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20.05.2014, Investor views and concerns about making investments in Mongolia and its mining sector, Randolph Koppa
1. BCM legislative Working Group
Informal Meeting
Randolph Koppa, BCM Vice Chairman
May 20, 2014
2. Stability of laws
Suddenly enacted laws
Vaguely drafted laws
Unclear country strategy
Poor investor relations
Use of bond proceeds
Fiscal and monetary policy
3. Laws on foreign investment have changed
twice in recent two years.
New Investment Law is viewed favorably, and
there was considerable consultation with the
private sector, but…
Lack of resolution of OT discussion raises
question about stability agreements.
4. Windfall profits tax
Long named law
SEFIL
Recent drafting and enactment of laws shows
these concern are being addressed.
5. World Economic Forum options
China slowdown
Russian relations
Third neighbor policy
Maybe 100 day plans are good for local
consumption, but the foreign investment
community needs a longer term vision.
6. Legal protections for foreign invested firms
Lack of information to institutional and other
investors
3 billion reasons why investors are watching
Mongolia
Speak to ALL constituents
Trial by FT and WSJ
Conference no-shows
7. Mongolia is now eyeing the world for
investment.
The world has also been eyeing Mongolia;
some of the world has lost patience and
needs to be re-engaged, while the rest
eagerly looks for reasons to consider acting
on the investment opportunities Mongolia
offers.
Clear, consistent messages, laws and actions
are key.
8. How were Sovereign bond proceeds applied?
What is progress on infrastructure?
Fiscal deficit exceeding 2%
Monetary policy of BoM
Balance of trade, foreign exchange reserves
Foreign direct investment
Debt to GDP
OT
All the above impact secondary market pricing.