Mongolia required to improve investment climate in order to utilize mineral resourcesEconomy
Ulaanbaatar /MONTSAME/. According to a study carried out on making investments in the mining sector, 79 percent of the participants have answered that they are ready to invest in Mongolia due to its abundant mineral resources.
However, it was discovered that the country has yet to create the sufficient conditions for foreign investment as policy and institutional factors are weak. Furthermore, the study’s participants noted how there are certain factors that cause the most difficulties, such as the limited accessibility of geological information, slow court proceedings, availability of infrastructure, and human resources.
The study was commissioned by the European Bank for Reconstruction and Development in cooperation with the Ministry of Mining and Heavy Industry, and conducted by Adam Smith International.
The findings of the ‘Mongolian Mining Industry and Supply Chain – Investment Climate Benchmarking Study’ were presented during a workshop, ‘Foreign Direct Investment in Mining of Mongolia’, that took place on May 17.
Noting that it was a timely study, Deputy Minister of Mining and Heavy Industry O.Batnairamdal underlined its significance for pinpointing where the country’s mining sector ranks among other countries, and prioritizing the issues faced by investors and entities. He said, “The Law on Foreign Investment that was adopted by Mongolia in 1993 is currently being revised. As the prices of the main mineral products are high on the global market at the moment, it is possible for investments being made in the sector to similarly increase.”
In the last three decades, the mining sector has had a crucial role in Mongolia’s economy, making up 25 percent of the GDP and 70-75 percent of foreign investments.
Head of the European Bank for Reconstruction and Development (EBRD) in Mongolia Hannes Takacs noted the opportunity for Mongolia to attract foreign investment and grow its economy by using mineral resources, and highlighted that it is possible to increase the likelihood of investment by resolving issues related to matters such as taxes, special permissions, and licenses.
The workshop was also attended by mining sector experts, project team members, and representatives of companies and stakeholders.