The Asian Development Bank (ADB) has revised their projected growth statistics for Mongolia in 2018 and 2019. The forecast for this year was raised to 6.4%, significantly higher than the previous estimate of 3.8%. This momentum is expected to continue into 2019, with the ADB upping their forecast from 4.3% to 6.1%. The announcement underscores growing investor confidence in the country, and echoes a wider consensus that an economic rebound is firmly underway.
Financing sources underpinning investment since 2010 show Mongolia is heavily dependent on FDI, and the sharp drop from 2013-2015 has since picked up. While FDI sharply fell over the last few years, public investment financed by the government budget and DBM rapidly increased, relying on domestic and external debt financing. Looking forward, Mongolia has certain particular areas that foreign investors can enjoy for the time being.
Today's Mongolia is a paradox. Endowed with abundant natural hydrocarbon wealth, the country has grown fast feeding the factories of its energy-hungry southern neighbour, China. At the same time, it is precariously dependant on Russia for much of its own energy supply. Addressing this insecurity is therefore high on the government’s geostrategic to-do list.
In Mongolia, change is afoot. Natural resources offer rapid development - but only if the country manages them wisely. This depends heavily on how Ulaanbaatar interacts with its international partners.
The ‘One Belt, One Road’ (OBOR) initiative, launched by Xi Jingping, is more than an ambitious infrastructure project. It is perhaps the largest in history. It’s also the Chinese Premier’s legacy. With constitutional changes now permitting him to remain in office for life, there is an ever greater possibility of its delivery. Countries touched by it can look to consolidate trade with China, and benefit from the infrastructure dividend it brings. Here we set out four reasons why it could unleash Mongolia’s copper potential:
A Mongolian company, Steppe Gold, just listed on the Toronto Stock Exchange (TSX) at a valuation of US$25 million. The exchange- known for its focus on mining- is popular amongst exploration companies. This project, though in its infancy, is viewed as a baby step in developing 140,000 of ounces of precious metals in the first year of production. Perhaps for this reason, Steppe’s leadership team have described it as ‘low cost, low risk.’
Mongolian Properties is the oldest, largest, and most reputable Mongolian real estate agent. We are a real estate intermedeiary and advisory firm offering agency, representation, property, management, property valuations, interior design, furnishing and financial intermediation services.
