- The document provides a summary of business and economic news from Mongolia in its NewsWire issue 459 dated January 6, 2017. - Key highlights include Mongolia requesting a $200 million loan from Russia's second largest bank, XacBank receiving $20 million in funding from the Green Climate Fund, and explorers like Xanadu Mines and Erdene intersecting high grades of gold at their projects in Mongolia. - Other news items cover Mongolian Mining preparing for debt restructuring, SouthGobi Resources executing a debt deferral agreement, and several international partnerships and investments in Mongolia.

1. BUSINESS COUNCIL of MONGOLIA
NewsWire
www.bcmongolia.org
info@bcmongolia.org
Issue 459 – January 6, 2017
BCM NewsWire provides short summaries of news collected from around the world. Each
article is kept to a maximum of 150 words for brevity, but click on the link next to
“Source” to read the full article.
NEWS HIGHLIGHTS:
Business:
• Mongolia requests $200m loan from Russia’s second-largest bank
• Mongolian Mining ready for debt restructuring
• XacBank approved for $20 mn funding from Green Climate Fund
• 3 new mineralized porphyry centers identified at Xanadu’s copper-gold project
• Erdene Intersects 110 meters of 9.3 g/t gold at Altan Nar
• Gold producers dream of Xanadu
• Prophecy Sells 10,000 tons of coal to Erdenet Mining
• Chinese firm to provide free feasibility study for China-standard railway
• Mongolian Mining contracts out fuel, office and security services
• S. Korea’s SH Corp. to partner for urban development in UB
• New rules put in place at Development Bank
• FRC grants operational licenses to NBFIs
• Mongolia Energy to raise $2 mn from placement
• SouthGobi Resources executes deferral agreement with CIC
• Attocube to enter Mongolian preschool education market
• Children’s education company announces franchise in Mongolia
• Gobi expands abroad
• Turquoise Hill appoints Maryse Saint-Laurent as independent director
• Khan Bank appoints IFC representative board member
• Altai confirmed as permanent director of MSE
• New weather app launched
• Monos Farm named “Best National Producer” by MNCCI
Economy:
• Mongol Bank: FX auction, swap agreement, T-bills
• 7 Jan. to run as a business day
• Mongolian Economy suffers as business activity continues to slow
• Mongolia may default in 2017 without urgent foreign funding, warns Eurasia
• Miners invest MNT20 bn in 2016
• Mongolia asks Russia to grant $1.6bn loan for undisclosed purpose
• Mongol Bank denies plans to roll out MNT50,000 note
• Civil penalties increasing by 25 percent
• VAT program to continue through 2017

2. • Livestock numbers hit all-time high in 2016
• Dzud may affect up to 150,000 herders
• Mongolia to offer visa concession for tourists groups
• State Commission begins inspection at new airport
• Mongolia and U.S. discuss cooperation in roads and transport sector
• Germany to lend EUR13.5 mn for specially protected areas
• World’s worst air has Mongolians seeing red, planning action
• UB approves MNT3.2 bn budget to push electric heating and fight air pollution
• 70% of Korea’s fine dust particles come from China (and Mongolia), study says
• Mongolia and Russia to boost agricultural cooperation in four main areas
• Mongolia to impose controls on GM foodstuffs
• Mongolia faces economic winter
• Why Mongolia is a wrestling powerhouse
• Nomads who live with real-life Rudolph
Politics:
• Mongolian gov't approves plan to revive economy
• Bill marks changes for presidential election
• Cable broadcasters oppose proposed cable tax
• Standing committee on petitions hold discussion on air pollution
• Government to allow benefits to single parents
• Indonesia, Brazil embassies to be liquidated
• New Japanese Ambassador assumes office
• Mongolia, Laos sign agreement on diplomatic missions’ land use
• U.S. Embassy celebrates 70th anniversary of Fulbright Program
• 3 convicted for 1998 assassination of Zorig
• Despite frigid weather, Mongolians protest worsening smog
• Mongolian authorities arrest suspect for drug smuggling
• Mongolia's young democracy tested by economic crisis
• Landlocked Mongolia considering permanent neutrality
• China’s Diplomatic hat-trick no accident
• India drives Mongolia into China's submission
• Deported mother and daughter resume their lives in Calgary after leaving Mongolia
again
• China needs to get over the Dalai Lama's visit—EDITORIAL
BCM Updates:
• Member-to-Member Special Offers & Benefits
Economic Indicators:
• Inflation
• Central Bank Policy Rate
• Currency Rates
*Click on titles above to link to articles.

3. SPONSORS
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BUSINESS
MONGOLIA REQUESTS $200M LOAN FROM RUSSIA’S SECOND-LARGEST BANK
Mongolia’s government has asked VTB, Russia’s second-largest bank, for a loan of USD200
million for buying Russian oil products, Russian media have said. “The two sides expressed
satisfaction with an export loan extended by the VTB bank to the Development Bank of
Mongolia, which has enabled Mongolia to be supplied with Russian oil products,” media
stories quoted the Russian cabinet as saying in a report on Russian-Mongolian governmental
talks in Ulaanbaatar on December 13. The report was published this week.
“The Mongolian side has asked the VTB bank to consider long-term financing to a sum of
$200m with better terms for interest rates,” the report said.
Source: Emerging Markets
MONGOLIAN MINING READY FOR DEBT RESTRUCTURING
Mongolian Mining Corp. is prepared to launch debt restructuring after defaulting on
USD600 million in corporate debt last year, the Mongolia-focused miner announced on 21
December. Mongolian Mining, certain subsidiary guarantors and partner liquidators have
entered into an agreement with certain consenting note holders.
The 8.875 percent interest senior notes were set to mature in 2017, but Mongolian Mining
missed a payment last year. On 21 December, a Cayman Islands court made an order
approving each of the (RSAs) and authorizing partners in the liquidation to take all steps
required to bring them into effect.
Source: Mongolian Mining Corp., 2
XACBANK APPROVED FOR $20 MN FUNDING FROM GREEN CLIMATE FUND
XacBank LLC received unanimous approval for USD20 million to finance more-efficient and
renewable energy production in Mongolia, the bank announced on 19 December. Approval
from the fund’s board of directors on 15 December comes after XacBank was accepted for
accreditation last October. The program is an extension of XacBank’s existing Business
Loan Program for GHG (greenhouse gases) Emissions Reduction, which targets low-interest

4. lending to small business. Businesses run by women will be a more specific target.
The low-interest lending program aims to reduce CO2 emissions by 1.2 million tons over
eight years.
Source: Montsame
3 NEW MINERALIZED PORPHYRY CENTERS IDENTIFIED AT XANADU’S COPPER-GOLD
PROJECT
Xanadu Mines Ltd. reported the finding of three new targets in its latest exploration
highlights from its Kharmagtai copper-gold projects on 22 December. First assays have
been received from an undercover bedrock drilling program confirmed continuity of
mineralization under shallow cover with drilling intersecting anomalous bedrock copper
and gold mineralization over a widespread area of approximately 25 square kilometers.
“Drill testing is expected to start immediately and we are looking forward to what we
might learn from the next program of RC drilling.” said Xanadu’s managing director and
chief executive officer, Andrew Stewart.
Click on the Source for highlights including a target with greater than 0.3 percent copper
and three grams per ton of ore gold over a two-meter interval.
Source: Xanadu Mines Ltd.
ERDENE INTERSECTS 110 METERS OF 9.3 G/T GOLD AT ALTAN NAR
Erdene Resource Development Corp. reported of 9.3 grams per ton of gold in ore in its
December exploration results report from the Altan Nar gold-polymetallic project. The 9.3
grams of gold over 110 meters at Hole TND-101 was accompanied by 32 grams per ton of
silver, and 1.4 percent combined lead-zinc.
Click on the Source for other highlights from Altan Nar, the Discovery Zone North, the
Altan Arrow gold-silver project and the Bayan Khundi gold project.
Source: Erdene Resource Development Corp.
GOLD PRODUCERS DREAM OF XANADU
Australian gold producers are among a host of mining companies that have taken a close
look at Mongolian explorer Xanadu Mines Ltd. in recent weeks, with a shortage of new
discoveries, improving appetite for acquisitions and recent policy stability in Mongolia
putting the nation’s stalled mining industry back on track. Xanadu’s Ulaanbaatar-based
managing director Andrew Stewart told The Australian the company had hosted five visits
in the past two months from mining companies interested in learning about its early-stage
copper and gold projects in Mongolia.
The level of interest is a sharp improvement on recent years, he said, when the company
would host just one to two such visits a year. He said Australian gold miners in particular
were showing renewed interest in Mongolia. “There are a lot of cashed-up mid-tier gold
producers that are looking to expand,” he said. “When you look at Australia, there just
aren’t as many options for those big discoveries.”
Source: The Australian
PROPHECY SELLS 10,000 TONS OF COAL TO ERDENET MINING
Prophecy Development Corp. has signed two coal sales and purchase agreements to sell a
total of 16,000 tons of coal sourced from its 100 percent owned Ulaan Ovoo mine. The two
purchasers were Erdenet Mining Corp, for 10,000 tons, and Selenge Energy Heat Plant, for
6,000 tons. Coal deliveries sourced from existing stockpiles from Ulaan began in December

5. 2016. Delivery of the 16,000 tons is expected to complete by February 2017.
In recent months, Prophecy has received multiple, unsolicited written expressions of
interest from parties in Russia, China, and India, relating to possible transactions involving
sales from, or joint venture of, Ulaan Ovoo.
Source: Prophecy Development Corp.
CHINESE FIRM TO PROVIDE FREE FEASIBILITY STUDY FOR CHINA-STANDARD RAILWAY
The Chinese company CREC will develop a feasibility study this year for a new railway
route to be built between Choibalsan Soum and Khuut in Dornod and Zuunbayan Khangi at
no cost with a memorandum signed by Mongolia’s railway developer on 26 December. The
192-kilometer route between Choibalsan and Khuut will be built with a Chinese-standard
rail gauge, as opposed the the wider Russian standard. The study is expected to be
complete before the end of June, while the rail is expected to complete between 2018
and 2020.
The construction proposal will be submitted to parliament for approval before construction
launches, the cabinet under Prime Minister Erdenebat decided on 21 December.
Source: Unuudur
MONGOLIAN MINING CONTRACTS OUT FUEL, OFFICE AND SECURITY SERVICES
Mongolian Mining Corp. has contracted out three service agreements with providers for the
next two years. From 1 January 2017 until 31 December 2019, NIC will provide fuel
transportation, site storage and fueling services to Mongolian Mining from for a total
consideration of up to MNT36 billion (USD14,48 million). Also during that time USS will
provide about of office and camp support from a contract worth up to USD13.74 million,
and M-Armor will provide security from a USD6.46 million contract.
NIC is an associate of Oyungerel Janchiv, a non-executive director. USS and M-Armor are
wholly-owned subsidiary of Mongolian Mining’s parent company, MCS Group.
Source: Mongolian Mining Corp.
S. KOREA’S SH CORP. TO PARTNER FOR URBAN DEVELOPMENT IN UB
A South Korean company focused on urban housing has agreed to help build up Ulaanbaatar
lagging infrastructure. A Mongolian delegation led by the head of the Ulaanbaatar City
Council, Ts. Sandui met with the met with Byeon Chang-heum, the president of the ‘SH’
(Seoul Housing) Corp., and Seoul city official, during a visit to South Korea 13 to 20
December. The parties agreed to establish a joint working group to work together on
issues including the battle against air pollution in the capital and the need for sewage
facilities.
Source: News.mn
NEW RULES PUT IN PLACE AT DEVELOPMENT BANK
Lawmakers are introducing new regulations for the Development Bank of Mongolia to
better shield the country from its growing liabilities during today’s economic turmoils.
Parliament approved a resolution to implement risk-prevention ventures for the bank as its
liabilities have stacked up to MNT5.9 trillion as of 28 December. The resolution hikes the
the bank’s capital to MNT1 trillion and puts its debt under the accounts of the Ministry of
Finance, consolidating the government’s total debt. The Development Bank’s total asset
and loan portfolio amounted MNT7 trillion and MNT5.9 trillion, respectively,
The Development Bank has financed some 2,000 programs and projects since its

6. establishment in 2011.
Source: Montsame
FRC GRANTS OPERATIONAL LICENSES TO NBFIS
The Financial Regulatory Commission has granted operational licenses to six non-banking
financial institutions. The non-banking financial institutions processed the licensing on the
condition they hold a shared capital of MNT800 million. The commission cut that figure
from MNT2.8 billion in March 2016.
Source: Montsame
MONGOLIA ENERGY TO RAISE $2 MN FROM PLACEMENT
Mongolia Energy Corporation aims to raise HKD15.6 million (USD2 million) from a new share
placement. The miner said it agreed to place 60 million new shares at HKD0.26 per share,
representing a discount of about 7.1 percent to the closing price of HKD0.28, to Gold
China Enterprises Co., Ltd. The subscription shares represent around 3.19 percent of the
enlarged issued share capital of Mongolia Energy.
The proceeds will be used as general working capital.
Source: Haitong
SOUTHGOBI RESOURCES EXECUTES DEFERRAL AGREEMENT WITH CIC
SouthGobi Resources Ltd. has deferred USD1.4 million in debt repayment to next May as
part of a revised payment schedule with China Investment Corp. The owed funds to be
repaid on 19 May are cash interest and associated costs monthly on average during the
period from December 2016 to April 2017.
Source: SouthGobi Resources Ltd.
ATTOCUBE TO ENTER MONGOLIAN PRESCHOOL EDUCATION MARKET
A South Korean producer of education resources will be making its products available to
preschools in Mongolia. Attocube announced on 19 December that it had signed a
memorandum of understanding with the Mongolian Association of Private Preschool Center
concerning its entrance into Mongolia’s preschool education market. The memorandum
commits Attocube to exporting approximately 1,000 sets of wooden blocks and related
educational content to Mongolian preschools, in addition to workbooks, picture books,
role-playing books, and board games.
Source: Korean Herald
CHILDREN’S EDUCATION COMPANY ANNOUNCES FRANCHISE IN MONGOLIA
Creative Learning Corporation has expanded its international presence with new master
franchise sales in Italy and Mongolia. The expansion of by proprietor of the highly-popular
children’s education and enrichment programs Bricks 4 Kidz and Sew Fun Studiosbuilds
upon sales announced recently of master franchises in Turkey, Switzerland, Czech
Republic, France, Philippines and Madagascar as well as numerous individual franchises
around the world. Coming in fiscal year 2017, these sales of new master franchises in Italy
and Mongolia build upon Bricks 4 Kidz’s robust sales of international franchises in fiscal
year 2016.
Bricks 4 Kidz is continuing its international sales efforts and expects to announce
additional international sales in the near future. These sales result from the effort Bricks 4
Kidz has expended to expand and develop its international presence through sales and

7. work with franchisees across the globe.
Source: Creative Learning Corp.
GOBI EXPANDS ABROAD
Gobi Cashmere JSC is expanding its consumer bases for it Mongolian cashmere garments
with the launch of new stores in Asia and Europe. The Mongolia-listed company opened its
first brand-name store in Japan as the Haneda airport in Japan last month just weeks after
opening a flagship store in Berlin, Germany. The Mongolia-listed companies plans to open
more branch shops in Brussels, Belgium and Erenhot, China in January 2017.
Gobi has also launched a shop in the United States at Georgetown through its subsidiary
T&U. Mongolian school friends Tosca Metz and Una said opening the cashmere boutique is
a childhood dream come true.
Source: Udriin Sonin, Georgetown Dish
TURQUOISE HILL APPOINTS MARYSE SAINT-LAURENT AS INDEPENDENT DIRECTOR
Turquoise Hill Resources has appointed Maryse Saint-Laurent to its board as an
independent director, effective 4 January, the 66 percent shareholder of Oyu Tolgoi
announced the same day.. Saint-Laurent is an accomplished legal executive, corporate
director and senior advisor to boards and management teams with almost 20 years of
experience in the energy and electricity sectors. Since 2015, she has served as a legal and
governance advisor.
"We welcome Maryse to the Turquoise Hill Board and look forward to benefiting from her
diverse background as a legal executive as well as an experienced director," said newly-
appointed Turquoise Hill Chairman Peter Gillin,
Source: Turquoise Hill Resources Ltd.
KHAN BANK APPOINTS IFC REPRESENTATIVE BOARD MEMBER
Khan Bank LLC has appointed John Law to its board of directors, representing the
shareholding held by the financial arm of the World Bank, International Finance Corp. (IFC)
Law has nearly 30 years of experience in finance and has served as a principal banking
specialist for the Financial Institutions Group at IFC. His other work includes top
managerial positions at Citibank and J.P. Morgan & Co covering the Asia-Pacific region.
Heis a Senior Advisor at Oliver Wyman, a leading global management consulting firm that
combines deep industry knowledge with specialized expertise in strategy, operations, risk
management, and organization transformation.
Source: Montsame
ALTAI CONFIRMED AS PERMANENT DIRECTOR OF MSE
Altai Khangai has been appointed as the executive director of the Mongolian Stock
Exchange (MSE) after four months working as the acting director. Altai is a lawyer who
served in the same position at the MSE from 2011 to 2014.
Source: Zuunii Medee
NEW WEATHER APP LAUNCHED
The new Anhaar weather app is in English and Mongolian for alerting mobile-phone users to
weather disasters. Developed by the National Emergency Management Agency of Mongolia
(NEMA) and the United Nations Development Program (UNDP), the mobile app aims to
make people in Mongolia better prepared for emergencies including dzuds, floods and

8. fires.
“The Anhaar app provides information on common hazards in Mongolia and instructions on
how to stay safe,” said Colonel Battogtokh P., the first deputy chief of NEMA.
Source: UB Post
MONOS FARM NAMED “BEST NATIONAL PRODUCER” BY MNCCI
Monos Farm has been named the “Best National Producer for 2016 by the Mongolian
National Chamber of Commerce and Industry (MNCCI). It produces more than 90 medicines
after launchings Mongolia’s largest pharmaceutical plant last year. The facility is also the
first to operates with international standards, including those from the World Health
Organization
Source: Unuudur
ECONOMY
MONGOL BANK: FX AUCTION, SWAP AGREEMENT, T-BILLS
The Bank of Mongolia on 27 December accepted bids for USD20.1 billion and CNY60 million
for resultant exchange rates of MNT2,480 and MNT351.60, respectively. It also accepted in
swap agreements U.S. dollar selling bids worth USD14.8 million.
On 4 January, the bank issued MNT133 billion worth of one-week treasury bills at a
weighted annual interest of 14 percent.
Source: Bank of Mongolia
7 JAN. TO RUN AS A BUSINESS DAY
The government has made Saturday, 7 January a day of work to compensate for the start
of the New Year’s holiday a day early last month. The Jargaltulga Erdenebat cabinet made
30 December a holiday in the hopes of keeping people home and preventing the spread of
influenza outbreaks and accidents from extreme weather conditions.
Source: Mongolia.GoGo.mn
MONGOLIAN ECONOMY SUFFERS AS BUSINESS ACTIVITY CONTINUES TO SLOW
The Headline Mongolian Sales Managers’ Index (SMI) for December was 37.0, almost
unchanged from the level in November. The index is close to it’s the lowest level in 8
months as winter conditions start to take hold.
The Market Growth Index experienced another sharp drop during the month which has also
been reflected in falling business confidence levels. The Sales Growth Index, improved
marginally to 33.8, up by 0.4 on the November level. Sales managers are reporting that the
weakness of the tugrik is severely hurting their businesses as the tugrik remained close to
record lows in mid-December against the Chinese Renminbi.
Source: World Economics
MONGOLIA MAY DEFAULT IN 2017 WITHOUT URGENT FOREIGN FUNDING, WARNS
EURASIA
A political snafu with the world's second-largest economy is no light matter for any country
but for troubled Mongolia, it could mean a potential sovereign default. Ulaanbaatar, facing
flat growth and a budget deficit of 20 percent of GDP in 2016, is in desperate need of
foreign lending to meet debt repayment obligations next year and Beijing may be the only
country willing to provide a soft loan, according to political risk consultancy Eurasia. While

9. President Xi Jinping's administration previously began talks on the matter, negotiations
have now adjourned following the Dalai Lama's recent visit to Mongolia. That could leave
the nation at high risk when a USD580 million bond issued by the state-run Development
Bank of Mongolia matures in March.
"The suspension of China talks will increase concerns in the market about a possible
default by the spring," Emily Stromquist, senior analyst at Eurasia, said in a note on
Tuesday.
Source: CNBC
MINERS INVEST MNT20 BN IN 2016
Mining continues to be the strongest magnet for investment in Mongolia as the 20 new
mines put on line last year brought MNT20 billion of investment and 800 new jobs. The
mining sector comprises 85 percent of Mongolia's exports, 63 percent of industrial
products, 18 percent of GDP and one-fourth of national revenue.
Source: Mongolia.GoGo.mn
MONGOLIA ASKS RUSSIA TO GRANT $1,6BN LOAN FOR UNDISCLOSED PURPOSE
Mongolia addressed Russia with the request to grant it a concessional loan of 100 billion
rubles (USD1.6 billion), but did not specify the purpose of the loan, Interfax reports with
reference to the protocol of the 20th meeting of the intergovernmental commission on
trade-economic and scientific-technical cooperation held with the participation of the
representatives from both countries. “Because of the absence of information on the
Mongolian part about the purpose of the requested loan and its financial parameters
acceptable to the Mongolian party, the Russian party has no possibility to examine the
partners’ request,” read the protocol.
In addition, Mongolia asked the Russian state-owned VTB Bank to provide a loan of USD200
million for the purpose to conduct long-term purchases of Russian oil products.
Source: Russian Construction
MONGOL BANK DENIES PLANS TO ROLL OUT MNT50,000 NOTE
The Bank of Mongolia has denied rumors that it was planning to roll out a MNT50,000 bill.
“The publishing of a new currency note for MNT50,000 is not in consideration by the Bank
of Mongolia,” said a spokesperson following reports in media that it planned to circulate
bills this year. Those reports were accompanies by an image of a MNT50,000 note, which
the bank also said was false. The spokesperson added that a new bill would be a matter
for lawmakers, and that the central bank could not make the decision to roll out a new bill
on its own.
“At present, the Bank of Mongolia is putting its all efforts into seeking solutions for
overcoming the existing economic challenges and reviving the economy. In comparison to
this issue, publishing MNT50,000 note isn’t important at all.”
Source: Mongolia.GoGo.mn
CIVIL PENALTIES INCREASING BY 25 PERCENT
Fines, penalties and fees will be hiked by a quarter along with the raise in the minimum
wage that serves as benchmark. The minimum wage is set at MNT240,000 a month this
month as a result of persistent demands from the Confederation of Mongolian Trade
Unions. Motorists caught driving after their inspection is up will be fined MNT120,000, or
50 percent of the minimum wage, for example.

10. The trade union originally wanted a 40 percent hike, but concluded to just 25 percent
given today’s fiscal challenges.
Source: Mongolia.GoGo.mn, Montsame
VAT PROGRAM TO CONTINUE THROUGH 2017
The value-added tax refund program implemented last year will continue into 2017
[Source did not include a citation for this claim -ed]. Mongolia is expecting to hand out
total refunds of MNT32.1 billion to 896,873 individuals this year. The program also
included a lottery, which collected MNT675.9 million from the 20 percent tax.
Source: Undesnii Shuudan
LIVESTOCK NUMBERS HIT ALL-TIME HIGH IN 2016
The number of livestock grew 9.9 percent to 61.5 million last year, according to official
figures from the National Statistics Committee. Broken down, that includes 3.63 million
horses, 4.08 million cows, 401,300 thousand camels, 2.78 million sheep and 2.56 million
goats. Sheep accounted for 45.3 percent of all livestock, while goats were 41.6 percent,
horses 5.9 percent and camels at 0.7 percent. Uvurkhangai, Khuvsgul, Arkhangai, Tuv and
Bayankhongor Aimags had the largest numbers of animals.
Source: News.mn
DZUD MAY AFFECT UP TO 150,000 HERDERS
Around 150,000 herders in the northern belt of Mongolia are at risk of losing their animals
and livelihoods this winter as officials prepare to scale the dzud risk up to an emergency
level [Source includes no citation for this claim -ed]. As temperatures plummeted to below
-40Celsius in northern Mongolia and -56Celsius in the west in recent weeks, the national
State Emergency Commission dispatched authorities and aid groups to conduct risk
assessments across the country.
Unlike the last dzud, this one is expected to impact northern and eastern Mongolia. The
most vulnerable are the 2,500 pregnant women, 26,000 children and 8,000 elderly people
living in winter pastures. Dzuds usually occur in five-yearly cycles and last for two winters.
Mongolia is still reeling from the 2015-2016 dzud which killed 1.2 million livestock and left
tens of thousands of herders in poverty. The 2010 dzud was much more deadly, killing
eight million animals and costing the government millions in aid response.
Source: UB Post
MONGOLIA TO OFFER VISA CONCESSION FOR TOURISTS GROUPS
Tourists arriving in Mongolia in groups will be able to receive discounts on visas. The
concessions can be received by travel through travel agencies, in addition to a new 72-
hour visa-free policy for all foreign travelers in-transit. Government made the decree in
the hopes of encouraging more travel to Mongolia.
Source: Mongolia.GoGo.mn
STATE COMMISSION BEGINS INSPECTION AT NEW AIRPORT
A committee has launched an inspection of new international airport due to commission
this year. Construction of The New Ulaanbaatar International Airport (NUBIA) is underway
at Khushig Valley, Tuv Aimag, about 52 kilometers south of Ulaanbaatar.. “When the
Commission issues its concluding report, the Civil Aviation Authority of Mongolia will begin
their flight tests and other tasks of the Operational Readiness and Airport Transfer

11. process”, said Kimihiro Maeta, the Japanese Consultants Project Manager, about the
inspection that launched on 2 January.
Started in June 2013, the nearly complete construction progress of Mongolia’s new
international airport is expected to wrap up this month.
Source: Mongolia.GoGo.mn
MONGOLIA AND U.S. DISCUSS COOPERATION IN ROADS AND TRANSPORT SECTOR
Mongolia is looking for help from the U.S. government to complete its mission of building
roads between the capital and all 21 provinces. Minister of Road and Transportation D.
Ganbat in a meeting with U.S. Ambassador Jennifer Galt last week said the ministry would
like funding from the Millennium Challenge Corporation’s second compact for roads and
transportation projects. Mongolia has still yet to link together every province with the
capital, said Ganbat, with another 130 kilometers of roads between Gobi Altai and Uvs
Aimags still needed.
Ganbat also suggested expanding the 176.4 kilometers of roads between Choir and
Sainshand that were built with financing from the Millennium Challenge Fund’s first
compact with a third lane and a fourth lane for the road between the capital and Darkhan.
Funding was also needed for upgrading facilities along the 620 kilometers of road between
Ulaanbaatar and the Zamyn Uud land port to China, he said.
Source: Montsame
GERMANY TO LEND EUR13.5 MN FOR SPECIALLY PROTECTED AREAS
Germany will give addition financing toward Mongolia’s specially protected areas, bringing
a total of EUR13.5 million for 2017. The additional EUR7 million of funding will expand the
number of to protected area throughout western Mongolia. The 11 areas originally marked
to receive financing for construction and environmental management are Otgontenger,
Dornod Mongol, Gorkhi Terelj, Khangain mountains, Khan Khentii, the Khustain mountains,
Onon, Balj, Orkhon valleys, Tarvagatai mountains, Ulaan Taiga, Zed Khantai Buteel
mountains.
Source: Unuudur
WORLD’S WORST AIR HAS MONGOLIANS SEEING RED, PLANNING ACTION
If you think air pollution in China has been bad, just look at Mongolia. Levels of particulate
matter in the air have risen to almost 80 times the recommended safety level set by the
World Health Organization—and five times worse than Beijing during the past week’s bout
with the worst smog of the year. An air pollution protest was held last week along with a
crowdfunding campaign to purchase 100 air purifiers for hospitals and schools raised more
than $1,400 in five days.
“The hospital I visited today did not have any air purifiers, even though 40 mothers were
scattered along a narrow corridor, each with a sick baby in their arms,” Onon Bayasgalan,
an environmentalist who organized the crowdfunding campaign, said Thursday. “They
sleep on fold out cots in the corridors, as the hospital rooms are full of pneumonia cases.’’
Source: Bloomberg
UB APPROVES MNT3.2 BN BUDGET TO PUSH ELECTRIC HEATING AND FIGHT AIR
POLLUTION
Ulaanbaatar and global organizations such as the World Bank are ready to spending
millions this year combating air pollution in the capital. The National committee to reduce

12. air pollution has budgeted MNT5 billion for 2017, including MNT3.5 billion to subsidize
electricity costs by 50 percent to encourage the use of electric heaters over burning coal
and other materials. Meanwhile, electricity will be completely free to ger districts.
MNT450 million will be spent on improved stoves and MNT400 million will be spent on
briquette. Moreover, the World Bank to invest MNT7.8 billion for the Ulaanbaatar Clean Air
Project (UBCAP).
Prime Minister Erdenebat Jargaltulga has outlined a plan to combat air pollution that
includes the use of aid from China to relocate ger dwellers into homes linked to city
heating and provisions of affordable heating units.
Source: Mongolia.GoGo.mn, UB Post
70% OF KOREA’S FINE DUST PARTICLES COME FROM CHINA (AND MONGOLIA), STUDY
SAYS
About 70 percent of fine dust particles found in South Korean skies come from neighboring
Northeast Asian countries such as Mongolia and China, a recent study shows. According to
an analysis of the state-run Korea Environment Institute, up to 70 percent of Korea’s fine
dust particles and other airborne pollutants originated in China and other Central Asian
countries like Kazakhstan and Mongolia.
Since the arrival of the New Year, a thick toxic haze has blanketed most of South Korea,
prompting local authorities to advise people to stay indoors. Researchers at the KEI
pointed out that the Korean Peninsula is under the influence of air pollution in China and
Mongolia due to northwesterly wind. They added that three Chinese provinces, adjacent to
Korea, topped the list in China for high fine dust emission levels.
Source: Korean Herald
MONGOLIA AND RUSSIA TO BOOST AGRICULTURAL COOPERATION IN FOUR MAIN AREAS
Mongolia was expected to receive five million doses of vaccine for animals from Russia last
month as part of its renewed efforts to work with Mongolia for agriculture. The Ministry of
Food, Agriculture and Light Industry has finalized a deal with Russian for the improvement
of livestock health, export of animal origin products, establishing crop farm and trans-
boundary trades. The commencement of a second stage of the livestock health program
was been negotiated during the 20th meeting of Mongolia-Russia Intergovernmental
Commission held in Ulaanbaatar.
Russia was committed to sending the five million vaccine unites by 25 December, out of an
agreed total of 20 million doses.
Source: Montsame
MONGOLIA TO IMPOSE CONTROLS ON GM FOODSTUFFS
Parliament members have tabled a draft amendment to the country's food legislation to
control production and import of genetically modified foods and raw materials. The
amendment prohibits the planting and production of genetically-modified raw material
and foods, establishes standards and controls for imports, and proposes new food safety
legislation. The proposed effective date is 1 January 2017.
Source: Agra-net.com
MONGOLIA FACES ECONOMIC WINTER
Mongolia is in the depths of an unusually harsh winter that is decimating livestock and
sending temperatures to minus 56 degrees Celsius. But an economic winter has also hit

13. people like factory owner Jargalsaikhan. The 40-year-old once thought Mongolia’s
economic boom would last more than a decade. He had had ambitious plans for the
cement factory he started eight years ago, thinking that bank lending will keep flowing.
Then, the Mongolian economy collapsed, and his factory can barely survive now.
Since coming to power in June, the Mongolian People’s Party has announced an economic
reform plan containing spending cuts. They have also asked the International Monetary
Fund (IMF) for help. IMF aid could ease financial concerns for the country, as Mongolia will
have to repay $1 billion in debt by 2018.
Source: Central News Asia, Financial Tribune
SUMO'S NEXT SUPERSTARS? WHY MONGOLIA IS A WRESTLING POWERHOUSE
At a sumo training camp on the outskirts of Ulaanbaatar, Mongolia, tension was beginning
to mount. The World Sumo Championships was just days away. For the wrestlers in the
Mongolian national youth team, a win would gain them global recognition. Acceptance into
a Japanese "heya" (a sumo stable) might be just around the corner.
Although sumo isn't an Olympic sport, Mongolian athletes have scooped medals in judo and
wrestling —similar sports that have provided 17 of the nation's 26 medals in Olympic
history. "In Mongolia, though, the same salaries seem much bigger. Sumo champions are
also incredibly famous in Mongolia, and former champions have parlayed their sumo
careers into careers in politics and business,” said Taylor Weidman, a photographer who
shadowed the wrestlers.
Source: CNN
NOMADS WHO LIVE WITH REAL-LIFE RUDOLPH
A community in Northern Mongolia doesn’t look to the sky on Christmas Eve for Rudolph.
Because they have reindeer in their very own backyard. In the snowy wilds near the
Khuvsgul Lake live a nomadic reindeer herding family, the Gabaa’s. The Gabaa family use
reindeer for milk, cheese and transport. And their dung for fire.
Despite being able to spend only three days with the Tsaatan people, photographer Joel
Santos— who captured the stunning images of the family with their deers—traveled four
days to reach them — three driving and one on horseback — before repeating the epic
journey to return home. The youngest member, Uchraa, is already well trained in riding
the family reindeer. The family rely on their reindeer for milk, cheese and transportation.
Click on the link for the full photo essay.
Source: Gold Coast Bulletin
POLITICS
MONGOLIAN GOV'T APPROVES PLAN TO REVIVE ECONOMY
The Mongolian government on 21 December approved a detailed plan to revive the
landlocked country's economy, which has been mired in a severe downturn. The Mongolian
government is expected to start negotiations with other countries on long-term loans with
low interest rates to reduce its debt burden and refinance its current loans. Also, the
Mongolian government and the Bank of Mongolia will determine terms to extend or
refinance a USD580 million loan taken out by the Development Bank of Mongolia, which is
due in March, and international bonds due in January 2018.
Recently, Mongolian Parliament Speaker Miyegombo Enkhbold led a delegation of the
country's top officials to wealthy Gulf countries, such as Saudi Arabia, Kuwait and the

14. United Arab Emirates, and Mongolia's neighbor Russia, to seek financial assistance. Under
this economic revival plan, the Mongolian government will also try to diversify its mining-
dependent economy and improve the quality of veterinary services for its 61.5 million
livestock herds and export meat abroad.
Source: Global Times
BILL MARKS CHANGES FOR PRESIDENTIAL ELECTION
Lawmakers hope to change aspects of the contest for this year’s presidential election with
a new bill they’ve submitted. MPs Baasankhuu U., Oyundari N. and Enkhbold N. have
submitted a bill for this year’s election based on recommendations from the General
Election Committee.
Source: Montsame
CABLE BROADCASTER OPPOSE PROPOSED CABLE TAX
Cable TV broadcasters are protesting a proposed tax on television subscriptions that
Parliament will vote on. This bill is breaching the Constitution and other laws,” said
industry representatives in a press conference.
“This will be another blow to Mongolians during the economic hurdle.”
Source: Udriin Sonin
STANDING COMMITTEE ON PETITIONS HOLD DISCUSSION ON AIR POLLUTION
Parliament plans to adapt a long-term plan for combating air pollution in the capital.
Lawmakers are addressing concerns of the public as air pollution in Ulaanbaatar has
exceeded recommended levels from international groups such as the World Health
Organization by up to 6 times. In an opening speech for debate held in Parliament
preceding the drafting of legislation, MP Sarangerel D. said the smog problem that has
grown since the 1990s in Ulaanbaatar comes mostly from the so-called ger districts of
informal housing that use coal burning for heat and energy. The amount of a toxic
component called benzopirin, which causes cancer, has been observed to exceed the
tolerable level in 14 times in Ulaanbaatar’s smog, she said, according to a study conducted
by Chinese researchers.”
Air pollution is a problem of responsibility. Our citizens are demanding a certain effective
decision on this,” said Sarangerel.
Source: Montsame
GOVERNMENT TO ALLOW BENEFITS TO SINGLE PARENTS
A new bill before the cabinet would give more benefits to parents in need. The bill
outlines entitlements from the fifth month of pregnancy for parents with twins. The new
bill calls for MNT72.billion in spending to parents. Monthly benefits would be made
available to stay-at-home mothers of children up to three years old and quarterly benefits
for single parents.
Mongolia has 531,000 families with children, and 16 percent are single-parent households.
Source: Montsame
INDONESIA, BRAZIL EMBASSIES TO BE LIQUIDATED
Mongolia will shut down its embassies in Indonesia, Brazil and consulates offices at Osaka,
Japan and Hailar, China to save some cash while it waits on emergency financial assistance
from donor countries and international groups. The government expects to save between

15. USD400,000 and USD500,000 for the closure of each diplomatic office. “The Parliament
ordered the Government to liquidate some embassies,” said Foreign Affairs Minister Tend.
Munkh-Orgil. “The government needs to save.”
The foreign minister had previously announced plans at these specific locations because of
the few Mongolians living abroad in Indonesia and Brazil. Twenty-seven Mongolians live in
Indonesia, while 25 are in Brazil.
Source: Udriin Sonin
NEW JAPANESE AMBASSADOR ASSUMES OFFICE
A new ambassador from Japan has come to Mongolia. Japanese Ambassador Masato
Takaoka presented his credentials to President Elbegdorj Tsakhia on 26 December.
Source: Mongolia.GoGo.mn
MONGOLIA, LAOS SIGN AGREEMENT ON DIPLOMATIC MISSIONS’ LAND USE
Mongolia has signed an agreement for land use in Laos regarding land use for diplomatic
missions. Mongolian Ambassador Galbadrakh L. and the Deputy Minister of Foreign Affairs
of Laos, Sengphet Houngboungnuang ,signed the Agreement on the Use of Land and
Building for the Diplomatic Mission between the Government of Mongolia and the
Government of the Lao PDR on 26 December.
Source: Montsame
U.S. EMBASSY CELEBRATES 70TH ANNIVERSARY OF FULBRIGHT PROGRAM
U.S. Ambassador Jennifer Zimdahl Galt hosted a reception at her residence to
commemorate the 70th anniversary of the Fulbright exchange program on December 16.
Every year, nearly 40 scholars, students, researchers, and professionals travel between the
U.S. and Mongolia to work in areas ranging from health to IT. Thanks to the Government
of Mongolia’s support, up to ten additional Mongolian grantees get the opportunity to
study in the U.S. on the Fulbright program every year—more than double the number of
scholarships that were available prior to the establishment of this valuable partnership.
Founded in 1946 by U.S. Senator J. William Fulbright, the Fulbright program was
established to promote peace and enhance mutual understanding between the people of
the United States and other countries through the exchange of persons, knowledge, and
skills. It was launched in Mongolia in 1994.
Source: U.S. Embassy
3 CONVICTED FOR 1998 ASSASSINATION OF ZORIG
A closed court in Mongolia has convicted three suspects of the 1998 murder of Sanjaasuren
Zorig, a politician remembered for leading a peaceful transition to democracy. Nicknamed
the "Golden Swallow of Democracy,” Zorig was Mongolia's minister of infrastructure and
was widely expected to become prime minister in 1998 when he was assassinated in his
home at the age of 36. Mongolian media identified the three suspects as B. Sodnomdarjaa,
Ts. Amgalanbaatar and T. Chimgee, and said they had been found guilty of murder by a
panel of judges on Tuesday after a hearing held behind closed doors since October. They
were each given prison sentences of between 24 and 25 years.
Zorig's sister, Oyun, who is a former government minister, said she and her family did not
think justice had been done. "We also requested that the case is de-classified and the
court is open," she said. "Unfortunately, the request was not accepted."
Source: Reuters

16. DESPITE FRIGID WEATHER, MONGOLIANS PROTEST WORSENING SMOG
Hundreds of Mongolians have braved frigid weather to stage a protest in the country's
capital demanding that the government do more to address worsening air pollution they
fear is sickening their children and shortening their lives. The protesters gathered Monday
in a public square in front of government offices, holding banners with slogans such as
"Let's give fresh air to our future children," ''Smog is silent killer" and "We can't breathe."
Purevkhuu Tserendorj, one of the protest's organizers, said, "We are desperate and we are
organizing this demonstration to make authorities feel our frustration and anger."
Source: Business Insider
MONGOLIAN AUTHORITIES ARREST SUSPECT FOR DRUG SMUGGLING
Mongolian detectives have arrested d a man who was trying to enter the Zamyn-Uud
Mongolia-China border with 50 grams of methamphetamines. The man was arrested while
holding the drug known as “crystal” or “ice” among users on 22 December, close to the
Chinese border. The man is a Mongolian citizen and is being held at detention center
number 0461. He now faces between five and 10 years in prison for drug smuggling.
Source: News.mn
MONGOLIA'S YOUNG DEMOCRACY TESTED BY ECONOMIC CRISIS
Thirty-nine year old Otgonjargal left her hometown in western Zavkhan province about 15
years ago to make a living in the capital Ulaanbaatar. She sells clothes and other
accessories beside a road, but business has never been as bad. This year, her business has
plunged 50 per cent as the economy shrank. Otgonjargal blames the politicians for her
ordeals. “Of course I’m disappointed with the politicians.”
Many Mongolians are frustrated by the government’s seeming inability to contain the
economic fallout. Political watchers say the results of June’s parliamentary elections
indicates widespread frustration with the economy.
Source: Channel News Asia
LANDLOCKED MONGOLIA CONSIDERING PERMANENT NEUTRALITY
In the 13th century, Genghis Khan built the great Mongol empire through brute military
force. But today, the modern Mongolian nation is a young democracy that would rather
make friends than war. Sharing borders with major powers China and Russia, the third-
neighbor policy Mongolia has been cultivating has brought new allies such as the United
States and Japan in recent years. “The third-neighbor policy is important for Mongolian
independence. We’re trying not to be under the pressure of our two neighbors,” said
Professor Dashnyam Zolboo from the Mongolian Institute of International Affairs.
As another safeguard against outside dominance, Mongolia also wants to adopt a formal
policy of neutrality. President Elbegdorj Tsakhia believes a non-alignment position will
best serve a desire for peace, security and balanced foreign relations for the country.
Mongolia has yet to officially declare itself a neutral country although President Elbegdorj
has asserted that Mongolia has essentially been neutral in all but name.
Source: Channel News Asia
CHINA’S DIPLOMATIC HAT-TRICK NO ACCIDENT
In the final two weeks of 2016, Chinese diplomacy has scored an impressive hat-trick:
normalization of relations with Norway, Mongolia's commitment not to allow Dalai Lama
visits, and restoration of diplomatic ties with Sao Tome and Principe after the country cut

17. relations with Taiwan. This diplomatic treble was no accident. The seemingly unrelated
cases share a similarity: recanting perceived challenges to China's core interests. They sent
a strong signal to the world that the appeal of good Chinese diplomatic relations is rising
and that respecting China's concerns is not empty talk.
The one-China principle is the unshakable basis for China to develop relations with other
countries. Mongolia has promised never to allow such visits again [Correction: the foreign
minister merely said the government would not invite the Dalai Lama for a visit during the
current government administration -ed], just one month later. Mongolia's move rings alarm
bells for any countries that have contact with this political exile who attempts to split
Tibet from China under the cloak religion—such a move will severely jeopardize ties with
China.
Source: Ecns.com
INDIA DRIVES MONGOLIA INTO CHINA'S SUBMISSION
Prime Minister Narendra Modi was the first-ever Indian Prime Minister to visit Mongolia. He
may also be the last, as Mongolia now wishes that he had never come. When squeezed by
China to apologize for the Dalai Lama’s visit and promise to never again invite him,
Mongolia learned the hard way that India would neither come to its aid nor deliver on its
promises. Beijing made Ulaanbaatar kowtow, and that was a resounding slap on New
Delhi’s face.
Modi announced a credit line of USD1 billion during his visit in 2015 and assured the
Mongolian leaders that India would extend support in diverse fields and increase exports to
Mongolia. For New Delhi, it was a successful foray into “China’s backyard.” But there was
no trace of the muscle from India, and, on December 21, Ulaanbaatar apologized abjectly
to Beijing and promised to not allow the Dalai Lama to enter the country while the current
government is in place.
Source: InDepthNews
DEPORTED MOTHER AND DAUGHTER RESUME THEIR LIVES IN CALGARY AFTER LEAVING
MONGOLIA AGAIN
Months after they were forced to leave Canada, Ariunaa Demberel and Enky Ankhbayar are
embracing the opportunity to resume their lives in their adopted homeland. In September,
the pair were deported from Canada after officials determined they had inappropriately
entered the country in 2014 seeking refugee status as opposed to a humanitarian
exception based on the fact Ariunaa’s ex-husband allegedly kidnapped, beat and raped her
in their native Mongolia. The mother and daughter returned to Mongolia and immediately
fled to Russia and then the Philippines.
With the assistance of a worker in the office of Canada’s Minister of Public Safety,
Demberel and Ankhbayar were issued temporary visas allowing the mother to work and the
daughter to study in Canada. On Remembrance Day, the duo set foot on Canadian soil. The
two businesses that employed Ariunaa held her positions while she was overseas and she
has returned to work. Enky has resumed her studies at Western Canada High School.
Source: CTV
CHINA NEEDS TO GET OVER THE DALAI LAMA'S VISIT—EDITORIAL
Since the 13th and 14th centuries, the Mongolian Empire has allowed merchants, scholars,
diplomats, and religious peoples from all over the world and treated them equally on a
diplomatic and people-to-people level. Despite this history, the Dalai Lama’s visit in

18. November to Mongolia created somewhat expected tensions with the Chinese government.
But the Dalai Lama’s visit was not a China-Mongolia bilateral issue. The Dalai Lama was
invited by the Center of Mongolian Buddhism, the Gandantegchinlen Monastery, and was
accepted by the people.
From Mongolia’ standpoint, it behooves Chinese foreign policy to accept and respect
Mongolia’s Constitution and citizen’s rights to invite whomever they wish to conduct
religious ceremonies. From a geopolitical standpoint, it is in the best interests of both
China and Mongolia to continue their diplomatic, good-neighbor relations at both the
government-to-government and people-to-people levels.
Bolor Lkhaajav is pursuing a Master’s of Arts in Asia-Pacific Studies at the University of
San Francisco, and was formerly a Security Analyst with Horizon Intelligence.
Source: The Diplomat
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ECONOMIC INDICATORS
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]
Year 2012 *14.0% [source: NSOM]
Year 2013 *12.5% [source: NSOM]
Year 2014 *11.0% [source: NSOM]
Year 2015 *1.9% [source: NSOM]
November 30, 2016 *0.2% [source: NSOM]
*Year-over-year (y-o-y), nationwide
Note: -0.6% y-o-y - Ulaanbaatar City, November 30, 2016
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]

19. 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]
July 30, 2014 12.00% {source: Mongol Bank}
January 14, 2015 13.00% {source: Mongol Bank}
January 14, 2016 12.00% [source: Mongol Bank]
May 6, 2016 10.50% [source: Mongol Bank]
August 18, 2016 15.00% [source: Mongol Bank]
CURRENCY RATES – 5 January 2016
Currency Rate
U.S. dollar USD 2,497.12
Euro EUR 2,636.96
Japanese yen JPY 21.54
British pound GBP 3,075.70
Hong Kong dollar HKD 322.02
Russian Ruble RUB 41.59
Chinese Yuan CNY 363.02
South Korean Won KRW 2.11