The document summarizes business and economic news from Mongolia. It discusses ongoing negotiations between Mongolia and Rio Tinto over the Oyu Tolgoi mining project. It also mentions that Aspire Mining has identified potential savings of $200 million by selecting a new route for a proposed rail line. Additionally, it provides updates on various mining and infrastructure projects throughout Mongolia.

1. BUSINESS COUNCIL of MONGOLIA
NewsWire
www.bcmongolia.org
info@bcmongolia.org
Issue 269 – April 12, 2013
NEWS HIGHLIGHTS:
Business
 Mongolia debates the interests of Goldman Sachs;
 Rio Tinto says talks with Mongolia ongoing, productive;
 Aspire study highlights $200m savings from new Ovoot rail route;
 Government demands that Petro China build roads;
 Newera makes move for JV for Ulaan Tolgoi;
 Haranga expects increased resource measure at Selenge;
 Rio Tinto seeks to sell stake in Ivanhoe Australia;
 MSE brings out remote trading;
 EBRD supports IMC hospital;
 SkyC&C Ltd deploys Minerva iTVFusion for pay TV;
 Newcom Group to complete Salkhit in 2013;
 Naadam Cashmere launches Kickstarter campaign;
 Ariunaa Suri at Tokyo Fashion Week;
 Maptek provides educational licenses of mining software to MUST;
 MIG executive chairman resigns;
 Runge merges with two mining technical firms;
 Erdene year-end report;
 Anglo American gets S&P downgrade.
Economy
 Mongol Bank cuts interest rates for second time this year;
 Monthly FDI reaches new low;
 Bids total MNT 25 billion for Mongol Bank’s 12-week bills;
 Belarus to establish technopark in Mongolia;
 UB to install new traffic signs;
 Turkish premier to unveil renovated street;
 Mongolian auto dealers sell in Kazakhstan for higher rewards;
 Mongolia scolds Rio on costs as mine riches replace gers;
 NEMA on alert for heavy snowfall;
 Mongolian officials look to western Montana wildlife crossings as model;
 University of Queensland group to study mining impact on herders;
 Save the Children finds worrying trends;
 Renewed investment to drive gold price to over USD1,800/oz by year-end.
Politics
 Presidential election scheduled on 26 July;
 Swiss account had no bearing on OT agreement, says Bayartsogt;
 Economic Development Deputy Minister pleads for consensus on return of FDI;
 MPP protests shorten opening session of Parliament;
 Economic Development Ministry rumored to be drafting bill to replace SEFIL;
 Premier returns safely to UB after perilous hike;
 Government bans swine and poultry imports following bird flu epidemic;
 Xi calls for boosted cooperation;

2.  China, Mongolia discuss cooperation in protecting cultural heritage;
 Cabinet minister talks of Mongolian-U.S. cooperation in minerals sector;
 Civil organization demands OT board resignations;
 Mongolians hopeful for a less corrupt society;
 Mysterious mail triggers global tax haven expose;
 Mongolia's role in 2013 Community of Democracies ministerial meeting;
 North Korea warns it is on brink of nuclear war with South.
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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Mongolian National Broadcasting

3. BUSINESS
MONGOLIA DEBATES THE INTERESTS OF GOLDMAN SACHS
Mongolia‘s parliament is deliberating on its past dealing with Goldman Sachs (Asia) LLC to decide
whether or not there was a conflict of interest.
Goldman Sachs acted as an advisor to the Mongolian government during the drafting of the Oyu
Tolgoi investment agreement, advising on financial aspects such as the development of a financial
model. The World Bank and other organizations, meanwhile, provided their own brand of financial
and legal advice, some without charge, while Goldman Sachs left a bill of USD 250,000, according to
Erdenes Oyu Tolgoi LLC at a session of Parliament.
Mining Minister Davaajav Gankhuyag concluded that session, remarking upon the need for a court‘s
opinion. However, what court the case should be introduced to has yet to be decided. One possibly
regulatory body is the U.S. Securities and Exchange Commission.
Source: Business-Mongolia.com
RIO TINTO SAYS TALKS WITH MONGOLIA ONGOING, PRODUCTIVE
Rio Tinto PLC is having productive talks with the Mongolian government over the investment
agreement for its Oyu Tolgoi project, the chief executive of the global miner‘s copper division said
on Tuesday.
Rio and Mongolia are at loggerheads over the future of one of the world‘s largest untapped copper
deposits just as the mine ramps up output and the Rio Tinto subsidiary that owns it tries to line up
USD 4 billion for the next stage of development. The mine is operating under a temporary budget
after the two sides failed to agree on a deal last month, having disagreed over taxes and rising costs
that Mongolia fears will erode prospective earnings.
―While there are complex issues that need to be resolved, constructive progress is being made,‖
said Jean-Sebastien Jacques, speaking as part of the CESCO/CRU copper conference in Santiago.
―We continue to have productive discussions with the government on a range of issues.‖
Source: Reuters
ASPIRE STUDY HIGHLIGHTS $200M SAVINGS FROM NEW OVOOT RAIL ROUTE
Aspire Mining has completed a rail pre-feasibility study revision confirming that it could save USD
200 million by taking a more direct route further to the south for its proposed Erdenet to Ovoot rail
extension in Mongolia. The plan reduces capital expenditure for the rail line to USD 1.3 billion.
Importantly, further capital expenditure cost savings are possible from a de-rating of haulage
capacity from 22 million tons annually to an initial starting capacity of between 10 million and 12
million tons per year. Optimization of the eastern half of the alignment could also result in
additional cost savings.
The costs savings translate to USD 50 million saved a year due to a redefined rail path, shorter total
kilometers along more agreeable terrain and the modeling of longer trains has resulted in a 30
percent reduction in the per kilometer rail operating costs.
A route farther to the south than identified in the July 2012 Caliber review was identified and
selected as it is cheaper in terms of capital and operating expenditure and has less risk from an
environmental, geotechnical and hydrological perspective. It also confirmed the seismic risk as
being tolerable and manageable under normal design standards. A further advantage of the new
southern alignment is that it crosses into Zavkhan Aimag to the south, potentially providing rail
access to this province.
Aspire will continue to work on advancing the Erdenet-Ovoot railway by providing more engineering
definition and progress towards a bankable feasibility study. When the definition is at a suitable
stage the company will start the process to seek a rail concession and the other supporting permits
and approvals required from the Mongolian government.
Source: Proactive Investors

4. GOVERNMENT DEMANDS THAT PETRO CHINA BUILD ROADS
Petro China Daqing Tamsag LLC has begun connecting oil wells with pipelines for delivery,
disregarding its agreement with Mongolia to build roads for transport.
Parliament Speaker Zandaakhuu Enkhbold said during a recent visit to Dornod Aimag that the
government would cancel Petro China's permits if it does not build the roads it is obligated to by
their agreement with the government.
Petro China, which pumps oil from the Tamtsag oil field at Matad Soum, Dornod Aimag has begun
extracting oil from 500 of the 521 oil wells it has drilled. That company expects to confirm an
additional 240,000 tons of resource this year, bringing it to a total of 650,000 tons. Petro China also
extracts oil in Khulunbuir, near to Tamsag, where it transports oil to processing plants via pipelines.
Petro China is the largest oil explorer in Mongolia, exporting 80 to 100 trucks full of oil to China a
day.
Source: News.mn
NEWERA MAKES MOVE FOR JV FOR ULAAN TOLGOI
Newera Resources Ltd. announced its entrance into a memorandum of understanding to work
towards completing a formal joint venture agreement covering a single large exploration license in
Umnugobi Aimag.
―Newera is excited to have secured, subject to regulatory due diligence and execution of a full
form joint venture agreement, what is seen to be a very prospective green field coal exploration
play in the South Gobi province of Mongolia,‖ said Executive Chairman Martin Blakeman.
The Ulaan Tolgoi project license covers 43,830 hectares with a prospective for coal in concealed
extensions of the late Permian coal-bearing Tavan Tolgoi group rocks of the South Gobi Basin.
Visible in satellite imagery, striking east to west through the south of the license in the Sonduult
thrust fault which is postulated to be a potential extension of the Naryn Sukhait thrust fault. Minor
coal outcrops along the Naryn Sukhait thrust fault to the west of Ulaan Tolgoi led to the discovery
of the largest Mongolyn Alt Group (MAK) and Ovoot Tolgoi coking/thermal coal deposits as well as
the Soumber, Bilutt, and Guildford Coal's South Gobi deposit.
Newera has a 60-day due diligence period to express satisfaction with the results of the due
diligence of the license and wish to continue. Continuance will be subject to a USD 64,500
reimbursement of past expenditure to the vendor to the joint venture. The first stage of the
agreement would have the vendor grant exclusive rights to attain 51 percent of the project, and
following that an additional 19 percent at a cost of USD 1.2 million.
Source: Newera Resources Ltd.
HARANGA EXPECTS INCREASED RESOURCE MEASURE AT SELENGE
Haranga Resources Ltd. reported an expected increase of its measured resource at the Selenge
project.
The announcement followed the completion of tests over 2,660 six-meter composite mineralized
samples from last year's 35,000-meter drill program. The results will be added to the company's
updated resource model, which is in the final stages of drafting and verification.
―A significant increase and enhanced JORC compliant resource for Selenge is expected in
approximately for weeks,‖ reads the source.
The company said shortly after the new resource measurement is complete it will submit its mining
license application. Later this year, the company expects to receive an updated independent
assessment of the project economics and the commencement of a feasibility study.
Source: Haranga Resources Ltd.
RIO TINTO SEEKS TO SELL STAKE IN IVANHOE AUSTRALIA
Rio Tinto is accelerating a plan to sell billions of dollars in noncore assets, even as a slowdown in
commodities could lower prices for the deals. Copper and gold producer Ivanhoe Australia Ltd. is
the latest operation to go on the block. Citigroup has been appointed to run the sale of the 57%
stake in Ivanhoe Australia, people familiar with the matter said. Ivanhoe Australia is controlled by

5. Rio Tinto's Turquoise Hill Resources Ltd. unit.
The sale would be one of several sought by Rio Tinto's new chief executive. Turquoise Hill also plans
to sell its roughly 58% stake in SouthGobi Resources Ltd., a Mongolian coal miner, the people said.
That process has been delayed, however.
Ivanhoe Australia's market value has dropped to 148.7 million Australian dollars (US$156.8 million)
from as much as A$1.5 billion in early 2011, punished by declining commodity prices. Ivanhoe
Australia said Thursday in a filing to the Australian Securities Exchange that Turquoise Hill has
begun a strategic review of its stake.
Ivanhoe Australia's main projects under development are the Mount Elliott and Merlin operations,
which contain gold and base metals, including copper. The stake sale could trigger a full takeover
of the company. Australian law generally requires that a buyer acquiring 20% of a company must bid
for a full takeover.
Rio Tinto inherited the Ivanhoe Australia and SouthGobi stakes last year when it took majority
control of Turquoise Hill. Its most prized asset is the Oyu Tolgoi mine in Mongolia, which holds some
of the world's biggest unexploited copper and gold deposits.
Rio Tinto CEO Sam Walsh, who took over in January, has made selling assets a priority. Deutsche
Bank estimated that Rio Tinto could raise as much as US$10 billion from its asset sales.
Source: Wall Street Journal
MSE BRINGS OUT REMOTE TRADING
Mongolian Stock Exchange (MSE) JSC introduced remote trading as part of its upgrading process
while implementing the Millennium IT trading platform.
The upgrade comes with the master services agreement, signed by the State Property Committee,
London Stock Exchange Group and MSE. The agreement is a collaborative effort to develop
Mongolia's capital markets with a series of targeted objectives.
Source: Mongolian Stock Exchange JSC
EBRD SUPPORTS IMC HOSPITAL
The European Bank for Reconstruction and Development (EBRD) will loan USD 13.1 million to
International Medical Center LLC to partially fund Mongolia's first private hospital that meets
international standards.
The loan will go towards construction and equipment costs for a new 90-bed hospital in
Ulaanbaatar. Due to Mongolia's aging health care infrastructure, many patients opt to travel abroad
to seek treatment, spending an estimated USD 100 million a year. Currently Ulaanbaatar is in great
need of a hospital with modern equipment and highly skilled staff.
―We are proud to support the creation of the first private hospital on this scale in Mongolia. As well
as providing medical services, the project will serve as a blueprint for more private sector
investment in health care in rapidly developing Mongolia,‖ said Aza Ulziitogtokh, the head of the
EBRD office in Mongolia.
IMC is a company operating in Mongolia that owns and manages hospitals. It has partnered with
Samsung C&T, a health sector management and consultancy subsidiary of Samsung Group, and
Korea University Medical Center, a university hospital in South Korea.
Source: Business Mongolia
SKYC&C LTD DEPLOYS MINERVA ITVFUSION FOR PAY TV
Minerva Networks, a provider of software solutions for the delivery of television services to
connected devices, today announced that broadband service provider SkyC&C Ltd. has deployed
Minerva iTVFusion to offer advanced television services within the region.
The Minerva platform will enable the Mongolian operator to offer pay-television services nationwide
over its broadband and mobile networks. Both live and on-demand content will be available to
SkyC&C subscribers via computers, Android, and IOS devices, as well as Internet protocol set-top
boxes.
―With the Minerva platform we are able to offer our customers all the latest features of a premium

6. pay-TV service,‖ said Bayarbat Ariunbold, chief executive officer of SkyC&C. ―We are looking
forward to delivering more services on more devices to our growing subscriber base.‖
Source: Business-Mongolia.com
NEWCOM GROUP TO COMPLETE SALKHIT IN 2013
Newcom Group said the Salkhit wind farm project is on track to complete this year.
Experts have speculated that Mongolia has enough wind energy to match seven nuclear power
plants. In light of the enormous renewable energy potential Newcom Group has partnered with
General Electric Co. the European Bank for Reconstruction and Development, and the Netherlands‘
Development Financial Co. to establish the company Clean Energy LLC. The company is now seeking
MNT 160.2 million as investment and long-term loans for its operations.
The Salkhit power station will save 1.6 million tons of water, 150,000 tons of coal and the
equivalent of 180,000 tons of greenhouse gases. Experts have likened the ability of the wind farm to
offset carbon to forestry: A single hectare of forest can reduce greenhouse gases by 10 tons, while
the Salkhit plant will match that of 18,000 hectares of forest.
The 31 wind turbines are 80 meters long and when fully propped will stand as tall as roughly a 30-
story building at 120 meters above the ground. At 125 tons each, holding them in place is 240 cubic
meters of concerts, enough concrete for the foundation of a nine-story building. Each turbine has a
capacity to generate 49.6 megawatts. The Salkhit region, itself, has average wind speeds of 7.8
meters per second.
Source: Montsame
NAADAM CASHMERE LAUNCHES KICKSTARTER CAMPAIGN
Naadam Cashmere has announced a sale offering its Mongolian garments at wholesale prices for the
duration of its recently launched Kickstarter campaign on the website kickstarter.com, which ends
15 May.
―It‘s about more than sales,‖ said Naadam chief executive and co-founder Matthew Scanlan. ―We‘re
getting the word out about Naadam, but also telling the story of the Mongolian herders who carry
this worldwide, multimillion-dollar industry yet find themselves struggling at the mercy of
worsening local economic conditions. They benefit from every dollar we make. We make sure of it.‖
Designed in New York City and manufactured locally in Mongolia using 100 percent cashmere,
Naadam supports Mongolia‘s nomadic goat herders—the source of the majority of the world‘s finest
cashmere—by investing a portion of profits in a World Bank-sponsored program that insures the
herder‘ livestock as climate change and worsening economic conditions make it increasingly
difficult for them to support themselves.
Source: Naadam Cashmere
ARIUNAA SURI AT TOKYO FASHION WEEK
Fashion designer Ariunaa Suri made her debut at Tokyo Fashion Week, displaying her 2013
collection.
Suri showed an interesting mash up of textures and colors, the collection is a mix of street wear and
sleek urban. Tokyo is known for its unique sense of fashion and its one-step-ahead modern look is
reflected here. The range is filled with amazing drapery and the designer has done a great thing
with a lot of the looks.
Source: 2threads
MAPTEK PROVIDES EDUCATIONAL LICENSES OF MINING SOFTWARE TO MUST
Mining technology developer Maptek has provided educational licenses of Vulcan geological
modeling and mine planning software to the Mongolian University of Science and Technology (MUST)
Maptek is a reseller for the region, while Information Technology Experts LLC will conduct the
training of staff and ongoing research of fourth-year students in the School of Mining Engineering.
About 2,400 students study mine engineering at MUST, with nine different specializations offered.
Addressing guests at the launch ceremony of the Maptek Vulcan laboratory on Friday, 5 April,

7. manager of IT Experts Batchuluun Bayanmunk said the software would help prepare students for job
opportunities in the private sector as well as with state agencies. Maptek will provide 15 networked
Vulcan licenses, giving students access to open-cut and underground mine design, pit optimization
and geological applications.
Source: Maptek
MIG EXECUTIVE CHAIRMAN RESIGNS
Mongolia Investment Group Ltd. (MIG) announced the resignation of Leung Chung Tak Barry as an
executive director and as director at all MIG subsidiaries.
Leung confirmed that he had no disagreement with the board and there was no matter relating to
his resignation that needed attention brought to shareholders.
Source: Mongolia Investment Group
RUNGE MERGES WITH TWO MINING TECHNICAL FIRMS
Runge LLC has officially changed its name to RungePincockMinarco LLC.
The name change sees Runge, a mining software technology solutions firm; Pincock Allen & Holt, a
U.S. mining advisory firm; and Minarco-MineConsult, an Asian capital markets advisory firm unifying
under a single global name.
―As three of the best known leaders in our respective fields, our unification makes us the largest
independent group of mining technical experts in the world,‖ says the source.
Source: RungePincockMinarco LLC
ERDENE YEAR-END REPORT
Erdene Resource Development Corp. released its 2012 financial results and project review.
The company reported a high-grade, near-surface gold discovery at the Altan Nar project (29
meters of 4.3 grams per ton of gold) and commenced production at the Granite Hill Quarry for the
first quarter. A finalized sale of Granite Hill for USD 3.35 million was made in the second quarter,
while in the third Erdene secured a second mining license for the Zuun Mod-Khuvyn Khar project.
Also during the third quarter, Erdene completed regional metals and coal exploration. The fourth
quarter events included the sale of operating Kaolin assets for USD 923,000, an intersection of 47
meters of 1.3 grams per ton of gold on 1.3 kilometers at a step-out drill hole at Altan Nar, and the
completions of a USD 1 million placement at USD 0.17 a share.
Exploration work at the Altan Nar Gold project in 2013 expanded the discovery zone to 400 meters
in strike length with near-surface holds in the northern portion returning 27 meters of 1.79 grams
per ton of gold. Reconnaissance drilling outside the discovery zone identified multiple new targets
over a three-kilometer strike length including a substantial new gold-polymetallic zone intersected
within 50 meters of surface. Erdene is anticipating work at Altan Nar to commence in the second
quarter to additional drilling in 2013.
At the Khuvyn Khar-Zuun Mod copper-molybdenum project work was completed on a pit
optimization study that included high-level production scheduling, a review of operating and capital
costs and economic modeling. The study will be used to determine the parameters of additional
pre-feasibility level studies. Early stage surface exploration at the Altan Arrow gold project, a new
prospect, has returned significant gold and silver mineralization. Results include an average grade
from rock-chip samples over a 1 kilometer strike length of 3.5 grams per ton of gold and 60 grams
per ton of silver.
Source: Erdene Resource Development Corp.
ANGLO AMERICAN GETS S&P DOWNGRADE
Standard & Poor's (S&P) Rating Services this week downgraded its long-term corporate credit rating
on Anglo American to ―BBB‖ from ―BBB+‖ as continued high capital expenditure and volatile
conditions in the commodity sector were expected to weigh on the group's debts. Anglo American
recently opened an office in Mongolia, under the name Anglo American Development.
The ratings agency said in a statement that the diversified miner's operating cash flow would fall

8. further into the red during the 2013-2014 period than was initially forecast, on a sustained USD 7
billion expenditure.
―We consequently forecast that Anglo American's adjusted funds from operations to debt will
decline to 35 percent to 45 percent in 2013 and to 25 percent to 35 percent in 2014, under our
pricing assumptions, compared with a range of 45 percent to 50 percent that we consider
commensurate with a 'BBB+' rating,‖ S&P added
The agency rated the mining giant as stable, with no expectations of a further downgrade owing to
its strong liquidity and diversified commodity portfolio. S&P commented that the global miner may
turnaround in 2015 if management actions and higher commodity prices enabled the company to
contain debt increases during the next two years, pushing the ration of funds from operations above
45 percent.
Source: Mining Weekly
ECONOMY
MONTHLY FDI REACHES NEW LOW
The Balance of Payments statement from the Bank of Mongolia in February revealed a 51 percent
fall in foreign direct investment (FDI) year on-year.
The fall follows last January becoming the lowest income of FDI since 2010. February's USD 81
million drop, however, is the clearest indication seen so far of falling FDI.
―We don‘t know whether FDI will continue to fall or rise back again,‖ said the source. ―The recent
declines in FDI seem to have been caused mainly by political developments—last year‘s foreign
investment law, new draft Minerals Law, debate over OT—and politics, as we have said, is hard to
predict.
Source: Mongolia International Capital Corp.
BIDS TOTAL MNT 25 BILLION FOR MONGOL BANK‟S 12-WEEK BILLS
The Bank of Mongolia received MNT 25 billion in bids for 12-week government bills on behalf of the
Ministry of Finance on 10 April.
Two domestic banks submitted four bids in the auction. The Ministry of Finance accepted MNT 20
billion in bids, with winning bids ranged from 10 percent to 10.5 percent. The auction will settle on
Monday, 15 April. Bills will be held in the names of the purchasers at the Securities Clearing House
and Central Depository.
A previous auction by the Central Bank for 12-week bills on 27 March had the winning bids ranging
from 9.89 percent to 10.2 percent.
Source: Ministry of Finance
BELARUS TO ESTABLISH TECHNOPARK IN MONGOLIA
Industry and Agriculture Minister Khaltmaa Battulga met with Belarusian Industry Minister Dmitry
Katerinich to discuss the possibility of establishing a technopark for Belarusian mechanical
engineering products in Mongolia.
The two ministers met on 10 April in Minsk, where they discussed the possibility of opening a park
to enable service and maintenance of the Belarusian agricultural machines sold to Mongolia. They
said they intend to sign an investment contract on the matter. Belarus‘s Minsk Tractor Works,
Gomselmash, Bobruiskagromash, and Lidselmash have expressed interest in the project, while
Mongolia is prepared to begin proposing the idea to Mongolian firms.
Battulga said Belarus tractors are well known to Mongolia, as they were used in the 1950s to
develop their lands. Currently Mongolia buys tractors from several foreign companies, including
some from China, but Mongolian customers have expressed dissatisfaction with the quality of
machines in Mongolia. Mongolia would be interested in purchasing small-capacity tractors for its
agriculture, said Battulga.
OAO BelAZ is currently Mongolia‘s largest supplier of tractors, shipping 34 mine dump trucks to

9. Mongolia last year. Belarus shipped USD 24 million worth of merchandise to Mongolia in 2012. In
January and February this year, shipments reached 15.3 million, 25 percent up from the year-ago
period. BelAZ plans to set up a sales center for its dump tricks with a Mongolian partner in
September 2013. The Mongolian delegation also invited MAZ to participate in tender bids as its
buses were well suited to Mongolia‘s climate.
Source: Belarusian Telegraph Agency
UB TO INSTALL NEW TRAFFIC SIGNS
The Ulaanbaatar Auto Road Office has allotted MNT 1 billion to post new traffic signs on the streets
of Ulaanbaatar.
The Ministry of Roads and Traffic, General Agency for Specialized Inspection, and Korea‘s KCC
Group and BSMG jointly organized a seminar about proper sign placement and design. At the
seminar experts explained the importance of using the right standards for color and type, and how
the signs can affect a city‘s appearance.
Source: Unuudur
TURKISH PREMIER TO UNVEIL RENOVATED STREET
Turkish Prime Minister Tayyip Erdogan will attend an opening ceremony for the newly renovated
Ankara Street on 12 April.
Ulaanbaatar used Turkish financing for the street that runs from State Bank to the University of
Culture in Triangulate. Renovation took place on some 2.8 hectares of roads, costing a sum of USD
700,000. Other construction includes green spaces, pedestrian walk paths, a fountain, and street
lights.
Source: Undesnii Shuudan
MONGOLIAN AUTO DEALERS SELL IN KAZAKHSTAN FOR HIGHER REWARDS
Black market auto traders have begun selling old cars to Kazakhstan where they are more valuable
than the market here.
The traders from the Da Khuree market have reportedly started traveling to Astana, Kazakhstan via
Bayan-Ulgii Aimag to sell their cars. They say they earn more for their cars there because cars are
more expensive there in general.
According to a website at Kolesa.kz, a used 1997 Toyota Carina can sell for MNT 13.4 million in
Astana compared with MNT 5 million in Mongolia. A used 2008 Toyota Corolla sells for about MNT 30
million compared with MNT 18 million to MNT 20 million.
Source: Unuudur
MONGOLIA SCOLDS RIO ON COSTS AS MINE RICHES REPLACE GERS
Few things matter more today in the political and economic life of Mongolia than foreign
investment to develop its mineral wealth. Mining money has spawned gleaming office towers, pricey
gated communities and luxury-car dealerships in the capital. And yet, half of all Mongolians still live
like their nomadic ancestors in gers.
About 30 percent of the population lived in poverty in Mongolia in 2011, although that was an
improvement from 40 percent in 2010, before the start of payouts funded by mine proceeds.
Mongolia‘s gross domestic product expanded 12.3 percent last year to USD 10 billion. Economists
expect 15 percent growth this year. Oyu Tolgoi will be the largest contributor to the economy once
it is fully operational. With fees, royalties and the government stake, as much as 71 percent of
profits will go to Mongolians, the International Monetary Fund estimates.
―There is scope for Mongolia to vastly develop if it gets everything right,‖ said Vidur Jain, a
strategist at Monet Capital.
Instead of basking in new mineral riches, Elbegdorj is sparring with Rio Tinto. He complains that the
Oyu Tolgoi project is over budget, it should have paid taxes last year and needs greater financial
transparency. Rio Tinto PLC, through its Oyu Tolgoi unit, said it has pre-paid taxes and was not
obligated to make payments in 2012. The company said phase one construction costs are on budget,

10. at 6.2 billion, and in line with estimates it gave the government in December 2010. ―We have
always been fully transparent with all our shareholders regarding our project finances, costs and
operations,‖ Oyu Tolgoi chief executive Cameron McRae said in a 7 February statement.
Mongolia may already be paying a price for its toughening stand. After jumping 139 percent in 2010
and 47 percent in 2011, the tiny Mongolian Stock Exchange‘s Top 20 Index tumbled 19 percent last
year. It has fallen 15 percent this year, shrinking its market capitalization to MNT 768 billion as of 8
April.
For now, though, Elbegdorj is consumed by a presidential election in June, and he‘s betting that
playing hardball with mining companies will be a vote winner. He may be right.
Source: Bloomberg
MONGOL BANK CUTS INTEREST RATES FOR SECOND TIME THIS YEAR
Mongolia's Central Bank cut interest rates for a second time this year to bolster economic growth as
inflation eases and foreign investment falls.
The Bank of Mongolia reduced its policy rate to 11.5 percent from the previous 12.5 percent
effective 8 April, according to a statement posted to its website today. The cut is aimed at
increasing domestic credit and investments and simulating business activities, it said.
Mongolia in January cut interest rates for the first time since 2009 after economic expansion
moderated to 12.3 percent last year from a record 17.3 percent in 2011 and foreign investment fell
17 percent. Growth slowed as the price of coal, Mongolia's biggest export, declined and the
government introduced more controls of foreign ownership of mining assets.
A deceleration in the face of inflation over the last four months and the monetary authority's
estimate for further slowing was the main reason for the cut, Sandagdorj Bold, the Central Bank's
chief economist, said in an interview in Ulaanbaatar today. Mongolian trade and foreign investment
were also factors in the decision, he said.
―We are concerned about the FDI [foreign direct investment] and foreign trade environment.‖
Inflation eased to 11.3 percent at the end of February from 14 percent at the end of December,
Bold said. The Central Bank expects the pace to fall further this month, he said.
―In upcoming months we think we will see downward inflation,‖ Bold said. ―So it's consistent with
our target of 8 percent inflation by the end of the year.
Source: Bloomberg
NEMA ON ALERT FOR HEAVY SNOWFALL
The National Emergency Management Agency (NEMA) said that residents in seven counties in four
different provinces reported harsh spring weather conditions and heavy snowfall.
NEMA said reports came from Selenge, Dornod, Zavkhan, and Tuv Aimags. Snow depth was
reportedly between 20 and 33 centimeters in some places, with snow piling as high as 60
centimeters in some remote areas. NEMA said these areas were being given emergency attention.
NEMA also named a number of towns in Selenge and Tuv Aimags where snow depths reached
between 10 and 19 centimeters of snow cover.
Source: News.mn
MONGOLIAN OFFICIALS LOOK TO WESTERN MONTANA WILDLIFE CROSSINGS AS MODEL
A Mongolian delegation toured a wildlife crossing in Montana, United States with the Wildlife
Conservation Society (WCS).
The tour comes as Mongolia prepares to build an expansive transportation network to serve the Oyu
Tolgoi copper-gold mine, modeling it after the wildlife crossing in Montana, along a highway and a
railroad cutting Abo Canyon in New Mexico. The activity was funded by the U.S. Agency for
International Development (USAID) and the Trust for Mutual Understanding,
―We're trying to minimize the impact of mining and other development, said Buya Tulga,
representing the Ministry of Environment and Green Development. ―It's why we're studying here. We
chose Montana because these are good examples of how to [enhance] the wildlife movement
alongside the road.‖

11. Tulga expressed concern that as development races forward in Mongolia, habitat will be fragmented
and the region's endangered species could be lost. Much of the development is taking place south in
the Gobi Desert and Mongolia's eastern steppe. The new Ulaanbaatar-Beijing railway may further
bisect the region's prized habitat, jeopardizing the migration of several threatened species.
But Mongolia is rich in both resources as well as wildlife, with animals found nowhere else on the
planet. That includes the Bactrian camel, the Gobi bear, the Goitered gazelle, the Saiga antelope
and Asiatic ass, among others. Many of the species are considered threatened or critically
endangered. If development takes place with no mind to habitat, some fear the species could be
lost forever.
Kina Murphy, program director in Mongolia for the WCS, believes the nations competing interests
have a rare opportunity to come together and mitigate the impacts of development before they
arise, noting that the government officials were accompanied by representatives of the Oyu Tolgoi
copper mine.
Source: The Missoulian
UNIVERSITY OF QUEENSLAND GROUP TO STUDY MINING IMPACT ON HERDERS
The University of Queensland‘s Sustainable Minerals Institute (SMI) has received the Australian
Development Research Award Scheme grant to conduct research into building the capacity of the
Mongolian government and civil society to react and engage with responsible mining practices and
promote sustainable livelihoods of herder societies.
Mongolia‘s mining boom is threatening the sustainability of herder livelihoods through social
changes stimulated directly and indirectly by ecological impacts. The research examines both the
social and ecological impacts of mining from a gender perspective to understand how mining affects
both herder livelihoods and their dependent natural resources. This project aims to establish the
changing role of herder households due to the impacts of mining and draft safeguards for
government to promote sustainable development in mine-affected areas.
A collaborative engagement between social scientists at the University of Queensland's Centre for
Social Responsibility in Mining and Australian National University with scientists from the Centre for
Mined Land and Rehabilitation and the Centre for Water in the Minerals Industry will measure both
the ecological and social impacts of mining to provide comprehensive data to inform the
development policy. This continues SMI‘s enhanced focus on providing effective multi-disciplinary
solutions to the sustainability problems facing the global mining industry.
―Frequently social and ecological impacts of mining are researched exclusively, when the two are
often interlinked and overlap,‖ said project manager Isabel Cane. ―Approaching the problems faced
by herders from a cross-disciplinary method allows us to examine and explain the impacts more
conclusively and hopefully produce succinct safeguards for improved outcomes for women and men
in Mongolia.‖
The research will be conducted with partnered non-government organizations and academic
institutions in Mongolia.
Source: University of Queensland
SAVE THE CHILDREN FINDS WORRYING TRENDS
Save the Children released three assessment reports on Reliefweb last week highlighting a variety
of chronic issues for marginal herder households and their children in Mongolia.
The documents report that a substantial portion of herder households are becoming increasingly
vulnerable to recurrent natural disasters and are facing a progressive deterioration of their
livelihoods. While one of the main drivers of rising vulnerability are natural phenomena such as
drought or harsh winters, the agency points out that other systematic issues within the livestock
sector are also contributing to reduced livestock holdings for the poorest households.
The first report gives a detailed picture of who in Mongolia is most vulnerable to a dzud—a
particularly harsh winter season characterized by extreme low temperatures and heavy
precipitation. The second report assesses findings on protection issues children face at home,
school, and communities during a dzud. It also provides recommendations for both short-term and

12. long-term measures to strengthen the child protection services in the context of a dzud in rural
Mongolia.
The last report provides new analysis of issues surrounding rural-to-urban migration from the point
of view of pastoralist drop-outs as well as details to their level of food security and livelihoods in
their households.
Source: Reliefweb
RENEWED INVESTMENT TO DRIVE GOLD PRICE TO OVER USD1,800/OZ BY YEAR-END
The price of gold will rise to over USD1,800 an ounce by the end of the year on the back of
economic developments in the United States and a recovering global market, the Thomson Reuters
GFMS Gold Survey 2013 showed. Gold in a major mineral commodity produced in Mongolia.
Head of the consultancy previous metals research and forecast vision Neil Meader doubted that the
ongoing debate in the U.S. relating to budget cuts and the further raising of the debt ceiling would
be resolved in the near term, which would underpin the gold price this year.
―Gold is likely to remain very sensitive to U.S. monetary policy and, even though we've had some
hawkish noise from some within the Fed, it is difficult to see a material unwinding of the
quantitative easing program until well into 2014, which should bolster the gold price in 2013,‖ he
commented.
The report indicated that events in Europe would further augment the price of the yellow metal,
citing a significant potential for gold-friendly shocks as evidenced by the price uplift seen in mid-
March on the back of the economic volatility in Cyprus. Additional positive factors included the
maintenance of a low interest-rate environment and some investor's fears over the potential for the
resurgence of inflation.
Factors contributing to the slightly restrained investment environment in 2012 included the
relatively strong U.S. dollar and the loss of upward momentum in the gold price. However, support
continued from many investors remaining wary of conventional assets and through the persistence
of negative real short-term interesting rates in many countries. Investors were also encouraged by
the continuing vigor of demand from the official sector, which reached a 48-year high in 2012 as a
broad base of central banks, including Mongolia, expanded gold holdings against a backdrop of near
absence by Central Bank Gold Agreement signatories.
Source: Mining Weekly
POLITICS
PRESIDENTIAL ELECTION SCHEDULED ON 26 JULY
The General Election Committee (GEC) has scheduled the presidential election for 26 June.
The Standing Committee on State Structure held a meeting to discuss the issue on 9 April. It was
then that the GEC chairman proposed the date June 26.
One MP, R. Burmaa, criticized the budget allotment, saying it was increased without any basis.
According to the Standing Committee, total election expenditure is set at MNT 17.2 billion, of
which, MNT 392 million will be spent for the parliamentary re-election and MNT 91 million for
media observation.
Source: News.mn, Undesnii Shuudan
SWISS ACCOUNT HAD NO BEARING ON OT AGREEMENT, SAYS BAYARTSOGT
Parliament Deputy Speaker S. Bayartsogt said a Swiss bank account he hid from government
authorities created no conflict of interest when drafting the Oyu Tolgoi investment agreement,
saying that it had ―nothing to do with it‖.
Bayartsogt gave a formal apology for having an undisclosed bank account that U.K. newspaper The
Guardian reported held as much as USD 1 million at one point. He said it was attached to a
company called Legend Plus Capital Ltd. that he established before he was confirmed as minister of
finance.

13. ―You noticed that the time when the company was established, it was unclear that I would be
appointed as minister of finance. It means it was before the OT agreement process. I was appointed
as minister in October 2008. Afterwards, I began to participate in the agreement process beginning
from July 2009.
Bayartsogt spoke in favor of the so-called ―Government of Reform's‖ anti-corruption agenda. He
admitted he was just as responsible for reporting his assets as any other official.
―[I] made a mistake. I should have registered my company in my income report. He added,
―However, I think I should be charged ethically.‖
Source: Undesnii Shuudan
ECONOMIC DEVELOPMENT DEPUTY MINISTER PLEADS FOR CONSENSUS ON RETURN OF FDI
Economic Development Deputy Minister Ochirbat Chuluunbat pointed to Mongolia's flagging
reputation among investors as a key trigger to the fall in foreign direct investment in Mongolia.
Chuluunbat cited the Strategic Entities Foreign Investment Law (SEFIL) as well as disputes with Oyu
Tolgoi and Chalco as key issues that have raised concerns among investors in Mongolia. He noted
that investors such as Rio Tinto PLC are free to move their operation to locations such as Myanmar,
Mozambique, Mexico, and Bolivia. To encourage an investor to open up operations and maintain
them for five or more years, they would need stable legal and tax conditions.
―It is high time to revise our FDI conditions and its legal environment. It does not mean spending
extravagantly as happened in 1997. Today we are discussing the fact that the entities that have
special permissions to use our wealth have to pay the country, to transfer the licenses to those who
have money, and for professionals.‖
Chuluunbat said amending SEFIL was a step in the right direction, explaining it was important that
the law does not look to be charged against foreign investors. As for the Oyu Tolgoi investment
agreement, he said the operations should be allowed to run for two to three years before any quick
judgments be made.
―The managers who lead OT are also clever and understand that they have to share the country's
wealth with its citizens as they utilize the wealth.‖
He took the Boroo Gold project, owned by the Centerra Gold, as an example: Following the logic of
many politicians, he said, the investment agreement there was terrible because the foreign investor
owned the project 100 percent. Yet, in the 10 years of operation there, Boroo has exploited MNT 1
trillion worth of gold, of which 60 percent was direct to the Mongolian government. He noted that
MIAT Mongolian Airlines, Erdenes Tavan Tolgoi and Erdenet Mining Co. had suffered from poor
management and corruption, all the while under complete government control.
Source: Business-Mongolia.com
MPP PROTESTS SHORTEN OPENING SESSION OF PARLIAMENT
The opening day of Parliament's spring session was cut short due to a protest held by the Mongolian
People's Party (MPP).
The first issue open for discussion was the presidential election to be held this year, followed by
the Strategic Entities Foreign Investment Law (SEFIL). However, the morning session was canceled
when MPP took up picket signs in protest rather than appear for roll call, with 79.9 percent
attendance in the session. MPP members said they were dissatisfied with Government Action Plan
and said that freedoms of the press and democracy had suffered since the entrance of the so-called
Government of Reform, led by the Democratic Party (DP).
―The Democratic Party Parliament is proof that national security is in chaos,‖ said a statement from
MPP members.
Protesters also voiced criticism of President Tsakhia Elbegdorj, who cut his opening speech short
after MPP members left the meeting hall. Ts. Elbegdorj also criticized Foreign Minister G
Zandanshatar, demanding his resignation.
Source: Info Mongolia

14. ECONOMIC DEVELOPMENT MINISTRY RUMORED TO BE DRAFTING BILL TO REPLACE SEFIL
While investors await a decision from Parliament on the announced revisions to the Strategic
Entities Foreign Investment Law (SEFIL), the Ministry of Economic Development is reportedly
already in development of a new law to replace it.
The source reported that knowledgeable informants said that the ministry is preparing new
legislation that will govern all investment into the country. Although the bill had not yet been
revealed to the source, it said it was told the legislation ―strongly embraces free-market principles‖
and would allow greater access for foreign investment than previous laws passed.
Source: Mongolia Investment Banking Group
PREMIER RETURNS SAFELY TO UB AFTER PERILOUS HIKE
Prime Minister N. Altankhuyag returned safely to Ulaanbaatar on Monday after he became lost in a
snowstorm while hiking last weekend.
The prime minister made the journey up Mount Bukhan Khaldun in Khentii Aimag on Sunday, 7 April
along with 70 others. The prime minister was scheduled to return to camp on Sunday, but was
prevented by a snow storm that day. Those at camp called in emergency officials when Altankhuyag
and his companions did not show up and communication was lost. Also lost in the storm was Cabinet
Minister Ch. Saikhanbileg.
President Ts. Elbegdorj called in a rescue team from the National Emergency Management Agency
(NEMA). The premier and a second group of hikers were located at two separate locations later that
day. By Monday morning a helicopter began transporting members in groups, with Altankhuyag
leading one of the two groups. Afterwards the prime minister received treatment at the Second
General Hospital of Ulaanbaatar.
Source: Info Mongolia
GOVERNMENT BANS SWINE AND POULTRY IMPORTS FOLLOWING BIRD FLU EPIDEMIC
The State Specialized Inspection Agency (SSIA) has put a ban on the import of chicken and swine
products following a warning from the World Health Organization about a deadly outbreak of a new
kind of bird flu.
This variant of the bird flu, called H7N9, has already infected 16 people and killed six in China. The
SSIA has cautioned the Ulaanbaatar Specialized Inspection Office and provincial officials to be
aware of a possible outbreak and to prepare for any possibility that they may have to contain one.
The ban on imports has officials inspecting all vehicles crossing Mongolia's borders, starting from 5
April.
Source: News.mn
XI CALLS FOR BOOSTED COOPERATION
China and Mongolia should take the chance to beef up cooperation as well as strategic mutual trust,
President Xi Jinping told visiting Parliament Speaker Zandaakhuu Enkhbold on Sunday.
The bilateral relationship is an important direction for China's diplomacy with its neighbors, Xi said
on the sidelines of the Boao Forum for Asian Annual Conference 2013. Xi told Enkhbold that both
sides should ―show respect on major issues including sovereignty, security and territorial integrity,
and they should take care of ―each other's concerns.‖ He suggested the each support one another's
infrastructure development and cooperate financially. He also said China would aid Mongolia in
mineral processing, the development of energy sources, and agriculture.
The speaker said he expected bilateral cooperation to expand in trade as well as the energy and
minerals sectors. He added that Parliament was ―willing to provide legal support.‖ Enkhbold also
said in an interview with China Daily that the economy was a driving force in the China-Mongolia
relationship.
―It is the highest level of cooperation Mongolia has so far reached with a foreign country,‖ said
Enkhbold.
Statistics shows that bilateral trade in 2012 reached USD 6.6 billion and Mongolian exports to China
amounted to around 3.9 billion, about 70 percent of Mongolia's total exports, according to the

15. Chinese embassy in Mongolia. Ulaanbaatar stresses the importance of infrastructure as well as
provided added value to its mineral products.
―Given the geographic proximity of the two countries, each and every sector is full of opportunities
to explore,‖ he said; adding that tourism is among those areas in which greater bilateral
cooperation is expected to occur.
Source: China Daily
CHINA, MONGOLIA DISCUSS COOPERATION IN PROTECTING CULTURAL HERITAGE
Chinese and Mongolian representatives concluded on Tuesday a meeting aimed at strengthening
bilateral cooperation in protecting intangible cultural heritage.
During the meeting, which opened Monday, the two sides reviewed the achievements made so far in
this regard and discussed future cooperation programs. The two neighboring countries share a rich
diversity of intangible cultural heritages and have maintained good long-term cooperation in
protecting them.
China and Mongolia are both state parties to the Convention for the Safeguarding of the Intangible
Cultural Heritage, a treaty adopted in 2003 at a general conference of the U.N. Education,
Scientific and Cultural Organization (UNESCO).
Source: Xinhuanet
CABINET MINISTER TALKS OF MONGOLIAN-U.S. COOPERATION IN MINERALS SECTOR
Cabinet Minister Chimed Saikhanbileg spoke in favor of having Peabody Energy Corp. collaborate in
the Tavan Tolgoi West Tsankhi coal field during a meeting with Francisco Sanchez of the U.S.
Department of Commerce.
Saikhanbileg received Sanchez, the Under Secretary of Commerce for International Trade, to
discuss mutual cooperation for trade and their countries' respective economies. The cabinet
minister noted that the United States has been an important trade partner to Mongolia since its
transition to a market economy and democracy, and proposed strengthened bilateral ties in these
areas. This included proposals for cooperation in shale exploration and exploitation for shale oil and
an interest in having Peabody Energy cooperate in the development of West Tsankhi.
Sanchez said he was pleased to learn that Parliament was moving to ease restrictions laid out by
the Strategic Entities Foreign Investment Law and that he hoped this would help broaden their
economic partnerships.
Source: Info Mongolia
CIVIL ORGANIZATION DEMANDS OT BOARD RESIGNATIONS
A civil organization is demanding the resignation of the Mongolian board members at Oyu Tolgoi
LLC. The board of directors are N. Bagabandi, a former president of Mongolia, Puntsag Tsagaan, a
former minister of finance, Ch. Ganbold, a singer, and G. Batsukh, a former ambassador to Canada.
B. Tserendorj, head of the Center for Preventing Citizens from Social Violence, and B. Amarsanaa,
director of the Chingunjav Center Fund, and L. Lkhagvasuren, a resident of Sukhbaatar district,
made an official statement demanding their resignation, saying they had failed to represent
Mongolian society.
―Authorities signed the agreement without having asked the people,‖ said L. Lkhagvasuren, resident
in Sukhbaatar district. ―However, now it has become clear that the agreement is not a good one.
They have even admitted to this mistake.‖
Source: Undesnii Shuudan
MONGOLIANS HOPEFUL FOR A LESS CORRUPT SOCIETY
Despite Mongolia's display of commitment to combat corruption, it remains an area of great
concern, and, according to a new survey released on 3 April by the Source, a significant threat to
the quality of governance.
The ―Survey on the Perceptions and Knowledge of Corruption‖ (SPEAK), conducted in partnership
with the Sant Maral Foundation, surveyed 1,360 households in seven districts of Ulaanbaatar and 21

16. counties of six provinces, representing four regions of Mongolia. The survey measured corruption
levels in Mongolia by capturing data on public perceptions and grand corruption, institutional
behaviors, as well as people's actual experience with corruption at the household level.
Importantly, the survey for the first time included questions on grand corruption, and builds on
earlier benchmarking studies started by the foundation in 2006 and conducted 11 times since then.
According to the survey findings, while 89 percent of the respondents say corruption is a common
occurrence in the country, corruption has clearly declined as a matter of concern among
respondents. Back in 2006, 29 percent of respondents ranked corruption as one of the top concerns,
making it the second most important issue, while in 2012 just 8 percent did, making it the fifth
most important concern after unemployment, poverty, ecological degeneration, and inflation. The
majority of respondents said that using official positions to collect gifts or money and help friends
or relatives are the most common types of corruption, yet 28 percent of respondents said these acts
did not constitute corruption, despite the practice being prohibited by the new law on elections.
Respondents said ―land and property‖ and ―mining‖ were the two most corrupt sectors. Findings
showed citizens have more confidence in the Independent Agency Against Corruption (IAAC), with
60 percent saying they would report a corruption case if their identities were kept anonymous while
17 percent would do so regardless. But only 29 percent of respondents were aware of the IAAC's
anti-corruption telephone barrier.
Based on the respondents' reported experience, it seems that fewer people are now paying bribes.
However, the average size of a bribe has increased from MNT 136,000 in 2006 to MNT 391,000 in
2012.
Source: Asia Foundation
MYSTERIOUS MAIL TRIGGERS GLOBAL TAX HAVEN EXPOSE
It all began when Australian journalist Gerard Ryle received a mysterious package in the post that
the leak revealing a trove of names identified with offshore accounts, including Deputy Speaker
Sangajav Bayartsogt, reached the public,
The former Fairfax Media investigative reporter was busy trying to unravel the details of a large
financial fraud in Australia when a hard drive—with the details of 2.5 million digital files—appeared.
The drive was a treasure trove of Wikileaks-style proportions that shed light on the often murky
world of offshore tax havens—where millions of dollars are stashed in secret accounts—and would
yield information on 120,000 offshore companies and nearly 130,000 individuals.
But Ryle who later moved to head the International Consortium of Investigative Journalists (ICIJ) did
not know that yet.
―My instinct told me it was big, but you do not know,‖ Ryle said. Technical impediments also
frustrated the early attempts to pore over the information he received.
The ICIJ coordinated a 15-month long probe that involved 86 investigative journalists in 46 countries
to compile a series of reports it began releasing around the world this week, using a strategy similar
to that used by WikiLeaks when it released hundreds of thousands of diplomatic cables in 2010. So
far, the revelations have made waves in several countries, causing embarrassment to French
President Francois Hollande's former campaign treasurer Jean-Jacques Augier as well as the family
of the former president of Azerbaijan. One of Mongolia's most senior politicians, former finance
minister Bayartsogt, told the ICIJ he was considering resigning after the study claimed he had set up
an offshore entity and a secret Swiss bank account which at one point contained more than USD 1
million.
―I shouldn't have opened that account. I should have included the company in my declarations,‖ he
said. ―I should probably consider resigning from my position.‖
Source: Sydney Morning Herald
MONGOLIA'S ROLE IN 2013 COMMUNITY OF DEMOCRACIES MINISTERIAL MEETING
Later this month, Mongolia will host the seventh ministerial conference of the Community of
Democracies, an intergovernmental forum of democracies. The April 2013 conference in
Ulaanbaatar will be an occasion for the group to further reinvigorate its agenda.

17. Mongolia, which currently holds the presidency of the Community of Democracies, offers a number
of lessons to offer that could contribute to the organization's re-commitment to its objectives,
especially emphasis on the interdependence between poverty, development and democracy. The
case of Mongolia on poverty and democracy is instructive. The country started transitioning to
democracy over twenty years ago and, for almost as long, the rate of poverty has stood at 30
percent and above. Corruption, on the other had has continued to increase. The implications were
grave: most reforms stalled, vote buying became a serious concern, and public trust in the
institutions of democracy was shaken.
The lesson to be drawn from this experience is that, early on in the transition process, new
democracies should put economic liberty and transparency on a par with other democratic values
such as regular elections, rule of law, human rights, freedom of association and freedom of speech.
Early on, the Community of Democracies realized that democracy cannot be sustained without
persistent efforts to eliminate extreme poverty and, vice versa, that the strengthening of
democratic governance was ―an essential component‖ of the efforts to alleviate poverty. Poverty is
as much a threat to a democracy as poor institutions in that it deprives people of their political
voice preventing them from holding their government accountable and eroding public trust in those
institutions.
After years of stalled reformed it appears that Mongolia's government is now more willing to tackle
its governance issues. It has laid out its plans to reform the civil service, judiciary and police, the
institutions most frequently cited as corrupt. Wider policy deliberation and citizen participation are
encouraged. If sustained, reform should improve government effectiveness and create an enabling
governance environment for focusing on poverty eradication. The country's significant extractive
wealth will also need exemplary management so that its benefits go to the entire population in an
equitable way.
Source: Brookings Institute
NORTH KOREA WARNS IT IS ON BRINK OF NUCLEAR WAR WITH SOUTH
As North Korea warned foreigners on Tuesday that they might want to leave South Korea because
the peninsula was on the brink of nuclear war—a statement that analysts dismissed as hyperbole—
the American commander in the Pacific expressed worries that the North's young leader, Kim Jong-
un, might not have left himself an easy exist to reduce tensions. South Korea has the largest
population of immigrant Mongolians in the world.
―His father and his grandfather, as far as I can see, always figured into their provocation cycle an
'off ramp,'‖ the commander Adm. Samuel Locklear, said during testimony before the Senate Armed
Services Committee. ―And it's not clear to me that he has thought how to get out of it. And so that's
what makes this scenario, I think, particularly challenging.‖
At the core of the concern within the administration and intelligence agencies is that they do not
understand Kim's motivations. His father and grandfather suggested, at times, they might be willing
to negotiate to end their nuclear program. But Kim arrived in power with a small nuclear arsenal,
and he may be calculating that with those potential weapons in hand, he is less vulnerable to
attack.
Experts saw the new threat as part of what they have begun referring to as ―psychological
warfare,‖ meant to force concessions from Washington and Seoul. In recent days, analysts say,
those threats have appeared designed specifically to cause jitters among businesses and investors in
South Korea, perhaps reflecting a calculation that South Korean President Park Geun-hye might be
unable to stand as firm if her country's already weakened economy is seriously threatened.
The North's warning followed a similar advisory last week in which it told foreign embassies in the
North Korean capital, Pyongyang, to devise evacuation plans. And it came a day after the North said
it was temporarily suspending operations at a joint North and South Korean industrial park; the
South had previously assuaged investors' fears about possible hostilities by saying the operations at
the factories were continuing despite the North's belligerent stance.
Source: New York Times

18. ANNOUNCEMENT
MONGOLIA INVESTMENT SUMMIT 2013, APRIL 16-18, LONDON
Business Council of Mongolia members are invited to attend the Mongolia Investment Summit
London 2013 and receive a 15 percent discount on their registration fee. This is your last chance to
register and meet investors, Mongolian businesses and government officials.
The Mongolian investment climate has received some positive news in recent weeks. The draft
minerals law has been deferred and the foreign investment law is up for amendment.
A boom is thought to be on the horizon with the potential for huge growth in sectors like mining,
real estate and capital markets. The Mongolia Investment Summit London is attracting nearly 300
registered delegates involved in this fast growing market.
The event provides an excellent opportunity to meet with major investors, mining groups,
government officials and real estate specialists to identify new business partners. At the event, the
views on the country will be discussed by investors from companies such as Barclays Natural
Resource Investments, HSBC Global Asset Management, Collabrium Capital and more. The event
provides an opportunity not to be missed.
Enter the discount code ―Business-Council-Mongolia-Special‖ when you register to receive the early
bird discount plus an additional 15 percent off.
___________________________________________
FOREIGN INVESTMENT IN MONGOLIA CONFERENCE, APRIL 19, UB
BCM and UB Risk Management Consulting (headed by Dr. Khashchuluun, former Chair of NDIC) are
organizing a "Foreign Investment in Mongolia: Challenges, Risks and Solutions" conference on April
19, 2013 at the Kempinski Hotel.
As we know, Mongolian economy has been rapidly growing with 17.5% in 2012 and 12.3% growth in
2013. During 2010-2012, foreign investment in Mongolia increased at a rapid speed, contributing
significantly to economic growth, creating more jobs and financing various projects in the country.
However, the OT copper gold project, long a cornerstone of Mongolia‘s increased FDI, is almost
completed. The timing of other potentially large FDI projects such as PPP power stations and the TT
project are not clear. The result could be that inflows into Mongolia may not grow as much as in
previous years.
Speakers include:
- I. Ser-Od, Vice Director, Business Council of Mongolia
- S. Bold, Chief Economist, Central Bank
- S. Javkhlanbaatar, Foreign Investment Regulations and Registration Department Head, Ministry of
Economic –
Development of Mongolia
- B. Amarsanaa, Academic Secretary of National Legal Institute
- D. Gan-Ochir, Head of Financial Stability Council, Advisor to President of Central Bank
- D. Achit-Erdene, CEO, MICC
- Dr. Ch. Khashchuluun, Director of UBRM Consulting, professor of the Economic School of the
Mongolian National University
Attached is the Agenda of the event. FREE registration, please contact tugi@bcmongolia.org,
317027.
___________________________________________
3RD RISK MANAGEMENT FORUM, 1 MAY, ULAANBAATAR
The 3rd Risk Management Forum of Mongolia will be held on 1 May 2013 in Ulaanbaatar at the Blue
Sky Tower.
This is the largest risk event in Mongolia, co-organized by the Business Council of Mongolia and

19. Mandal General Insurance. The Risk Forum will provide the most comprehensive overview of risks
that Mongolia faces today and the status of risk management all under one roof. Risk management
techniques and tools will be shared and best practices promoted across industries.
Last year, the event had attracted over 250 representatives of Mongolia's top corporations and
government agencies and resulted in the formation of Risk Institute of Mongolia. This year, the
expert speakers will be address topics concerning Macro Risks, Business Risks, and Community Risks.
For more information, visit RiskForum.mn.
___________________________________________
2nd MONGOLIA TRADE & COMMODITY FINANCE CONFERENCE, 14 MAY, ULAANBAATAR
Exporta's second Mongolia Trade & Commodity Finance Conference will be held at the Chinggis Khan
Hotel in Ulaanbaatar on 14 May. The Business Council of Mongolia (BCM) is acting as an institutional
partner for the event and has negotiated a 15 percent discount for its members to attend.
The Mongolia Trade & Commodity Finance Conference is the only specifically organized event for
the Mongolian trade and commodity finance community. It provides an unrivaled platform for
discussion and networking for leading local businesses and institutions, as well as those
international practitioners looking to tap into the huge potential of this rapidly developing market.
Speakers include Chuluunbat Orchirbat, vice minister of the Ministry of Economic Development,
Battsengel Gotov, chief executive of Mongolian Mining Corp., and Jim Dwyer, executive director of
BCM.
To receive the discount quote BCM15 when booking. Click here for more information and booking.
___________________________________________
COAL PROCESSING & MINING TECHNOLOGY EXPO, 4-5 JUNE, ULAANBAATAR
The Coal Processing & Mining Technology Expo will be held in Ulaanbaatar from 4 to 5 June 2013.
The expo is co-located with the Transportation & Logistics Expo, and because of this co-location you
will be able to meet with a more diverse and broader group of attendees. With many international
as well as local Mongolian companies already signed up to exhibit, you will be a part of what is
becoming the premier event for the mining and transportation industries serving Mongolia.
BCM members will receive a special 10 percent discount. To register and receive your discount
email Saruul at saruul@bcmongolia.org. For more information about the exhibition, contact Glenn
Scott atgscott@uexpos.com or visit the website coalexpomongolia.com.
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FUTURE MONGOLIA, 19-22 JUNE, ULAANBAATAR
The Future Mongolia international trade fair will be held at the Buyant Ukhaa Sport Palace in
Ulaanbaatar, near the Chinggis Khaan International Airport, from 19 to 22 June, 2013.
After the successful premier with nearly 100 exhibitors from 14 nations and some 4,200 visitors, we
cordially invite you to the second Future Mongolia. This international trade fair offers the
opportunity on an enlarged exhibition space to present modern and sustainable solutions and
responses to the present needs of Mongolia and its population.
BCM members will get 5% discount on raw space. Please contact Saruul at
saruul@bcmongolia.org to get a special discount code. For more information, visit Future-
Mongolia.com.
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COALTRANS MONGOLIA, BLUE SKY, 25-26 JUNE, ULAANBAATAR
The Coaltrans Mongolia conference will be held at the Blue Sky Tower from 25 to 26 June. BCM
members will receive a 15% discount to attend the event, please use the discount code BCM.
Coaltrans Mongolia will explore the development of coal projects in the country and offer an insight
into what level of influence Mongolia will have over future international coal prices. Join us on the
25th and 26th of June 2013, as we return to this exciting market for the third year, to have an
impact on how this new coal frontier evolves and cement your position as a leading player in the

20. market.
Speakers will include Batsuuri Yaichil, Chief Executive Officer of Erdenes Tavan Tolgoi LLC, Graeme
Hancock, President and Chief Representative of Anglo American Development, and Bayanjargal
Byambasaikhan, Chairman of the Business Council of Mongolia.
For more information, email coaltrans@euromoneyplc.com.
___________________________________________
“MM TODAY” on MNB-TV, Friday, 18:50-19:00
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 18:50 to 19:00 tonight. Tune in to watch this program that reports stories from
today‘s BCM NewsWire.
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BCM‟S MINING SUPPLY CHAIN DATABASE
The new version of BCM‘s Mining Supply Chain Database is in use. Following the initiative of Oyu
Tolgoi LLC, the BCM has maintained the Mining Supply Chain Database since March 2009. It is an
honor to introduce you to the new version of the database which is totally upgraded as to its
content and use of information technology opportunities.
As of December 31, suppliers registered on the database totaled 1,405. During 2012, 251 new
supplier entities joined the Database and 236 prior supplier registrants updated their company
profiles. In addition, 22 buyers were also registered and 82 tender announcements were posted.
We are inviting all Mongolian mining suppliers and buyer companies to join the Mining Supply Chain
Database. Please visit here for registration—FREE!
If you have any questions regarding the database, please contact Undral at undral@bcmongolia.org
or 317027
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.
___________________________________________
ENGLISH WEBSITE: 'PRESENTATIONS', 'MONGOLIA REPORTS', „MONGOLIAN BUSINESS NEWS‟,
„PHOTO GALLERY‟
On BCM‘s English website, the ―Resources‖ and ―Presentations‖ sections are available. Recently
added from BCM‘s monthly meeting on March 25:
•Ruth Pulaski, Director Marketing & Development, American University of Mongolia – ―American
University of Mongolia: Integrating a Liberal Education Approach to Learning‖ at the BCM monthly
meeting, March 25, 2013
•B. Bayar, Managing Director, ELC LLC – ―Update on Legal Developments Regarding Foreign
Investment‖ at the BCM monthly meeting, March 25, 2013
•Tony Burchill, Australian Consul-General & Trade Commissioner, Austrade – ―The Business of Being
a Third Neighbour‖ at the BCM monthly meeting, March 25, 2013
Other recently added presentations:
•Dr. .Brian Fisher, Managing Director, BAEconomics, "Economic Impact of draft Minerals Law" at the
Kempinski Hotel, March 18, 2013, Ulaanbaatar
•Dr. Ch. Khashchuluun, CEO of UBRM Consulting, Mongolia and Mining, The policy evolution: What's
the next? at the Kempinski Hotel, March 18, 2013, Ulaanbaatar
•Martin Pow, Partner, Enterprise Risk Services and Learning Leader, Deloitte Onch LLC, Black

21. Swans: Fact or Fiction, A different risk management philosophy at the BCM Risk Management
Working Group meeting, March 14, 2013
The following 3 presentations were added from Coal Mongolia, 21-22 February:
―Current state of coal sector of Mongolia and future trends‖ by Minister of Mining D. Gankhuyag at
the Coal Mongolia 2013, Feb 21, SS Convention Center, Ulaanbaatar;
―Economic Reform Objectives‖ by Vice Minister, Economic Development, H.E. Mr. O. Chuluunbat at
the Coal Mongolia 2013, Feb 21, SS Convention center, Ulaanbaatar;
―Presentation for Coal Mongolia 2013‖, Norihiko Kato, CEO of Khan Bank, Feb 21 at the SS
Convention Center, Ulaanbaatar, Mongolia.
Presentation by Bold Baatar, CEO of Altan Dornod Mongol, ―Mongolian Mining Investment
Environment‖ at the Mining Industry Open Discussion, February 1, 2013, at Kempinski Khan Palace
Hotel.
Please note the presentations from each of the BCM monthly meetings. Please also note 25
presentations from the Mongolian Investment Summit 2012 on 30-31 October in Hong Kong; and 9
presentations from Discover Mongolia 2012.
The ―Mongolia Reports‖ section includes ―Highlights of 2012, Mongolia‖ by European Bank for
Reconstruction and Development (EBRD); the ―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‖; ―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; ―Mongolia-a supplement to Mining
Journal‖ from Mining Journal October, 2012; ―Macro Overview‖ September, 2012 by EPCRC; ―Taxes
for Expatriates in Mongolia‖ by PricewaterhouseCoopers.
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.
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.
Connect with BCM on Linked-in to join the diverse group of professional contacts creating a better
business environment in Mongolia today.
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.
Hear breaking news and announcements as they happen when you follow BCM on Twitter at
http://twitter.com/#!/bcMongolia.
We have now 1,036 fans on our Facebook fans page, 1,182 connections on LinkedIn network, and
648 followers on Twitter.
Of course for news information, interviews, event photos, and announcements regarding our

22. organization, visit the official BCM website at www.bcmongolia.org and www.bcm.mn.
BCM WORKING GROUP MEETINGS
The BCM Capital Markets Working Group met on Thursday, April 11, with 12 members attending.
Howard Lambert,/ING Bank/ moderated the session.
New Member: Chris MacDougall, MIBG, was welcomed.
Guest Participants: Zheng Wei, Zhou Xiaozhou from Bank of China.
Speakers and topics:
- Update on the Government Debt Auction: Daniel Patrick O’Connell/Ministry of Finance/
- Mongolia Quarterly Update-2013: Chris MacDougall/Mongolian Investment Banking Group/
Next meeting: 12th of June 2013 at BPI meeting room 12th floor Express Tower.
Please contact erka@bcmongolia.org.

23. 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]
March 31, 2013 *9.8% [source: NSOM]
*Year-over-year (y-o-y), nationwide
Note: 9.4% y-o-y, Ulaanbaatar city, March 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]

24. CURRENCY RATES – APRIL 11, 2013
Currency Name Currency Rate
US dollar USD 1,409.80
Euro EUR 1,843.52
Japanese yen JPY 14.21
British pound GBP 2,164.82
Hong Kong dollar HKD 181.85
Chinese Yuan CNY 227.52
Russian Ruble RUB 45.63
South Korean won KRW 1.24
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.