Tight times for Mongolia’s retail sector

 

Tight times for Mongolia’s retail sector

#

A cooling economy, persistently high inflation and tighter credit regulations will maintain pressure on Mongolia's retail sector throughout 2015, though demand for shop space in certain segments remains strong.

Read more...

Are we the land of robbers, or the game for the foreigners?

Source: Baabar.mn

Are we the land of robbers, or the game for the foreigners?
Baabar, a famous blogger's article titled "Are we the land of robbers, or the game for the foreigners?" published on his blog on Feb. 6th.
He says that the procedure for the judgment of the three employees from SGS has taken the express lane to put them imprisoned.
He wrote that the IAAC (Independent Authority Against Corruption) is the agency for combating the corruption, and the Ministry of Finance issues the analysis, instead of the third party experts. Article continues to say that an entity with foreign investment should be treated as an international case, and the conclusion of the international auditing body is accepted, but this practice did not happen in Mongolia.
Further, the court used the "surprise method", commonly practiced in Mongolia, as the judges read out a monetary penalty first time, that is only to "surprise attack" with sentencing a jail term the day. Writer also reiterated advisor Chuluunbat's statement, saying that the tax evasion case is applicable to the entity, but not to an individual.

Read more...

Mongolia Growth Group Ltd. CEO’s Address to Shareholders

Source: Mongolia Growth Group

To the Shareholders of Mongolia Growth Group Ltd. (MGG);

As the largest shareholder and newly appointed CEO, the time has come to explain the recent corporate events at MGG and detail our path forward. I feel strongly that the actions taken on December 15th are the first of many concrete steps that will stabilize our business and put it on a much more sustainable path going forward.

How We Got Here?
In the summer of 2010, I embarked upon a journey to Mongolia that became the genesis of MGG. While in Mongolia, I became convinced of the long-term growth potential of the country and became determined to create a way for myself and some friends to invest in a country whose rapid economic growth seemed largely inevitable on the back of a mining boom.

Read more...

Mongolia is at a turning point, again...

Source: INS Mongolia

 

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.

Read more...

Legislative Agenda for the Autumn Session of the Mongolian Parliament September 2014

Resource: http://ehoganlovells.com/

On 22 September 2014, the Chairman of the Parliament of Mongolia ("Parliament") adopted Order #147 which approved those matters which will be discussed at the autumn session of Parliament.

The Order provides that the following draft laws and resolutions will be discussed in the following order:
Law on the Ratification of the Agreement on Transparency in Matters Related to International Trade and Investment between the United States of America and Mongolia;
Resolution on Measures to Ensure the Implementation of the State Policy on Railway Transportation;
Motion to dismiss a certain cabinet minister from office;
Resolution on the Approval of the State Policy on the Road Transportation Sector;
Law on Fire Safety;
Law on the Budget of Mongolia for 2015;
Law on the Budget for 2015 of the Human Development Fund;
Law on the Budget for 2015 of the Social Insurance Fund;
Resolution on the Approval of Main Directions for State Monetary Policy for 2015;
Law on Trade;
Law on Amendments to the Tax Laws;
Law on the Pledge of Movable Properties and Intangible Assets;
Law on the State Registration of Legal Entities;
Law on Crimes;
Law on Minor Offences;
Law on Combatting Domestic Violence;
Law on the Mongolian Language;
Resolution on the Revision of the State Policy on Education;
Law on Amendments to the Law on Procedures for the Implementing the Law on Prohibition of Exploration and Mining in Headwater Areas, Protected Zones for Water Reserves and Forest Lands;
Law on Inspections;
Consolidated Law on Elections;
Law on Political Parties and the Law on the Financing of Political Parties;
Resolution on the Approval of the Long Term Development Policy of Mongolia;
Law on Amendments to the Minerals Law;
Laws and other draft decisions of Parliament that have been under discussion by Parliament; and
Others.
Other laws and resolutions that are not listed in the above can be included with the approval of the Council of the Chairman of Parliament.

The autumn session of Parliament will commence on 1 October 2014 and end on 10 February 2015.

Of particular interest to investors are the following potential developments.

Ratification of the US-Mongolia Agreement on Transparency

One of the significant benefits of ratification of the Transparency Agreement is the joint undertaking to provide opportunities for public comment on proposed laws and regulations and to publish final laws and regulations in English, which should facilitate the ability of not only U.S. but other foreign enterprises to do business in, and invest in, Mongolia.

Law on the Pledge of Movable Properties and Intangible Assets

Access to finance is one of the major challenges faced by many Mongolian businesses. Current weaknesses of the Mongolian system include lack of clear legal framework and the absence of a registration regime for taking security over movable assets such as equipment, machinery and certain types of intellectual property rights, and over shares or securities in unlisted Mongolian companies. Reforms in this sector should improve access to finance by enabling lenders to take a broader range of collateral as security.

Law on the State Registration of Legal Entities

Whilst improvements were made to the process for incorporating companies by foreign investors in Mongolia by the passage of the Investment Law in October 2013, amendments to the law will introduce an online registration process for incorporation of legal entities and registration of subsequent changes in the registered details of a legal entity as well as provision of services by the Legal Entities Registration Office. The amendment will hopefully make the registration process and other related services more efficient and increase the level of transparency and openness of the state register.

Long Name Law (Item 19)

While historically this legislation has been controversial, appropriate and balanced amendments to the Law on Procedures for the Implementing the so-called Long Name Law would assist to bring much-needed clarity and opportunity to continue operation to investors in the mining sector (mainly in the alluvial gold sector) whose exploration investments and activity have in practice been on hold since the initial passage of the law in 2009.

 

Mongolia Reports