BUSINESS COUNCIL of MONGOLIA NewsWire

www.bcmongolia.org info@bcmongolia.org

Issue 320 – April 11, 2014

NEWS HIGHLIGHTS:

Business

Mongolia counts cost of mine delay as RioTinto deadline passes;

China's Shenhua to invest in cross-border rail link from Mongolia;

Korea's Posco readies for SNG plant;

Aspire signs MOU with Sainshand Industrial Park;

FeOre secures water usage agreement for Ereeny iron ore project;

Aspire signs letter of intent for power supply;

Xanadu completes private placement;

Development Bank acquires stake in Mongolian Mortgage;

MSE companies to distribute MNT 3.08bn in dividends;

Gobi begins cashmere processing in 2014;

Prophecy receives updated Chandgana preliminary economic assessment;

Mongolia’s Thomas Air wins tender in India;

Fuel leak causes MIAT flight delay;

Darkhan Metallurgical Plant reports March performance;

Government representatives visit MCX;

New website advertises tourism in Mongolia;

BCM Vice Director steps down;

Golomt battles to restore its reputation.

Economy

Mongol Bank: FX auctions, treasury bills, 10-year bills;

Premier denies plans for MNT 50,000 banknotes;

Energy Ministry makes agreements to tackle looming energy shortfalls;

Civil servants see salary raises;

Second round of vocational training launches;

DP presents on “Smart City” initiative;

Ulaanbaatar to move 4,800 families from gers to apartments;

UB to upgrade capacity to heat 50,000 more homes;

City “Railbus” service to launch in June;

Mongolia ranks 55th in the world for Internet speed;

Russian Defence Minister suggests shifting coal transport through Mongolia;

Rio says copper overcapacity to last at least 2 years;

Drones join robots in high-tech future for risky mines;

China: Slower growth, but a bigger economy.

Politics

OT included in economic revitalization resolution;

Parliament launches spring session;

Parliament approves spring session agenda;

Cabinet plans financing strategy to expand energy production;

Bayanselenge becomes Justice Coalition Deputy Chair;

Mongolia: more than just a courtesy call;

In Mongolia, Hagel gets a horse, just for a bit;

Mongolia signs MoU with North Korea;

Mongolian freighter with North Korean crew sinks off South Korea;

Parents of Megumi Yokota invited to North Korea in May;

Governor of Uvs visits Tuva Republic;

Mongolia and Czech Republic collaborate on green development;

Mongolians visit Alaska for disaster response exercises;

Mongolia: activist and ambitious.

ECONOMIC INDICATORS

MSE Top 20 Index by market Capitalization;

Foreign-listed Companies with Mongolian Assets;

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

BUSINESS

MONGOLIA COUNTS COST OF MINE DELAY AS RIO TINTO DEADLINE PASSES

A dispute between the Mongolian government and its biggest foreign investor over the expansion of

one of the world‘s largest copper mines has added to concerns over the country‘s faltering

economy.

A financing deadline to expand the vast Oyu Tolgoi copper project passed last week without an

agreement between developer Rio Tinto PLC and the government. The expansion is seen as crucial

to Rio‘s plans, but the Anglo-Australian mining company missed a deadline to secure USD 4.2 billion

in project financing from banks for the project as discussions continued with the Mongolian

government over how to divide the revenues.

Mongolia needs the revenues to fund spending commitments made in the first flush of optimism of a

mining-based windfall for the landlocked nation‘s nearly three million people. But expansion of the

mine, which began producing copper in 2013 and which could eventually generate one-third of the

country‘s gross domestic product, is now not likely until 2015. Few believe the mine expansion will

not happen, although it could be developed on a reduced scale.

An agreement on the mine ―would be a wonderful signal, but there has got to be a lot more than

that,‖ said Jim Dwyer, head of the Business Council of Mongolia, which promotes trade and

investment in the country. In 2013, parliament passed a law to treat foreign and domestic investors

the same. But foreigners remain concerned by Mongolia‘s history of sudden regulatory changes and

corruption probes that have sometimes ensnared foreign projects or citizens.

Much will depend on the spring parliamentary session, which began on Monday, when the

government‘s approach to Oyu Tolgoi will be debated. The weak currency and drop in Mongolian

stock prices has had some benefits. Two Japanese banks have set up shop in Ulaanbaatar while

work has begun on the first power plant in the capital to be built since the 1980s.

―In 2010-2011, lots of people said values were too high,‖ said Howard Lambert, chief representative

of ING Bank in Mongolia. ―Now we are starting to see those people come back.‖

Source: Financial Times

CHINA'S SHENHUA TO INVEST IN CROSS-BORDER RAIL LINK FROM MONGOLIA

Shenhua Group, China's top coal producer, will form a joint venture with partners in Mongolia to

build a cross-border rail link that will help ship coal to China, the company confirmed on

Wednesday.

The deal marks a change in attitude in Mongolia, which has long sought to keep its powerful

neighbor at arm's length amid fears about China's political and economic hegemony in the region.

China buys more than 90 percent of Mongolia's exports and has sought big stakes in the country's

strategic assets. A signing ceremony for the new rail joint venture was held in Ulaanbaatar on

Monday.

A Mongolian government official said the Chinese firm will own 49 percent of the project, which will

involve the construction of a 13-kilometer rail link from the Chinese border to a terminal where

coal is delivered by trucks. Yondon Manlaibayar, the director general of the department of railways

at the Roads and Transportation Ministry, said a consortium of Mongolian firms, including state-

owned miner Erdenes Tavan Tolgoi and the Hong Kong-listed Mongolian Mining Corporation, would

share the remaining 51 percent.

Mongolia plans to spend USD 5.2 billion on the expansion and upgrade of its railway network, and

last year hired Samsung C&T to lead construction of a 217-kilometer route south from the Ukhaa

Khudag mine in the South Gobi region towards China. A route to China would reduce the cost of

shipping coal to customers in China—now largely done by road—and would also improve Mongolia's

access to China's ports. But an additional 27 kilometers of rail connecting the Shenhua line and

Samsung C&T's line will be needed to complete the route. In the meantime, the temporary drop-off

point will be established for trucks to deliver coal to the Shenhua joint venture rail to be carried

into China, said Manlaibayar.

"They (the joint venture partners) don't want to wait for us to complete the whole line," said

Manlaibayar.

The Shenhua joint venture project and the connecting 27 kilometers of line will be built using

China's rail gauge, while the rest of the line uses the Russian standard, said Manlaibayar. A station

for gauge transference will be built where the Samsung-led rail line ends, he said. Mongolia's rail

policy requires the use Russia's wider gauge standard, but some in the industry worry about the

added costs of having to change standards at the end of the Samsung line.

Source: Reuters

S. KOREA'S POSCO READIES FOR SNG PLANT

Posco, South Korea's top steelmaker, said Thursday that it has established a subsidiary to operate a

synthetic natural gas (SNG) business that is planning extend operations to Mongolia.

The subsidiary, named POSCO Green Gas Technology, was established in Posco's Gwangyang

complex on the country's southern coast, where it is building an SNG plant with a capacity of

500,000 metric tons a year.

Posco has also agreed with Mongolia's MCS Group to establish a 50-50 joint venture to build an SNG

plant in Mongolia. The two companies are aiming to complete financing by the end of this year and

start work on the plant with a target date for bringing it online of the end of 2018.

Posco has spent KRW 870 billion (USD 824 million) since June 2011 on the coal-to-gas plant in Korea,

which is expected save the company KRW 200 billion a year on liquefied natural gas imports, Posco

said in a statement.

Posco has recently picked the SNG business as one of its future growth engines. Posco has been

conducting research since 2009 with the country's top oil refiner SK Innovation Co., Ltd. to develop

technology to make SNG and coal-based oil through a coal-to-liquids process.

The steelmaker currently consumes some 60,000 metric tons a month of LNG to fire its plants. It

imports the LNG from the BP-led Tangguh project in Indonesia under a 20-year contract signed in

2009 for 550,000 metric tons a year.

Source: Platts

ASPIRE SIGNS MOU WITH SAINSHAND INDUSTRIAL PARK

Aspire Mining Ltd. announced that its Mongolian subsidiary has signed a non-binding memorandum

of understanding with the state-owned company responsible for the development of the Sainshand

Industrial Complex for future coal supply.

The memorandum relates to the intent by Sainshand Industrial Complex SOE to enter into future

purchase agreements for Ovoot Project coking coal and establishes a basis of information sharing

prior to negotiation. The Source called the agreement ―an important step for the Ovoot Project as

it is recognized alongside the Tavan Tolgoi coal operation as being a key supplier of raw materials

to the Sainshand Park.‖ Blending studies completed by Aspire in 2013 have shown that Ovoot

project coking coal can add significant value to Tavan Tolgoi‘s low and non-coking coals.

The Sainshand Industrial Complex SOE is a Mongolian government entity established to oversee the

development of the Sainshand Industrial Park, the largest industrial development project in

Mongolia. The Sainshand Park infrastructure has been designed by Fluor Corporation and it is

intended to house both coke and steel plants, amongst other industries. Sainshand Park is located

along the existing Trans-Mongolian Railway with rail and road access to northeast China.

In order to supply the Sainshand Park with Ovoot Project coking coal, the Erdenet-Ovoot project

railway connecting to the Trans-Mongolian Railway will need to be completed. Northern Railways

LLC, Aspire‘s Mongolian rail infrastructure subsidiary, has applied to the Mongolian government for

a rail concession over the Northern Rail Line. Mongolian government approval is required before

this rail project can proceed.

Source: Aspire Mining Ltd.

FEORE SECURES WATER USAGE AGREEMENT FOR EREENY IRON ORE PROJECT

FeOre Ltd. on 4 April announced that Mongolian subsidiary Taisheng Development LLC has entered

into a water usage agreement with the Ministry of Environment and Green Development on the

Jargalant tenement. The agreement secures the needed water for the annual production of one

million to 1.2 million tons of iron concentrate for the Ereeny Project, which is 25 kilometers from

Jargalant.

"It is an important and essential milestone of the development of Ereeny Project and is a result of

countless efforts by the Company", said Chairman Tim Sun.

Source: FeOre Ltd.

ASPIRE SIGNS LETTER OF INTENT FOR POWER SUPPLY

Aspire Mining Ltd. on 10 April announced that a non-binding letter of intent (LOI) had been signed

for the future supply of power to its wholly-owned Ovoot coking coal project, located in Khusvgul

Aimag.

The non-binding LOI covers the supply of 30 to 35 megawatts per annum of power supplied from the

Zavkhan Power Plant which is expected to be commissioned in late 2015. The coal fired Zavkhan

Power Plant is located approximately 70 kilometers south of the Ovoot Project and is being

constructed by New Asia Group LLC. Electricity produced from the power plant will feed directly

into the existing 110-kilovolt power grid that runs directly through the Ovoot Project license area.

―The signing of this letter of intent for power supply highlights the ready accessibility of power to

the Ovoot Coking Coal Project,‖ said Aspire Managing Director David Paull. ―Access to sufficient

quantities of power and water are essential to a successful coal mining operation.‖

Source: Aspire Mining Ltd.

XANADU COMPLETES PRIVATE PLACEMENT

Xanadu Mines Ltd. raised AUD 1.47 million (USD XX) via a fully subscribed private placement.

The placement, which had Bell Potter Securities Ltd. as sole lead manager for proceeds and is

subject to shareholder approval of the Kharmagtai acquisition, saw Xanadu issue 30.78 million fully

paid ordinary shares at AUD 4.8 cents per share. Proceeds from the placement will be used to

accelerate exploration activities at the Kharmagtai copper-gold project. Xanadu has arranged over

USD 10 million in new funds for the acquisition of and exploration activities at the Kharmagtai

copper-gold project.

Xanadu has mobilized to the Kharmagtai site and commenced exploration activities, including

development of a comprehensive 3D geological model for drill hole targeting. Drilling is to

commence at Kharmagtai as soon as practically possible upon completion of the Kharmagtai

transaction.

Source: Xanadu Mines Ltd.

DEVELOPMENT BANK ACQUIRES STAKE IN MONGOLIAN MORTGAGE

The Development Bank of Mongolia inked a deal for up to 15 percent ownership of Mongolian

Mortgage Corporation(MMC) for MNT 10 billion.

The Development Bank joins Toriin Bank and other commercial bank stakeholders in the shared

ownership of the mortgage lender. Mongolian Mortgage holds 4.9 percent of its own shares, and is

able to sell 95.1 percent of its interest in the event of mortgage defaults.

Source: Undesnii Shuudan

MSE COMPANIES TO DISTRIBUTE MNT 3.08BN IN DIVIDENDS

Eleven out of 249 locally listed public companies have opted to distribute MNT 3.08 billion in

dividends to shareholders in March, reported the Mongolian Stock Exchange.

An additional 33 companies debated whether or not to distribute dividends but declined to do so.

The MSE received financial reports from 108 companies in 2013, 54 of which earned profits for the

year. The following 11 companies will distribute the amounts per share listed, totaling MNT 3.08

billion as dividends.

Gazar Suljmel - MNT 7,233.39

Bayangol Hotel - MNT 355

Technik Import -MNT 200

Gobi - MNT 130

Talkh Chiher - MNT 110

Makh Impeks - MNT 100

Takhi Ko - MNT 65

Bi Di Sek - MNT 11.78

Achit Alkabi - MNT 10

Germes Center - MNT 5.82

Erdenet Subarga - MNT 5

Source: Undesnii Shuudan

GOBI BEGINS CASHMERE PROCESSING IN 2014

Gobi Cashmere, one of Mongolia's biggest producers of cashmere and wool products, observed

Wednesday the launch of cashmere processing operations for the year.

Gobi acknowledged the importance having herders sell the raw cashmere, known as greasy

cashmere, to national producers. ―This is a similar event to that of farmers having their first

harvest,‖ said a company official.

Source: Montsame

PROPHECY RECEIVES UPDATED CHANDGANA PRELIMINARY ECONOMIC ASSESSMENT

Prophecy Coal Corp. on 3 April announced that it had filed a revised technical report on its

Chandgana Tal coal mining licenses in central Mongolia.

The financial evaluation in the new report, which updates a November 2012 report titled "Technical

Report, Coal Resources and Preliminary Economic Assessment, Coal Mine Component, Chandgana

Tal Coal Project," indicates that the project is potentially economically viable given the coal price

assumption of USD 17.70 per ton sold at the mine gate directly to the power plant. The coal price is

fully indexed and will rise according to rising input costs such as fuel, labor, and parts. The report

said the coal project is expected to provide stable returns throughout the life of the mine.

Furthermore, the mineral resource estimate of 124 million tons of coal covers only the Chandgana

Tal mining licenses with potential to scale up the Chandgana power plant project and source

additional coal supply from subsidiary Chandgana Coal LLC's nearby Khavtgai Uul coal deposit. An

independent study sponsored by Asian Development Bank suggested a Mongolia power supply deficit

of 600 megawatts by 2016 and 900 megawatts by 2019. This deficit could be satisfied by a scaled up

Chandgana power plant.

Prophecy cautioned that the assessment, which was prepared by John T. Boyd Co., was preliminary

and has a degree of accuracy of plus or minus 35 percent.

Source: Prophecy Coal Corp.

MONGOLIA‟S THOMAS AIR WINS TENDER IN INDIA

Mongolian airline Thomas Air LLC on 1 April won the rights to participate in a series large

construction projects to take place in the northern regions of India.

Thomas Air participated in a four-phase tender process for the rights. The tender was announced in

January by Survey of India, the country‘s central engineering agency in charge of mapping and

surveying. The tender attracted some ten aviation companies from Mongolia, Australia, Canada,

France, Indonesia and Spain before concluding 1 April.

Thomas Air will sign a contract with its Indian partners leading construction projects for urban

development, railways and highways, namely in southern part of the Himalaya Mountains.

Source: Montsame

FUEL LEAK CAUSES MIAT FLIGHT DELAY

MIAT Flight ОМ302А was delayed from departure from the Incheon airport in South Korea to

Ulaanbaatar on 3 April due to technical problems.

The flight failed to depart at 14:50 that day because of a fuel leak from the plane‘s petroleum

tank. Passengers were sent to hotels while repairs were made before departing from Incheon at

07:00 the next day. MIAT reported that the flight landed at Chinggis Khaan International Airport at

11:50 on the same day.

Source: News.mn

DARKHAN METALLURGICAL PLANT REPORTS ON MARCH PERFORMANCE

The Darkhan Metallurgical Plant exceeded activity projections, according to a March performance

report received by the State Property Committee.

The plant exceeded its monthly plan by 8.2 percent last month, with 394,341 cubic meters of

―overburden removal‖, 100,607 tons of iron ore explored, and 74,600 ton of iron ore concentrate

processed. The report said that activities exceeded projections for overburden removal, exploration

and processing by 11.8 to 27.5 percent last month, said the report.

Source: Montsame

GOVERNMENT REPRESENTATIVES VISIT MCX

A high-level Mongolian delegation visited the Multi Commodity Exchange of India (MCX) 31 March to

learn from India's experience of managing a successful market exchange.

O. Erdenebulgan, vice minister of mining, led a delegation of Mining Ministry officials and the

Financial Regulatory Commission's securities department director general to learn more about

identifying market values for commodities and manage pricing risks through a mineral resource

commodity exchange.

―We are very happy to find a capable knowledge-sharing platform in MCX. We have been enriched

by the learning we have gathered from MCX and would surely find this knowledge very useful in

operationalizing our proposed commodity exchange at Mongolia,‖ said Erdenbulgan.

Source: Multi Commodity Exchange

NEW WEBSITE ADVERTISES TOURISM IN MONGOLIA

The Ministry of Culture, Sport and Tourism has launched the website travel2mongolia.com to

promote tourism to the country.

This website launched following the announcement that Mongolia would partner with Messe Berlin,

the main organizer of the ITB Berlin international exhibition, ITB 2015 on 1 April. ITB Berlin is the

world's largest tourism trade fair, last year attracting 10,000 companies from 188 countries.

Source: Montsame

BCM VICE DIRECTOR STEPS DOWN

Business Council of Mongolia Vice Director Ser-Od Ichinkhorloo resigned this week.

―I do appreciate my BCM Admin team. I think my colleagues' endeavors, the friendly and

professional teamwork on the BCM missions, have been most important,‖ said Ser-Od. ―We are now

passing a very hard and complicated time in terms of the business environment. But I do hope the

bright future will be closer than we see now.‖

Ser-Od said he was stepping down to pursue the establishment and management of his own

business-to-business services provider, B2BMongolia.com.

Source: BCM

GOLOMT BATTLES TO RESTORE ITS REPUTATION

Golomt Bank LLC‘s reputation has mined unexpected depths over allegations of hidden defaults,

lawsuits with leading financial institutions and a sudden parting of the ways with a globally

respected chief executive officer. Now a new group of executives is launching a fightback.

Luvsandorj Bolormaa, the newly minted executive vice president and chief investment officer of

Golomt Bank, joined Mongolia‘s third-largest lender in January. Bolormaa certainly has the

credentials to rebuild Golomt‘s reputation. She was previously deputy chief executive officer of the

Development Bank of Mongolia. Before that, she was a vice-president at Deutsche Bank, in New

York, overseeing coverage of financial institutions. She notes, right off the bat, that the bank

hasn‘t always been particularly effective at the simple art of forming and transforming public

opinion.

"Our problem is that we aren‘t very good at public relations," she admits. "Not just at Golomt, but

as a country. Mongolians aren‘t very good at being put on the spot and being forced to deny or find

answers to allegations."

Golomt denies any foul play. Luvsandorj notes that USD 65 million in letters of credit to Itochu that

were defaulted on but never went reported were then "very new products" in Mongolia‘s banking

sector. Golomt paid Itochu USD 1.2 million to settle a suit claiming the purchased orders used for

the credit line to purchase mining equipment for Altan Gold were faked. However, a dispute with

Stanhope Investments, an arm of the Abu Dhabi sovereign wealth fund, is very real.

"Yes, we are in dispute with Stanhope Investments—Bloomberg is correct there," admits Luvsandorj.

"Stanhope is where the only problem is. The wording [relating to the timing of the IPO] is really the

problem. We are seeking to resolve the dispute amicably, hopefully by finding an acceptable

solution for all parties."

What remains clear, despite Luvsandorj‘s puckish demeanor, is that Golomt hasn‘t always been a

particularly well-run financial institution. Its failure to deliver a full audit of its 2012 finances until

November 2013 forced both Moody‘s Investors Service and Standard & Poor‘s to halt ratings of

Golomt‘s credit, both citing a lack of data. Then there are the accusations that Golomt destroyed

files on the orders of top management in order to delete any paper trail leading auditors (or

regulators or journalists) to evidence of malfeasance. These allegations center on the Itochu case

and suggest that Golomt excised files relating to existing letters of credit in order to pre-empt any

outside investigation.

Some have begun to wonder if the reputation of the banking sector itself has been tarnished,

perhaps irreparably. The central bank advisor and chief economist Sandagdorj Bold denied such

concerns were tenable. "I really don‘t think so. Foreigners lack the information necessary to

understand the industry. There is nothing wrong with our banks." He notes that Mongolia‘s capital

adequacy ratio is now 16 percent, one of the highest rates in the world. "Overall, the banking

system of Mongolia is sound and stable," Bold adds. "Capital adequacy, liquidity condition, risk

tolerance and the resilience of the Mongolian banking sector have been quite strong. We know our

banks and we affirm that Mongolian banks‘ operations are quite normal."

Due to the complexity and length of this article, readers are advised to read the full article here.

Source: Cover Mongolia

ECONOMY

MONGOL BANK: FX AUCTIONS, TREASURY BILLS, 10-YEAR BILLS

The Bank of Mongolia on 10 April sold USD 6.5 million at auction for a closing rate of MNT 1,781.1

and CNY 8 million for a closing rate of MNT 286.02. On the same day, the Bank of Mongolia

received an equivalent of USD 30.5 million and CNY 20 million from currency swap transactions with

local banks. On 9 April the central bank held its regular auction for 28-week maturity government

treasury bills at a face value MNT 20 billion out of MNT 38 billion in bids, with each unit worth MNT

1 million. Treasury bills were sold to commercial banks at a discounted price and with a weighted

average yield of 10.5 percent. Also on 9 April, the central bank auctioned 10-year bills worth MNT

10 billion. MNT 2 billion out of MNT 2 billion in bids were sold at a weighted interest rate of 17.5

percent a year.

Source: Bank of Mongolia

PREMIER DENIES PLANS FOR MNT 50,000 BANKNOTES

Prime Minister Norov Altankhuyag refuted a statement from Finance Minister Chultem Ulaan that a

MNT 50,000 banknote was under review during his weekly 30 Minutes press conference on 3 April.

News.mn reported last week that Ulaan said a MNT 50,000 banknote was under consideration during

a working visit to the 11-11 hotline center for reports of corruption. ―Today I asked President of

Mongolbank Naidansuren Zoljargal if it was going to introduce a MNT 50,000 banknote and he

responded, 'No.' So, it is a rumor.

Separately, Altankhuyag admitted that complaints from the opposition of the deteriorating

economic situation in Mongolia were not unfounded. ―I won‘t lie and say that the current Mongolian

economy is in good condition. Mongolia‘s income has been reduced. The world economy this year

has worsened compared to previous years and this is also influencing our economy. When the global

economy declines, it impacts the price of Mongolian export products.‖

He added that the government was not standing idle, however. In response, the government and

central bank were instituting new plans to increase coal exports while providing financial support to

construction activities and cashmere production.

The prime minister also shook off complaints fielded by the opposition that the current government

had only completed 30 percent of its action plan. ―Is it necessary to go after a number? The

administration has had only 1.7 years since its establishment. The results of the government‘s

performance are measured by the facts, and the fact is that people‘s living standards have been

improved.‖

Source: UB Post

ENERGY MINISTRY MAKES AGREEMENTS TO TACKLE LOOMING ENERGY SHORTFALLS

Representatives of the Energy Ministry and the Development Bank of Mongolia signed an agreement

with contractors Thursday for the expansion of Mongolia's power generation and network.

The government is expected to lead eight projects this year to expand the country's heat and

electricity capabilities through upgrades to the Amgalan Thermal station, Central Thermal Plant No.

3 and Central Thermal Plant No. 4.

The Energy Ministry has made expanding energy capacities to meet growing demand in Ulaanbaatar

its main priority for 2014, in conjunction with the government's "Smoke-free Ulaanbaatar" program

that is to see the re-planning of Ulaanbaatar's ger districts.

Source: Montsame

CIVIL SERVANTS SEE SALARY RAISES

Civil servants received salary raises 1 March, said President of Confederation of Mongolian Trade

Unions Kh. Amgalanbaatar.

The government is spending MNT 139 billion for the salary raise, said Amgalanbaatar. ―One time

salary increases could not solve all problems and we will work to increase salary even more.‖

Source: Undesnii Shuudan

SECOND ROUND OF VOCATIONAL TRAINING LAUNCHES

Prime Minister Norov Altankhuyag attended a graduation ceremony Monday for the first round of

vocational training participants.

Providing stipends to vocational training participants "gives a confidence that all will work

homeland, not abroad," said Altankhuyag underneath a banner that stated ―We are making wealth.‖

Every trainee receives a stipend of 190,000 each month and job uniforms.

The government vocational training initiative has registered 1.728 people for the second round of

training this year, and will begin training once contracts with employers are inked. A reported 79

percent of the 6.417 individuals who participated in the job training have received employment.

This year will see 5,220 workers participate in job training.

Source: Montsame

DP PRESENTS ON “SMART CITY” INITIATIVE

Members of the Democratic Party (DP) at a press conference on 3 April unveiled the "Smart City"

initiative being led by the Ulaanbaatar government.

The city administration plans to roll out its six-year program this year in an effort to improve city

services and improve the living standard by introducing technological innovations for a new

metropolis, said the DP representatives. The program is targeting six main areas: governance, the

economy, residents' needs, city services, the environment, and lifestyle standards.

The program is following the lead of the DP's "Mongolian 2020" action plan and Tsakhia Elbegdorj's

"From Big Government to Smart Government" initiative. "The program targets the speed up of city

public services by 50 to 90 percent and to reduce crimes by 20 percent.

Source: Montsame

ULAANBAATAR TO MOVE 4,800 FAMILIES FROM GERS TO APARTMENTS

The government is reportedly expecting 4,800 families from Ulaanbaatar's ger districts to move into

apartments this year.

Ulaanbaatar has 67 sites in 21 different areas where there are plans to build apartment buildings.

City authorities have selected 16 out of 32 companies that bid to participate in the construction

projects. Some companies taking part in Ulaanbaatar's urbanization and ger redevelopment projects

have complained of legal and infrastructure obstacles. Replanning of Ulaanbaatar's ger districts is

set to continue for 6 years at a cost of MNT 148 billion. Contracts for MNT 53.183 billion for

construction have been made and infrastructure works are underway.

Source: Undesnii Shuudan

UB TO UPGRADE CAPACITY TO HEAT 50,000 MORE HOMES

The government has approved financing for the construction of the Songino and MBA power

generation substation, and the Ikh Toiruu electricity transmission lines.

The Development Bank and the Economic Development Minister Batbayar received approval to

finance 30 to 40 percent of the work to take place for the energy infrastructure. The power

generation and delivery capabilities would allow 50,000 additional families to receive heat from the

central thermal energy grid.

The government is introducing additional energy and heat infrastructure in the hopes of reducing

pollution in Ulaanbaatar.

Source: Undesnii Shuudan

CITY “RAILBUS” SERVICE TO LAUNCH IN JUNE

Ulaanbaatar Railway LLC (UBTZ) on 4 April introduced its ―Railbus‖ project to launch in June.

The project comes from the initiative of the Ulaanbaatar Mayor's office, setting out to bring 136-

seat public rail buses able to carry 350 to 400 passengers at a time. The cars will travel 47 minutes

between Tolgoit and Amgalan and 45 minutes between Amgalan and Tolgoit, reaching a speed of

100 kilometers per hour. The Railbus will travel three times a day on a single track and six times on

a double track, picking up and letting off passengers at four different stations.

The first phase of the project will see three rail buses travel on two separate routes commissioned

by 6 June. The next target will be to commission rail buses to travel on routes to Khui Doloo khudag

and other destinations. The project requires that the Ulaanbaatar Mayor's Office free up land

already planned for other construction projects to make way for the construction of the double-rail

track and its stations. A joint task force that includes representatives of UBTZ and the Ulaanbaatar

Mayor`s Office will be established to develop a work plan.

Source: News.mn

MONGOLIA RANKS 55TH IN THE WORLD FOR INTERNET SPEED

Mongolia was ranked 55th on broadband network diagnostics firm Ookla's Net Index, which ranks 189

countries by download speed on the Internet.

Mongolia clocked in at an average download speed of some 13.93 megabytes per second and 10.3

for uploads. That compares with a global average of 17.5 megabytes per second for downloads and

7.9 for uploads. Russia ranked 38th and China at 47th, receiving download speeds of 22.16 and

18.24 megabytes per second, respectively. Hong Kong leads the world on the index with 76.14

megabytes per second for downloads, followed by Singapore and Romania.

Mongolia ranked 51st in the previous year's index, clocking in a download speed of 13.95 megabytes

per second.

Mongolia‘s Top 20 Internet Service Providers as of April 2014:

1. Yokozunanet LLC 33.13 Mbps

2. Bodisoft Co.,Ltd 30.78 Mbps

3. Yokozunanet 29.41 Mbps UNIVISION 32.36 Mbps

4. The first E-commerce ISP in Mongolia 37.35 Mbps

5. Mongolia 24.11 Mbps Mobinet LLC 26.01 Mbps

6. Univision 22.04 Mbps YOKOZUNANET 25.35 Mbps

7. Mobinet LLC. aS Mobinet ISP 21.76 Mbps

8. Mobinet LLC 19.65 Mbps

9. Bodicomputer Co.,ltd. 18.42 Mbps

10. SKYCC, VoIP and ISP, Ulaanbaatar 7.25 Mbps

11. Digicom LLC 7.22 Mbps

12. Citinet LLC 7.08 Mbps

13. Sansar-Internet 6.33 Mbps

14. G-Mobile Corporation 6.20 Mbps

15. Kewiko LLC 5.76 Mbps

16. GemNet 4.39 Mbps

17. Mongolia Telecom 1.41 Mbps

18. Ulusnet, ISP, Ulaanbaatar 1.18 Mbps

19. Telemax Communication 0.25 Mbps

20. Peace Avenue 0.20 Mbps

Source: News.mn

RUSSIAN DEFENCE MINISTER SUGGESTS SHIFTING COAL TRANSPORT THROUGH MONGOLIA

Russian Prime Minister Dmitry Medvedev has ordered Defense Minister Sergei Shoigu to proceed with

a proposal for the development of coal transportation towards the south of Russia—through Western

Mongolia to China and then to other countries—at a government meeting, according to a meeting

transcript.

―Our program implies the construction of a railway from Kuragino southwards to Kyzyl. From Kyzyl

this can be going on through Western Mongolia to Urumqi, China, and then in any direction: to

Pakistan, India, anywhere,‖ said Shoigu.

―If such a project could be approved and developed together with the Chinese partners, they would

play the most active role in it,‖ he added.

Source: Port News

RIO SAYS COPPER OVERCAPACITY TO LAST AT LEAST 2 YEARS

Copper overcapacity will last the next two or possibly three years, and prices will ―remain

volatile,‖ said Jean-Sebastien Jacques, copper chief executive officer at Rio Tinto Group.

―The overcapacity that we are seeing for this year is on the back of investment decisions made 5 or

10 years ago,‖ Jacques said in an interview in Santiago yesterday. ―The entire industry is of the

view that there will be overcapacity in the next two or possibly three years.‖ Long term

fundamentals are ―strong,‖ he said. Rio Tinto will focus on projects that ―can create value

throughout the cycle.‖

Source: Sydney Morning Herald

DRONES JOIN ROBOTS IN HIGH-TECH FUTURE FOR RISKY MINES

Mines without miners? Not quite. Still, a technology boom in robots, drones, driverless trucks and

pilotless trains is beginning to reshape one of the world‘s most labor-intensive industries,

portending automation of logistics, supply chains and mapping and allowing development of mines

in regions once thought too dangerous or remote to exploit.

Already about 200 driverless haul trucks are working iron ore mines, mainly in Australia. Meanwhile,

mining giant and Oyu Tolgoi operator Rio Tinto Ltd., which funds one of the world‘s largest non-

military robotics programs, will soon use unmanned trains to deliver cargo to the coast and set

drones aloft at its remote mines. Drones can monitor stockpiles, map exploration targets and track

equipment and will eventually deliver parcels to workshops according to Accenture PLC—and on a

schedule far ahead of that envisioned by Amazon.com Inc.‘s Jeff Bezos, who one day wants

Amazon‘s books and DVDs delivered instantly to customers via miniature helicopters.

―Come and see me in about October,‖ said John McGagh, head of innovation at Rio Tinto in

Brisbane, Australia, where staff use the world‘s largest multi-content touchscreen to monitor

mining operations from Utah to Queensland. ―You will see drones flying around. That‘s not so long

away.‖

Technological advances in the development of drones and robots will help create mines of the

future in remote locations such as Mongolia that can be directed from NASA-inspired control rooms

in first world cities in the U.S. and Australia. BHP Billiton Ltd., the world‘s biggest, Anglo American

PLC and Rio are among miners ramping up this automated global high-tech race, betting new

equipment will help cut costs and improve returns as well as allowing them to exploit deposits so

far considered too complex or too dangerous for humans.

A fully-automated mine, which offers the precision achieved in automaking, is probably only a

decade away, according to Rowan Melrose, Brisbane-based president of automation and technology

at equipment maker Sandvik AB‘s mining unit.

Source: Bloomberg

CHINA: SLOWER GROWTH, BUT A BIGGER ECONOMY

Mongolia's economy grew nearly 12 percent last year, the United States around 2 percent. So

Mongolia grew around six times faster than the United States, yet of course the United States

contributed more to gross domestic product (GDP) growth—over 150 times more. Why? Because size

matters.

Let's apply this logic to China. A bigger but somewhat slower growing China of the future will

contribute about as much to global demand as the smaller but faster growing China of before. This

is arithmetic: An economy that is twice as big can grow by half as much and contribute the same to

global demand. By the way, China today is more than twice as big as it was a decade ago.

So, the good news is, even with slower growth, China will continue to be an engine of global

output. Indeed, an even bigger engine than before. How big is China? Big! China is the world's

second largest economy. Based on purchasing power parity (PPP) exchange rates, China increased

from 6 percent of global output in 1995, to 15 percent last year. Or, if you prefer using market

exchange rates, the corresponding rise in China's share of global GDP is from 2 percent in 1995 to 12

percent in 2013.

China is the world's most populous country. So per person, GDP in China is USD 6,500, compared to

USD 53,100 in the United States. Even the most developed cities in China do not approach the

income levels of advanced economies. This underscores that China still has considerable room to

grow. And, in the end, the world economy benefits the most from sustainable growth in China. As

argued before, the world should welcome the slowdown in China to a more sustainable growth rate.

Welcome, because it means much higher income in the future. And, as shown above, it means that

China will continue to be an engine of global growth.

Author Steven Barnett is the International Monetary Fund (IMF) division chief for Asia and the

Pacific.

Source: Huffington Post

POLITICS

OT INCLUDED IN ECONOMIC REVITALIZATION RESOLUTION

The Oyu Tolgoi copper-gold mine was included in a proposed resolution submitted by Economic

Development Minister Nyamjav Batbayar.

The resolution would give the order for government to prepare the necessary documents for the

second stage of investment for Oyu Tolgoi, in addition to the relaunch of exploration, financial

support to industrialization, and possibilities for the exploration of oil, oil shale, and natural gas in

protected areas. The proposed resolution would reportedly give 19 different directives with the

purpose of fostering economic growth and stability during spring session of Parliament.

Source: Cover Mongolia

PARLIAMENT LAUNCHES SPRING SESSION

The opening of the 2014 spring session of Parliament was held on 7 April to an audience of party

and foreign delegates.

―Parliament could not confirm the list of issues to be discussed during the session of Parliament,‖

said Parliament Speaker Zandakhuu Enkhbold in his opening address. ―Thus, I expect the first issue

to be passed by Parliament to be the list of issues to be discussed. However 252 bills were

suggested to be discussed at the spring session, but only 52 proposals have been submitted. These

proposals that were submitted need to be arranged due to their socio-economic importance.‖

The speaker also said discussions expected to be held during the session would be reviews for the

2013 financial performance of government and the state budget reports for 2015, as well as bills to

be prioritized by socio-economic importance. There is also debate expected regarding 272 funded

construction projects that underwent audit and need to be confirmed before funding can resume.

The spring session of Parliament was noteworthy for the fact that it was attended by party leaders

without seats in parliament, as well as foreign ambassadors and consuls. Separate caucuses were

expected to convene following the opening of Parliament.

Source: News.mn

PARLIAMENT APPROVES SPRING SESSION AGENDA

Parliament Tuesday adopted a draft resolution to set an agenda for the spring session of

Parliament.

Head of the Standing Committee on State Structure A. Bakei introduced to Parliament proposals and

conclusions on the agenda. He noted that of the total bills and resolutions submitted to the

committee, 5 came from the president, 4 from standing committees, 99 from coalition and party

representatives, 95 from the Cabinet Secretariat, and 10 from independent parliamentarian

Sainkhuu Ganbaatar.

Bakei added that an extra 25 proposed pieces of legislation had been added to the agenda.

Source: Montsame

CABINET PLANS FINANCING STRATEGY TO EXPAND ENERGY PRODUCTION

The Development Bank of Mongolia on 4 April received orders from the Cabinet Secretariat to

finance projects that aim to expand Mongolia's energy generation capabilities.

The projects will be for the development and construction of the Songino and MBA sub-stations and

the power lines at Ikh Toirog and Bayangol Town. Economic Development Minister N. Batbayar

received the task of settling the financial matters while the Development Bank is responsible for

dispersing funds.

The government intends to meet the growing energy demand of Ulaanbaatar with the installment of

the electric lines and power sub-stations while combating the worsening air pollution in the city

during winter. The government hopes to ensure energy supply to 50,000 families in the ger districts

with the power infrastructure.

Source: Montsame

BAYANSELENGE BECOMES JUSTICE COALITION DEPUTY CHAIR

Parliamentarian Z. Bayanselenge has been appointed deputy chair of the Justice Coalition to

replace Finance Minister Chultem Ulaan.

This decision came from a Monday meeting of the coalition, which is made up of the Mongolian

People's Revolutionary Party and Mongolian National Democratic Party. Ulaan was reportedly

replaced based on his own request.

Source: Montsame

MONGOLIA: MORE THAN JUST A COURTESY CALL

U.S. Secretary of Defense Chuck Hagel will touch down in Ulaanbaatar this month, marking the first

visit of a defense secretary to Mongolia since Donald Rumsfeld toured the landlocked country in

2005.

Something transformational is happening in Mongolia‘s security doctrine and these changes are not

going unnoticed in Washington. Mongolia‘s focus on the peacekeeping niche—deploying

peacekeepers to a high-risk area on the border of South Sudan and Sudan in 2012 and for the NATO-

led Kosovo intervention from 2005-2007—has resulted in a dramatic modernization of the Mongolian

Armed Forces (MAF). Former Mongolia hands Christopher Pultz and Jonathan Addleton have noted

that the MAF‘s reorientation is centered on three goals: developing capacity to participate in U.N.-

led missions, bolstering counterterrorism efforts and enhancing its role in humanitarian and disaster

relief missions. These goals are supported by Washington‘s financial and diplomatic support.

President Tsakhia Elbegdorj has bigger and bolder plans for his country to play a prominent role in

Northeast Asia as a center for internationally supported peacekeeping operations. The policy, which

is bolstered by the MAF‘s significant effort despite its diminutive size (fewer than 10,000 active

soldiers), goes hand-in-hand with Elbegdorj‘s ―third neighbor‖ approach, which provides Mongolia

an air pocket from its economic and security reliance on Beijing and Moscow. The softer side of this

diplomatic push has been demonstrated by Ulaanbaatar‘s membership in the Organization for

Security and Cooperation in Europe and its previous chairmanship of the Community on

Democracies. Ulaanbaatar has also been promoting its soft power as an interlocutor through its

active engagement as a meeting venue between Japan and North Korea over the lingering issue of

abducted Japanese citizens.

Hagel‘s visit will likely highlight the accomplishments mentioned earlier and chart a course for the

future of the U.S.-Mongolia defense relationship. Specifically, such a partnership must focus on

continuing to train and build the capacity of the MAF, while also taking time to assist Ulaanbaatar

on necessary institutional defense reforms. But, equally important to these tactical efforts, will be

a joint push to get Mongolia to have greater impact and integration into the developing regional

security architecture in Asia.

Source: The Diplomat

IN MONGOLIA, HAGEL GETS A HORSE, JUST FOR A BIT

Before Defense Secretary Chuck Hagel even landed here in

Mongolia, he knew there was no way that he could keep the

horse. After all, his predecessor, Donald Rumsfeld, did not get

to keep the horse he got—and called Montana, so named because

he said the Mongolian landscape reminded him of the state

where his wife, Joyce, was born. Back in 2005, Rumsfeld became

the first American secretary of defense to visit Mongolia, and he

received Montana with great fanfare. And then he left him

there. The reason was Montana immediately brought up delicate

issues of diplomacy, such as whether American taxpayers would

have to pay for its upkeep. Such issues prompted much head

scratching, and Rumsfeld had to leave Montana, a steed with a

black mane, behind.

When President George W. Bush followed Rumsfeld to Mongolia a

short time later, the White House quietly persuaded Mongolian

officials not to gift him with a horse, and they complied.

More than eight years later, Hagel's motorcade entered the

imposing grounds of the Mongolian Ministry of Defense, his gift horse stood off to the side of a

ceremonial yurt.

Before getting his gift, Hagel had to go through the protocol of meetings with his Mongolian

counterpart about the array of issues that dominate American-Mongolian relations—namely thanking

Mongolia for sending troops to Iraq and Afghanistan. Mongolia‘s minister of defense, Bat-Erdene

Dashdemberel, had kind words for the strength of the American-Mongolian bond. ―Mongolia is a

peace-loving country,‖ the defense minister said of the country that still reveres its native hero

Genghis Khan. ―This principle is the core of the relationship.‖

Okay, time for the horse ceremony. A herder brought the horse up to Hagel and Bat-Erdene

gestured toward its mane. ―This will be your horse from now on, you can name it.‖

Then, for the moment everyone was waiting for, Hagel said, ―I‘m going to name this horse

Shamrock.‖

Huh? Not Nebraska? Not Omaha? Not even Cornhusker? Nope, Shamrock. ―Shamrock was the name of

the mascot of the high school I graduated from,‖ Hagel said.

Then he turned sadly to Shamrock. ―You be good while I‘m gone,‖ he said.

Source: New York Times

MONGOLIA SIGNS MOU WITH NORTH KOREA

Mongolia and North Korea signed a memorandum of understanding for the establishment of

intergovernmental relations in Pyongyang on 2 April, reported the website kcna.co.jp that same

day.

Representing Mongolia during the signing ceremony was Minister of Industry and Agriculture Kh.

Battulga, who also serves as Mongolia's chairman of the Inter-governmental Committee for

Consultation in Economy, Trade, Science and Technology with North Korea. Mongolian Ambassador

M. Ganbold was also present along with embassy officials. Also present was Ri Ryong Nam, North

Korea's Minister of Foreign Trade, the Korean chairman for the intergovernmental body

Another memorandum of understanding was signed between North Korea's Ministry of Foreign Trade

and Mongolia's Ministry of Labor.

Source: Montsame

MONGOLIAN FREIGHTER WITH NORTH KOREAN CREW SINKS OFF SOUTH KOREA

A Mongolian-flagged freighter with a crew of 16 North Koreans sank off the coast of South Korea,

killing at least two, the South‘s coast guard said.

The ―Grand Fortune‖ was carrying iron ore from North Korea to China when it sank 130 kilometers

(81 miles) off the southern South Korean city of Yeosu early this morning, the Korea Coast Guard

said in a statement. Three crew members were rescued and 11 are missing, it said. The Korea Coast

Guard did not detail a cause of the sinking. Waves were as high as 3.5 meters (11 feet) in the area

around the time of the incident, which occurred outside South Korean territory, it said.

―The lives of the rescued people are not at risk,‖ the coast guard said. Footage of the incident

posted online by the coast guard showed one crew member being pulled from the water by a

helicopter, wearing a life vest inscribed ―Ulan Baatar.‖

Last month, South Korea repatriated a North Korean fishing boat that drifted across the disputed

western maritime sea border with engine trouble. The two countries remain technically at war after

the 1950-53 Korean War ended without a peace treaty.

Source: Business Week

PARENTS OF MEGUMI YOKOTA INVITED TO NORTH KOREA IN MAY

The parents of Megumi Yokota, who has become to the Japanese public the representation of the

unresolved issue of Japanese citizens abducted by North Korea, have apparently been invited to

visit the hermit country in May.

There has been movement in the case of Megumi Yokota—whom Pyongyang admitted abducting but

claim to have committed suicide—as the parents were reunited with their granddaughter Kim Eun

Gyong, daughter of Megumi, in early March in Mongolia. Shigeru and Sakie Yokota told a meeting of

the ruling Liberal Democratic Party (LDP) lawmakers that the North had made the invitation when

they met their granddaughter, the daughter of Megumi to a South Korean man and fellow abductee

Kim Young Nam, for the first time in Mongolia a few weeks ago. The meeting was in the Mongolian

capital of Ulaanbaatar, and Eun Gyong also brought her baby—the Yokota‘s great-granddaughter—

with her.

Shigeru and his 78-year-old wife have long been very visible in the continued efforts to get North

Korea to allow all abductees to return home, including their daughter Megumi, abducted in 1977 at

age 13. Pyongyang had already admitted in 2002 to having abducted 13 Japanese to North Korea—

including Megumi. But they also said that she committed suicide in 1994 after giving birth to Kim

Eun Gyong. In 2004, North Korea handed over evidence to Japan of Megumi‘s death, claiming that

those were her cremated remains. Subsequent DNA testing in Japan proved that the remains were

of somebody else. And so the Yokotas are not giving up hope on their daughter yet.

Source: Japan Daily Press

GOVERNOR OF UVS VISITS TUVA REPUBLIC

Mongolia and Russia's Tuva Republic renewed a protocol for cooperation during a visit by a

delegation headed by Uvs Aimag governor D. Tsendsuren from 4 to 6 April.

The agreement covers the areas of the trade, economics, science, techniques, borders and culture.

The fact that the number of people who passed through the Uvs border to Tuva doubled in the first

two months of this year demonstrated the importance of closer ties, said Tsendsuren. Sh. Kara-Ool,

the chairman of the Tuva government, said he was sorry that a cooperation agreement between

their two governments had not been signed sooner. He thanked the Uvs governor for his proposals

to expand cooperation.

Tsendsuren said his visit was a direct request sent to him from the president and prime minister to

tighten relations and briefed Kara-Ool on some of Mongolia's biggest projects in construction,

infrastructure development, agriculture, education and health. He added that Uvs had launched a

policy that provided businessmen with investment and business opportunities.

Source: Montsame

MONGOLIA AND CZECH REPUBLIC COLLABORATE ON GREEN DEVELOPMENT

Mongolian Minister of Environment and Green Development Sanjaasuren Oyun visited Czech

Republic between 30 March and 2 April.

Minister Oyun held individual meetings with Czech Deputy Environment Minister Jan Kri, and other

officials for talks over a wide range of issues, including bilateral relations, environmental

protection, remediation, green development, investment, energy and the increase of cooperation

on urbanization and development. Both sides agreed to provide Mongolia's environmental workers

with short courses to take place in the Czech Republic and to boost bilateral relations concerning

the environment.

MP Oyun at a joint press conference gave special thanks for Czech Republic's work to reintegrate

the Przewalski's horse to Mongolia after the species died out at its native habitat.

Source: News.mn

MONGOLIANS VISIT ALASKA FOR DISASTER RESPONSE EXERCISES

During Exercises Alaska Shield and Vigilant Guard-Alaska 2014 VG-AK14, members of Mongolia‘s

National Emergency Management Agency visited to observe disaster response and coordination

exercises, from 26 to 31 March.

The Mongolian representatives attended the event as part of the National Guard State Partnership

Program. Alaska and Mongolia began their partnership in 2003 and conduct approximately six to

eight joint exercises each year. The two regions were partnered due to their similarity in size,

terrain, and natural disasters, with many citizens living in rural areas.

VG-AK14 is a regional, tactically focused exercise designed to test the response and coordination of

different agencies from a disaster scenario earthquake and tsunami. Each joint training exercise

allows the two regions to exchange ideas and share practices to improve each other‘s operations

when responding to a major disaster. ―They face a lot of the same challenges we do,‖ said Major

Alex Elmore, Alaska State Partnership Program coordinator.

This will be the first time Colonel Ulambayay Nyamkhuu, city manager for emergency response at

Ulaanbaatar, and Major Ariunaa Chadraabal, an officer in the foreign cooperating division, visit

Alaska to learn more about the National Guard‘s tactics and procedures in responding to a

simulated earthquake. Soldiers and Airmen in the Alaska National Guard benefit from this

partnership as well, and they travel to Mongolia and to operate and train in an unfamiliar

environment. ―It makes our leaders and junior enlisted much more flexible and adaptable to a

situation,‖ said Elmore.

The Alaska National Guard will continue to enhance their partnership with Mongolia by sending a

bilateral affairs officer to work at the embassy in Ulaanbaatar for a two-year tour.

Source: DVIDS

MONGOLIA: ACTIVIST AND AMBITIOUS

Mongolia is fast becoming an ambitious country worth watching in the Asia-Pacific. Given its

neighborhood, it is perhaps unsurprising that most attention is focused on its two (much) larger

neighbors, but under the leadership of President Tsakhiagiin Elbegdorj the country‘s foreign

ambitions have grown considerably.

Nations from the world over have experienced high-level contact with Mongolia in the past year.

Part of Mongolia‘s diplomatic explosion was driven by a poor foreign direct investment outlook in

the beginning of 2013—as a resource rich country, Mongolia‘s economic well-being is highly

contingent on the health of its mining sector. A 43 percent decline in overall foreign investment,

and a 32 percent decline in the mining sector, was thus cause for concern.

Mongolia used the occasion of the 100th anniversary of its establishing a professional diplomatic

service to pursue its activist foreign policy worldwide—it has set the goal of establishing bilateral

diplomatic relations with all UN member states. At the same time, Mongolia, under Foreign Minister

Luvsanvadan Bold, has adopted a ―one window‖ policy wherein its diplomats disseminate

information globally about Mongolia as a hospitable destination for foreign direct investment.

President Elbegdorj himself traveled across Asia and the world to improve Mongolia‘s presence on

the world stage, and world leaders returned the favor.

Further, as Alicia Campi, president of the U.S.-Mongolia Advisory Group, notes, the country signed

―63 bilateral and international agreements in 2013, including agreements with the United States,

the European Union, Japan, and China.‖ The Ulaanbaatar Dialogue aimed to reduce mistrust

between the major Northeast Asian states, including Japan, South Korea, and China, and also

mediating the region‘s engagement with North Korea via both Track-I and Track-II dialogue.

President Elbegdorj has succeeded remarkably in helping Mongolia proliferate worldwide both

diplomatically and economically. While its interest in becoming a major player regionally is driven

first and foremost by its economic needs, it sees a niche for itself in security matters. Mongolia has

so far been the least talked-about of the five Northeast Asian countries, but this is set to change

with its activist diplomacy and ambitious foreign policy.

Source: The Diplomat

ANNOUNCEMENTS

CSR FORUM, KEMPINSKY HOTEL, 21 APRIL

The U.S. Embassy and the Business Council of Mongolia will host the Corporate Social Responsibility

(CSR) Forum on 21 April from 09:00 to 12:00 at the Kempinski Hotel.

The Forum will include presentations on CSR practices at leading U.S. companies working in

Mongolia followed by Q&A and discussion. This CSR event is free of charge.

For more information or to attend, please RSVP with the U.S. Embassy by contacting Daria

Purevsuren at DarisurenP@state.gov or calling 7007-6105.

___________________________________________

MONGOLIA INVESTMENT SUMMIT, LONDON, 30 APRIL-1 MAY

The second annual Mongolia Investment Summit in London will be 30 April and 1 May.

An additional post-summit workshop will be held, giving participants presentations, discussions,

panels and networking opportunities. Keynote speakers include Ochirbat Chuluunbat, vice minister

for economic development, Dorjpurev Dulamsuren, vice minister for energy, and Clemente

Cappello, chief investment officer at Sturgeon Capital

Download the full attendee list here.

BCM members can take advantage of a special 25 percent discount by using the offer code

UL912BCM when registering. Register online at mongoliainvestmentsummit.com/London, call +44

(0) 207 216 6056, or email cs@resourcefulevents.com

___________________________________________

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.

___________________________________________

BCM MEMBERS RECEIVE 15% DISCOUNT FOR OIL AND OIL SHALE MONGOLIA, 14-15 MAY

The Oil and Oil Shale Mongolia 2014 international investment conference, hosted by the Petroleum

Authority of Mongolia, will be held in Ulaanbaatar on 14 and 15 May.

The event will be attended by international investors, oil, gas, and oil shale companies, service

providers, consultancies, equipment suppliers, and traders.

Delegates will have a unique opportunity to network with industry's key contacts at the country's

first international investment conference on oil, gas, and oil shale. They will have the opportunity

to obtain vital information on legislation and policies on oil, gas, and oil shale exploration and

production regulations from the officials of the Ministry of Mining and Petroleum Authority of

Mongolia. Moreover, projects on oil refinery, exploration, production, plus oil shale projects will be

presented.

BCM members will receive an exclusive 15 percent discount. For more information call +976 9909-

1765 or 9910-5877, email info@oilmongolia.com or logon to OilMongolia.com.

___________________________________________

“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 LAUNCHING ITS LOGISTICS WORKING GROUP

More than 20 individuals with members have indicated interest in joining this new WG. The initial

meeting of the Logistics WG will be held on Tuesday, April 15, at 4 pm at BPI/USAID conference

room, 12th floor, Express Tower. Members with interest in joining the WG can still contact

Erdenetsetseg at erka@bcmongolia.org to join this WG or for more information.

Given the makeup of BCM's membership, we welcome individual volunteers from our logistics,

mining, transport, university and other interested members to join our new Logistics Working

Group. This BCM Working Group (WG) can lead private sector input and recommendations in this

critical area for Mongolia and make a real and meaningful impact.

If you have interest in joining this new working group, please contact 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‟

• ―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

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.

The following presentations are from the January 27 BCM monthly meeting:

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

Standard Investment LLC

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

Division for Promotion and Consultancy Services, Invest Mongolia Agency

The following have been added to Interview Section:

• 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.

Social stats: BCM now has 5,306 fans on our Facebook fans page, 1,646 connections on LinkedIn

network, and1,008 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/

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 1,293 students and teachers

have participated with BCM in the University Classroom Project.

The next BCM in the University Classroom series will be on 16 April at the (IF&E). Mr. Nick Cousyn,

COO, BDSec will speak --"Update of Mongolian Capital Markets".

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 – 10 APRIL 2014

Currency Name Currency Rate

US dollar USD 1,780.86

Euro EUR 2,467.92

Japanese yen JPY 17.50

British pound GBP 2,986.95

Hong Kong dollar HKD 229.66

Chinese Yuan CNY 50.06

Russian Ruble RUB 286.99

South Korean won KRW 1.71

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.