By: Credit Suisse

Published: July 24, 2016

After domestic concerns over foreign direct investment (FDI) and slumping metal prices slowed Mongolia’s economy to a crawl in 2015, Prime Minister Saikhanbileg Chimed wants to reassure investors that they are welcome in his country. “My message is a simple one. Mongolia is back and open for business,” Saikhanbileg said in a speech at the AIC 2016 on April 7. Opposition groups have protested against some major mining projects, causing delays that have now been resolved, Saikhanbileg said, asserting that the country would ensure protection for foreign investors and a transparent rule of law. “As you know, in a vibrant democracy, it’s not always easy to get where you want to go directly,” Saikhanbileg said. Mongolia is heavily dependent on mining, which accounts for 80 percent of its GDP. To reduce that dependence, the landlocked nation set between China and Russia has adopted a “rainbow” economic development plan, hoping to add more “colors” besides mining, Saikhanbileg said. Top candidates include agribusiness, tourism, IT, health care, construction and power generation. The vast country has more livestock (56 million) than people (3 million), and with ample grassland, its cattle and lamb are able to roam free, making them extra tasty. “We have the most democratic livestock in the world. They are free to choose where to go and what to eat,” Saikhanbileg said. The country also offers abundant sunshine and room for solar and wind energy projects that could power nearby cities and manufacturing centers, Saikhanbileg said. “Mongolia could be an energy hub for the entire Asian market,” he added. Mongolia’s transition to democracy and a market based economy, which began in 1990, is still ongoing. The country still has many state-owned industries that need to be divested, along with capital markets that are still evolving. Saikhanbileg called the expansion of the Mongolian stock exchange one of his “highest priorities.”