PRESENTATION

1. FINANCING FOR MONGOLIA’S
TRANSPORT SECTOR
Experience and Future
Directions for the
Asian Development Bank
Coaltrans Mongolia 2012

2. ADB transport strategy in
Mongolia
 Rural connectivity and poverty reduction
 Regional integration and trade
 Central Asian Regional Economic Cooperation (CAREC
Program
 Border crossings and facilities
 Reducing logistics costs
 UB urbanization
 Asset management
 Private sector participation and PPPs

3. ADB financing for transport
 Approved Projects (Loans/Grants)
 5 road sector projects ~$185 million
 1 logistics facility ~$45 million
 2 aviation sector projects ~$60 million
 Planned/Proposed Projects
 2 road sector loans ~$125 million
 Urban transport project ~$215 million
 UB logistics facility ~$65 million
 Technical Assistance provided for
aviation and roads/proposed for
logistics and urban transport
Western Regional Road – Existing condition
Western Regional Road – Existing bridge

4. ADB Financed Transport Projects
Road Development
Project, 1995
Second Road Development
Project, 1999
Regional Road
Project, 2004/2008
Regional
Logistics, 2010
Western Regional Road
Phase 1, 2008
Western Regional Road Corridor
Development Program
– Tranche 1, 2011
Western Regional Road Corridor
Development Program –
Tranches 2 &3, 2013-2016
UB Airport//Air Nav
System, 1993/1995

5. Experience to date - roads
 History of rapid cost escalation
 Procurement delays
 Lack of experience with
international practice (e.g.
FIDIC)
 Lack of maintenance
 Need for capacity development
in sector
Second Road Development
Western Regional Road
Regional Road

6. Road sector challenges and
opportunities
0
2000
4000
6000
8000
10000
12000
1992 1997 2000 2006 2009 2012 2015 2021
Improved earth
Gravel
Paved
Km road works completed 2000-2008
0
100
200
300
400
500
600
2000 2001 2002 2003 2004 2005 2006 2007 2008
km
Network expansion plans to 2021 (km)
 Sector production needs to increase rapidly.
GDP growth > 15% after 2012
 Fiscal balance to improve in parallel Sector resources to rise quickly after 2012
Demand for road works will expand fast
 Government Action Plan
 National Development Strategy
Sources: DOR, National Development Strategy, ADB calculations

7. Strategies to address road sector
constraints
 New financing modalities – multi-tranche financing
facility (MFF)
 Long term investment programs
 Provide incentives for reform
 Match financing to project readiness
 Explicit support to develop domestic contracting
industry
 Support sector performance through capacity
development technical assistance
 $2 million grant - Japan Fund for Poverty Reduction (JFPR)
 Prepare and implement sector roadmap

8. Comprehensive sector
development
Road Sector
CDTA
Management
for
Development
Results TA
Loan financed
Capacity
Development
 $2 million JFPR financing
 Implement sector roadmap
 Consulting support
for management and
procurement
 Road asset
management system and
training
 Procurement
specialists
 Consolidated PMO
 International
consultant support PIU
 Added PIU staff
 Consultant support for road sector
program monitoring - dual posted at
MNRM & EA
 Immediate implementation support
MFF

9. New direction for ADB support:
Logistics
 Zamyn-Uud approved 2010  Ulaanbaatar proposed 2013
Figure 4-2: General Location of ZULC

10. New direction for support: Urban
transport
 UB Urban Transport Project
(2012 proposed)
 Bus network upgrade/BRT
 Road network improvements
 Traffic management
 Pedestrian improvements
BEFORE
AFTER
BRT Network Plan - 2020

11. Future opportunities
 Railways
 High impact for Mongolian development
 Needs greatly exceed ADB resources allocated to Mongolia
 PPP? PPP advisory role?
 ADB technical assistance to railway subsector
 Infrastructure tariff study
 Proposed consultant support for Development Bank of Mongolia
 Seeking other opportunities

12. Thank you