Javkhlanbaatar Sereeter, Director General, Invest in Mongolia

1. KEY OUTCOMES OF THE NEW
INVESTMENT LAW
Javkhlanbaatar Sereeter
Director General
18 November 2014, Hong Kong, PRC
MONGOLIA
INVEST in

2. 2
Contents
Section 1: Implications of the Investment Law
Section 2: More Legal Enchancement
Section 3: Projects initiated for Industrialization

3. 3
Ease of Doing Business, 2015

4. INVESTMENT POLICYREVIEW
/April 2014, UNCTAD/
TRADE POLICYREVIEW
/September2014, WTO/
POSITIVE AND GOOD NOTES
From the Members of the UNCTAD and WTO
Representativesof foreign investors

5. 5
The Interest of Investors is Higher in 2014
• Over 50 forums and conferences
• Over 4500 potential investors of22 countries
• 257 newly registered foreign entities in first 10 months in 2014
The list of 22 economies:
- China
- Hong Kong, PRC
- France
- Japan
- USA
- Switzerland
- Canada
- Korea
- Germany
- England
- Turkey
- Myanmar
- India
- Latvia
- Austria
- Russia
- Taiwan, PRC
- Italy
- Spain
- Poland
- Hungary
- South Africa

6. Declining FDI Inflow
/in billion USD/

7. 7
Contents
Section 1: Implementation of Investment Law
Section 2: More Legal Enhancement
Section 3: Project Development

8. 8
• The amendment to Mineral’s Law seeks to limit
the state’s role in mining and create a stable and
feasible development in the industry.
• The new law provides a number of incentives
available to petroleum explorers, including
exemptions from customs duty and VAT in the
first 5 years, and income taxes fromoil sales.
Mineral Law is revised
Petroleum Law is
revised
Issue of 106 licensesIssue of 106 licenses
State Policy for Minerals
• A policy framework that would define the
country’s priorities and strategies in the minerals
sector in the future.
• The Government approved a decree to settle the
uncertainty caused the frozen106 mining licenses.
More Legal EnhancementMore Legal Enhancement

9. 9
•The “Glass Account Law” enables public control and
monitoring of the budget spending and procurement for
transparency.
SMART Governance
Initiative
• Decisive Regulatory reform aimed to reduce and
abolish inefficient, business unfriendly, excessive
government regulations and red tapes
The Glass Account
Law
State Policy on Railway
More Legal Enhancement
1435 mm gauge routes:
• Tavantolgoi – Gashuun Sukhait
• Khuut – Bichigt
1520 mm gauge routes:
• Arts suuri – Erdenet
• Tavantolgoi – Sainshand – Baruun-Urt – Khuut –
Choibalsan
• Khuut – Numrug

10. 10
More International Engagement in 2014
EPA
• Japan-Mongolia Economic Partnership
Agreement is the first free trade agreement
of Mongolia.
• Negotiations were finalized.
FIPA • Foreign Investment Protection and Promotion
agreements with 43 countries
• Mongolian-Canadian BIT negotiations were
re-commenced
TransparencyAgreement • An Agreement on Transparency in Matters
Related to International Trade and Investment
between the United States of America and
Mongolia was signed in September 2014.
• MIGA Guarantee Agreement is underway to
approved at the Parliament.

11. 11
Contents
Section 1: Implementation of Investment Law
Section 2: More Legal Enhancement
Section 3: Projects initiated for Industrialization

12. 12
Signed PPP Projects- USD 7.5 bln
In 2013, the Government of Mongolia approved 43 projects under the condition of PPP
mechanism.
№ Project name Total Cost Concessionaire
1 “Telmen power plant” project USD 183.0 million “New Asia Group” LLC
2
“Altanbulag-Ulaanbaatar-Zamyn-Uud
highway” project
USD 5.0 billion
“CHINGGIS LAND
DEVELOPMENT GROUP” LLC
3
“Nariinsukhait – Shiveehuren” road
project
USD 47.6 million “RDCC” LLC
4
“Establishment of the mining and
metal processing complex” project
USD 725.0 million “QSC” LLC
5 “Tuul-Songino power plant” project USD 163.1 million “MORIT IMPEX” LLC
6
“Tavantolgoi-Khanbogd-Hangi” road
project
USD 237.8 million “MCCC” LLC
7 “POWER PLANT #5” (CHP5) project USD 1.2 billion
“GDF SUEZ, SOJITZ, POSCO,
NEWCOM” LLC

13. 13
CHP 3 CHP 4
“Baganuur”
SOE
Amgalan
Power Plant
USD 30.9 million
Under the project, the
capacityof the plant has been
increasedby50.0 Mw and
reached 186 Mw. The cost for
producing 1 kw/henergywill
decrease fromMNT 74.7 to
MNT 36.
Performance: 100%
USD 47.4 million
Under the project, the
capacityof the plant has
been increasedby123.0
Mw and reached 580
Mw.
The expansionamount
will provide 10% of
domestic energy
consumption.
Performance: 81%
USD 10 million
The capacityfor Coal
crushingandloading
will increase by4.5
millionton yearlyand
can provide heating and
Ger district households
continuously withcoal.
Performance: 100%
USD 25.6 million
This power plant will
provide east side of
Ulaanbaatar withenergy.
Performance: 75%
Million
USD113.9
Light industry
Power Plants

14. 14
Ulaanbaatar Engineering Infrastructure
Energy
Infrastructure
projects
Performance: 61.1%
Construction
Infrastructure
projects
Performance: 93.2%
City’s ger district
redevelopment
Infrastructure
projects
Performance: 24.2%
Million
USD103.4
More USD 300 mln
loan has been
granted fromADB
and EB from 2013.

15. 15
Project financing:
184,5 Million USD
Performance: 43%
Railway
267 km railroad Tavantolgoi
- Gashuun Sukhait Route is
built from 1800 km

16. 145
Million
USD
48.6
Million
USD
75.1
Million
USD
21.3
Million
USD
888 projects for import substitution
and export promotion projects
Financed 85 entities through the
commercial banks
Agriculture and light industry
sector
Aim to develop domestic final products’
industry and supply domestic demands
Financed 110 entities
Projects to develop SMEs
Financed 116 entities through the
commercial banks
Light industry
Light industry

17. “Expecting a positive trend in FDI”
Thank you for your attention