Article series

Institute for National Strategy

Article№16- 22nd Mar

Institute for National Strategy

After the IMF bailout package… What else?

Why the bailout? The Mongolia government has jointly announced with the IMF that it will implement the politically difficult – but inevitable – rescue package, and avoid becoming a delinquent international debtor. Let’s be clear – this is an aid package, at very low interest rates. It is also coming from long-term friends of Mongolia – the IMF/World Bank, ADB and with support from Japan and other bilateral partners. The Chinese government will reportedly extend the term of the US$2.2B Yuan swap facility (due in August) by three...
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Article№15- 21st Apr

Institute for National Strategy

Macro view of Government

Today I have the responsibility to give a macro view of government. This is a difficult topic to do well – especially when there are so many experts in the room This report will be a business centric assessment of government performance When we talk about government we often refer to the different arms of government collectively – which can...
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Article№13- 3rd Feb

Institute for National Strategy

Difficult times-Positive progress

The prime minister survives When the recent “no-confidence” petition was finally lodged, championed by a resource nationalist MP, it gave the Prime Minister the opportunity to face the parliament and stare down his challengers. Analysis of what was said in parliament indicates that this vote was much more about politics and much less about the subject...
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Article№12-30th Dec 2015

Institute for National Strategy

Article№11

Institute for National Strategy

Trends and Development of Real Estate Sector

For 1.4 million Mongolians living in Ulaanbaatar, the country’s economic progress has manifested itself most visibly in real estate. Ulaanbaatar has witnessed large-scale development and re-development, and the city is almost unrecognizable from 10 years ago. New residential areas, above all in and around Zaisan and the stadium area, have sprung up. New retail concepts, such as Hunnu Mall, have also entered the market....
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Article№10

Institute for National Strategy

Ensuring good policy debate during the election period

The next general election is due in mid-2016 and Mongolia’s economy continues to suffer, along with many other economies globally. The massive decline in commodity prices and faltering growth in China are significant reasons for concern in Mongolia. The commodities boom is now a bust and it is difficult to get finance for good projects anywhere in the world, and even more difficult in frontier economies....
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Article№9-25th May 2015

Institute for National Strategy

Economy is back to business

The prolonged dispute between Rio Tinto and the government has finally ended. The signing of the Oyu Tolgoi Underground Development Plan (UDP) in Dubai, signifies the turning of an important page. Mongolia has stepped up to the big league, and successfully negotiated a settlement with a global business force. This deal is equitable and sets great precedents for those contemplating investments – large and small – in Mongolia....
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Article №8-8th April 2015

Institute for National Strategy

Article№7-16th March 2015

Institute for National Strategy

INS Interview with Byambasaikhan, CEO of Erdenes Mongol

INS Opinion There are not many examples globally where governments have successfully led “non-service related” businesses profitably and are “leaders in class”.  In the mining sector the keys to success are to have a high quality orebody and world class management approaches, which implies a world class team. In practice this means to be highly safe, to design your business processes to keep unit operating costs at low levels, to deliver capital projects on time and to budget and to achieve the fair market price for your product. Investors and financiers look for these attributes from those company’s seeking to raise finance. They also look very closely at the shareholders, their motivations and the support of the government for business and the judicial system that presides over the borrower. Mr. Byambasaikhan faces challenges both inside his holding company and with his shareholders. Gaining alignment as to the changes required and the rewards that may follow will be his immediate challenge. ————————- Background: Byambasaikhan is the CEO of Erdenes Mongol LLC, the nation’s largest investment holding company that is comprised of Erdenes Tavan Tolgoi JSC, Oyu Tolgoi LLC, Erdenet Mining Corporation, Shivee Ovoo JSC, and Baganuur JSC. He also chairs the Business Council of Mongolia which represents 260 active companies. *What...
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Article№6-6th Jan 2015

Institute for National Strategy

Private sector recovery –new paradigms needed

“Vertrouwen komt te voet en vertrekt te paard.”  This is a famous Dutch proverb translated as “Trust comes on foot and leaves on horseback.” However, in the current context of the Mongolian investment climate this could be reworded as  – “investors come on foot and leave on horseback”. Investment, both foreign and domestic, is fundamentally built on trust. In just a few short years since the boom times of 2009-2011 Mongolia has gone from being an international “investment show case” to a “basket case”. Investors and financiers are extremely cautious and most have lost interest....
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Article№5-8th Dec 2014

Cameron Mcrae

Mongolia is at a turning point, again…

Institute for National Strategy The economic situation is dire and the previous cabinet has managed itself into a position of high debt, with accompanying high inflation, high interest rates and a steadily devaluing currency. Inflows for direct investment have slowed to a dribble due to long lasting commercial disputes, and a lack of confidence in the rule of law and government behavior. Will “new PM” Saikhanbileg’s new government make the correct policy settings, fix the big problems in the correct order, and direct scarce resources to where it will deliver most benefit in the medium term. Evidence is clear that political leaders are plentiful and political rhetoric is cheap but brave and sensible policy making and execution is much scarcer. Will this new leader organize parliament for success and choose the best team and prioritize correctly for the challenges upon us?...
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Article№4-19th Nov 2014

Cameron Mcrae, Khashchuluun Chuluundorj

Achieving Macro-economic stability (part 2)

INS Problem statement Last week Mr. Khashchuluun raised the “macro-economic” issues that need to be understood and reconciled by ordinary Mongolians, policy influencers and policy decision makers alike. Three years of high economic growth have been experienced but at the same time we now have a situation where we rate poorly in terms of inflation, affordable housing, low interest rates, job growth, and improved government service delivery.  At the same time our personal and national debt levels are escalating rapidly and the Mongolian currency is steadily declining in value. Mongolia now has a significantly higher level of debt, with higher interest and debt repayments to honor and service, and a structural current account deficit to deal with. This situation will not disappear and will only get worse if not addressed immediately. What can be done?...
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Article№3-20th Oct 2014

Khashchuluun Chuluundorj, Cameron Mcrae

Achieving Macroeconomic Stability (part1)

INS Problem Statement  After 3 years of record economic growth, huge inflows of foreign investment and strong national currency, the economy now looks to be in poor shape with poor macroeconomic fundamentals. Why is economic growth so important and what are the economic fundamentals that need to be achieved to get sustainable and diversified growth of the Mongolian economy for the broadest possible impact for Mongolians and Mongolian organisations?...
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Article№2- 15th Sep 2014

Cameron Mcrae

Regaining credibility …..

Problem statement by INS Mongolia’s ability to attract third neighbor investors and financiers to support funding of it’s huge development agenda has deteriorated. Providers of capital are seeking answers to 2 basic questions while considering lending or investing into Mongolia. Is the Government of Mongolia supportive of an empowered private sector and is it proactively resolving business disputes? What is the winning strategy that will turbocharge the economy? Opinion by...
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Article№1-1st Sep 2014

Cameron Mcrae

Moving Mongolia forward – and Why INS?

A group of men were enjoying the midday sunshine and each other’s company. They were rivals and friends – who drank and played together. This day they were enjoying their vodka and telling stories, and planning the future for themselves and their families. A sheep was tethered to the pole 20 meters away, it looked forlorn and aggravated as it knew it was soon to be their dinner. The hours passed, the noise grew, the plans grew grander and eventually the men fell into a drunken sleep. Several hours later, the men started waking up. They were hung-over, but still cheerful as they remembered all the plans they had made for themselves. Somebody said, “let’s eat”. And they all looked to the table, where there was no food. One looked back in the direction of the sheep, and laughed. Another sleepily said “the sheep is still a sheep”....
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