Industry & Retail

Although it may never compete with neighbours with well-established manufacturing sectors and economies of scale, Mongolia has the potential to meet domestic needs and produce goods, such as meat and cashmere for export. The move into mass production faces a host of constraints: Mongolia has a small domestic market, poor infrastructure, a growing minerals sector competing for labour and capital, and its neighbours, China and Korea, are world leaders in low-cost mass production. At the same time, Mongolia is an open economy, with low tariffs and limited non-tariff barriers, and as such, goods can easily enter from abroad. Nevertheless, Mongolia has the potential to develop a strong and healthy industrial sector: domestic demand is climbing, quality is improving and interest rates have, over the long term, been falling. If the programme to improve cashmere manufacturing and the investments to raise the quality of meat production pan out, exports of manufactured goods could become a meaningful economic contributor. This chapter contains an interview with B. Chuluunbatar, President and CEO, Monnis Group.