2014, PRESENTATION, MINISTRY OF INDUSTRY AND AGRICULTURE, B.TSOGTGEREL

INVEST MONGOLIA-2014

Presenter: B.TSOGTGEREL

Vice Minister

03 Sep, 2014

MINISTRY OF INDUSTRY AND AGRICULTURE

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MONGOLIA'S ECONOMY CONTINUES TO EXPERIENCE COMPARABLY HIGH

GROWTH RATES AMONG THE WORLD COUNTRIES

Asia

Europe

Canada

South America

Africa

USA

Australia,Pacific

Mongolia

↗11.7%

↙0.2%

↗7.7%

↗2.2%

↙2.3%

Annual GDP growth rate (%) in 2013


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1.Doing Business

Rank

2. Country CreditRating

3. Index of Economic Freedom

4. PoliticalRisk

Rating(ICRG)

5. Corruption

Rank

1

Business environment Descriptions Rank/ TrendMongolia is ranked 76th out of 185 economies in Doing Business 2013. Its overall score is 12 points higher compared to 2012, reflecting an 56 point increase in the Starting a Business indicator

Mongolia’s credit rating is upgrading due to giant mining projects and financial system development. S&P: B+, Moody’s: B2, Fitch: B+ Outlook: Stable

Mongolia’s economic freedom score is 58.9, making its economy the 97th freest in the 2014. Mongolia is ranked 19th out of 42 countries in the Asia–Pacific region.

The Political risk rating is 65.5 or ranked 62th out of 140 countries. Mongolian political system is more democracy compared to other mining emerging countries

In terms of Corruption index: The biggest news is clearly that Mongolia has jumped from 120th to 94th least corrupt country in Transparency International 2013.

76 /185

Stable

97 /177

62 /140

83 /177

2

3

4

5

Mongolia is the least densely populated country in the world. It is governed by an open, democratic government and a free market economy. There is wide spread access to the Internet and 97 per cent of the population is literate.

Also Mongolia is no longer in the wilderness when it comes to global business. In fact, its strategic location to resource-hungry China is an enviable strength

MONGOLIAN LEGAL AND ECONOMIC ENVIRONMENTS ARE MORE

VIABLE WITH UPWARD TREND

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MAJOR SHARE OF THE LABOUR FORCE HAS BEEN EMPLOYED IN AGRICULTURE

SECTOR WHILE SHARE OF CONTRIBUTION TO GDP HAS BEEN SIGNIFICANT

• 15% OF REAL GDP AS OF 2013 (AFTERMINING SECTOR WHICH ACCOUNTED16% OF GDP)

• ABSOLUTE VALUE OF THE SECTOROUTPUT REMAINED RELATIVELYSTABLE OVER THE YEARS

• 7% OF TOTAL EXPORT REVENUES ASOF 2012 (DOWN FROM 23% IN 2005)

• NATIONAL WORKFORCE (THE LARGESTSHARE)

• ANIMAL HUSBANDRY SUBSECTOREMPLOYS ~90% OF THEAGRICULTURAL SECTOR WORKFORCE

0

1

2

3

4

5

6

Real G

DP

at

2005 p

rices (

MN

T t

rill

ion

)

Agriculture

Mining

Other

0.0

0.2

0.4

0.6

0.8

1.0

1.2

Em

plo

ym

en

t (m

illi

on

)

AgricultureMiningOther

Economic Performace


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Trend of Mongolian livestock sector

0.4 (1%)

2.7 (6%)

3.0 (6%)

19.1 (44%)

20.1 (43%)

0 5 10 15 20

Camel

Horse

Cattle

Sheep

Goat

Soviet-era Current Development- Mining eraIn the Future

Sustainable development

0.5 (2%)

2.3 (9%)

2.8 (11%)

15.1 (58%)

5.1 (20%)

0 5 10 15 20

Camel

Horse

Cattle

Sheep

Goat

LIVESTOCK, RELATED SPECIALISTS AND MEAT AND MILK SUPPLY CHAIN (HERDING TO END USER) WERE STATE OWNED

FURTHER INCREASE IN GOAT NUMBER

STATE POLICY INTENTED TO SUPPORTI CASHMERE AND WOOL MANUFACTURERS, AND HAS BEEN ENCOURAGED GOAT QUANTITY OVER THE YEARS

SHRINKING CONTRIBUTION SHARE THE ECONOMY DUE TO MINING SECTOR SURGE

SUSTAINABLE LIVESTOCK DEVELOPMENT –GOVERNMENT INITIATING ANIMAL HUSBANDRY DEVELOPMENT BY WHOLE CYCLE

INDUSTRIAL AND AGRICULTURE MIXED DEVELOPMENT PATH

LEATHER PROCESSING SECTOR IS EXPECTED TO BECOME A SUCCESSFUL FLAGSHIP LIGHT-INDUSTRIAL PROJECT.

FOR MONGOLIA, IT IS TIME TO SHIFT TRADITIONAL

AGRICULTURAL SECTOR INTO INDUSTRIAL DESIGN AND

PRODUCE MORE VALUE ADDED PRODUCTS, THE SOLUTION IS

AGRICULTURAL CLUSTER

HEAVY INDUSTRY

LIGHT INDUSTRY

FOOD PROCESSING

INDUSTRY

CROP PRODUCTION

ANIMAL HUSBANDRY


$

150.0 million

40.0 million

20.0 million

20.0 million 20.0 million

200.0 million

20.0 million

90.0 million

Crop 3 National campaign

Organic food program

National program “Milk”

STATE POLICY FOR FOOD AND AGRICULTURE

NATIONAL FOOD

SECURITY PROGRAM

MONGOLIAN NATIONAL

LIVESTOCK PROGRAM

NATIONAL PROGRAM ON

INDUSTRIALIZATION

RELATED POLICY AND PROGRAMS

“Sainshand” industrial

complex

Coal to liquid project

Copper smelter

Metallurgical factory

Heavy Industry

Wool and cashmere processing

Textile and apparel

Leather and skin processing

Agricultural commodity exchange

Light industry

Food industry

Meat production

Milk production

Vegetable

Intensified farming

(Husbandry)

Pasture, fodder, water supply

Veterinary, breeding animal

Animal husbandry

• Wool: 1.1

thousand

tones

• Meat: 260

kg meat per

animal

•Meat: 120

kg per

animal

•Meat: 120

kg per animal

• Wool: 21

thousand

tones

• Meat: 20 kg

per head

• Cashmere:

7.0 thousand

tones

• Meat: 16

kg per

animal

SUSTAINABLE DEVELOPMENT ON ANIMAL

HUSBANDRY

0.4 mil 2.7 mil 3.0 mil20.1

mil

19.1

mil

Large animal leather: 1 million piecesSmall animal leather: 9 million

pieces

Meat: 253 thousand tones

Dairy product: 407 million liters

Total number of Mongolian Livestock- 45.3 million

Crop production

Wheat

Greenhouse

Vegetables and Fruits

Seabuckthorn

Why

New “Investment law” (03 Oct. 2013)

Import tax exemption for agricultural equipment

and machineries until 31 Dec.2017

Establishment of necessary infrastructure will be

covered by the Government of Mongolia

Sustainable raw material supply

WHY INVEST INTO THE INDUSTRY AND AGRICULTURE

SECTOR OF MONGOLIA?

THANK YOU FOR YOUR ATTENTION
