As the Mongolian economy weakens, the country’s banking system faces challenges. Assets on balance sheets are looking far less solid and customers are finding it harder to service their loans as growth slows and as the boom of recent years comes apparently to an end. Nevertheless, the core of the Mongolian banking system is quite sound.
Legislative changes in early 2012, like the Strategic Entities Foreign Investment Law (SEFIL), combined with a global trend of capital outflow from developing countries, unnerved investors and led to 17% and 47% year-on-year drops in foreign direct investment (FDI) in 2012 and the first three quarters of 2013, respectively. In November 2013, the...
The Bank of Mongolia, the country’s central bank, has a tough job. Not only does it have to contend with international crises and crashes, like everyone else, but it has responsibility for a relatively young and untested banking system. Moreover, and more to the point, it has to deal with extreme money flows caused by fluctuating resource prices...
Following a mining-related boom in exports and foreign direct investment (FDI), from mid-2012 Mongolia’s rapid economic growth faced the challenges of trade deterioration and falling commodity prices and demand on the one hand, and global and regional uncertainty on the other. The Oyu Tolgoi (OT) gold and copper mine that had emerged as a beacon...
For a relatively young democracy, Mongolia has taken giant steps in developing its socioeconomic and political system. The values of democracy are today very much instilled in Mongolian society, which is significant given the country’s socialist past. Economic development has also been a major achievement in recent years, as the country has seen a significant inflow of...
The development of financing for smaller companies is vital for the Mongolian economy. While resources-focused ventures have the potential to transform the country, it will be more modest enterprises that provide stable employment and income, long-term underlying growth and locally made products. Without a vital small and medium-sized enterprise...
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