15.11.2013, NEWSWIRE, Issue 300

BUSINESS COUNCIL of MONGOLIA
NewsWire
www.bcmongolia.org
info@bcmongolia.org
Issue 300 – November 15, 2013
THIS MARKS BCM NEWSWIRE'S 300TH ISSUE! THANKS TO ALL OUR MEMBERS FOR THEIR
SUPPORT!
NEWS HIGHLIGHTS:
Business
 SouthGobi Resources to restate results for past 3 years;
 Entrée negotiates for stabilities at OT;
 Areva forms a joint venture with Mongolia’s Mon-Atom;
 Prophecy Coal pays off outstanding loan;
 Sentosa completes first round of drilling at Darvii Naruu;
 U.S. firm presents alternative course for Aspire's railway project;
 Petro Matad data acquisition on track, exploration director to leave;
 Undur Tolgoi to acquire road construction firm;
 MEC fails to make note payments;
 Teck increases stake in Erdene to 10.4 percent;
 APU ordered to cease use of Chinggis Khaan’s name for its beer;
 Erel to commission prefabricated materials factory;
 HBOil extends option to purchase offshore DPRK exploration rights;
 Direct UB-Erenhot flight to launch;
 APU opens world-class food warehouse;
 AUM opens new presentation course;
 Michelmores extends international credentials in Tenger deal;
 Kyrgyz lawmaker indicates government losing patience with Kumtor talks.
Economy
 World Bank urges tightened economic policies;
 Mongolia's new investment rules to spur mining sector development: miners;
 Mongolia gears up for the fight of its mining life;
 Mongolia to open investment agency;
 Mongolia commissions UB-Dundgobi road;
 Government wage budget increases 18 percent;
 Bring in the start ups: supporting SMEs in Mongolia;
 Greenfields man helps combat Tuberculosis in Mongolia;
 Central Asian commodities exporters going strong, says EBRD;
 China expected to cut growth target to 7 percent;
 New leadership brings a change to Australia’s resources sector;
 Mining will continue to drive Australian economy for the next five years.
Politics
 Mongolia will never bury nuclear waste, says Elbegdorj;
 12 health projects expected for completion in 2013, says Health Minister;

 President initiates development roadmap meeting;
 The MNT 70,000 grant per month for students will be changed;
 Amarjargal resigns from Parliament;
 Mongolia joins Open Government Partnership;
 Mongolia receives support from international institute for green economy;
 Serbia and Mongolia sign agreement on visa abolishment;
 Mongolia signs intergovernmental agreement on dry ports;
 Mongolian ambassador stresses educational ties with India;
 UN officer attends Mongolian peacekeepers ceremony in South Sudan;
 Mongolia and Russia to establish cross-border protected reserve;
 Ganjuur Sutra registered on UNESCO World Heritage List;
 Mongolia's wealthy politicians;
 Ministry of Health leads in government red tape, says study;
 Overview of the Investment Funds Law;
 South Korean money laundering in Mongolia comes to light;
 UB Mayor to receive honors in Washington, D.C.
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
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BCM MONTHLY MEETING RECAP
The BCM meeting on 11 November with Bayanjargal Byambasaikhan in the chair was attended by
150 members and invited guests. The meeting observed BCM's 6th-year anniversary and was
followed by BCM‘s Annual Membership Renewal Dinner seating 185 members.
Jim Dwyer, Executive Director, spoke on the importance of BCM‘s members, ―our Lifeblood.‖ Jim
announced a special offer for subsidiaries and divisions of current BCM members to join at a 50%
dues discount. This dovetails with a BCM goal to attract more medium-sized entities to its
membership.
BCM membership now stands at 268, an all-time high, compared with 250 in October 2012. The 5
newest members are:
1. Clear Lakes Capital was established in 2011 to manage offices and apartments in Mongolia. It
focuses on the central parts of Ulaanbaatar offering well-furnished properties and improves the
properties by replacing kitchens and fridges, installing flat screen TVs, ovens and dishwashers. All
apartments have emergency water heaters and most properties have LED lighting and smoke
detectors installed. Above all Clear Lakes responds to occasional breakdowns in a matter of hours.
Its properties are to be found in Park View, Regency Residence, Four Seasons Gardens and Temple
View.
2. Since its establishment in 1924, the Institute of Finance & Economics (IF&E) has been one of the
leading economic and business development centers in Mongolia offering high quality programs.
Students are offered new opportunities and the latest knowledge reflecting current market
developments. IFE is on its way of becoming a highly competitive business school in Asia.
IF&E offers a wide range of Business programs such as Financial Management, Business
Administration, Tourism & Hospitality Management and, Business Economics, Business Law, and
Marketing Management.
3. Ramada Ulaanbaatar City Center is a premier international hotel in Ulaanbaatar. The hotel is set
in a luxury shopping mall complex, standing 17 stories tall with a new modern architecture. It
features 128 guest rooms and suits, and inclusive executive floors with its own lounge. The hotel is
located in the heart of the Ulaanbaatar downtown and 20 minutes away from Chinggis Khan
International Airport.
4. Established in 1998, the Mongolian National University is the second biggest private institution of
higher education in Mongolia. Its distinguished history of excellence and hard work continues to
provide students with unique opportunities to make difference through academic teaching, research
and professional programs. Currently 5,200 students study in the 58 undergraduate and three
graduate programs.
Mongolian National University has established cooperative relationships with 18 universities and
research institutions abroad. The university pays close attention to foreign language education. In
Mongolia only MNU students are trained for seven semesters in advanced specialized knowledge of
English education and curriculum contents, and the ability to use English.
5. Salmira Investment Fund is a U.S.-based investment partnership formed by three brothers. The
fund is an expression of the three principals‘ profound interest in emerging and frontier market
investing. Ultimately, Salmira is a fledgling family office that the brothers hope will continue to
grow as it positions itself in Mongolia and other Asian economies on the verge of exciting expansion.
The fund has active investments in Mongolia‘s transportation and financial sectors; its principals
continue to evaluate opportunities across most sectors of the Mongolian economy. In addition to its
Mongolia-based projects, Salmira evaluates and has participated in various private market

opportunities in Southeast Asia as well as real estate and resource-related investments in the
United States.
___________________________________________
Nick Cousyn, Chief Operating Officer of BDSec JSC, presented ―A Westerner‘s Journey to the DPRK,‖
where he discussed his recent visit to North Korea for a site visit to the Rason port and the Sungri
oil refinery recently acquired by Mongolia-listed HBOil JSC. HBOil is participating in an oil
exploration and production joint venture with North Korea's state-owned oil company and is set to
purchase a company with oil exploration rights in North Korea's East Sea.
Matthew Pottle, Managing Partner, PwC, presented ―PwC CEO Survey 2013 – Confidence in Growth‖
where he discussed data collected from two year's of surveys and interviews from company heads
based in Monoglia benchmarked against international responses. He said that although chief
executives had short-term concerns for the economy, there was greater confidence for the long
term.
David L. Wyche, Economic and Commercial Section Chief at the U.S. Embassy, presented ―The U.S.-
Mongolia Transparency Agreement.‖ The agreement signed this year is a result of years of
cooperation for a trade and investment framework agreement (TIFA) and was a key step toward
establishing a free trade agreement.
Sereeter Javkhlanbaatar, Director General, Foreign Investment Regulations and Registration
Department of the Ministry of Economic Development, gave an update on the new Investment Law,
which took effect this month. The new law, he said, removes distinctions between foreign and
domestic investors, providing many equal provisions. One dramatic change, some audience
members noted, was a new rule for establishing a foreign invested company. While in the past a
start-up in Mongolia needed USD 100,000 in assets, now USD 100,000 is required per investor.
Javklhanbaatar noted many improvements, however, including the removal of restrictions for
investment by private companies. Any entity 50 percent or more owned by a foreign government,
however, will need ministry approval for more than 33 percent acquisition for any company
operating within banking and finance, telecommunications and media, or mining.
_________________________________________________________
BUSINESS
SOUTHGOBI RESOURCES TO RESTATE RESULTS FOR PAST 3 YEARS
Coal miner SouthGobi Resources Ltd., controlled by Rio Tinto PLC, said it would restate results from
2011 through 2013 because of an error in the way it booked revenue from coal sales at its Ovoot
Tolgoi mine.
The company said it expects a delay in filing its third-quarter results due 11 November, after it
recognized revenue earlier than it should have at the flagship mine. Turquoise Hill Resources,
through which Rio controls SouthGobi Resources, also said it would restate its results for the same
period.
SouthGobi said it should have recognized revenue when coal was loaded onto a customer's truck,
and not when the coal was delivered to the customer's stockpile, without being collected. The
company said it had applied for an order to stop its management from trading in its stock.
SouthGobi said that if it delayed filing of the restated results beyond 14 November, it could
potentially default on convertible debentures held by China Investment Corp.
Source: Reuters
ENTRÉE NEGOTIATES FOR STABILITIES AT OT
Entrée Gold Inc. reported on its negotiations with Mongolia for its joint venture with Oyu Tolgoi LLC
in its third-quarter report published 13 November.

Since the government placed its temporary restriction on the joint venture licenses from transfer in
February 2013, discussions have focused on issues arising from Entrée's exclusion from the 2009 Oyu
Tolgoi investment agreement, including the fact that the government of Mongolia does not have a
full 34 percent interest in the joint venture property. Discussions have also covered the fact that
the mining licenses integral to future underground operations are held by more than one corporate
entity and that Entrée does not benefit from the stability that it would otherwise have if it were a
party to the 2009 agreement.
―Meetings to discuss possible ways of addressing all parties' concerns have been positive and
constructive,‖ said the Source. ―No final agreements have been reached and further discussions
with all stakeholders are required.‖
Stakeholders of the Oyu Tolgoi project, including the Government of Mongolia, OT LLC, Erdenes Oyu
Tolgoi LLC, Erdenes MGL LLC and Rio Tinto.
Source: Entree Gold Inc.
AREVA FORMS A JOINT VENTURE WITH MONGOLIA‟S MON-ATOM
Areva SA has signed an agreement to develop uranium mines in Mongolia and form a new joint
venture with state-owned Mon-Atom. The joint venture is for Areva Mines LLC, 66 percent owned
by Areva and 34 percent owned by Mon-Atom. An agreement for Mitsubishi Corporation to take an
equity interest has also been signed.
The signing ceremony took place in the presence of Luvsanvandan Bold, minister for foreign affairs,
Laurent Fabius, French minister of foreign affairs, Luc Oursel, president and chief executive officer
of Areva, and Ken
Kobayashi, president and chief executive officer of Mitsubishi Corporation.
―This collaboration, which also involves our partner, Mitsubishi Corporation, is strategic on two
levels. It will enable us to develop the uranium sector in Mongolia and to pursue the geographic
diversification of Areva‘s mining activities,‖ said Luc Oursel.
Present in the country since 1997, Areva has carried out exploration work resulting in the discovery
of two uranium deposits in the province of Dornogobi, Dulaan Uul and Zoovch Ovoo, whose
resources are estimated at 60,000 tons.
Source: Areva SA
PROPHECY COAL PAYS OFF OUTSTANDING LOAN
Prophecy Coal Corp. announced that it has sold 18,525,000 common shares of Prophecy Platinum
Corp. Proceeds from the sale were used to fully pay out the secured loan from Waterton Global
Value L.P. Prophecy Platinum was previously owned by Prophecy Coal in a private sale to arms
length purchasers.
After closing the private sale, the company owns approximately 7.3 percent of the issued and
outstanding shares of Prophecy Platinum Corp.
Source: Prophecy Coal Corp.
SENTOSA COMPLETES FIRST ROUND OF DRILLING AT DARVII NARUU
Sentosa Mining Ltd. has completed the first round of reverse circulation drilling at its Darvii Naruu
Copper Gold Project in Gobi-Altai Aimag.
The company drilled 18 holes totaling 2,020 meters to test six anomalies selected from the 37
identified by a recent airborne geophysics survey. Samples from the drill holes are currently being
transported to Ulaanbaatar in Mongolia where they will undergo geochemical analysis. In addition a
selection of 23 surface and RC drill chip samples from various locations are being transported back
to Perth, Western Australia were they will undergo Petrology analysis. Analysis should be completed
by the end of this month with results expected in early December.
Source: Proactive Investors
U.S. FIRM PRESENTS ALTERNATIVE COURSE FOR ASPIRE'S RAILWAY PROJECT
The United States' Trimble firm announced 13 November that its Quantm alignment planning system

was employed by Aspire Mining Ltd. for route optimization on the Mongolian Northern Railways
project from its Ovoot project to Erdenet Soum.
Quantm was selected to investigate alignment alternatives on the 547-kilometer coal freight rail
pre-feasibility study. The pre-feasibility study revision that SMEC prepared for Aspire identified a
more direct route from the Ovoot project to Mongolia's second-largest city, Erdenet. The more
direct route has resulted in a lower capital expenditure projection for the Northern Rail Line
project, with potential savings of approximately USD 200 million.
"The Quantm software was a direct factor in enabling us to achieve the results from the rail study,"
said Matt Crompton, infrastructure manager for Aspire. "It helped us do the analysis quickly and the
results are now ready for use by more traditional platforms for detailed engineering and analysis."
Source: Trimble
PETRO MATAD DATA ACQUISITION ON TRACK, EXPLORATION DIRECTOR TO LEAVE
Oil explorer Petro Matad Ltd. has acquired over half of the 200 kilometers of 2D seismic earmarked
for its licenses on Blocks IV and V in Mongolia.
The seismic program is designed to provide detailed coverage over two prospect areas and to
confirm at least two locations for drilling in 2014. Acquisition of the remaining data is progressing
well, it added, though fieldwork was slightly delayed, and is expected to be completed prior to the
winter shutdown. Processing of the data acquired to date has already started. Petro Matad has also
been re-interpreting the data generated by its unsuccessful drilling campaign in the northern part
of Block XX, a process it said is now largely complete. This reworking has indicated that none of the
wells in that campaign were in three graven areas identified as a part of a trend extending into the
adjacent and producing field to the north, Block XIX.
―Possible extension of those fields into Block XX therefore remains untested,‖ Petro Matad said.
Scout data from Block XIX is being integrated with the existing database in order to evaluate how
best to pursue this potential. The re-interpretation work also identified a number of similar basins
in the southern part of Block XX and seismic to further delineate these basins is planned for 2014.
Separately, Petro Matad announced the departure of the exploration director who is carrying out
the re-interpretation work. Ridvan Karpuz is leaving at the end of the year to take up a new
position elsewhere, though he will remain as a non-executive and oversee the exploration program.
Karpuz joined in August of last year and was responsible for the re-appraisal and re-interpretation
work on the Mongolian acreage. Executive directors John Henriksen and Amarzul Tuul will manage
the group‘s operations in Mongolia until a new exploration director is appointed.
Source: Petro Matad
UNDUR TOLGOI TO ACQUIRE ROAD CONSTRUCTION FIRM
Undur Tolgoi Minerals Inc. has entered into an agreement to acquire complete interest in Great
Hoard Holdings SARL, a Luxembourg entity that holds 75 percent of the share capital of Mongolian
company Ashid Munkhiin Zam LLC.
Through its wholly owned British Virgin Island-registered subsidiary, Jucca Holdings Ltd., Undur
Tolgoi will acquire Great Hoard Holdings SARL in an exchange for 5,363,636 newly issued shares of
Undur Tolgoi. AMZ holds road construction, repair and maintenance permits. AMZ intends to seek
road construction contracts and tenders in Mongolia. Road construction is one of the fastest growing
industries in Mongolia. The government intends to build over 10,000 kilometers of paved road in the
next 10 years. As part of its goal, the government passed a law in 2012 mandating paved roads
between Ulaanbaatar and each of the country's 21 province centers by 2016.
Last year Mongolia raised USD 1.5 billion in its first ever bond offering. Shortly afterward the
government announced that most of the bond money would be spend on development of
infrastructure and allocated USD 335 million to the road budget. Mongolia's roads officially total
49,294 kilometers, but only about 25 percent of the roads are currently paved. Most roads are little
more than dirt tracks, which are usually dusty and occasionally muddy. By undertaking
straightforward grading work, the roads would be quite similar to those servicing many of the
mining and outback communities in Australia.

"We are excited to enter the road construction industry in Mongolia,‖ said Chairman James Passin.
―For the benefit of its shareholders, we are committed to building [Undur Tolgoi] into a significant
and successful Mongolian-focused public company. Following a strategic review of the company, the
Board of Directors is refocusing the company away from mineral exploration in order to participate
in Mongolia's massive infrastructure growth potential."
Source: Undur Tolgoi Minerals Inc.
MEC FAILS TO MAKE NOTE PAYMENTS
Mongolia Energy Corp. Ltd. failed to repay principal and interest before the expiration of a
convertible note on 12 November.
MEC‘s default on redemption of the SF convertible note also triggers its potential early redemption
obligation under other existing convertible notes. As of the date of this announcement, these
outstanding convertible notes, excluding the note, have the aggregate principal amount of
approximately HKD 2.4 billion (USD 309.5 million). The holders of the note have proposed a
conditional six-month moratorium from 12 November 2013 on repayment of principal and interest
due under the note subject to formal agreement between the parties and MEC that the company
intends to exercise.
Shareholders and potential investors of the company are urged to exercise caution when dealing in
the shares of the company.
Source: Mongolia Energy Corp. Ltd.
TECK INCREASES STAKE IN ERDENE TO 10.4 PERCENT
Teck Resources Ltd. brought its stake in Erdene Resource Development Corp. to 10.4 percent via a
private placement that grossed a total USD 685,000.
Teck Resources has subscribed for 2.14 million units of the private placement for a total of USD
150,000. This investment will reduce the minimum amount of additional equity investment required
to be made by Teck on or before April 23rd, 2014 from USD 500,000 to USD 350,000 in order to
maintain the Strategic Alliance between Teck and Erdene.
The issuance saw a sale total of 9,797,500 units priced at USD 0.07 per unit. It follows a USD
500,000 private placement previously announced on 18 October, which was oversubscribed and
increased to the maximum to satisfy strong investor demand. Each unit is comprised of one common
share of Erdene and one-half of one common share purchase warrant. Each whole common share
purchase warrant entitling the holder to purchase one common share at a price of USD 0.10 for a
24-month period.
Source: Erdene Resource Development Corp.
APU ORDERED TO CEASE USE OF CHINGGIS KHAAN‟S NAME FOR ITS BEER
The Fair Competition and Consumer Protection Authority Mongolia have delivered a claim notice to
alcohol producer APU to cease the use of Chinggis Khaan for its beer products.
The note reported that consumers had complained of the company‘s use of the same name for the
beer product as well as its vodka. APU has accepted the claim and announced the company would
no longer provide a beer called Chinggis Khan.
Separately, Parliament has been in continued discussions about legislation that would ban the usage
of Chinggis Khaan‘s name and image for the marketing of alcohol and tobacco products
Source: News.mn
EREL TO COMMISSION PREFABRICATED MATERIALS FACTORY
Erel Group's new prefabricated materials factory is set to play a key role in the development of
Mongolia's ger districts.
Erel has concluded a contract with EBAWE Anlagentechnik GmbH, a German manufacturer for the
construction of a prefabricated construction materials factory. The factory produces hollow core
slabs, solid walls, sandwich walls, beams and columns. The prefabricated panels have advantages
over ordinary building materials due to the shorter time for construction, flexibility in form,

dimensions and design, cost-effective installation, and high resistance against earthquakes.
The provision of concrete will be ensured by means of a newly installed batching plant and
connected bucket conveyor system. For architectural panels a concrete grinding machine is
available.
The factory, known as Erel BUK-1, aims to be a major supplier of prefabricated concrete elements
for the Ulaanbaatar City Regeneration Project. The project goal is to develop and build up to
200,000 housing units as well as infrastructure, such as schools, hospitals, office space, retail
space, parks and recreational areas, district heating, electricity, water, sewerage and other
utilities and amenities. The aim is to move citizens from the ger districts.
The project will be financed in part by the Development Bank of Mongolia.
Source: Info Mongolia
HBOIL EXTENDS OPTION TO PURCHASE OFFSHORE DPRK EXPLORATION RIGHTS
HBOil JSC has negotiated an extension of its option agreement for the acquisition of up to 51
percent of a company with oil exploration rights in North Korea's East Sea.
HBOil extended the deadline on its option to purchase 51 percent of Korex Ltd. which holds the
exclusive rights for the exploration and production of hydrocarbons in the entire territorial waters
of North Korea in the East Sea to 31 January 2014. The extension allows HBOil additional time to
raise the necessary funds to exercise its option in full.
HBOil JSC will be featured as a presenting company at the annual Mongolia Investment Summit in
Hong Kong from 19 to 20 November.
Source: BDSec
DIRECT UB-ERENHOT FLIGHT TO LAUNCH
China's Capital Airlines will open a direct air route next Thursday between Ulaanbaatar and Erenhot
in north China's Inner Mongolia Autonomous Region.
The airline will operate two weekly round-trip flights with a flight duration of one hour and 20
minutes. The lowest fare without tax for one-way and round-trip tickets will be 620 yuan (USD
101.8) and 1,050 yuan respectively. It is the first year-round direct flight opened between the two
cities.
MIAT Mongolia Airlines opened a temporary direct flight between Ulaanbaatar and Erenhot on 7
August which is due to close on 2 November. Erenhot, bordering Mongolia, has been a bridgehead
for China's economic and trade ties with its northern neighbor, with many Mongolians residing and
doing business in the city.
Source: Xinhuanet
APU OPENS WORLD-CLASS FOOD WAREHOUSE
APU JSC opened its world-class, fully automated food warehouse.
Built in cooperation with Germany's Krones, construction, equipment and software installation took
11 months. The warehouse spans 96,000 cubic meters and stands 12 stories high. A single software
program is used to manage the warehouse while a separate program is used for supply
management.
Source: Udriin Sonin
AUM OPENS NEW PRESENTATION COURSE
The American University of Mongolia (AUM) is rolling out its "Taking the Stage: Becoming a Dynamic
Presenter" course targeting business professionals.
The workshop is structured to guide students through the presentation process from research to
practice to assessment. Students will choose a topic to focus on for the workshop throughout the
four weeks and build a single presentation on that topic. Students are given the opportunity to
prepare a presentation they need for work.
The course will be held from 19 November to 12 December at a cost of MNT 500,000.
Source: American University of Mongolia

MICHELMORES EXTENDS INTERNATIONAL CREDENTIALS IN TENGER DEAL
Law firm Michelmores‘ London office has advised private equity groups Bamboo Finance and Triodos
Investment Management on the sale of a significant stake in Tenger Financial Group to a consortium
led by Japanese bank Orix Corporation and which included the International Finance Corporation
and Mongolyn Alt Corporation.
The transaction has taken over a year to bring to completion as a result of a series of complex
constitutional and regulatory hurdles that needed to be overcome, including the approval of the
Ministry of Economic Development and the Bank of Mongolia. Enclude Capital Advisory UK Ltd., a
London-based specialist corporate finance advisor acted, as the sole financial advisor to the sellers.
―This complex multi-party, multi-jurisdictional deal is further evidence of Michelmores‘ growing
expertise in advising private equity funds, financial institutions, corporates and government
agencies on a wide variety of cross-border transactions in some of the most challenging emerging
markets,‖ said Joe Whitfield, a team leader for Michelmores.
Source: Lawyer Monthly
KYRGYZ LAWMAKER INDICATES GOVERNMENT LOSING PATIENCE WITH KUMTOR TALKS
A member of Kyrgyzstan's ruling coalition has indicated growing impatience on the part of the
government with discussions over the future of the Kumtor gold mine. Omurbek Tekebayev, leader
of the Ata-Meken parliamentary faction, said November 12 that Bishkek should have no dealings
with Centerra Gold Inc., the mine's current owner.
A new round of negotiations between the Kyrgyz government and Toronto-listed Centerra Gold are
currently underway, after the parliament rejected a proposed agreement that would have given
Kyrgyzstan a 50 percent holding in the mine. Under the draft agreement, Kyrgyzstan would have
exchanged the 32.7 percent stake it has held in the listed parent company since 2009, for a 50
percent stake in a new joint venture that would manage the mine. On 23 October, the Kyrgyz
parliament gave a resounding rejection of the draft deal, with just two of the 120 MPs voting in
favor. Instead, MPs instructed the government to negotiate a new deal that would give Kyrgyzstan
at least 67 percent of the mine.
However, there have recently been indications that Bishkek has become impatient with the long
drawn out negotiations any if a deal is not reached by December may move ahead with
nationalizing the mine, despite the damage this would likely do to the country's reputation among
international investors. In an interview with the BBC, President Almazbek Atambaev—who has
previously urged the government and parliament to reach a compromise with Centerra—indicated
that nationalization could be an option.
"In the next month we will define: either we will annul the agreement, or nationalize the project.
We are considering the opportunity of assets distribution to our benefit in more than 60 percent.
But the head of the state has rather radical opinion—he is for 100 percent," Tekebayev said.
Tekebayev also denied that nationalization would result in production at the mine, which accounts
for around 12 percent of Kyrgyzstan's GDP, being suspended.
Source: BNE
ECONOMY
WORLD BANK URGES TIGHTENED ECONOMIC POLICIES
The World Bank said that the persistent large balance of payments imbalance is a key challenge to
the Mongolian economy, in its newly released semi-annual Mongolia Economic Update.
The recent amendment of the 2013 budget shows the government‘s commitment to keep the
official budget deficit within the ceiling of the Fiscal Stability Law. Yet, the fiscal policy will remain
highly expansionary in 2013 and 2014 as a large portion of the Chinggis bond is used to finance
public investment projects outside the budget. The budget deficit is expected to reach over 12
percent of GDP in 2013 even though the official budget deficit is contained at 2 percent of GDP.
Monetary policy has been expansionary as well, with outstanding bank loans increased 62 percent in

one year in September. Credit expansion is largely due to lending programs introduced by the Bank
of Mongolia. The rapid credit growth has been reflected in volatile exchange rate movement and
rising inflation in recent months.
Growth-oriented economic policies need to be tightened toward economic stability, and fiscal
policy should be tightened further and the off-budget spending should be included in the budget
and controlled under the fiscal discipline of the Fiscal Stability Law. The Bank of Mongolia should
curb the rapid growth of credit and phase out policy lending programs.
"By slowing down the expansion of investments and by focusing on those investments that will have
the greatest economic impact, the government will be able to address progressively the
development needs of the country while maintaining economic stability,‖ said Coralie Gevers, the
World Bank Country Manager in Mongolia. ―If one stimulates the economy too much in a global
environment that is uncertain, it runs the risk of generating economic volatility which will hurt poor
people and will make it hard for businesses to plan and finance their operations.‖
The World Bank expects Mongolia‘s economy to grow at 12.5 percent for 2013, a downward revision
from its previous forecast of 13 percent. The revised forecast reflects the facts that economic
growth in China and the recovery of the minerals market have been slower than expected.
Source: World Bank
MONGOLIA'S NEW INVESTMENT RULES TO SPUR MINING SECTOR DEVELOPMENT: MINERS
Mongolia's new legislation that removes distinction between domestic and foreign companies when
it comes to investing in the country will help attract more investment, miners with projects in the
region said Friday.
From 1 November, foreign companies will not need to seek government or parliamentary approval
before investing in Mongolia. There will be no restrictions on the amount of investment if the
company is not 50 percent or more owned by a foreign government. If the company is state-owned
with more than 50 percent share held by a foreign government, it cannot buy more than 33 percent
of a project in Mongolia, without government approvals.
The new law also provides a stable tax structure as the rates cannot be amended by future
legislation unless those changes benefit the investor. It also removes all restrictions on the
movement of assets in or out of the country and also provides protection against nationalization of
the investors' assets.
‖We believe that this will improve sentiment towards Mongolia-related investment stories,"
Australia's Aspire Mining Ltd. said in a note to stakeholders Thursday.
"While the investment law has become effective recently and further regulations are to be issued, it
is certainly a welcome development which should promote domestic and foreign investment in
Mongolia," an official from SouthGobi Resources Ltd. said.
"Reports also suggest that the law is a first step in streamlining the investment environment and
creating more favorable investment conditions by simplifying the registration process and removing
some approval requirements," he added.
Source: Platts
MONGOLIA GEARS UP FOR THE FIGHT OF ITS MINING LIFE
On 1 November Mongolia's new, friendlier foreign investment law came into force. Probably not a
day too soon.
Foreign direct investment in the country dropped 49 percent to September 2013 compared to last
year which already marked a 17 percent year-on-year decline. The value of the currency, the
tugrik, is down 20 percent this year. Inflation has returned to double digits. The Mongolian central
bank's off-balance sheet spending is burning through foreign reserves as foreign debts balloon to 55
percent of gross domestic product (GDP). The country has been bailed out by the International
Monetary Fund (IMF) no fewer than five times and it suffers a domestic bank failure on average
every 18 months.
While the changes from the 2012 Strategic Entities Foreign Investment Law (SEFIL) which has been
replaced, including greater certainty surrounding mining taxes and royalties and the scrapping of

the distinction between private foreign and domestic investors, are being universally welcomed as a
positive step, a number of issues remain unresolved.
"In spite of the ups and downs, the trend has been a steady march forward as more and more
investors discover the long term prospects of the country and the potential rewards for patience
and commitment," said the Chairman of Oyu Tolgoi and Mongolia's trade and foreign affairs
ambassador at large, Galsan Batsukh.
Following its so-called Article IV mission to Mongolia the IMF issued a stern warning about Mongolia's
prospects given the country's deteriorating macro-economic picture, reduced investment from
developed economies and the economic slowdown in China: "Spillover risks will particularly affect
the more vulnerable emerging market economies. In light of this, Mongolia needs to change course
to avoid becoming highly exposed to these external shocks and risks of crisis.‖
Source: Mining.com
MONGOLIA TO OPEN INVESTMENT AGENCY
The Cabinet of Ministers approved the creation for an investment authority on 9 November.
The agency will be under the authority of the Ministry of Economic Development and will be tasked
with attracting foreign investors, sustaining the stability of the legal and business environments,
promoting the country‘s investment environment, and issuing stability certificates for eligible
investors.
The agency will also be responsible for coordinating with the State Registration Authority and
enforcing the terms of the Investment Law.
Source: Business-Mongolia.com
MONGOLIA COMMISSIONS UB-DUNDGOBI ROAD
A commissioning ceremony was held for a new 104-kilometer road connecting Ulaanbaatar with
Dundgobi Aimag was held 10 November.
The road is the third completed out of plans by the government to connect the capital with each of
Mongolia's 21 provinces. Three Mongolian companies participated in construction for one year and
four months. Spending on the road was MNT 49.2 billion, financed by proceeds for the 2012 USD 1.5
billion Chinggis bond.
Source: Undesnii Shuudan
GOVERNMENT WAGE BUDGET INCREASES 18 PERCENT
The Mongolian Labor Union has successfully negotiated an 18 percent increase in its allocations for
salaries, pensions and welfare.
The Union and Mongolian Employers‘ Federation announced a 36 billion increase for additional
spending in these areas after working together with 30-person working group of government
officials for the negotiations. They said MNT 139 billion would be used for salaries increases to
teachers and health care workers and MNT 96 billion for pensions and social welfare. They are
planning a gradual implementation to the provinces outside of Ulaanbaatar.
The government plans to implement a new method for implementing the salary hikes to prevent
inflationary pressures on groceries such as meat and gasoline. The salary raises will be granted to
employees that demonstrate qualifications and productivity as well as having years of experience.
The government plans to introduce future salary increases in line with economic growth.
The total allotment for government wages is MNT 1.5 trillion.
Source: Unuudur
BRING IN THE START UPS: SUPPORTING SMES IN MONGOLIA
Small businesses have never been old-fashioned nor in vogue in Mongolia. Small-and medium-size
enterprises (SMEs), however, are still important to the economy.
Assisting SMEs has been challenging to past governments in Mongolia, which spent billions of tugrugs
in soft loans to contribute to SME development. Despite these efforts, small business owners still
complain that not enough has been done.

―Soft loans that are supposed to go to SMEs are usually stuck with the middle man, the bank,‖ said
E. Ariuntugs, chief executive at the Mongolian Financial Non-Banking Institutions' Association.
There are also many who say that soft loans do not go to SMEs at all, but instead go to large
companies. One method to resolve this issue would be to introduce a mechanism that issues soft
loans through non-banking financial institutions (NBFIs) instead of banks. Most SMEs who fail to
meet the threshold put up by banks are left with no choice but to knock on the doors of NBFIs
because SME start ups are typically classified as high risk by banks. But an NBFI is different from
the bank. They provide services for about 60 percent of SMEs, with some 390,000 clients typical
among them. In total MNT 320 billion is circulated among NBFIs in Mongolia, of which about 70
percent is investors-owned equity. This gives more leeway to take risks and provide fewer obstacles
for small business owners to attain credit.
Approval of the Investment Law by Parliament is a large step forward in the right direction for
Mongolia‘s financial sector. However, this too is likely to be of most benefit for the country‘s
largest companies. Only NBFIs have the power to directly address the situation.
Source: Mongolian Economy
GREENFIELDS MAN HELPS COMBAT TUBERCULOSIS IN MONGOLIA
In an article for online publication The Conversation, Cameron Wright likens the spread of
tuberculosis in Mongolia to the reign of the nation‘s 12th century warlord Genghis Khan.
―This invader, Mycobacterium tuberculosis, favors stealth over force,‖ he writes. ―The disease that
it causes, tuberculosis (TB), has endured from ancient times into the 21st century. ―TB
disproportionately affects the world‘s vulnerable, with over 95 percent of active cases and deaths
caused by TB occurring in developing countries.
The 24-year-old Greenfields resident and Youth Ambassador for Development currently resides in
Ulaanbaatar, Mongolia, where he works as a Public Health Project Officer for the Mongolian Anti-
Tuberculosis Association (MATA). Since he flew to Mongolia in March this year, he has teamed up
with various national and international health organizations, including WHO and World Vision
Mongolia, to help combat TB and raise awareness of the MATA‘s work worldwide.
―Mongolia has a high burden of TB relative to its population,‖ he said.
Wright said his plans post-Mongolia are ―still evolving,‖ but hopes to secure a future in the public
health sector when he returns in March next year.
―It will also be good to see my family and friends,‖ he said.
Source: Madurah Mail
CENTRAL ASIAN COMMODITIES EXPORTERS GOING STRONG, SAYS EBRD
The European Bank for Reconstruction and Development (EBRD) reported strong growth across
almost the entire Central Asia and Caucasus region, with the launch of new natural resources
projects in Kazakhstan, Mongolia and Turkmenistan boosting the economies of the three major
commodities producers.
Mongolia, where production started at the massive Oyu Tolgoi copper-gold deposit this year, has the
region's highest growth forecast for 2013, with the EBRD expecting to see growth of 13 percent. Ten
percent growth is expected for Turkmenistan, following an increase in gas exports to China. Growth
will "remain strong over the medium term, supported by exploration of Turkmenistan's abundant gas
reserves and further diversification of export routes," the report says.
The EBRD increased its 2013 forecast for Kazakhstan's economic growth after an increase in oil
production and continuing high levels of investment. The EBRD expects Kazakhstan's economy to
grow by 5.6 percent in 2013—up from an earlier forecast of 4.9 percent—and 5.5 percent in 2014.
However, the bank warns of weakness in Kazakhstan's banking sector, where levels of non-
performing loans remain high. Strong growth of between 6 percent and 8 percent is also expected
elsewhere in Central Asia, despite a fall in remittance flows from Russia, which is expected to have
the greatest impact on the Tajik economy.
In the Caucasus, growth has accelerated to 4.5 percent in Azerbaijan due to a combination of
higher oil production and fiscal stimulus from the government, though the EBRD expects growth to

slow slightly to 3.5 percent in 2014. Meanwhile, growth in Armenia slowed from 7.1 percent in 2012
to just 2.5 percent this year following delays in public infrastructure spending and a hike in Russian
gas prices. There was a similar picture in Georgia, where growth dropped to 2 percent mainly due
to uncertainty in the run-up to the country's 27 October presidential elections. A modest recovery is
expected in both countries in 2014.
Source: BNE
CHINA EXPECTED TO CUT GROWTH TARGET TO 7 PERCENT
China will cut its growth target to 7 percent next year in a sign of the government‘s determination
to push through structural reforms and steer the economy on to a more sustainable path, one of the
country‘s top investment banks has predicted.
With Communist party leaders gathered in Beijing this week for a meeting that will set China‘s
policy direction for the coming decade, investors and companies have been looking for clues about
their strategic thinking. A lowering of the country‘s growth target—although unlikely to be
announced until the annual Chinese parliament in March—would be an important distillation of the
government‘s plans. China has consistently exceeded its annual growth targets in practice, but a
cut would still be an indication of Beijing‘s willingness to tolerate slower growth in the interest of
addressing risks from rising debt levels to soaring property prices. Beijing has aimed for 7.5 percent
growth in recent years.
China International Capital Corp. (CICC), an investment bank headed by Levin Zhu, son of former
premier Zhu Rongji, forecast in a report on Monday that the government will decide to lower next
year‘s growth target to 7 percent. CICC‘s analysts, led by chief economist Peng Wensheng, said the
target cut would set the stage for 2014 as a crucial year for implementing reforms, following on
from the Communist party plenary meeting that began in Beijing on Saturday and concludes on
Tuesday.
CICC said the lower growth target would lead the central bank to keep monetary policy on a tighter
footing, a shift that appears to have started already. On Monday, it reported that banks issued CNY
506 billion (USD 83 billion) in new loans in October, well down from September‘s CNY 787 billion.
Overall new credit issuance, including China‘s shadow banks, was also much lower in October,
falling to CNY 856 billion from September‘s CNY 1.4 trillion.
―The October credit numbers point quite clearly to a firmer stance,‖ said Louis Kuijs, an economist
with Royal Bank of Scotland in Hong Kong. ―We expect the firmer stance to be maintained in the
coming quarters.‖
Source: Financial Times
NEW LEADERSHIP BRINGS A CHANGE TO AUSTRALIA‟S RESOURCES SECTOR
The election of Australia's Liberal leader Tony Abbott as the new Prime Minister has heralded
significant changes for the country‘s resources sector.
In October, Abbott ingratiated himself to the resources sector by releasing draft legislation to
repeal the much-contested minerals resource rent tax (MRRT). Opponents criticized that the MRRT,
which was introduced in 2012, was predicted to raise only AUD 7.2 billion in revenue by the 2016-
2017 financial year, nearly AUD 5-billion less than expected by the Gillard government. The tax
raised only AUD 126 million during the first half of the 2012-2013 financial year.
Further, the newly elected government has moved to simplify the environmental approvals process
for major projects, introducing a ―one-stop-shop‖ concept to slash red tape and increase
investment, while maintaining environmental standards. The second stage would see the federal
and state governments agree on bilateral assessments and updating those that are already in, while
stage three would see agreements on bilateral approvals within 12 months with willing states. Azure
Capital MD for corporate advisory Geoff Rasmussen pointed out that the strong Australian dollar, as
well as the high cost of labor and the perception of unnecessary bureaucratic delays in
environmental approvals, were all still a disadvantage to Australia.
―Ultimately, you are competing against every country in the world in trying to get global
investment dollars into your assets. Getting rid of the MRRT and the carbon tax is not going to mean

that we will be fundamentally more competitive overnight.‖
Rasmussen noted that, while there was little to be done about the strength of the Australian dollar,
government did have influence on the cost structure of certain projects. He also suggested further
tax reforms and possible incentives to provide a permanent workforce in the northern regions of the
country, where resource projects are currently reliant on the fly-in, fly-out method of transporting
workers to site.
Source: Mining Weekly
MINING WILL CONTINUE TO DRIVE AUSTRALIAN ECONOMY FOR THE NEXT FIVE YEARS
Economic forecaster BIS Shrapnel has said that the mining industry would continue to be a positive
driver of the Australian economy—which competes Mongolia for exports to China—over the next five
years, despite a predicted fall in investment in the sector. In its ―Mining in Australia 2013 to 2028‖
report, BIS said that mining investment, production, contractor services and employment would
follow very different paths over the next five years.
While the mining investment boom peaked in the 2012-2013 financial year and was forecast to
decline 20 percent over the next five years, mining production was poised to grow 41 percent over
the same period, driving commensurate increases in mining operations activities, maintenance and
exports. The value of mining production rose 8.8l percent in 2012-2013 to AUD 151 billion, and BIS
noted that the outlook for production was strong, with yearly average growth of 7.1 percent
forecast to 2017-2018. This would lift the mining sector‘s share of Australian gross domestic product
(GDP) to 12.2 percent, making it Australia‘s second-largest industry sector.
―With respect to the mining boom, it‘s probably fair to say that this is not the beginning of the end,
but the end of the beginning,‖ said senior manager of BIS‘s infrastructure and mining unit, Adrian
Hart. ―
He said BIS Shrapnel is forecasting the ratio mining activity to GDP to rise from 18.7 percent to 19.8
percent by 2018. However, Hart noted that growth in mining employment would not keep pace with
the expansion in production as miners sought to restore productivity lost during the furious race to
invest in new capacity since the mid-2000s. BIS expected that mining operations employment would
rise only 11 percent over the next five years, mainly in oil and gas and iron-ore, whereas mining
construction employment would slump 40 percent.
―Given the strong increases in production expected, this translates to a 60 percent labour
productivity surge over the next five years,‖ Hart said. He added that this would provide both
challenges and opportunities for suppliers and contractors to the mining industry.
Source: Mining Weekly
POLITICS
MONGOLIA WILL NEVER BURY NUCLEAR WASTE, SAYS ELBEGDORJ
President Tsaskhia Elbegdorj refuted suspicions that Mongolia was being targeted as a destination
for nuclear waste disposal on Twitter November 13th following widespread rumors within the public
and a protest against yellow cake production by young members of the Mongolian People's Party.
―Mongolia still stands on its nuclear-free status. I assure you again the rumor about nuclear waste
burial in Mongolia is not the policy of Mongolia,‖ said Elbegdorj in a tweet.
The government issued an official statement 12 November on nuclear waste, refuting claims that
plans existed where nuclear waste would be buried und Mongolian soil
―Some political parties and public organizations released a note claiming Mongolia is allowing the
burial of nuclear waste from Japan in Mongolia,‖ reads the note. ―The note claimed that the Prime
Minister signed a nuclear waste agreement during his visit to Japan and the Foreign Minister signed
a uranium deal with France. Mongolia has declared its policy on nuclear energy and uranium
exploration. The reform Government takes this responsibility seriously announcing that Mongolia
has neither buried nuclear waste nor will bury nuclear waste in the future.‖
Source: News.mn

12 HEALTH PROJECTS EXPECTED FOR COMPLETION IN 2013, SAYS HEALTH MINISTER
Health Minister N. Udval provided an update on the developments in the health sector, specifically
regarding the construction of new health facilities, during Prime Minister Norov Altankhuyag's 30-
minute weekly press meeting Thursday.
"Eight out of the 47 projects have ended. 12 are planned to be completed by the end of this year,"
said Udval.
One project for the establishment of a burn center has increased to MNT 26 billion during the
project implementation, she noted. Responding to this, the prime minister said the government
would cut financing from the state budget, with the remaining work sold by tender bid auction.
Altankhuyag said that from here on hospitals would have the power to appoint their heads
themselves rather than have appointments come down from the Ministry of Health.
Source: Montsame
PRESIDENT INITIATES DEVELOPMENT ROADMAP MEETING
President Tsakhia Elbegdorj has initiated a meeting for 16 November where government, business,
academia, and civil society will convene to provide input for a road map for development for
Mongolia in the years up until 2050.
The meeting ―From a Big Government to a Smart Government‖ will open debates and discussions
about how far Mongolia is looking into her future, how well the country is cognizant of its strengths
and weaknesses, and how cautious Mongolia is against repeating its past mistakes.
Participants will be divided into five groups --decision-makers, local government, media, academia
and NGOs, and businesses—to together reach a common stand on Mongolia‘s development agenda.
The conclusions made during the each of the five sessions will be reported on by moderators at the
Plenary Session.
Source: Montsame
THE MNT 70,000 GRANT PER MONTH FOR STUDENTS WILL BE CHANGED
The Standing Committee on Budget is set to introduce a new scheme for monthly student stipends
that grant different sums to students based on academic performance and the institutions they
attend. A portion of graduate students will also have to be employed to receive a stipend. Stipends
will amount to half of minimum wage.
Source: Zuunii Medee
AMARJARGAL RESIGNS FROM PARLIAMENT
Democratic Party parliamentarian R. Amarjargal presented a resignation letter to the Parliament
speaker during a session of Parliament.
Amarjargal presented his resignation during a discussion on the state budget. In an address he noted
the need from parliamentarians for strong principles, honor and penchants for speaking truth,
giving independent member Sainkhuu Ganbaatar as an example. He gave no reason for his
resignation, but criticized government saying that it needed people like him who are clean as well
as economists such as Ts. Oyunbaatar.
Source: Unuudur
MONGOLIA JOINS OPEN GOVERNMENT PARTNERSHIP
Mongolia joined the Open Government Partnership (OGP), an international platform for domestic
reforming for greater accountability for the government to citizens, during a summit in London from
31 October to 1 November.
Mongolia introduced its action plan and joined as a member of the Open Government Partnership
during the summit, where over 1,000 delegates from sixty countries gathered. The three key
priorities of the action plan are to improve public services, increasing the transparency of public
institutions, and enhance justice while reducing corruption. Mongolia's adoption of the Anti-
Corruption Law and the Law on Information Transparency and the Right to Information in 2011, as
well as accession to the U.N. Convention against Corruption in 2005 were important milestones for

Mongolia's membership to the Open Government Partnership.
The government shared its experiences, providing examples in its development of open governance
at the London summit.
The partnership was launched in 2011 to provide an international platform for domestic reform for
greater transparency and accountability. The partnership has grown from eight member countries in
its inception to the today's 62.
Source: Montsame
MONGOLIA RECEIVES SUPPORT FROM INTERNATIONAL INSTITUTE FOR GREEN ECONOMY
Mongolia participated in the Global Green Growth Institute (GGGI) is Seoul, Korea from 3 to 5
November, where nations' leaders discussed strategies for developing green economies.
Former Korean President Lee Myung-bak announced a ―low carbon, green growth‖ strategy as a new
vision to guide the nation‘s long-term development in 2008 and founded the national committee.
Later in 2009, the government of Korea adopted the Green Growth Law, after which the Global
Green Growth Institute was established in June 2010 that grew into new kind of international
organization.
―Mongolia supports the Institute‘s action from the early beginning and we are glad to cooperate. In
order to broaden our activity in Mongolia, we opened a GGGI representative office in Ulaanbaatar
last September and the GGGI is ready to co-implement the Mongolia‘s National Strategy for Green
Growth,‖ said Director-General of the GGGI Howard Bamsey.
A Mongolian delegation led by Deputy Parliament Speaker L. Tsog and Minister of Environment and
Green Development Sanjaasuren Oyun were in attendance. The event was significant given the
discussion now underway in Parliament over how to best build a green economy. Mongolia became a
member state of GGGI during the 2013 Global Green Growth Summit held in Songdo.
SERBIA AND MONGOLIA SIGN AGREEMENT ON VISA ABOLISHMENT
Serbia's Minister of Foreign Affairs Ivan Mrkic and his Mongolian counterpart Luvsanvandan Bold
signed an agreement for the abolishment of visas.
Mrkic said at a joint press conference held after the meeting that the Serbian and Mongolian
friendship is traditional and noted that Mongolia has very dynamic economic growth which is among
the biggest in the world. He expressed his hope that companies from Serbia would find interest in
doing business in Mongolia, adding that the laws which this country adopted recently provide for a
stable business environment.
Bold said that his visit to Belgrade is of historic importance because the 57th anniversary of
establishing diplomatic relations between the two countries is observed this year. He and Mrkic
discussed a series of issues related to economic cooperation, the possibility for establishing a
mechanism of cooperation between the two countries‘ parliaments and governments, and
cooperation in the field of education, science and culture.
Source: Balkans.com
MONGOLIA SIGNS INTERGOVERNMENTAL AGREEMENT ON DRY PORTS
Mongolia has signed an agreement that will help develop dry ports throughout Asia.
The second session of the Forum of Asian Ministers of Transport was held at the United Nations
Conference Center in Bangkok, Thailand from 4 to 8 November. In attendance was Minister of Road
and Transportation A. Gansukh, where he participated in discussions on regional transport issues
including those relating to regional transport networks, transport facilitation and logistics, financing
options for regional infrastructure development, and sustainable and inclusive transport.
Fourteen member countries sign the Intergovernmental Agreement on Dry Ports, the third
Intergovernmental Agreement to be negotiated under the auspices of ESCAP. By signing the
agreement, the governments of Armenia, Cambodia, China, Indonesia, Islamic Republic of Iran, Lao
PDR, Mongolia, Myanmar, Nepal, Republic of Korea, Russian Federation, Tajikistan, Thailand and
Vietnam pledged to promote international recognition of dry ports, facilitating investment in dry

port infrastructure, improving operational efficiency and enhancing the environmental sustainability
of transport, where Mongolia‘s border ports of Zamyn-Uud, Sainshand, Ulaanbaatar and Altanbulag
were considered as International Dry Ports, in addition to Choibalsan.
MONGOLIAN AMBASSADOR STRESSES EDUCATIONAL TIES WITH INDIA
Mongolian Ambassador to India Sanjaasuren Bayaraa stressed the need of strengthening educational
ties between Mongolia and India countries, last week Friday in an address to the students at
Maharishi Dayanand University (MDU).
As a chief guest of inter-zonal youth festival, Bayaraa said that India and Mongolia share historical
ties and active cooperation between them can further improve the academic scenario.
The three-day youth festival commenced that day with dance and music performances and literary
expression. MDU vice chancellor HS Chahal threw light on the historical and cultural linkages of
both countries and said that avenues of educational and cultural exchange can be explored between
the two countries.
Source: Hindustan Times
UN OFFICER ATTENDS MONGOLIAN PEACEKEEPERS CEREMONY IN SOUTH SUDAN
The U.N. under-secretary general for the Department of Field Support, Ameerah Haq, traveled to
Bentiu, the capital of the State of Unity of South Sudan on Friday 8 November.
Haq met with the deputy governor, Mabek Lang de Mading, and the Council of State, when she will
visit the headquarters of the Second Mongolian Battalion of the United Nations Mission in South
Sudan (UNMISS). While with the Mongolian Battalion, Haq will attend a parade where Mongolian
peacekeepers will be decorated in appreciation of their work to support the people and authorities
of Unity State. The Mongolian Battalion is due to rotate next week and be replaced by the Third
Mongolian Battalion, with a force-strength of 850 men and women.
Mongolian engineers started assisting local authorities as early as June, when the governor
requested their support to address the damage caused by seasonal heavy rains. The engineers have
undertaken infrastructure work such as leveling and building drainage along Bentiu‘s main road,
constructing dykes or draining and rehabilitating the public sports complex of Bentiu so it could host
the independence celebrations in July—just to name a few of their projects.
―By working together and supporting the state government, the local authorities and the citizens of
the state, the Mongolian Battalion and UNMISS are striving to help extend state authority, prevent
conflicts, protect civilians and consolidate the peace so the people can build a strong economy and
a fairer society, where every child in every part of this state can succeed and achieve his or her
dreams,‖ USG Haq said about her travel to Bentiu.
Haq‘s visit is part of a wider tour in South Sudan. In Juba, she met with the minister of foreign
affairs and international cooperation, Benjamin Mariel Barnaba, as well as UNMISS staff and the
mission‘s senior management.
Source: U.N. Mission in South Sudan
MONGOLIA AND RUSSIA TO ESTABLISH CROSS-BORDER PROTECTED RESERVE
Mongolia and Russia have signed an agreement for the protection of rare species that migrate
between the countries.
B. Tulga, deputy minister of environment and green development, the World Wide Fund in
Mongolia, and the Mongolian-Russian Intergovernmental Natural Protection Commission met in
Moscow for a third annual meeting where they discussed the need to protect of the Uvs Lake basin
area and rare species that migrate to both sides of the Mongolia-Russia border. They agreed to
establish a protected area that would cover the Onon Balj National Park in Mongolia and Sohondyn
Shim Mandal Protected Area in Russia.
Other topics of discussion included the prevention of forest fires, the lumber industries in Russia
and Mongolia, and finding biological substitutes for pesticides.
Source: Unuudur

GANJUUR SUTRA REGISTERED ON UNESCO WORLD HERITAGE LIST
Mongolian Foreign Minister Luvsanvandan Bold received a certificate for the registration of the
Ganjuur Sutra on the World Tangible Heritage list from UNESCO Director General Irina Bokova 7
November.
The sutra becomes the third historical artwork from Mongolia registered on UNESCO's Memory of the
World. The sutra is a collection of Buddhism writings, consisting of 108 volumes. Each black paper
page was in 1819 beautifully decorated with nine precious stones as well as gold, silver, coral,
pearl, turquoise, lapis, lazulite, and nacre.
Other Mongolian contributions to UNESCO's Intangible Heritage list are Naadam festival, khoomii
(throat singing), long song, the Eagle festival, the Morin khuur (horse-headed fiddle), and the
Mongolian epict, the Mongolian flute playing technique, Bielgee folk dance, and the "Tsuur" musical
instrument.
Source: Montsame
MONGOLIA'S WEALTHY POLITICIANS
The median net worth of members of the US Congress—435 representatives and 100 senators—is a
comfortable USD 440,000, more than six times the wealth of your average American household.
Among U.S. lawmakers there are also haves and have-nots with the bank accounts of the 50 richest
members holding a tidy USD 1.6 billion. That translates to small beer across the Pacific. The
wealthiest 50 delegates to China's National People's Congress, a body that acts as a rubber stamp
for Communist Party decisions, control USD 94.7 billion, according to the Hurun Rich List.
While it seems fair to say that these days you have to be rich to be elected in the United States and
that being wealthy in China ingratiates you with the Communist Party, Mongolia takes the concept
to a whole new level.
Mongolian parliamentarians and high-ranking government officials have been required since 2007 to
disclose their assets and net worth to the Asian nation's Independent Authority Against Corruption.
The Mongolist blog has crunched the numbers and it looks like Mongolia's top politicians have
managed to expand their asset base much quicker than the rate of economic growth in the country.
According to latest 2012 annual filing, current parliament members are sitting on MNT 1,137 billion
in total net assets or approximately USD 785 million. Of the 74 MPs that disclosed their wealth, the
top four control about 64 percent of the total.
Those are impressive numbers particularly when you consider Mongolian politicians' hoard relative
to the size of their country's economy. U.S. Congress members' combined fortunes are a rounding
error when you consider America's USD 15.7 trillion economy. Chinese politicians fare better. They
control 1.1 percent of the globe's second largest economy. The rulers of Mongolia's fewer than three
million citizens have amassed moolah to the equivalent of 7.6 percent of the country's GDP.
Source: Mining Weekly, The Mongolist
MINISTRY OF HEALTH LEADS IN GOVERNMENT RED TAPE, SAYS STUDY
The Ministry of Health leads the government in bureaucracy, found the Mongolian National Chamber
of Commerce and Industry in a bureaucracy index for 2013. Following the Health Ministry (in order
of greatest to least layers of bureaucracy) was the Ministry of Education and Science, Ministry of
Industry and Agriculture, Ministry of Justice, Ministry of Construction and Urban Development,
Ministry of Defense, Ministry of Labor, Ministry of Energy and Ministry of Foreign Affairs.
Source: Udriin Sonin
OVERVIEW OF THE INVESTMENT FUNDS LAW
Parliament‘s approval of the first ever Investment Funds Law (IFL) in early October went relatively
unnoticed, with all attention of the time focused on the Investment Law. Nonetheless, it should be
noted that the IFL is of great importance to the future of Mongolia‘s economic growth and financial
sector development when it takes effect 1 January 2014.
Comprising 11 chapters and 58 provisions, the purpose of the IFL is to regulate the basic relations
related with the establishment of an investment fund, issuance of a license for the fund, regulation

fund management companies, custody of fund assets and protection of investor rights and interests.
The law defines two main types of investment funds—private and mutual, and different regulatory
norms will apply. Private funds will be subject to limited regulation from the Financial Regulatory
Commission (FRC). Those funds will not be allowed to do public marketing and can raise funds only
through private offerings. Mutual funds can raise funds through public offerings to 50 or more
people.
One chapter of the IFL is dedicated to custodian services. Along with Securities Market Law, the IFL
brings the concept of custodian services in order to protect investors. Custodian banks will
responsible for custody of fund assets, registration of fund units, verification of net asset value of
funds and also exercise some control over management companies.
Foreign funds are not allowed to raise funds in Mongolia without licensing, but these funds can carry
out investment activities after going through a registration process with the FRC. As a special
purpose vehicle, investment funds will not be taxed as a business entity, however investors will pay
income taxes on returns subject to effective tax regimes.
Source: Mandal Asset Management
SOUTH KOREAN MONEY LAUNDERING IN MONGOLIA COMES TO LIGHT
Local newspapers reported that the Economic Crime Combat Division of the Criminal Police
Department has brought down a South Korean organized money laundering operation in Mongolia.
An unnamed source said evidence was found that proved that the head of a South Korean crime
organization, a gangpae (tr: street gang), Ahn Jae Man, was laundering money in Mongolia collected
from extortion practices, loan sharking and gambling in South Korea.
Ahn Jae Man was arrested for a gambling business and an illegal transfer of MNT 11 billion from
South Korea. The origin of the transfer was named as Uilsot, as the company director, Lee Jae Gun,
in order to disguise the money as an investment. The company used the money to build a hotel
named Richfield in the Chingeltei District of Ulaanbaatar. Ahn Jae Man was accused of attaining
USD 4.5 million in South Korea through illegal means.
Lee Jae Gun, the owner of Richfield, was investigated by Chingeltei District police for forced
prostitution by Chingeltei District Police in 2011, but the case was dropped due to lack of evidence.
The State Investigation Department has confiscated the Richfield hotel due to its connection in the
arrest.
Source: News.mn, Unuudur
UB MAYOR TO RECEIVE HONORS IN WASHINGTON, D.C.
Ulaanbaatar Mayor Erdene Bat-Uul will be honored at International Republican Institute's 30th
Anniversary Celebration 9 December in Washington, D.C., United States. Bat-Uul will be share the
honor with Mikulas Durinda, a former prime minister of Slovakia.
Source: NAMBC
ANNOUNCEMENTS
MONGOLIA INVESTMENT SUMMIT, HONG KONG, NEXT WEEK
Since opening up the registration for the fourth annual Mongolia Investment Summit 2013 in Hong
Kong from 19 to 20 November, organizers have received an overwhelming response from investors.
With the new Investment Law being passed by the Mongolian Parliament last week, we expect the
investor interest for the Summit to pick up even more.
Meet with up to 500 senior level delegates at the Summit and set up one-on-one meetings with
investors and potential business partners all in one place. Mongolia Investment Summit is the only
Mongolian investment event taking place in Hong Kong, the financial deal-making hub of Asia. All
registered delegates will have exclusive access to our advanced Mongolia Invest Online Meeting
Planner which will allow you to see who‘s coming and let you pre-arrange meetings with the other
attendees to make the best use of your time at the event.

BCM is again a supporting partner organization. BCM members will enjoy 15% discount; please quote
Priority Code 695BCM15D during registration. To speak, sponsor or exhibit: Please contact King Tai
at king.tai@beaconevents.com.
___________________________________________
AUSTRALIAN UNDERGROUND MINING INDUSTRY PROGRAM, NOVEMBER 21-29
The Australian Trade Commission and the Underground Mining Engineer‘s Association of Mongolia
(UMEAM), is now registering companies and organizations to participate in an Australian
Underground Mining Industry Program, which will take place in Sydney and Brisbane on 21 to 29
November. The program consists of eetings with Australian mining equipment, technology and
service supplier companies in Sydney and Brisbane. Attending the 2013 Underground Mining
Excellence Conference and exhibition will provide an opportunity to engage with the latest
underground mining innovations and technology providers and a possible visit to the North Parkes
underground mine site.
Registration will close on 10 November. Attendance is limited. For more information, call 9910 6102
or send an email to bart.gurbazar@austrade.gov.au.
__________________________________________
“MM TODAY” ON MNB-TV, FRIDAY, 19:00-19:10
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 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.
S. Oyun, Minister of Environment and Green Development, presentation at BCM monthly meeting on
May 27 added to Mongolian website, bcmongolia.org/mn/илтгэлүүд.
- Байгаль орчин, ногоон хөгжлийн сайд С.Оюун, Байгаль орчин, ногоон хөгжлийн шинэчлэлийн
бодлого, үйл ажиллагаа, МБЗ-ийн сарын уулзалт 5 сарын 27, 2013
___________________________________________
ENGLISH WEBSITE: 'PRESENTATIONS', 'MONGOLIA REPORTS', „INTERVIEWS„, MONGOLIAN
BUSINESS NEWS‟, „PHOTO GALLERY‟
On BCM‘s English website, the ―Resources‖ and ―Presentations‖ sections are available:
The following are presentations from the Mongolia Mining Summit, Perth, Australia, October 29-31,
2013:
• Mongolia‘s Minerals Future and Development by Otgochuluu Ch, Director General, Department of
strategic policy and planning at Ministry of Mining, Mongolia at the Mongolian Mining Summit 2013,
Perth, Australia, Oct 29-31, 2013
• Mongolian Economy: Investment Opportunities /Challenges, Jim Dwyer, Executive Director,
Business Council of Mongolia at the Mongolian Mining Summit 2013, Perth, Australia, Oct 29-31,
2013
• Oyu Tolgoi: Lessons from the Gobi, Houston Spencer Vice President, Communications and Media
Relations, Oyu Tolgoi at the Mongolian Mining Summit 2013, Perth, Australia, Oct 29-31, 2013

• Market dynamics for Mongolian coking coal in the Chinese market, Graeme Hancock, President
and Chief Representative at Anglo American, Mongolia at the Mongolian Mining Summit 2013, Perth,
Australia, Oct 29-31, 2013
• Speech by Mr. Ariunbold Byamba, Deputy Director, Erdenes MGL LLC at the Mongolian Mining
Summit 2013, Perth, Australia, Oct 29-31, 2013
• Launching Mining Projects in Mongolia–A Major Contractor‘s Perspective, Eric Erdenebat
Tseveendorj, Country Manager, Orica Limited at the Mongolian Mining Summit 2013, Perth,
• Investing in a dynamic legislative environment, Elisabeth Ellis, Managing Partner Ulaanbaatar,
Minter Ellison at the Mongolian Mining Summit 2013, Perth, Australia, Oct 29-31, 2013
• Sandvik In Pit Crushing & Conveying (IPCC), Doug Turnbull, Principal Mining Engineer, Sandvik
Mining Systems, at the Mongolian Mining Summit 2013, Perth, Australia, Oct 29-31, 2013
• Ovoot Coking Coal Project, David Paull, Managing Director Aspire Mining, at the Mongolian Mining
• The business of being a third neighbor, David Landers, General Manager, East Asian Growth
Markets at the Mongolian Mining Summit 2013, Perth, Australia, Oct 29-31, 2013
• Nuurst Thermal Coal Project, Daniel Rohr, Chief Financial Officer, Modun Resources Ltd, at the
Mongolian Mining Summit 2013, Perth, Australia, Oct 29-31, 2013
• Culture matters in building sustainable long-term business relationships, Hana Tserenkhand
Byambadash Business Development Consultant. AusMon Consulting and Dr Christine Hogan Adjunct
Professor, Curtin University. Consultant & Author at the Mongolian Mining Summit 2013, Perth,
• Maximizing Business Benefits from Your IT Investment, Brad Skeggs, Executive Director, COSOL, at
the Mongolian Mining Summit 2013, Perth, Australia, Oct 29-31, 2013
• Presentation by Battsengel Gotov, CEO, Mongolian Mining Corporation, at the Mongolian Mining
• Mongolian Mining Sector "Present and Future Developments", N.Algaa, Executive Director,
Mongolian National Mining Association, at the Mongolian Mining Summit 2013, Perth, Australia, Oct
29-31, 2013
• Jim Dwyer, Executive Director of BCM – ―Mongolian Economy: Investment
Opportunity/Challenges‖ at the 16th Annual NAMBC Investors Conference, Sept 24, 2013
• Business-mongolia.com: ―Working group‘s conclusion on the economy‖
• Joshua Sunga, Internship Program Director, AIESEC- "Youth Leadership Development" at the BCM
Monthly Meeting Aug 26. 2013
• G. Zorig, Country Manager, Tree Global Mongolia – ―Tree Global Mongolia Overview Presentation‖
at the BCM Monthly meeting Aug 26, 2013
• G. Saruul, Deputy CEO, Mongolian Stock Exchange – ―Securities Law Overview‖ at the BCM Monthly
meeting Aug 26, 2013
• Bilguun Ankhbayar, Chief Executive Officer, Mongolian Investment Banking Group LLC,
―MIBG Review‖, at the MSE-BCM Securities Law Overview Session, July 4, 2013
• Robert Rooks, Director, PwC Hong Kong, ―A brief Overview of Custody Services‖, at the MSE-BCM
Securities Law Overview Session, July 4, 2013
• Anthony Woolley, Senior Associate, Hogan Lovells, ―The Revised Securities Market Law‖, at the
MSE-BCM Securities Law Overview Session, July 4, 2013
• B. Saruul, Director General, Securities Department, Financial Regulatory Commission of Mongolia,
―Securities Markets Law – Path to Market Reforms‖, at the MSE-BCM Securities Law Overview
Session, July 4, 2013
Please note the presentations from each of the BCM monthly meetings.
The ―Mongolia Reports‖ section includes the following:
- ―Monthly Macroeconomic Overview, Sep 2013,‖ by EPCRC

- ―Selected Macroeconomic Indicators; data through October 16, 2013‖ by International Monetary
Fund;
- ―IMF Completes 2013 Article IV Mission to Mongolia‖ by International Monetary Fund;
- ―Mongolia Macro Flash‖, Adrienne Lui, Asia Pacific Economics Research, Citigroup Global Markets
Asia Ltd;
- ―Selected Macroeconomic Indicators for Mongolia, as of June 2013‖ by International Monetary
Fund;
- ―Polit Barometer April, 2013‖ by Sant Maral Foundation;
- ―Market Update‖ by Mandal General Insurance LLC;
- ―Annual Report 2012‖ by International Monetary Fund;
- ―Regional Economic Outlook: Asia and Pacific‖, April 2013 by International Monetary Fund;
- ―Highlights of 2012, Mongolia‖ by European Bank for Reconstruction and Development (EBRD);
- ―Official statement of Oyu Tolgoi LLC in relation to information, data and facts related to Oyu
Tolgoi‖ discussed during open session of the State Great Khural‖, dated 1 February, 2013‖;
- ―Mongolia Investment Climate Statement‖, by the Economic and Commercial Section of the U.S.
Embassy;
- ―Mongolia Foreign Labor Force Ratio for 2013‖ by Hogan Lovells International LLP;
- ―How Mongolia will perform in 2013?‖ by Mandal Asset Management;
- ―Mongolia Business Owner and CFO Survey result‖ by BDSec JSC;
- ―The fiscal regime for mining - a way forward‖ by IMF Fiscal Affairs Department;
- ―Taxes for Expatriates in Mongolia‖ by PricewaterhouseCoopers.
The following interviews are added to Interview Section from the Oxford Business Group, Mongolia
Reports 2013 book:
• B. Byambasaikhan, Chairman, Business Council of Mongolia: ―Talk is cheap‖;
• President Ts. Elbegdorj: ―Diversifying for growth‖
• Jim Dwyer, Executive Director, Business Council of Mongolia: ―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‖;
• B. Chuluunbaatar, President and CEO of Monnis Group: ―Climbing the ranks‖;
• Cameron McRae, President and CEO, Oyu Tolgoi: ―Sitting on a copper mine‖.
BCM's English website includes the ―Mongolia Business News‖ section where the 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 5th Anniversary BCM Gala dinner on November 5.
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 http://www.facebook.com/pages/THE-BUSINESS-COUNCIL-OF-
MONGOLIA/129826330435540 to read the latest announcements and comment on events carried in
the NewsWire with the community.

Connect with BCM on Linked-in to join the diverse group of professional contacts creating a better
business environment in Mongolia today.
Hear breaking news and announcements as they happen when you follow BCM on Twitter at
http://twitter.com/#!/bcMongolia.
We have now 1,822 fans on our Facebook fans page, 1,521 connections on LinkedIn network, and
804 followers on Twitter.
Of course for news information, interviews, event photos, and announcements regarding our
organization, visit the official BCM website at www.bcmongolia.org and www.bcm.mn
BCM WORKING GROUP MEETING
BCM's Legislative Working Group met on Thursday November 14, with 16 members attending.
New member: Pierre-Michel Motteau from Audier Partner was welcomed.
Gust: Simon Scott partner of Minter Ellison.
Co-chair James Liotta, Mahoney Liotta, moderated the session.
Meeting discussion was on the following topic:
1) The new Investment Law and the implications it may have on the investment climate in
Mongolia.
2) The Draft Minerals Policy of Mongolia
The direction would take Mongolia, the implications it may have on the investment climate in
Mongolia, and the implications it may have on doing business in Mongolia in the minerals sector.
Please contact erka@bcmongolia.org
ECONOMIC INDICATORS

INFLATION
Year 2006 6.0% [source: National Statistical Office of Mongolia (NSOM)]
Year 2007 *15.1% [source: NSOM]
October 31, 2013 *10.8% [source: NSOM]
*Year-over-year (y-o-y), nationwide
Note: 9.5% y-o-y, Ulaanbaatar city, October 31, 2013
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 – NOVEMBER 14, 2013
Currency Name Currency Rate
US dollar USD 1,738.82
Euro EUR 2,340.10
Japanese yen JPY 17.43
British pound GBP 1,788.28
Hong Kong dollar HKD 224.26
Chinese Yuan CNY 285.42
Russian Ruble RUB 53.17
South Korean won KRW 1.63
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.

15.11.2013, NEWSWIRE, Issue 300

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15.11.2013, NEWSWIRE, Issue 300