first Eurobond—dubbed a "Chinggis bond" by wags—raising a whopping USD 1.5

billion for 10 years at below Spain's borrowing costs at the time. The country has been rescued by

the International Monetary Fund five times in the past two decades or so, but investors still placed

USD 15 billion of orders—equal to 150 percent of its annual economic output.

However, since then investors have become more discerning on emerging market bonds, and

Mongolia in particular. The yield of the international bond maturing in 2022 has climbed from 5.62

percent last May to 7.55 percent today.

Economic growth is strong and government debts relatively weak, but Mongolia's macroeconomic

vulnerabilities—particularly its dependence on foreign finance—are significant, and government

policy has been erratic. Still, one big international investor has kept faith with Mongolia. Franklin

Templeton funds—mostly controlled by Michael Hasenstab—own over 14 percent of the Chinggis

bond, according to the most recent filings.

Source: Financial Times

FITCH: WEAKENING MONGOLIAN MINING HIGHLIGHTS RISKS FOR BANKS

The extension of a debt repayment by Mongolian Mining Corporation (MMC) highlights the pressures

for the industry and the risks for local banks, said Fitch Ratings in a 30 April statement.

―Mongolian banks are susceptible to the liquidity and profitability pressure in the mining sector as

this flows through to the broader economy,‖ reads the Source. ―Mining's weakness stems largely

from depressed demand, as indicated by falling prices. This also has a negative impact on the

Mongolian tugrug, which depreciated by 20% in 2013 and by another 6% so far this year.‖

Foreign-currency loans at around 30 percent exposes banks credit risk from a weaker local

currency, said the Source. Although foreign-currency lending is largely made to hedged

corporations, banks have built up credit risks from the ―exceptionally loose macro policy‖ used by

Mongolia to fuel credit growth above the country's nominal gross domestic product (GDP).

―Buffers against the risk are not robust, as the brisk pace of credit expansion at capped rates under

the government's loan programme pressures margins, liquidity and capital. Growth of non-

performing loans is rapidly outstripping that of total loans, rising by 93% y-o-y in March 2014 against

54%. The headline figure for NPLs remained at 5.2% of total loans (4.2% a year before). But Fitch

believes this underestimates asset-quality stress as it only captures 90-days-or-longer-overdue

loans.‖

The Sourced said Trade and Development Bank of Mongolia LLC's USD 40 million short-term

unsecured loan to MMC, representing 1.3 percent of the bank's total assets or 18 percent of equity,

was ―manageable,‖ compared with 11 percent for Golomt Bank LLC, 4 percent for Khan Bank and 3

percent XacBank. Credit risk is somewhat mitigated by credit guarantees by the Development Bank

of Mongolia, said the source.

―The mounting pressure on Mongolia's economic and financial stability underpins the Negative

Outlook on our 'B+' sovereign rating.‖

Source: Fitch Ratings

MONGOL BANK: FX AUCTIONS, SWAP AGREEMENTS, 1-WEEK BILLS, TREASURY BONDS

The Bank of Mongolia on 30 April reported the auction of USD 11 million for a closing rate of MNT

1,795.02. On 1 May, the Bank of Mongolia received an equivalent of USD 103 million from swap

agreements with commercial banks for a closing rate of MNT 1,795.

The central bank reported on 30 April the issue of one-week bills worth MNT 284.7 billion at a

weighted interest rate of 10.5 percent. The central bank also reported 30 April MNT 83 billion in

bids for the auction of 12-week treasury bonds with a face value of MNT 30 billion. Each unit was

worth MNT 1 million and sold at a discounted price with a weighted average yield of 9.27 percent.

Source: Bank of Mongolia

MONGOLIA REQUESTS EXTENSION FOR MNT-CNY SWAP AGREEMENTS

Prime Minister Norov Altankhuyag requested an extension to Mongolia's currency swap agreements

with China while meeting with China's Finance Minister on 29 April.

"Mongolia is willing to extend the validity period, but with an increased volume of national

currencies to exchange. We believe the finance minister would pay more attention to resolve this

issue on a timely basis.‖ Altankhuyag said the swap agreement both strengthened Sino-Mongolian

relations while providing stability to the Mongolian economy.

Separately, Jiwei thanked Mongolia for accepting Chinese President Xi Jinping's proposal to jointly

found the Asian Infrastructure Investment Bank (AIIB). Altankhuyag said Mongolia sees the bank as

an opportunity promote Mongolia's belief that developing infrastructure is crucial to the economic

growth of landlocked countries.

Source: Info Mongolia

MONGOL BANK OFFICIAL CALLS TUGRUG DEPRECIATION “SEASONAL PHENOMENON”

A central bank official has predicted that the tugrug may begin to appreciate by the end of this

year.

―In the first quarter of 2014 out trade balance improved,‖ said J. Bataa, director of the Financial

Market Department of the Bank of Mongolia. ―Exports were up 22 percent in the first quarter

compared with the same period last year.‖ While Bataa conceded that the tugrug was still

depreciating against the tugrug, he dismissed it as a long-term affect despite the fact that the

currency had been falling for over a year. ―I think it's a seasonal phenomenon only,‖ he said.

―Our economy activates beginning in spring. Therefore, imports increase starting from February and

exports begin in May, which improves the exchange rate again. The second factor for the tugrug

depreciation is the delayed payments for coal exports, but coal exporters are working on it. Now

USD 200 million in payment for coal is pending.‖

To maintain stability in the tugrug, Bataa said the central bank was holding regular foreign

exchange auctions for the short term and swap agreements for the long term. He said the auctions

were keeping a check on currency fluctuations so that they never dipped more than 0.23 percent

within a day. ―This is relatively good compared with other countries,‖ he said. He added that the

bank was expecting between USD 200 million and USD 500 million within the next three months

from the swap agreements.

Improvements to the legal environment would also benefit the economy, including incentives for

sales of gold to the central bank and for foreign banks to enter the market.

―Considering all these factors, I think the tugrug will strengthen against the dollar by the end of

2014.‖

Source: Udriin Sonin

OT DISPUTE WEIGHS ON TUGRUG AS CAPITAL DRIES UP

Negotiations between the Mongolian government and Rio Tinto Group over financing for the Oyu

Tolgoi copper mine have dried up foreign capital and caused the tugrug to hit a new low, a fund

manager said.

―Because of this impasse, international capital is staying away on the sidelines until this important

issue is solved,‖ Michael Preiss, co-founder of Mongolia Asset Management, said in an e-mail.

―Everyone is waiting for OT resolution to act as a catalyst to come into the market to ensure that

we have indeed seen the bottom and that the currency downtrend has reversed.‖

The tugrug fell 0.3 percent to 1,790 to the dollar yesterday and has weakened 26 percent from a

year ago. The currency is now the worst performing in Asia over the past 12 months. The fall in

currency coincides with weak foreign investment, which fell 28 percent in the first two months of

this year after declining 54 percent last year. Foreign reserves stand at USD 2.4 billion as of

January, down 40 percent from last year. A weakened tugrik increases the costs of most imports,

including construction materials, electronics, clothing and food, and has helped push inflation to

12.4 percent.

A central bank price stabilization program has managed to level prices for products including meat,

flour and gasoline. The authority injected MNT 677 billion (USD 380.3 million) last year, according

to Bank of Mongolia Chief Economist Bold Sandagdorj. The central bank will inject less this year,

Bold said, declining to give an amount.

Source: Bloomberg

APRIL SALES MANAGERS' INDEX

Tugrug worries in Mongolia are reflecting on-going inflationary pressures, the challenge of

maintaining stable levels of staffing, and continued decline on monthly sales.

The Headline Index is designed to reflect overall economic growth, with the April Headline Index

value of 48.0 indicating that the economy continues to contract at an increasing rate. Sales

Managers have said that key sectors in the economy such as mining are frequently forced to reduce

output and staffing levels during the winter months and that this is continuing to have a negative

impact on economic development.

Business Confidence among Sales Managers remains low, falling to 47.1 in April from 48.7 in March.

The Market Growth Index, which reflects the growth of the general marketplace in panelists‘ own

industry sectors, registered 44.6 in April. This represents the fifth consecutive month of decline and

the third month under 50. The Product Sales Index, which reflects the sales of individual companies

rather than the wider economy, increased marginally to 37.3 in April from 37.0 in March, suggesting

sales continue to fall at a rapid pace.

Panelists have attributed this to the sharp depreciation of the tugrug against the U.S. dollar, which

is pushing up prices of imported goods, especially from China and Russia. The Prices Charged Index

has fallen for the fifth consecutive month, registering 59.8 in April. The Index shows rapidly

increasing prices, which indicate that sales managers are still passing on large price increases to

business and consumers albeit at a slightly slower rate. The Staffing Index, which reflects the

number of staff taken on compared to the same period last year, fell to 51.1 in April from 52.3 in

March, indicating that Sales Managers are still expanding their payrolls although at a slow pace.

"Panelists have explained that extreme weather conditions have eased this month although worries

about further devaluation of the Tugrik against the dollar continues to undermine Business

Confidence,‖ said Panel Manager Ganaa Badgamgarav. ―However, Sales Managers hope to see major

improvements for investment and economic development in the coming months as sales will start to

pick up."

Source: World Economics

NUMBER OF MINE WORKERS GROWS

The number of workers employed by mining companies grew 13 percent in March year-on-year,

according to the National Statistical Office.

The number of mine workers grew to 20,400 compared with the same period from the year before.

Workers employed by metals miners represent 46 percent of the industry's workforce compared

with 40.7 percent in coal mining, and 5.5 percent in petroleum extraction. The coal industry

increased its workforce by 8 percent while the petroleum industry saw growth of 52 percent.

Source: Zuunii Medee

UB SUPPORTS LOCAL AGRICULTURE

Ulaanbaatar will soon approve a city policy to assist small produce operations in bringing their

goods to the Altan Bulag border point, said Deputy Governor T. Bat-Erdene.

―Produces from those enterprises were sold at Ereen market, now we look for other possibilities

like using the border point in Altanbulag,‖ he said. ―We will continue a ―Weekend Market‖ initiative

for selling produce on Saturdays and Sundays from 8:00 to 12:00. Locations shall be soon finalized.‖

Source: Zuunii Medee

MINING DOWNTURN FORCES MONGOLIA TO DIVERSIFY

Few in Mongolia sympathize with the mining industry amid dispute with the government. Despite

the fact that mining is the largest contributor to the economy, at 20 percent last year, Mongolians

are not always thrilled at being best known for the wealth under their feet—principally coal, copper

as well as some gold and iron ore.

―It interferes with the nomadic lifestyle,‖ says Surenjav Odbayar, a mining analyst for local

brokerage National Securities. ―The water resources are not so huge either, and they take away

from the drinking resources from the herders.‖

Odbayar said Mongolia in March announced it was spending MNT 270 billion to finance light industry

start-ups and to expand areas such as small manufacturing and textiles, as well as MNT 22 billion

into construction. By comparison, mining investment from the government received MNT 18.3

billion. ―It says a lot about the government's thinking,‖ Odbayar remarked on the size of

investments made by government.

In charge of attracting investment into Mongolian industry is Demberel Irmuun, director of the

division for promotion and consultancy services at the newly formed Invest Mongolia Agency. Irmuun

says he has about six meetings a day with potential investors, such as an Italian group that recently

visited that was interested in exploring options for the production of textiles in Mongolia. To

encourage the development of various sectors of the economy, one strategy is to publish a series of

investment guidebooks to instruct investors on where to invest and with what offices they must

register. Although still in the early stages, Irmuun said one forthcoming book would cover Mongolia's

budding green energy industry.

That fits in with one of three scenarios for Mongolia developed by the World Economic Forum

earlier this year in Davos, which envisages the country carving out a role for itself in China's move

toward developing a greener economy. However, Mongolia has far to go in what the WEF terms

"charting a course for the country from mineral wealth to long-term sustainable and diversified

growth."

―When the politicians go abroad, they say mining is still a major component of the economy, but

when they're campaigning to the voters they talk all about diversifying the economy,‖ says

Odbayar. ―This kind of behavior leads one to the conclusion that Mongolia is still not giving up on

the mining sector."

Source: BNE

SCIENTISTS SEE STRONG CORRELATION BETWEEN AIR POLLUTION AND MISCARRIAGE IN UB

Burning coal for domestic heating may contribute to early fetal death according to a new study by

experts from The Saban Research Institute of Children‘s Hospital Los Angeles and Ulaanbaatar.

In a paper published in April in the journal BMC Pregnancy and Childbirth, researchers report

―alarmingly strong statistical correlations‖ between seasonal ambient air pollutants and pregnancy

loss in Ulaanbaatar. Ulaanbaatar has one of the highest levels of air pollution of all world capitals,

with sulfide dioxide and particulate matter levels during winter months, which are up to 23 times

World Health Organization standards. Air pollution in winter is largely caused by coal burning in ger

stoves. The scientists examined the association between spontaneous abortion (miscarriages) and

seasonal variation of air pollutants.

―We found that the incidence of miscarriage revealed a striking seasonal pattern of variation,‖ said

David Warburton, who led the team of scientists from the Saban Research Institute.

While the overall rate of miscarriages (occurring in approximately 15 to 20 percent of pregnancies)

reported in Ulaanbaatar is similar to that of Western countries, including the United States, the

study showed that spontaneous abortion incidence per calendar month increased from 23 per 1,000

live births in May to 73 per 1,000 live births in December 2011. Monthly average ambient levels of

air pollutants showed increases in relation to the duration of hours of darkness, as well as the

coldest temperatures—when Ger heating stoves are used most.

―We and our colleagues in government and academia in Mongolia are expending concerted efforts

to improve stove efficiency and to educate the public about correct and more efficient lighting and

heating methods,‖ Warburton said, adding that a similar, strong correlation between air pollutants

and miscarriages may also occur elsewhere in the world where similar levels of air pollution exist.

―The disturbingly strong correlation between air pollution indices and fetal death that we found

suggests that much more needs to be done to further ameliorate the toxic effects of air pollution on

the human unborn,‖ Warburton concluded.

Source: Red Orbit

USAID PARTNERS WITH WORLD VISION FOR DISASTER RISK MANAGEMENT IN WEST

USAID will partner with World Vision Mongolia to reduce the impact of natural disasters on people in

Western Mongolia. The target areas for this project are Bayan Ulgii, Khovd, and Uvs—the three

western-most provinces in Mongolia.

Funding of USD 275,000 will go towards initiatives that target these areas for their heightened risk

of disaster due to their isolation, the absence of infrastructure, and their distance from major

urban areas. The centers of each of these provinces are more than 1,400 kilometers from

Ulaanbaatar. There are no railways and most roads consist of dirt tracks across the desert or

steppe.

The nation regularly experiences various types of disasters, including dzud, flooding, earthquake,

fire, and wind-, snow-, and dust storms. The Western Mongolia Disaster Risk Reduction (DRR)

project has been developed to support the National Emergency Management Agency (NEMA),

provincial emergency management staff and communities to more effectively assess risks and to

develop appropriate preparation and response plans. The project will also help to strengthen

government DRR policies and resources to support remote provinces and to prepare people for key

disasters. World Vision will also work with the Ministry of Education and Science on the

development of educational materials on disaster preparedness and to develop a standard DRR

curriculum for households and schools.

Source: U.S. Embassy

MONGOLIA'S GREEN POWER PIONEERS KEEP ASIAN SUPER GRID DREAM ALIVE

The most ambitious proposal in Mongolia‘s green-development initiative is to have Mongolia play a

crucial role in the Asian Super Grid—a grand vision endorsed by the Japan Renewable Energy

Foundation, an organization created by SoftBank Chairman and Chief Executive Officer Masayoshi

Son soon after the Fukushima Daiichi nuclear disaster in 2011. The aim is to move Northeast Asia

away from its dependence on fossil fuels and nuclear reactors.

Local conglomerate Newcom brought Salkhit, Mongolia's first 50 megawatt wind farm, online in

June 2013. The company Cleantech is going to start building a USD 200 million, 102 megawatt wind

farm a few miles away from the Oyu Tolgoi copper mine, aiming to get it up and running in the first

quarter of 2015. This project is backed by Happy Wind, a Swedish investment company. Further

north, Germany's Ferrostaal is building a USD 120 million wind facility in Sainshand, near Tavan

Tolgoi. And Aydiner of Turkey is planning a USD 94 million wind farm in the city of Choir next year,

according to Erdenebaatar Altai, an engineer with the company.

Mongolia's first solar farm, a 30 megawatt, USD 76 million project in Sainshand, has just been

approved. South Korean energy group Daesung Industrial is carrying out a couple of solar pilot

projects in the country. And SoftBank has set up a joint venture with Newcom to develop solar and

wind plants there, independent of the Asian Super Grid idea.

But investors say they worry about the government's ability to pay wind and solar farms for their

power. At the heart of the Super Grid initiative is Gobitec, a large-scale clean energy development

in the Gobi Desert. It would have 100,000 megawatts of wind and solar capacity destined for

export. Organizations from Europe and Asia that have conducted feasibility studies estimate

Gobitec's total cost will approach USD 300 billion.

"The financing associated with the magnitude of the capital costs Gobitec would likely accrue may

prove too much for private investors," Cooper and Sovacool wrote, adding that "it is unclear

whether governments will be willing to underwrite these costs."

Source: Nikkei Asian Review

COMMODITIES BACK IN FAVOR AS A PORTFOLIO DIVERSIFIER

After several tough years, investors are once again starting to warm to commodities. That‘s the

view one of the sector‘s most successful hedge fund managers.

According to Pierre Andurand ―smart investors‖ are growing concerned about their exposure to

equities follow last year‘s run-up prices. and are looking to place contrarian bets in other assets

classes such as commodities.

―We feel sentiment is turning. Pension funds are coming to us and saying they want to invest in

commodities while others aren‘t looking,‖ said Andurand, whose eponymous hedge fund returned

almost 25 percent last year.

Commodity funds were shunned by investors last years as Wall Street analysts, big picture

strategists and powerful consultants turned cold on oil, metals and grains amid lackluster demand

for raw materials. But after a record USD 50 billion of net redemptions in 2013, total inflows into

passive commodity index funds and commodity-linked exchange traded funds this year have so far

totaled almost USD 6 billion, according to research by Citigroup. This follows a strong start to the

year on commodity markets, which has seen the Dow Jones UBS commodity index, for example, rise

9.4 percent, compared with the S&P 500 which is up just 1.8 percent.

Analysts at Citi reckon investors are starting to take commodities seriously as a portfolio

diversification tool because for the first time in many years raw materials are not moving in lock-

step with either equities or the U.S. dollar.

But while sentiment towards commodities is starting to thaw, there are still reasons for caution

such as softening demand from China and other leading commodity-importers, which has hurt the

performance of industrial commodities. A lack of clear trends and volatility means it is also difficult

for funds to deliver strong returns. As a result, traders are seeking new ways to make money and

have to work a lot harder to generate returns. It takes a little more analysis and investors have to

be more creative about trades than when prices were just moving higher.

Source: Financial Times

CHINA PLANS CRACKDOWN ON IRON ORE IMPORT LOANS

China plans to get tougher on loans for imports of iron ore, Mongolia's fourth largest mineral import

in March, as concerns grow that steel mills are using import loans to stay afloat in defiance of

policies to reduce overcapacity in heavily polluting and loss making industries.

The China Banking Regulatory Commission warned banks to tighten controls over letters of credit

for iron ore imports in a document that caused iron ore futures in China to drop 5 percent on

Monday. Rumors of the stricter measures, which are expected after the 1 May holiday, have been

circulating in China for at least two months, after a hasty stock sale caused ore prices to tumble in

late February. Steel mills and traders have used iron ore imports to raise money as other sources of

credit dry up, in yet another channel for off-book or ―shadow‖ financing. Part of the attraction of

the practice is that mills benefit from lower international interest rates compared to those in

China.

Chinese firms have developed a number of creative channels for raising money thanks to years of

capital controls meant to starve the real estate sector of speculative funds. But the bulk and

difficulty of transporting iron ore makes it a cumbersome material for raising money, limiting its

flexibility as a financing tool compared with copper or gold. Regulators are worried that the

collapse of a heavily indebted mill could endanger a chain of local bank branches and even local

governments, since steel mills are often the largest employers, taxpayers and debtors in their area.

Data from the first quarter of the year show that China is on track to produce 822 million tons of

steel this year, a rise of 5.5 percent from last year‘s output, despite the rising debt levels,

increased financing costs and the prospect of more environmental regulation. More capacity is still

being built, lamented CISA vice-chairman Zhang Changfu, further squeezing margins in the industry.

―With the industry in such a state, how can new capacity still be built?‖ Zhang mused at CISA‘s

quarterly press conference.

Source: Financial Times

CHINA POISED TO PASS US AS WORLD‟S LEADING ECONOMIC POWER

The United States is on the brink of losing its status as the world‘s largest economy, and is likely to

slip behind China this year, sooner than widely anticipated, according to the world‘s leading

statistical agencies.

The United States has been the global leader since overtaking Britain in 1872. Most economists

previously thought China would pull ahead in 2019. The figures, compiled by the International

Comparison Program hosted by the World Bank, are the most authoritative estimates of what money

can buy in different countries and are used by most public and private sector organizations, such as

the International Monetary Fund. This is the first time they have been updated since 2005. After

extensive research on the prices of goods and services, the ICP concluded that money goes further

in poorer countries than it previously thought, prompting it to increase the relative size of emerging

market economies.

With the IMF expecting China‘s economy to have grown 24 percent between 2011 and 2014 while

the United States is expected to expand only 7.6 percent, China is likely to overtake the United

States this year.

The findings will intensify arguments about control over global international organizations such as

the World Bank and IMF, which are increasingly out of line with the balance of global economic

power. When looking at the actual consumption per head, the report found the new methodology as

well as faster growth in poor countries have ―greatly reduced‖ the gap between rich and poor,

―suggesting that the world has become more equal.‖

Source: Financial Times

POLITICS

MONGOLIA PREMIER UNVEILS 100-DAY PUSH TO REVIVE ECONOMY

Mongolia‘s Prime Minister unveiled a stimulus bill, dubbed a ―100-day action plan,‖ that will seek to

revive the mineral rich nation‘s flagging economy.

Prime Minister Altankhuyag Norov‘s 50-point agenda promises to boost infrastructure, mining,

manufacturing and the development of small and medium-sized businesses. The bill still needs the

approval of parliament and is part of a renewed drive to improve the economy after two years of

slowing growth.

―Within these 100 days we believe we should reduce bureaucracy, increase mining, approve the re-

issue of exploration licenses‖ and resolve a dispute over 106 canceled mining licenses, Altankhuyag

told foreign press and diplomats from nations including the United States., China and Russia, at a

briefing in the capital, Ulaanbaatar, today. Mongolia is seeking to energize an economy that saw

growth decline from a world-beating 17.5 percent in 2011 to 11.7 percent last year. The Mongolian

tugrik fell to a record low of 1,796 to the dollar on 29 April and has lost 25 percent of its value over

the past 12 months.

Altankhuyag‘s plan broadly seeks to promote foreign investment and reduce Mongolia‘s reliance on

imports. Infrastructure spending proposed includes building a road to connect the landlocked

nation‘s two neighbors, Russia and China; constructing thermal power stations; and developing two

free economic zones. It also calls for improved debt management, tax incentives for foreign banks,

and raising the amount of Mongolia‘s currency swap agreement with China.

Mongolia will also offer concession projects worth USD 1 billion ―not only in mining but also in the

tourism sector,‖ Altankhuyag said. ―It‘s important to focus on local businesses as well as mining and

the fact that they are trying to do multiple things simultaneously is a good thing,‖ said U.S.

ambassador Piper Anne Wind Campbell, who attending the briefing. ―I do think you have to move

forward on all these as opposed to looking for one silver bullet.‖

Altankhuyag, 56, faces public pressure to improve the economy after citizens, numbering many

hundreds according to an eyewitness account, rallied at least twice on Ulaanbaatar‘s Chinggis

Khaan Square earlier this month to protest against an inflation rate that‘s running at 12.4 percent.

Source: Bloomberg

MONGOLIA TO REVISE MINERAL LAW TO ATTRACT INVESTMENT

Mongolian Mining Minister Davaajav Gankhuyag Wednesday submitted a draft amendment to the

Minerals Law to Parliament Speaker Zandaakhuu Enkhbold, as the country is trying to improve its

investment environment.

Despite the adoption of new laws and regulations to make the investment environment favorable,

no new international and domestic investment is coming to the exploration sector which is the

driving engine of the mineral sector, said the minister, quoted by a press release of the Mongolian

parliament.

The draft amendment calls for setting up a database about funds raised from international stock

markets, improving agreements between holders of mining licenses and the local government,

feasibility studies, and making clear the roles and responsibilities of government agencies and

mining license holders. The draft amendment also bans transference of exploration licenses wholly

or partially within three years since the issuance of the license.

Source: Shanghai Daily

PARLIAMENT DISCUSSES ECONOMIC STIMULUS INITIATIVE

Parliament has received a new proposal for economic stimulus in the country.

The proposal was submitted to Parliament on 18 April with the disclaimer that the issue was an

urgent one for immediate discussion. Parliamentarians, however, were in no rush. They said the

proposed stimulus required explanations that would need to run until the next session this week.

Separately, Parliament made inquiries on spending of the Samurai bond to Finance Minister Chultem

Ulaan and parliamentarians D. Oyunkhorol and J. Erdenebat.

Source: Montsame

MONGOLIA WILL PROPOSE GAMBLING ON HORSE RACING TO TAP CHINA

Mongolia‘s government will propose laws to set up a professional horse-racing league and legalize

betting to compete for the Chinese gambling market.

―Our priority is to make the legal environment for a jockey club operation so that we can have a

market share‖ of the Asian jockey business, Oyungerel said, adding that she hopes to submit the

draft in parliament within three months. ―Our law is heavily based on Hong Kong Jockey Club

rules.‖

Legalized gambling would help diversify Mongolia‘s resource-reliant economy as prices for

commodities such as copper and coal languish at multiyear lows. The Mongolian tugrik touched a

record low of 1,796.5 to the dollar before closing at 1,789, while economic growth fell for the

second straight year, to 11.7 percent in 2013.

Wagering on horses might give Mongolia access to a piece of the Chinese gambling market that‘s

made Macau the world‘s biggest gambling hub. Revenue in Macau, the only place in China with

legalized casino gambling, will double by 2018, according to Aaron Fischer, an analyst with Hong

Kong-based brokerage CLSA.

A law to allow betting would mark the first time Mongolia allowed gambling since a Macau-operated

casino closed in 1999 and three lawmakers were convicted of helping rig the tender to build it in

exchange for gifts including cash and vehicles.

―Mongolia is developing,‖ said Jan Wigsten, founder of Nomadic Journeys, an Ulaanbaatar-based

tour company. ―It is normalizing in the global sense and the institutions are becoming stronger,

which is necessary with gambling.‖

The government is seeking to build a horse-racing track near the site where the country is building

a new airport, 54 kilometers (33.6 miles) south of the capital Ulaanbaatar. Oyungerel said more

than 50 horse trainers from Mongolia will visit Hong Kong to study the business. The minister said

one law to legalize online gambling and lotteries and a second law to allow horse betting and

jockey clubs are in draft form. After the first two drafts are submitted to parliament, the

government will decide if more legislation is needed, including a bill to allow casinos, said

Oyungerel.

Source: Bloomberg

DP BOOTS BURMAA FOR DISSENTING VOTE

The Democratic Party's (DP) Control Committee has moved to oust Parliament member R. Burmaa

due to a vote against the party's position on legislation that would prohibit members of Parliament

from serving on certain ministerial positions.

DP party members Kh. Battulga, J. Batzandan, M. Zorigt and R. Burmaa voted in favor of having the

so-called Double Deel law take effect 1 July this year rather than the original proposal for 2016.

Their votes were in violation to the party's guidelines, which states that any member who votes

against Ulaanbaatar's mayor or the government would be removed from the party.

Burmaa, whose removal is pending further approvals expected this week, was seventh on the DP's

party for the 2012 elections. If Burmaa's membership is terminated, Trade and Development Bank of

Mongolia LLC Chief Executive Officer B. Medree would be next on the list to take a seat in

Parliament.

The decisions will have to receive approval from the party's National Advisory Committee this week.

Source: Udriin Sonin

MP SAYS HE LEFT JUSTICE COALITION DUE TO „DOUBLE DEEL‟ LAW

Former Mongolian National Democratic Party seatholder D. Battsogt has cited disputes over the so-

called Double Deel bill for his decision to leave his party and the Justice Coalition that cooperates

in the Democratic Party‘s coalition government.

Battsogt said there was a rift among members of the government concerning the Double Deel bill

that is currently being debated by Parliament. Battsogt, who said he now plans to continue his term

as an independent, said that members of the Justice Coalition were receiving pressures from the

prime minister to extend their recess while debate was continuing on the bill. If passed, the law

would force certain minister to resign as the law prohibits seat holders in parliament from serving in

most ministerial positions.

―There were disagreements in the coalition while discussing the Double Deel bill,‖ said Battsogt.

―There‘s no need to give repeated breaks, force the society into confusion and halt Parliament with

a law that‘s already become clear.‖

He said the Justice Coalition at the start of the spring session of Parliament had consensus with the

Democratic Party on the law. Civil servants, however, were in opposition. Although most minister

have not spoken out publically against the law, he said, many were working against the law to keep

their jobs.

Source: UB Post

MINING MINISTRY TO OVERSEE DEVELOPMENT OF ASGAT SILVER MINE

The Ministry of Mining at the Cabinet Secretariat meeting last week received orders to take the lead

on the development of the Asgat silver mine joint venture Mongolia has with Russia in order to bring

greater income to the Mongolian economy.

The Cabinet ordered Mining Minister Davaajav Gankhuyag to oversee the pre-feasibility studies for

the mine and provide evaluations as well as professional and technical support and oversee contract

drafting. The Cabinet made the orders after deciding that the mine could make significant

contributions to the economy if put into operation again.

The State Property Committee instructed the mine‘s operator Mongolrostsvetmet Ltd. to review all

previous studies made at the mine for assessment. However, the Asgat mining unit currently does

not have enough cash reserves to restart operations, according to a letter from Mongolrostsetmet

that was addressed to the Ministry of Mining [the Source provides no date –ed]. The letter explained

that the mine halted mining of crystals in the second quarter of 2013 because buyers in Russia had

discontinued their purchases. Costs were also racking up because of hikes to China‘s transportation

costs and taxes. Meanwhile the mine‘s gold reserves have depleted and other deposits lie on state-

protected land.

In 2007, Parliament included Asgat silver mine on its list of strategically significant mines. The

Mineral Resources Law entitles the state to up to 50 percent of any mine where exploration was in

some part funded by the state.

Source: UB Post

SAUDI ARABIA TO OPEN MONGOLIAN EMBASSY

The Kingdom of Saudi Arabia will open a Mongolian embassy in Ulaanbaatar, said Saudi Foreign

Minister Prince Saud bin Faisal bin Abdulaziz on 22 April.

Mongolia held its first meeting between foreign ministers last week where parties discussed several

issues concerning regional and bilateral affairs. Discussion centered on enhancing business ties and

mutual investments. Specific items discussed included an intergovernmental working commission,

construction of a meat processing plant in Mongolia, export of Mongolian meat to Saudi Arabia, and

the import oil products from Saudi Arabia.

Faisal said Saudi Arabia planned to open an embassy in Ulaanbaatar in the near future, seven years

after first establishing diplomatic relations. Relations have reportedly remained weak up until now

because no high-level visits had yet occurred between the two nations.

Source: Info Mongolia

VIETNAM, MONGOLIA BOOST MUTUAL TRUST, COOPERATION

Vietnam and Mongolia have agreed to boost the exchange of high-ranking delegations to enhance

political trust between the two countries, Vietnam News Agency (VNA) reported.

Both countries reached the agreement during a three-day political consultation between Deputy

Foreign Minister Ho Xuan Son and his Mongolian counterpart Damba Gankhuyag that ended here on

Tuesday. Both sides expressed satisfaction with the development of ties in the recent past

especially since Mongolian President Tsakhia Elbegdorj's visit to Vietnam last year.

Both sides are also keen to create favorable conditions for businesses to seek investment

opportunities to implement agreements signed between them. The two countries will also boost

bilateral collaboration in education, tourism, health and oil and gas exploitation, and cooperation

between the two foreign ministries. While in Vietnam, the Mongolian diplomat paid a courtesy call

on Deputy Prime Minister Nguyen Xuan Phuc.

Vietnam and Mongolia will mark their 60th anniversary of diplomatic ties later this year in

November.

Source: Bernama

CORRUPTION AUTHORITIES OPEN INVESTIGATION INTO FORMER MON ATOM DIRECTOR

The Independent Agency Against Corruption has opened an investigation into the director of Mon-

Atom for his selection of a company for a contract that has cost the company nearly USD 2 million,

according to an unnamed source from the Prosecutor's Office..

Director J. Batsaikhan is under investigation for his selection of Mon Zim LLC, which was selected to

lead exploration research for uranium reserves for USD 1.9 million. The company allegedly received

the contract without any bidding proceedings and without approval from the State Property

Committee. Members of Mon Atom allegedly never received any information on the company,

despite the fact that the company received a transfer from Mon Atom of USD 981,000 to its bank

account. Mon Zim's alleged MNT 900 million in payment is 4.5 times that of the MNT 200 million

other companies have received for similar research.

Last week the board terminated Batsaikhan's position as Mon Zim's director.

Source: Unuudur

MOSCOW TAKES UKRAINE, BEIJING TAKES MONGOLIA?

The events in Ukraine are being closely followed by nations around the world, but one nation that

may be watching the events in Ukraine more closely than others is China.

China has several active border disputes with its neighbors, and Beijing‘s reaction to the Ukraine

crisis so far has been muted. Beijing abstained from calling an emergency vote just prior to the

referendum over Crimea, falling back on its policy of non-interference and choosing not to

antagonize its only ally on the Council.

To go about the annexation of one possible target, Mongolia, President Xi Jinping would likely begin

by sending welcoming signals to Ulaanbaatar that should Mongolia chose to hold a referendum on

rejoining China, he would support the outcome. Prior to the referendum, Chinese troops would

amass near the border of Mongolia and Inner Mongolia, awaiting further orders in case the Chinese

population needs to be protected. International condemnation would surely follow, although given

Beijing‘s greater economic power, and Russia‘s current status as one of the most hated nations, the

penalties would likely be less harsh. Beijing would draw the wrath of Moscow, but Moscow would

face territorial battles on two fronts simultaneously.

Of course, the above scenario is fanciful, given the ethnic makeup of most Mongolians and their

fierce nationalism in opposition to the rule of Beijing. Further, the Mongolians have a strong sense

of nationhood and have fiercely opposed recent land grabs by Chinese companies. Yet Putin‘s

strategy of annexation might make more sense in areas where a Chinese-speaking minority find

themselves under oppressive foreign rule. Other than Mongolia, China currently claims territory

administered by Russia, India, Japan, Afghanistan, Pakistan, Tajikistan, Myanmar and Bhutan, as

well as numerous islands in the East and South China Seas claimed by Japan, the Philippines,

Malaysia, Vietnam, Taiwan and Brunei.

Beijing may never condemn the actions of its sole ally on the U.N. Security Council, but will need to

give the international community reassurances that Putin‘s action over the Crimea will not now be

regarded as fair play and copied by Beijing in order to assert any one of its disputed territorial

claims in the region.

Author Gary Sands ran his own private equity financial advisory in Shanghai from 2006 to 2012, and

contributed a number of op-eds for the South China Morning Post, U.S. News and World Report,

Washington Times, International Policy Digest, Eurasia Review, Indo-Pacific Review, Global Times,

Caijing and Shanghai Star Business Journal.

Source: Foreign Policy Blogs

ANNOUNCEMENTS

GTR‟S 3RD ANNUAL MONGOLIA TRADE & COMMODITY FINANCE CONFERENCE, BLUE SKY HOTEL,

13 MAY

The Business Council of Mongolia is offering members a limited number of free corporate passes

available (reserved for exporters, traders, manufacturers and producers of physical goods) and a 10

percent discount to GTR's 3rd Annual Mongolia Trade & Commodity Finance Conference 13 May at

the Blue Sky Hotel

With its focus on Mongolia‘s mining, minerals and vast commodity-led growth, this will be the key

trade gathering for the country‘s senior business leaders, providing timely insight on the challenges

facing the local banking and private sectors, as well as offering perspectives from the industry‘s key

supporting actors.

BCM is an institutional partner for the event, and so is offering members a 10 percent discount

when they enter the code BCM10. Contact Grant Naughton at gnaughton@exportagroup.com for

more information.

___________________________________________

“MM TODAY” ON MNB-TV, FRIDAY, 19:00 TO 19:10

BCM is pleased to announce that Mongolian National Broadcasting continues its cooperation with

BCM on ―MM Today‖. This English news program is aired every Friday for 10 minutes and is

scheduled from 19:00 to 19:10 tonight. Tune in to watch this program that reports stories from

today‘s BCM NewsWire.

BCM WORKING GROUP MEETINGS

The BCM`s Legislative Working Group met on Monday April 28, with 22 members attending at Open

Society Forum.

The WG was again expanded to include BCM members from mining companies and embassies.

Co-chairs James Liotta, Mahoney Liotta, and Bayar B, ELC LLC, moderated the session.

Meeting discussion was on the following topic:

- Draft Minerals Law Amendments. If you have any comments on the Draft Minerals Law

Amendments please send to the contact below.

We are happy to share latest version of the draft Minerals Law English and Mongolian with

interested BCM members.

The BCM Tax Working Group met on Tuesday, April 29, with 22 members attending.

Co-chair Khulan P. from OT moderated the session.

New members: Tuvshinbayar Badam, Peter Burnie

-Terra Energy, Tsetsegsaihan -Golomt Bank,

Guest: Peter Burnie, Akmal Rustamov from PwC.

Meeting agenda was:

- ―Tax audit process and common tax breaches in taxpayers‘ activities‖ by – Tsendmaa Choijamts

Executive Director at PwC.

The following part was full of Q&A. Members exchanged they practice and information on Tax

Audit process.

Please contact: T.Erdenetsetseg (Working Group Coordinator) at: E-mail: erka@bcmongolia.org

BCM IN THE UNIVERSITY CLASSROOM NEWS

Business Council of Mongolia (BCM) has been progressing with its BCM in the University Classroom

series since March 2012. Led by BCM‘s Education Working Group, the program provides lectures at

universities to help inspire students and give them direction for their future careers. The series has

grown to include an average of 10 lectures per academic year.Now 1479 students and teachers have

participated to BCM in the University Classroom Project.

Most recently Mr Hangal from Mongolian Talent Network gave a presentation entitled ―How to find

your job‖ to an audience of 65 students of Economy and Business Management graduating students

at the Mongolian University of the Humanities on 25th of April 2014.

Next BCM in the University Classroom series will be held on 2nd of May at the Language and Culture

school of Mongolian University of the Humanities. Mongolian Talent Network team invited to speak.

If you like to share your experience on some specific topic, you can discuss with us for the next

school term. Pleasecontact:erka@bcmongolia.org

BCM WEBSITES

MONGOLIAN WEBSITE „PRESENTATIONS‟ AND „NEWS‟ SECTIONS

The ‗Presentations‘ section on BCM‘s Mongolian website can be reached via bcm.mn/itgeluud.

As a key component of BCM‘s Mongolian website, articles from the ‗News‘ section and the

government website Open-Government.mn are regularly updated.

• ―Anti-Corruption legislation and State Policy‖ (Mongolian) by D. Munkhjargal, Prevention and

Public Awareness Department, Senior Commissioner, Independent Authority Against Corruption

(IAAC) Mongolia at the ―ANTI-CORRUPTION LEGISLATION/POLICY, INTERNATIONAL BEST PRACTICE

ON TRANSPARENCY‖ Training seminar, Mar 06, 2014

The presentation below was made at Mongolian National University as part of the ―BCM in the

University Classroom series‖ on February 27, 2014:

• Ser-Od Inchinkhorloo, Vice Director, BCM, ―Investment environment: Past, Present, Future‖

(Mongolian)

The presentation below is from the February 24 BCM monthly meeting:

• О. Зоригт, Гүйцэтгэх захирал, Майн Инфо "Майн Инфо ХХК-ний товч танилцуулга", МБЗ-ийн 2

сарын 24-ний сарын хурал

Dr. Khashchuluun, Executive Director, National Council of Private Sector Support, ―Taxation Impact

Research‖ to BCM Tax Working Group, February 19, 2014

• ТАТВАРЫН БАГЦ ХУУЛИЙН ӨӨРЧЛӨЛТ: ХУВИЙН ХЭВШИЛД, Ч. Хашчулуун, Хувийн хэвшлийг

дэмжих үндэсний зөвлөлийн гүйцэтгэх захирал 2014.02.19

20 Presentations from Coal Mongolia, 20-21 February, 2014:

• Уул уурхайн сайд Д. Ганхуяг, Төрөөс Эрдэс Баялгийн Салбарт Баримтлах Бодлого, Нүүрсний

Салбарыг Хөгжүүлэх Стратегийн Чиг Хандлага, Коал Монголиа 2014, 2 сарын 20-21.

• Сангийн сайд Ч.Улаан, МОНГОЛ УЛСЫН САНГИЙН ЯАМ, Улсын төсөвт нүүрсний салбарын

үзүүлэх нөлөө, татварын орчин шинэчлэл, Коал Монголиа 2014, 2 сарын 20-21.

• Монгол орны нүүрсний салбар дахь байгаль орчны асуудал, Байгаль орчин, ногоон хөгжлийн

яам, ХБОБНГ-ын дарга Д.Энхбат Коал Монголиа 2014, 2 сарын 20-21.

• НҮҮРСНИЙ АЖ ҮЙЛДВЭРЛЭЛИЙГ ХӨГЖҮҮЛЭХ ТЭЭВЭР ЛОЖИСТИКИЙН АСУУДЛУУД:

Л.ПҮРЭВБААТАР ТӨМӨР ЗАМЫН ИНЖЕНЕРҮҮДИЙН ХОЛБООНЫ ЕРӨНХИЙЛӨГЧ, ―УУЛ УУРХАЙН

БҮТЭЭГДЭХҮҮНИЙ ТЭЭВЭРЛЭЛТ‖ Коал Монголиа 2014, 2 сарын 20-21.

• МОНГОЛ УЛСЫН НҮҮРСНИЙ САЛБАР ДАХЬ ХӨРӨНГӨ ОРУУЛАЛТ, ХУДАЛДААНЫ ТААТАЙ ОРЧИН

БҮРДҮҮЛЭХ НЬ,ЭДИЙН ЗАСГИЙН ХӨГЖЛИЙН ДЭД САЙД О.ЧУЛУУНБАТ Коал Монголиа 2014, 2

сарын 20-21.

• Уул уурхайн дэд сайд О. Эрдэнэбулган, Олон улсын нүүрсний зах зээл дэх Монгол улсын

өрсөлдөх чадварыг нэмэгдүүлэхэд төрийн оролцоо Коал Монголиа 2014, 2 сарын 20-21.

• Ж. Батцэнгэл, Монголын Уул Уурхайн Корпорацийн дарга, МОНГОЛЫН НҮҮРСНИЙ САЛБАРЫН

ӨНӨӨГИЙН НӨХЦӨЛ БАЙДАЛ, Тулгарч буй бэрхшээл ба шийдэх боломж Коал Монголиа 2014, 2

сарын 20-21.

• Аршад Саеид, Пийбоди Энержи компанийн Монгол ба Энэтхэг улсыг хариуцсан Ерөнхийлөгч,

Дэлхийн нүүрсний зах зээл, Монгол улсад үзүүлэх нөлөөлөл, Коал Монголиа 2014, 2 сарын 20-

21.

• МОЗА гүйцэтгэх захирал Ч. Хашчулуун, Занарын дэлхии ̆н хувьсгал ба Монголын эдии ̆н засагт

үр нөлөө, Коал Монголиа 2014, 2 сарын 20-21.

• Багануур Энержи Корпорэйшн ХХК, Нүүрс хийжүүлэх, шингэрүүлэх цогцолбор парк төслийн

товч танилцуулга, Коал Монголиа 2014, 2 сарын 20-21.

• АДУУНЧУЛУУНЫ ЦАХИЛГААН СТАНЦ, БЕНЗИНИЙ ҮЙЛДВЭРИЙН ТӨСӨЛ, Ж.Золжаргал –

Төслийн удирдагч, Коал Монголиа 2014, 2 сарын 20-21.

• Ц.Ганцог, Жени Ойл Шэйл Монголиа ХХК Гүйцэтгэх захирал, ШАТДАГ ЗАНАРЫГ АШИГЛАХ

БОЛОМЖ, Коал Монголиа 2014, 2 сарын 20-21.

• Фэн Вэй эрчим хүчний зөвлөгөө өгөх компани, 2014 оны хятадын нүүрсний зах зээлийн

шинжилгээ болон үнийн таамаглал, Коал Монголиа 2014, 2 сарын 20-21.

• Я. Батсуурь, Эрдэнэс Таван Толгой ХК, Танилцуулга, Коал Монголиа 2014, 2 сарын 20-21.

• Хишиг Арвин Индустриал ХХК, ҮНДЭСНИЙ КОМПАНИУДЫН ТӨЛӨВШИЛ, ӨРСӨЛДӨХ ЧАДВАР,

Коал Монголиа 2014, 2 сарын 20-21.

• Виртген Групп, МОНГОЛЫН НҮҮРСНИЙ ЗАХ ЗЭЭЛ ДЭХ WIRTGEN БРЭНДИЙН SURFACE MINER

БУЮУ АНГИЛАН ОЛБОРЛОГЧИЙН ТЕХНОЛОГИ БОЛОН АШИГЛАХ БОЛОМЖУУД, Коал Монголиа

2014, 2 сарын 20-21.

• ―Тавантолгой‖ ХК-ийн Гүйцэтгэх захирал Р.Сэддорж, Дэвшилтэт технологи ба инновацийг

нутагшуулах нь, Коал Монголиа 2014, 2 сарын 20-21.

• ―УУЛ УУРХАЙН ДЭД БҮТЦИЙН ХӨРӨНГӨ ОРУУЛАЛТЫГ ДЭМЖИХ ТӨСӨЛ‖ Төслийн Зохицуулагч

Б.Энхбаатар,Коал Монголиа 2014, 2 сарын 20-21.

• ДЭД САЙД Д.ДОРЖПҮРЭВ, Эрчим Хүчний Яам, 2014 ОНД ЭРЧИМ ХҮЧНИЙ САЛБАРЫН

ХИЙГДЭХЭЭР ТӨЛӨВЛӨСӨН АЖЛУУД БОЛОН ТӨРӨӨС БАРИМТАЛЖ БУЙ БОДЛОГО, Коал

Монголиа 2014, 2 сарын 20-21.

• Ай Эм Си Монтан Компани, Нүүрс баяжуулах талаар, Коал Монголиа 2014, 2 сарын 20-21.

The below presentation is from the January 27 BCM monthly meeting:

• ОЙ ХАМГААЛАЛД СУУРИЛСАН БИЗНЕС, Цэсэдийн БАНЗРАГЧ /Ph.D/, БОНЯ- ны ОЙ

ХАМГААЛАЛ, ОЙЖУУЛАЛТЫГ ЗОХИЦУУЛАХ ХЭЛТЭСИЙН ДАРГА, МБЗ-ийн 1 сарын 27-ны

гишүүдийн сарын хурал дээр

___________________________________________

ENGLISH WEBSITE: 'PRESENTATIONS', 'MONGOLIA REPORTS', „INTERVIEWS„, MONGOLIAN

BUSINESS NEWS‟, „PHOTO GALLERY‟

• A. Bayarmaa, Head of BCM Environmental Working Group/Senior Carbon Finance Specialist, Clean

Energy LLC, ―BCM‘s Green Office Initiative: Starting from waste management and recycling‖ at the

BCM monthly meeting April 28, 2014

• L. Sumati, Director, Sant Maral Foundation, ―Socio-Political situation in Spring 2014‖ at the BCM

monthly meeting April 28, 2014

• ―Public-Private Partnership in Mongolia: Now and Future Prospects‖, E. Enerelt, Investment

Officer, ADB and Ts. Batbayar, Director of Concession Division, Ministry of Economic Development

at BCM monthly meeting, March 24, 2014;

• ―Areva in Mongolia: 15 years of presence – New perspectives in uranium mining‖, Thierry Plaisant,

General Director, Areva Mongol at BCM monthly meeting, March 24, 2014;

• ―Impact of Corruption in Mongolia‖ by L. Sumati, Director of Sant Maral Foundation at the ―ANTI-

CORRUPTION LEGISLATION/POLICY, INTERNATIONAL BEST PRACTICE ON TRANSPARENCY‖ Training

seminar, Mar 06, 2014;

• ―Anglo American Business Integrity policy and its application within the Business Globally‖ , Dr.

Graeme Hancock, President and Chief Representative Mongolia of Anglo American at the ―ANTI-

CORRUPTION LEGISLATION/POLICY, INTERNATIONAL BEST PRACTICE ON TRANSPARENCY‖ Training

seminar, Mar 06, 2014;

• Change of the package of taxation laws: private sector, Dr. Ch. Khashchuluun, Executive Director,

National Council for Private Sector Support, at the BCM`s Tax working group's meeting Feb 19,

2014;

• Economic and Capital Markets Update, Nick Cousyn, Chief Operating Officer, BDSec at the BCM

Monthly Meeting, Feb 24, 2014

• "The year 2014 starts with new IPO on the Mongolian Stock Exchange", Richard Kobayashi, CEO,

Standard Investment LLC at BCM monthly meeting, January 27, 2014

• "IMA Consultancy Services for Investors and Account Manager's Role", D. Irmuun, Director of

Division for Promotion and Consultancy Services, Invest Mongolia Agency at BCM monthly meeting,

January 27, 2014

15 Presentations at Coal Mongolia, February 20-21:

• Impact of Coal Sector on Government's Budget and the Taxation Regime , Ch. Ulaan, Minister of

Finance, MINISTRY OF FINANCE OF MONGOLIA

• Environmental issues in Mongolian coal mining sector, D.Enkhbat Ministry of Environment and

Green Development, Head of Environment and Natural Resources Department

• COAL INDUSTRIAL DEVELOPMENT, TRANSPORT AND LOGISTICS ISSUES: PRESENTATION TOPIC:

TRANSPORTATION OF THE MINING PRODUCT" Purevbaatar Luvsandagva, Head, Association of Railway

Engineering of Mongolia

• INVESTMENT INTO MONGOLIAN COAL MINING SECTOR AND CREATING AN ATTRACTIVE

ENVIRONMENT FOR INTERNATIONAL TRADE, VICE MINISTER OF ECONOMIC DEVELOPMENT, O.

Chuluunbat, Vice Minister, Ministry of Economic Development

• Government Involvement and Support to Enhance the Mongolian Competitiveness in Coal Sector,

O. Erdenebulgan, Vice Minister of Mining

• MONGOLIAN COAL INDUSTRY, Overcoming challenges in volatile market conditions, G.Battsengel,

Director, Mongolian Mining Corporation

• Global Coal Markets and Implications for Mongolia , Arshad Sayed, President of Mongolia & India,

Peabody Energy

• Introduction of CTL Plant Project, T. Munkhtur, Baganuur Energy Corporation

• ADUUNCHULUUN POWER AND CTL PROJECT, J.Zoljargal, Project Manager, MAK

• OIL SHALE OPPORTUNITIES IN MONGOLIA, Ts.Gantsog, Executive Director, Genie Oil Shale

Mongolia

• China Coal Market Lookout 2014, Fenwei Energy Consulting

• Erdenes Tavan Tolgoi JSC, Y. Batsuuri, CEO

• WIRTGEN SURFACE MINING TECHNOLOGY AND CHALLENGES IN COAL IN MONGOLIA by Wirtgen

Group

• "MINING INFRASTRUCTURE INVESTMENT SUPPORT PROJECT", Project Coordinator, B. Enkhbaatar at

the Coal Mongolia 2014, Feb 20-21.

• Coal Processing by IMC Montan.

Mongolia reports: http://bcmongolia.org/en/mongolia-reports

• Selected Macroeconomic Indicators as of Jan 2014 by International Monetary Fund

• Monthly statistical bulletin, March, 2014 , by Mongol Bank

• Social and economic situation of Mongolia as of March 2014 by National Statistical Office of

Mongolia (available in Mongolian language - Монгол улсын нийгэм эдийн засгийн байдал 2014

оны 3 сарын байдлаар, Үндэсний статистикийн хороо)

• Polit Barometer, March 2014, by Sant Maral Foundation

Interview Section: http://bcmongolia.org/en/interviews

• Jim Dwyer, Executive Director, BCM – ―Business need more business‖;

• Damshnamjil Tsogtbaatar, Chairman of the SPC: ―Privatizing Mongolia‖;

• Jan Hansen, Economist, ADB: ―The depreciation should help to increase the competitiveness and

to develop the non-mining industrial sector‖;

• Jim Dwyer, Executive Director, BCM: ―Minerals Policy‖;

• D. Bayasgalan, Director of Golomt Bank: ―Golomt has no problem‖;

• From the Oxford Business Group, Mongolia Reports 2013 book;

• B. Byambasaikhan, Chairman, BCM: ―Talk is cheap‖;

• President Ts. Elbegdorj: ―Diversifying for growth‖;

• Jim Dwyer, Executive Director, BCM: ―Non-mining sectors budding‖;

• Peter Morrow, Chairman, American University of Mongolia: ―Filling in the blanks‖;

• N. Zoljargal, Governor, Bank of Mongolia: ―Sustainable vision‖;

• Gansukh, Minister of Roads and Transportation: ―Accessing new markets‖;

• J. Od, President, MCS Group: ―Building interest‖.

BCM's English website includes the ―Mongolia Business News‖ section.

• 2014 Article IV staff report for Mongolia by International Monetary Fund;

• BCM comments on draft Amendments to the Minerals Law made to Mr. D. Gankhuyag, the Minister

of Mining, February, 2014;

• BCM Open Letter to Parliament and Government is available for download.

BCM continuously posts news stories and analysis of relevance to Mongolia at ‗Mongolian Business

News‖ before they are all put together each week for Friday's weekly NewsWire.

The ―Photo Gallery‖ contains photos from the 6th Anniversary BCM Renewal dinner on November

11, 2013.

BCM Football Cup 2013 pictures are posted to the website - http://bcmongolia.org/en/photos/350-

en/album?albumid=200

The BCM NewsWire will continue to be issued each Friday, incorporating items already on the home

page for a consolidated account of the week‘s events.

SOCIAL NETWORK WITH BCM

The Business Council of Mongolia (BCM) has expanded its reach to your favorite social networks.

Keep up to date on the latest business deals in Mongolia and how the climate for investment is

improving each day with BCM.

Add BCM on Facebook at https://www.facebook.com/TheBusinessCouncilOfMongolia to read the

latest announcements and comment on events carried in the NewsWire with the community.

Hear breaking news and announcements as they happen when you follow BCM on Twitter at

https://twitter.com/bcmongolia.

BCM is closing our old LinkedIn account from May 1, 2014. The new page allows BCM to alert

followers to the latest news and information critical to their businesses. Members‘ businesses will

be promoted. Additionally, BCM is delivering monthly info graphics on the latest data as well as

videos and other media content as they come.

The bulk of the content on the new page will be in Mongolian language to better cater to BCM's

Mongolian-speaking audience and members.

Please click on the below link to follow us on our new LinkedIn page.

http://www.linkedin.com/company/business-council-of-mongolia?trk=company_logo

Social stats: BCM now has 5,385 fans on our Facebook fans page, 530 connections on LinkedIn

network, and 1,042 followers on Twitter.

Of course for news information, interviews, event photos, VIDEOS and announcements regarding our

organization, visit the official BCM website at http://bcmongolia.org/en/

ECONOMIC INDICATORS

INFLATION

Year 2006 6.0% [source: National Statistical Office of Mongolia (NSOM)]

Year 2007 *15.1% [source: NSOM]

Year 2008 *22.1% [source: NSOM]

Year 2009 *4.2% [source: NSOM]

Year 2010 *13.0% [source: NSOM]

Year 2011 *10.2% [source: NSOM]

Year 2012 *14.0% [source: NSOM]

Year 2013 *12.5% [source: NSOM]

March 31, 2014 *12.4% [source: NSOM]

*Year-over-year (y-o-y), nationwide

Note: 11.9% y-o-y, Ulaanbaatar city, March 31, 2014

CENTRAL BANK POLICY LOAN RATE

December 31, 2008 9.75% [source: IMF]

March 11, 2009 14.00% [source: IMF]

May 12, 2009 12.75% [source: IMF]

June 12, 2009 11.50% [source: IMF]

September 30, 2009 10.00% [source: IMF]

May 12, 2010 11.00% [source: IMF]

April 28, 2011 11.50% [source: IMF]

August 25, 2011 11.75% [source: IMF]

October 25, 2011 12.25% [source: IMF]

March 19, 2012 12.75% [source: Mongol Bank]

April 18, 2012 13.25% [source: Mongol Bank]

January 25, 2013 12.50% [source: Mongol Bank]

April 8, 2013 11.50% [source: Mongol Bank]

June 25, 2013 10.50% [source: Mongol Bank]

CURRENCY RATES – 2 MAY 2014

Currency Name Currency Rate

US Dollar USD 1,795.35

Euro EUR 2,492.93

Japanese yen JPY 17.57

British pound GBP 3,030.73

Hong Kong dollar HKD 231.57

Chinese Yuan CNY 286.83

Russian Ruble RUB 50.45

South Korean won KRW 1.74

Disclaimer: Except for reporting on BCM‘s activities, all information in the BCM NewsWire is

selected from various news sources. Opinions are those of the respective news sources.