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Friday, December 20, 2013

[MSE Top 20 at 9-month high, IMF urges Mongolia to honor FSL & include DBM in budget, and 3 neighbors sign declaration to develop transit corridor]

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Friday, December 20, 2013

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Headlines in Italic are ones modified by Cover Mongolia from original

 

Overseas Market

Wolf Petroleum: Completion of Geochemical Analysis

150 out of 723 samples have identified high to medium gravity oil seeps and gas anomalies.

December 18, Wolf Petroleum Limited (ASX:WOF) --

The Company is extremely pleased to announce the results of geochemical analysis on seismic shot hole sediments.

Highlights:  

·         Log Propane (C3) Concentration. (Figure 1.) 80 out of 723 samples contain anomalous amount of propane gas.  

·         Methane (C1)/Ethane (C2) ratio. (Figure 2.) The propane (C3) gas in the samples was derived from an oil rather than wet gas source.  

·         Gas Wetness ratio (C2+/C1+). (Figure 3.) Anomalous gas wetness is found in samples over Toson Tolgoi Basin.  

·         High gravity oil microseeps. (Figure 8 & 9.) 100 out of 723 samples have high gravity oil microseeps.  

·         Medium gravity oil microseeps. (Figure 10 & 11.) 50 out of 723 samples have medium gravity oil microseeps.  

The Company has collected over 7,500 samples from the bottom of seismic shot holes and analysed a total of 723 samples (batches 1, 2 and 3). The geochemical analysis has confirmed the potential for the presence of oil in the Toson Tolgoi and Talbulag Basins.

These results further confirm the significant potential of Toson Tolgoi and Talbulag Basins  

The gas and liquid hydrocarbon seeps are generally located on the margins of the basins suggesting migration upwards and outwards of the basins.

The correlation of the hydrocarbon seeps and faults will be determined from an evaluation of hydrocarbon profiles over the seismic sections in the coming weeks.  

The Company is working towards opening a data room for potential investors and farmout partners early in 2014.

Link to release

 

YAK closed +10.99% to C$2.12 on Thursday

Mongolia Growth Group Ltd. Publishes November 2013 Monthly Letter to Shareholders

Thunder Bay, Ontario CANADA, December 18, 2013 /FSC/ - Mongolia Growth Group Ltd. (YAK - TSX Venture),a real estate company participating in the dynamic growth of the Mongolian economy via ownership of institutional-quality commercial property assets in Ulaanbaatar, Mongolia, is pleased to announce the release of its November 2013 letter to shareholders. 

November 2013 Shareholder Letter 

To the Shareholders of Mongolia Growth Group Ltd., 

In November 2013, MGG's core commercial property portfolio* experienced a same-store rental increase of 23% relative to November 2012 on properties owned 12 months or longer as measured in local currency (Mongolian Togrog). The occupancy rate for the core portfolio in November 2013 was 93.9%, including an occupancy rate of 98.5% for core retail properties and an occupancy rate of 84.7% for core office properties. 

Portfolio, Operations, and Development Update 

Portfolio 

During the month of November, we did not acquire or dispose of any property assets. 

Operations 

As the economy accelerates, we have seen a material increase in tenants paying rent on time. We ended the month with rent over 30 days late at less than 1% of our monthly rental revenue-which is our best rent collection performance thus far and substantially ahead of where our performance had been in prior months. 

Occupancy 

The Anand Building reached a 78.2% occupancy level as of November, 2013. In addition, we have recently received a request for additional space from an existing tenant which would increase the occupancy to near 92.2% when this lease becomes effective in January, 2014. We view this as a normalized occupancy level for an office building in downtown Ulaanbaatar, and above occupancy rates in comparable buildings. The successful leasing of this building completes a year of work that began with us buying the vacant and distressed asset, undertaking a complete renovation of the property for approximately USD $300,000 and finally seeing our leasing division turn this into cash flow. 

Development 

Over the past few months, we have begun planning for the construction of a high-street retail location of approximately 1,000 square meters that will replace portions of an existing structure that is now obsolete. We originally purchased this property with the view to completely re-develop it and it has been vacant since we acquired it. We anticipate that this development will be completed during the fourth quarter of 2014 and involve a budget of approximately USD $1,000,000. 

Mongolian Economic Update 

In the most recent quarter for which data is available (Q3 2013) Mongolian real GDP growth was 11.9%. 

Since we wrote you last: 

§  Mongolian leaders have embarked on an initiative to attract foreign investment and numerous government official have travelled overseas in order to explain the benefits of the new investment law. 

§  Mongolian Central Bank head, Mr. Zoljargal said that GDP could expand as much as 17% next year

§  According to Transparency International, the corruption index of Mongolia declined from 94th place to 83rd place out of 177 countries for 2013. This compares with 2009 when Mongolia was in 120th place. 

§  The Mining Ministry of Mongolia has issued a report on Mongolia's shale oil reserves noting that the country has approximately 60 shale oil deposits that total to approximately 700 billion tons of estimated reserves. Mongolia will look for investors to develop these resources over the next few years and ease the country off of foreign imports. 

§  The Development Bank of Mongolia will begin issuing its first 10-year Samurai Bonds which will be backed by a guarantee from the Japan Bank for International Cooperation. This should become a low cost source of capital for infrastructure development. 

We look forward to updating you again on our progress and new developments in the Mongolian economy next month. 

Sincerely, 

Harris Kupperman 
Chairman & CEO 
Mongolia Growth Group Ltd. 

Link to release

 

Mogi: having a hard time getting a Qualified Person to sign off on announcements it seems. PCY closed +25% to 7.5c on Thursday

Prophecy Coal (V.PCY) confirms Tugalgatai purchase termination – shares jump 41%

December 19 (Stockhouse.com) Prophecy Coal (TSX-V:PCY, StockForum), a Vancouver-based thermal coal mining and production company operating in Mongolia, released clarifications on their July 18, 2012 news release due to a British Columbia Securities Commission review of said disclosure.

The July 18 release announced that Prophecy had entered into a Sales and Purchase Agreement to acquire certain Tugalgatai coal exploration licenses from Tethys Mining and that the transaction was still subject to Mongolian governmental approval. 

The release went on to state that the company had a resource estimate of 2.33 billion tonnes coal at Tugalgatai and it wasn't until August 7, 2012, that this estimate was classified as "historic". However, Prophecy failed to include historic disclosure according to NI 43-101 stipulations in both the July and August releases. 

The company also failed to disclose differences between Mongolian classes and Canadian Institute of Mining classifications as required under sections 1.2 and 1.3 of NI 43-101 in both releases. 

According to today's news release, these reporting errors and omissions have been attributed to a "Qualified Person" oversight and the company wanted to assure investors they are not treating the 2.33 billion estimate as current. 

However, intentions toward the Tugalgatai purchase have changed and the news release went on to state, "The Company would like to further confirm that the Agreement was terminated on November 5, 2012 and that Prophecy is not intending to proceed with an acquisition of the Tugalgatai Assets and so will not prepare and file a National Instrument 43-101 ("NI 43-101") compliant technical report for its Chandgana Property in Mongolia that includes the Tugalgatai Assets." 

Prophecy Coal was in the news recently when the company paid off an outstanding secured loan at the beginning of November

Share rose 41.67% on the news to $0.085 per share. 

Currently there are 248.4m outstanding shares with a market cap of $21.1 million.

Link to article

Link to PCY release

 

MRC: Interim Update

December 17 -- Following the Interim Update dated 26 August 2013, the Board of Directors of Mongolian Resource Corporation ("MRC," ASX:MUB) wishes to provide information to the market on its ongoing efforts to stabilize and strategically develop the Company going forward.

On Monday, 18 November 2013, the Board of Directors authorized its legal representatives in Mongolia to submit a civil claim to the district court of Khan-Uul, Mongolia seeking a judgment compelling Tanan Jargalsaikhan to: 1) implement MRCMGL's Board of Directors' Resolution discharging the Executive Director of the company; and 2) turn over the original copies of charter, certificates, stamps and other related documents of MRCMGL to its duly appointed Directors.

On Wednesday, 11 December 2013, Judge Oyun entered Order No. 5452 freezing the assets of MRC MGL, Gunbileg Trade and Gunbileg Gold. This order was registered with the Court Enforcement Office on Thursday, 12 December 2013.

According to the Judge's order:

1.    Former MRC Director Tanan Jargalsaikhan's actions regarding the share transfer, property, and actions regarding: 1) the three (3) mineral licenses of MRCMGL; 2) the three (3) mineral licenses of Gunbileg Gold LLC; and 3) the mineral license of Gunbileg Trade LLC are all prohibited;

2.    Any and all outflow from MRCMGL's, Gunbileg Gold LLC or Gunbileg Trade LLC's bank accounts is prohibited;

3.    Any and all immovable and movable properties of MRCMGL, Gunbileg Gold LLC and Gunbileg Trade LLC's are immediately prohibited.

Although the Board is pleased with these positive developments, we anxiously await the Court's final ruling on the merits of MRC's case which will allow it to regain MRC's rightfully owned assets and to seek compensation and damages from the previous directors for their actions and criminal breaches under the Corporations Law by which the Company is governed.

As previously advised, once complete, the Board will endeavor to obtain a reliable understanding of the current state of the business, to raise additional capital to satisfy existing creditors and to resume trading as soon as possible.

The Board will continue to provide information to its shareholders and the market as soon as it becomes available.

Link to release

 

Khan Investment Management Update (12/20/2013)

For the month of November, the Khan Mongolia Equity Fund (KMEF) lost 1.49%, weighed down again by Turquoise Hill Resources Ltd (TRQ:US) which fell 14.52% after announcing a USD 2.4B 1-for-1 rights issue. The highly dilutive offer issued at a 42% discount sent the company's shares tumbling. 

According to the National Statistics Office, Mongolia's Q3 GDP expanded 11.5% yoy. The IMF predicts 2013 annual growth of 11.8%, and forecasts expansion of 11.7% for 2014 (Mogi: new IMF report now predicts 9.6% growth in 2014. See below under Economy for the IMF release), expected to be the highest in the world. Mongolia's Central Bank Governor announced that 2014 GDP growth could reach 17.00% due to renewed investor confidence and progress with Oyu Tolgoi (OT). 

In November President Elbegdorj announced his new "From Big Government to Smart Government" initiative in a two hour televised speech that included several strong worded statements such as "the OT dispute is the perfect example of why the Government shall not own equity in private businesses" and "Mongolia's oppressed class is the private sector." We look forward very much to a tangible action plan for implementation of this initiative which is largely aimed to "abolish interference of the state in business operations" and to "promote the economic growth of private entities".  

An unprecedented delegation of government officials and business leaders joined President Elbegdorj on his recent visit to Singapore and Hong Kong. Business forums held in each city where aimed to promote Mongolia as an investment destination following legislation of the new Investment Laws passed a month earlier. In very frank addresses, the President willingly admitted Mongolia had made mistakes, but highlighted that the government is committed to improving the business environment, reigniting foreign direct investment flows, and fostering Mongolian growth. "Just like others, we do make mistakes. There have been moments when we disappointed the investors. But because we are open, we can correct the mistakes and fix the problems." Following the President's tour the Mongolian Stock Exchange rallied 7.5% to November month end, indicating renewed interest in the tiny bourse. 

When interviewed on CNBC in Singapore, Head of Cabinet, Minister Saikhanbileg stated that the biggest challenge facing Mongolia today is Foreign Direct Investment (FDI). "Everybody in my country has started to acknowledge that without FDI, without technology, without know how and without good experiences… Mongolia has no way to prosper." According to Minister Saikhanbileg, outstanding issues with Rio Tinto are expected to be resolved before the end of the year, and the timetable for Phase Two financing and underground mine development at OT are expected to be announced. Saikhanbileg also highlighted that OT "is only one of the potential 50 more projects (like it)." 

Whilst in Singapore, President Elbegdorj and his delegation held a number of high level talks with Temasek Holdings, Singapore's leading sovereign wealth fund. Subsequently, Temasek executives have travelled to Mongolia for further talks, and have agreed to deepen their relationship. Efforts to strengthen Mongolia's relationship with its southern neighbour are also beginning to bear fruit. China's state owned Shenhua Group announced an agreement to buy 1Bt of Mongolian coking coal over the next 20 years, which bodes extremely well for Mongolia Mining Corp (MMC) (975:HK) noted as one of the suppliers in the agreement.  

In October, of the 15 positions within the portfolio, 6 gained, 4 remained unchanged, and 5 lost ground. Local cashmere producer Gobi JSC (GOV:MO) rallied 24.62%, Aspire Mining Ltd (AKM:AU) recovered 16.67% to AUD 0.07 and beverage manufacturer APU JSC (APU:MO) gained 10.62%. Xanadu Mines Ltd (XAM:AU) was the largest detractor to portfolio performance, losing  13.98% to AUD 0.08 (from AUD 0.09). FeOre Ltd (FEO:AU) lost 44.44% on extremely low trading volumes to record lows of AUD 0.0025  

The Khan Mongolia Equity Fund performance for October was -0.99%.

The Net Asset Value as at 31 October 2013 was USD 30.26 

In November, of the 15 positions within the portfolio, 3 gained, 2 remained unchanged, and 10 lost ground. FeOre Ltd (FEO:AU) recovered 60% from AUD 0.0025 to AUD 0.04 – on similarly low volumes that drove the price down a month earlier. Gobi JSC (GOV:MO) retreated 7.41% and  Xanadu Mines Ltd (XAM:AU) fell a further 25.00% to close at AUD 0.06. Turquoise Hill Resources Ltd (TRQ:US) was sold off 14.52% to USD 4.12. 

The Khan Mongolia Equity Fund performance for November was -1.49%.

The Net Asset Value as at 30 November 2013 was USD 29.81

The November Factsheet can be downloaded by registered users of the Khan Investment Management website – www.Khan-Management.com

The TRQ saga continues following the announcement of the USD 2.4B dilutive rights offer underwritten by Rio Tinto to repay credit facilities. Along with Ivanhoe Mines founder and Mongolian pioneer Robert Friedland, the KMEF will participate in the rights issue. Importantly, the 15 banks that have agreed to finance the expansion of OT have told Rio they will extend their commitments (which were due to expire before year end) until March 31 2014, reflecting their confidence in both the project and Mongolia. Another encouraging indicator was the unanimous approval of the 2014 operating budget by the Oyu Tolgoi LLC board. Commodity trading giant Trafigura also agreed an off-take deal for OT, agreeing to provide financing in exchange for a long term deal to buy an undisclosed portion of output. 

It is clearly in all stakeholders interests for OT Phase Two to proceed, and we believe it is only a matter of time before issues are resolved and the project receives a unanimous green light, at which point we expect a significant price revaluation. 

Aspire Mining's (AKM:AU) Ovoot Coking Coal Project in Mongolia continues to draw interest with two non-binding Memoranda of Understanding signed with large Russian buyers for up to 1.3Mtpa of coking coal, bringing its total coking coal MoUs to 6.9Mtpa. APU's Soyombo vodka recently received a 4 Star "highly recommended" rating by Paul Pacult whom Forbes calls America's foremost expert on distilled spirits. Soyombo outranked competitors Absolut (3 stars), and Grey Goose and Golia vodkas who received 2 stars. The favourable review is likely to boost the company's North American export initiative. 

Finally, Santa will visit the Development Bank of Mongolia on Christmas day this year when its first Samurai Bond settles. Backed by a guarantee from the Japan Bank for International Cooperation (JBIC), the 10 year JPY 30B (USD 294M) issue will have a coupon of 1.52% and matures on 25 December 2023. 

As mentioned previously, we expect a significant increase in interest, volumes, and new listing on the MSE throughout the course of 2014 once the new Securities Law comes into effect on New Year's Day. Amidst the uncertainties in Mongolia over the last 18 months, our portfolio companies have continued to progress the development of their individual projects. Many have been granted approvals and licences. Favourable legislation that removes uncertainties and provides a solid foundation for investors has now been put in place. It is clear the government needs investors back to support the nascent economy, and is doing what it can to rectify previous mistakes and foster growth. We remain confident that investment fundamentals remain intact and that Mongolia has a very bright future. 

According to President Elbegdorj "In terms of the investment environment in 2012 and 2013 (in Mongolia) it actually hit the ground. Now, because of our knowledge, because of our cooperation with you (investors) and because of our responsiveness, we will bounce back." 

My colleagues and I wish you a very Merry Christmas and a happy, healthy and prosperous 2014!

I thank our investors for their continued support and I look forward to updating you further in the New Year. 

Best regards, 

Travis Hamilton

Managing Director

KHAN INVESTMENT MANAGEMENT LIMITED

Link to Khan

 

Mogi: some still choose to remain blind while others wise up

How Low Will Turquoise Hill Go?

By Gary Bourgeault, December 17 (Seeking Alpha) --

Disclosure: I am long TRQ. (More...)

A series of events has led to the share price of Turquoise Hill (TRQ) getting hammered, even though it sits on one of the largest, mostly undeveloped, gold and copper mines in the world.

Much of this was triggered by the government of Mongolia, which continues to raise the stakes in the game by adding conditions that weren't part of the original agreement regarding the project.

Mongolian lawmakers have attempted to make the adjustments because of the rising costs associated with Oyu Tolgoi, which it believes may have been done intentionally by the miner, as higher costs would result in lower-than-expected payments to the government as production at the mine ramps up.

Negotiations, which are reported to be advancing, continue on.

Development Costs

At issue is the approximate $2 billion in overrun costs in the first phase of the project, which Turquoise Hill must get paid before the Mongolian gets its share of the revenue.

With the costs of the expansion of the underground mine projected to run over $5 billion, the Mongolian government wanted approval from parliament for the financing of the next phase of the project.

Mongolia is demanding assurances from Turquoise that the overruns won't happen again, but that's really an impossible promise to make in light of the time it takes to build out a mine, and the rise in price in materials and other associated costs which occur during the construction process.

To make a promise that can't be met at this stage would be worse than not making a promise at all, as a failure to meet Mongolia's terms could bring the project to a complete halt for an extended period of time. This is assuredly why it is taking time to work out a deal that isn't setting up Turquoise and Rio Tinto (RIO), which owns over 50% of Turquoise, for failure.

Expectations are the issues should be resolved in the early part of 2014.

Rights Offering

Turquoise Hill recently initiated a rights offering, as it needs to pay back what it owes to Rio Tinto, including $1.8 billion in interim funding and a $600 million bridge funding facility.

The miner is looking to raise $2.4 billion. If it has any capital left over after paying back the loans, it will use that toward expanding the project.

Pricing of the shares are $2.40; if any shares are left over, they will be acquired by Rio Tinto.

Extended Financing Commitments

With the expansion delay, banks that were financing the mine agreed with Rio Tinto to extend its commitments to March 31, 2014. That buys some time for the two companies to work the problems out with the Mongolian government, and also may point to the probability it should be done in the first quarter of 2014.

With a feasibility study still on pace concerning the underground expansion of Oyu Tolgoi in the first half of 2014, it also seems to reinforce the theory that matters should be resolved by that time.

Assuming they are, it will give a big boost to the share price of Turquoise Hill.

Production at the mine is projected to bring in 150,000 to 175,000 tons of copper in concentrates, and 700,000 to 750,000 ounces of gold in concentrates in 2014.

Over the life of the mine, it is estimated it will produce more than 1.2 billion pounds of copper, 650,000 ounces of gold, and 3 million ounces of silver on an annual basis. Even with the current challenges, this is why I'm so bullish on Turquoise Hill, which owns two-thirds of the project.

Rio Tinto's Commitment

Since Rio Tinto is counting on Oyu Tolgoi for its primary future growth, it's doubtful it will in any way let this project go unless it is taken away from it by the Mongolian government.

Rio has to diversify its mineral base in order to produce more consistent results in face of an ongoing difficult iron ore environment.

That suggests there is no way Oyu Tolgoi will slip out of its hands unless the project is nationalized.

Government Takeover?

About the only real long-term risk to Turquoise Hill is a government takeover of the mine. A secondary risk is a successful move by the government to secure a better deal with Turquoise than it already has. That could result in a lower percentage of revenue and earnings for the company.

While both of these are outside possibilities, it is doubtful either of them would happen. I think the more likely scenario is the Mongolian government will secure some limited agreement on project costs, although one that would give Turquoise Hill some wiggle room in case of unforeseeable circumstances that could add to the costs, such has already happened.

The fact that Turquoise Hill surpassed projected first-phase costs by about $2 billion, shows something unexpected happened, or those working on the estimate didn't do an accurate survey of the overall costs. Either way, that is what has brought the company to where it is at today.

Conclusion

Unless there is some very surprising decision by the Mongolian government, I don't think Turquoise Hill is in danger of losing this project. While it remains frustrating to investors and shareholders, I believe this will ultimately push Turquoise Hill into world-class status in the mining industry, and make a lot of money for shareholders.

I've been bullish on Turquoise Hill for some time, and remain so.

With Rio Tinto securing an extension from banks financing the second phase of the project through March 31, 2014, it appears this points to the high probability the company believes an agreement with the disputed points with the government of Mongolia are close to being resolved.

Finally, it is costing more to push the project forward, so in that case Turquoise Hill will take longer to make a great profit because of the higher production costs.

Once production is in full swing most people and institutions will forget about this as the huge production numbers come in, which will drive the share price of Turquoise Hill up.

Link to article

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Local Market

BDSec Daily Market Update, December 17: Top 20 +2.03%, Turnover 31.3 Million

December 17 (BDSec) Mongolia stocks rose over 2 percent on Tuesday, heading to its highest close in nine months. MSE Top 20 added 313.75 points or 2.03% to 15,768.28 points. Coal mining companies led the charge with Shivee Ovoo (+15.00%), Aduunchuluun (+5.07%), Baganuur (+4.49%), and Tavantolgoi (3.64%). Mogoin Gol (BDL). Out of 24 companies traded on the bourse, 17 rose, 5 fell, whereas 2 remained same. Traded value at the exchange was MNT 31.3 million.

Top Movers

Trading Value Leaders

Close (MNT)

Value (MNT)

Mogoin Gol (BDL)

14,100

8,502,300

APU (APU)

4,039

6,752,910

Baganuur (BAN)

4,751

3,149,543

 

 

 

Top Gainers

Close (MNT)

% Change

Shivee Ovoo (SHV)

6,900

15.00%

Aduunchuluun (ADL)

1,948

5.07%

Baganuur (BAN)

4,751

4.49%

 

 

 

Top Losers

Close (MNT)

% Change

Mongolia Development Resource (MDR)

640

-14.55%

Remicon (RMC)

160.41

-4.52%

Mogoin Gol (BDL)

14,100

-2.76%

Link to update

 

BDSec Daily Market Update, December 18: Top 20 +2.51%, Turnover 104.7 Million

December 18 (BDSec) Coal stocks helped the MSE Top 20 Index finish up 2.51 percent, to its highest close in nine months. Aduunchuluun (ADL) jumped 14.99% to MNT 2,240 after gaining 5% yesterday while Tavantolgoi (TTL) climbed 9.47% to close at MNT 6,240. Mogoin Gol (BDL) also advanced 9.93% to MNT 15,500. On the MSE, advancers outnumbered decliners by a ratio of 8 to 1. Traded value at the exchange was MNT 104.7 million or ~US$ 64k.

Top Movers

Trading Value Leaders

Close (MNT)

Value (MNT)

Tavantolgoi (TTL)

6,240

57,818,465

Material Impex (MIE)

14,010

29,417,000

Aduunchuluun (ADL)

2,240

5,708,442

 

 

 

Top Gainers

Close (MNT)

% Change

Aduunchuluun (ADL)

2,240

14.99%

Mogoin Gol (BDL)

15,500

9.93%

Tavantolgoi (TTL)

6,240

9.47%

 

 

 

Top Losers

Close (MNT)

% Change

Baylag Nalaikh (BNB)

647.87

-0.33%

Talkh Chikher (TCK)

13,500

-0.07%

Link to update

 

MSE News for December 19: Top 20 +2.76%, Turnover 48.9 Million

Ulaanbaatar, December 19 /MONTSAME/ At the Stock Exchange trades held Thursday, a total of 75 thousand and 008 shares of 28 JSCs were traded costing MNT 48 million 922 thousand and 028.00.

"Remikon" /30 thousand and 428 units/, "E-trans logistics" /14 thousand and 620 units/, "Hermes center" /10 thousand and 060 units/, "Silikat" /8,000 units/ and "Baganuur" /2,241 units/ were the most actively traded in terms of trading volume, in terms of trading value-"Baganuur" (MNT 11 million 205 thousand and 889), "Eermel" (MNT five million 129 thousand and 100), "Remikon" (MNT five million 099 thousand and 504), "APU" (MNT four million 298 thousand and 632) and "UB BUK" (MNT three million and 850 thousand).

The total market capitalization was set at MNT one trillion 712 billion 398 million 381 thousand and 988. The Index of Top-20 JSCs was 16,610.10, increasing by MNT 445.38 or 2.76% against the previous day.

Link to article

 

Sharyn Gol JSC (MSE: SHG) Announces the Appointment of Mr. Batbaatar Badan (B.Batbaatar) as Deputy Chief Executive Officer

ULAANBAATAR, Mongolia, Dec. 19, 2013 /CNW/ - Sharyn Gol JSC (MSE: SHG; "Sharyn Gol") is pleased to announce the appointment of Mr. Batbaatar Badan (B.Batbaatar) as Deputy Chief Executive Officer of the company. B.Batbaatar was initially appointed as a Non-Executive Director of Sharyn Gol in 2010. B.Batbaatar is the CEO of CBM LLC, a Mongolian-registered business consulting, administration, and geology service provider that has an exclusive relationship with Firebird Management LLC and its affiliated group of companies.

Commenting, Sharyn Gol's Chairman, Mr. Batmunkh Batkhuu said: "I am delighted to welcome B.Batbaatar into the management team where his extensive skills and international experience can now be applied on a day-to-day basis. Sharyn Gol is moving through a challenging development process, coal production has doubled in 2013 over 2012 and will double again in 2014, until we reach 2.5 million tons per annum in 2015. B.Batbaatar will play an important role in helping the company meets its challenges as we consolidate our position as the premier coal producer in northernMongolia."

Link to release

 

NACO Fuels JSC, Subsidiary of Sharyn Gol JSC's Announces Restart of Clean Coal Operations

ULAANBAATAR, Mongolia, Dec. 19, 2013 /CNW/ - NACO Fuels JSC (MSE:NKT, "Naco") is pleased to announce a successful trial run of its Clean Coal operations in Darkhan plant, producing high-quality smokeless fuels for the Ulaanbaatar city market. After the successful trial, improvements on the process will be made and production will gradually increase to full capacity throughout 2014. Sharyn Gol JSC (MSE:SHG, "Sharyn Gol") recently took over the company and currently owns 92.9% of the outstanding shares. Sharyn Gol is supplying coal used at NACO.

Ulaanbaatar city has been identified as one of the most air polluted capital cities in the world. NACO's Clean Coal product will dramatically reduce air pollution and have positive impact on health. The NACO process takes coal from Sharyn Gol and treats the coal in two vertical retorts. The retorts reduce the volatile matter content of the coal by over 60%, the emissions from which are the primary cause of the pollutants. This means that the coal burns much cleaner and for much longer and additionally reduces the overall amount of fuel used. NACO product will be sold in lump form initially and briquetting plant is expected to come on line next year. Potential valuable by-products are also captured, including bitumen and syngas.

Mr. B.Batbaatar, Chairman of NACO said, "Although this year we are doing a trial run after the company retorts were on care and maintenance, it is a major step forward in establishing the company as the primary supplier of clean, smokeless fuel to the Mongolian market. Our intention is to continue to develop and expand the business to ensure we can make a real difference to people's lives and health in our cities. Both Sharyn Gol and NACO are connected to the Trans-Mongolian rail road and have easy access to Ulaanbaatar."

Link to release

 

 

FMG Mongolia Fund: -4.4% in November

Year

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Year

2013

-1.33%

-5.38%

-8.27%

-7.46%

-3.96%

-3.17%

-4.42%

-6.68%

-3.12%

3.22%

-4.40%

-37.15%

2012

0.00%

-0.20%

-0.30%

-3.23%

-2.40%

-2.77%

2.63%

-8.13%

-2.56%

-4.66%

-3.26%

7.38%

-17.10%

Link to Mongolia Fund page

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Economy

BoM MNT Rates: December 19 Close

 

12/19

12/18

USD

1,641.38

1,647.44

EUR

2,246.80

2,268.69

CNY

270.31

271.36

GBP

2,688.74

2,682.44

RUB

49.81

49.98

December Chart:

Link to rates

 

BoM holds FX auction

December 17 (Bank of Mongolia) On the Foreign Exchange Auction held on December 17th, 2013 the BOM has received from local commercial banks ask offer of 11.0 million USD and bid offer of 20.0 million CNY. BOM has refused all offers.

On December 17th, 2013, The BOM has received USD Swap agreement bid offer of 12.3 million USD, USD Swap and Forward agreement ask offer of 10 million USD and CNY Swap agreement offer of 20 million CNY from local commercial banks. BOM has accepted all offer of CNY Swap agreement.

Link to release

 

BoM holds FX auction

December 19 (Bank of Mongolia) On the Foreign Exchange Auction held on December 19th, 2013 the BOM has received from local commercial banks ask offer of USD and bid offer of CNY. BOM has refused all offers.

On December 19th, 2013, The BOM has received USD Swap agreement bid offer of 135.0 million USD from local commercial banks and accepted the offer.

Link to release

 

RESULT OF GOVERNMENT SECURITIES AUCTION  

December 18 (Bank of Mongolia) Regular auction for 12 weeks maturity Government Treasury bill was announced at face value of 23 billion MNT and each unit was worth 1 million MNT. Face value of 23 billion /out of 35.55 billion bid/ Government Treasury bill was sold to the banks at discounted price and with weighted average yield of 9.15%.

Link to release

 

Consolidated Balance Sheet of Banks, November 2013

December 18 (Bank of Mongolia) --

Link to report

 

BoM: Monthly Statistical Bulletin, November 2013

December 18 (Bank of Mongolia) --

Link to report

 

Mongolia: new Samurai bond puts fiscal rules in spotlight

by Jacopo Dettoni

December 17 (FT beyondbrics) Resouce-rich Mongolia is going back to the international bond market in a push to offset a weakening economic cycle.

Government-backed Development Bank of Mongolia (DBM) has placed a ¥30bn ($290m), 10-year samurai bond to invest in much needed infrastructure projects. But the deal is stretching the country's borrowing rules to the limit.

The operation is 90 per cent guaranteed by the AAA-rated Japan Bank for International Cooperation (JBIC), which largely explains a final coupon of 1.52 per cent.

Although DBM was expecting a slightly lower yield of around 1.3-1.35 per cent, the deal stands out as a very good one for a a country whose sovereign and quasi-sovereign debt retains junk status among the world's major rating agencies.

Still, there is one last piece that has to fall in place to make it happen, as Mongolia's Fiscal Stability Law (FSL) approved in 2010 leaves little space for further debt issuance. The government and the DBM itself have borrowed over $2bn in international debt markets since March 2012 and public debt has climbed to around 50 per cent of GDP. Total debt should not exceed 40 per cent, which should rule out any further bond issuance. (Mogi: government debt should not exceed 50% in 2013, 40% in 2014. Plus, our government doesn't think DBM debt is government debt, even though DBM is a government agency)

That means an amendment to the FSL is necessary (Mogi: not if they can convince themselves DBM debt is not gov. debt). The finance ministry drafted a bill to raise the debt ceiling to 60 per cent, but it failed to get the required two-thirds majority in parliament in November. The government is now drafting a new bill to classify types of debt – in effect to separate public debt from quasi-sovereign debt (debt issued by state entities like the DBM), according to a Mongolian source who wished to remain anonymous (Mogi: well, there you go).

Chris MacDougall, managing director at Mongolia Investment Banking Group, tweeted a few days before the deal:

Nothing like a little bit of trickery to avoid legislation meant to protect fiscal stability. Show me the money! @MBBontoi @P_M_F_R @ncousyn

"The government can do that it whatever it wants on the legislative side, but we need to see a bit of a spark to get the economy back on track. Issuing new debt is not going to fix the economy in the long run and investors would like to see some more legislative stability," the MacDougall told beyondbrics after the placement.

Twisting the FSL to make room for the samurai bonds risks setting a dangerous precedent. Mongolia does not boast a brilliant track record in public finance management as the International Monetary Fund rescued the country five times over the last 23 years. The 2010 FSL was supposed to become a turning point and a milestone on the road towards sustainable public finance management. Boosted by mining developments such as Rio Tinto's Oyu Tolgoi (OT) copper and gold mine, whose phase I alone attracted investments for some $6.2bn, Mongolia's economy posted a five-year average real GDP growth of 9.3 per cent. But the economy is deteriorating amid uncertainties over OT phase II, along with weaker commodity market conditions. Fiscal discipline hangs in the balance again.

Even before Mongolia works out how to account for the samurai bond, parts of the FSL had lost traction already. Its 2 per cent public deficit threshold, for example, is largely avoided through off-budget spending carried out by the same DBM. Considering all spending, the overall fiscal deficit will likely reach 12 per cent of GDP this year, the World Bank estimates.

"This has rendered the FSL ineffective as a constraint on policy-making," rating agency Fitch said in its latest report on Mongolia, where it revised the country's outlook to negative from stable while affirming its previous B+ rating.

Some government officials believe the economic assumptions behind the FSL are now proving to be too challenging for Mongolia's current economic cycle. But further tweaks the rules will add new uncertainties over the government's stance over fiscal stability. Debt is one thing, but a clear plan and limits are needed, otherwise it can backfire. Samurai warriors were known to have sharp swords.

Link to article

 

IMF Executive Board Concludes 2013 Article IV Consultation with Mongolia

December 18, 2013, IMF --

On November 15, the Executive Board of the International Monetary Fund (IMF) concluded the 2013 Article IV Consultation1with Mongolia.

Mongolia continues to be one of the fastest growing economies in the world, expanding by 12½ percent in 2012 and by 11½ percent in the first half of 2013. Growth was buoyed by a relatively mild winter that has boosted agriculture and by expansionary fiscal and monetary policies. These have been deployed to compensate for the marked slowdown in coal exports and foreign direct investment (FDI)-financed mining development—key drivers of growth in recent years. The strong growth of the economy over the past two years has helped reduce poverty.

Slowdown of FDI inflows and exports, together with expansionary macroeconomic policies, have put pressure on the balance of payments. As a result, central bank reserves have come down considerably from record levels reached in late-2012, after Mongolia's successful first sovereign bond issuance. In recent months, to help relieve the balance of payment pressures, the Bank of Mongolia has allowed more exchange rate flexibility. Looking ahead, real GDP growth for Mongolia is currently projected at close to 12 percent in 2013 and by 9½ percent in 2014, helped by the start of production at the Oyu Tolgoi copper and gold mine.

Mongolia's medium-term prospects remain promising given its large natural resource endowment. However, expansionary macro policies are likely to put pressure on inflation and the balance of payments in the period ahead. Also, Mongolia is facing an uncertain external environment. Advanced economies will eventually exit from the very supportive monetary policies implemented in recent years. China's economy is expected to rebalance away from a mostly investment-based growth model toward a more consumption-based growth model. Both these factors are bound to have major spillovers globally and especially in the region. Spillover risks will particularly affect the more vulnerable emerging market economies.

Executive Board Assessment2                                                                              

Executive Directors commended Mongolia's significant progress in recent years in economic development and reducing poverty. The medium-term outlook remains favorable, underpinned by developments in the mining sector. However, Directors cautioned that continuation of expansionary fiscal and monetary policies could threaten stability. They welcomed recent steps, particularly in the areas of fiscal and exchange rate policies to address rising domestic demand and balance of payments pressures, but called for further decisive recalibration of policies to address vulnerabilities, rebuild buffers against external shocks and ensure sustainable strong growth.

Directors emphasized the need for an ambitious and credible fiscal consolidation plan. They encouraged the authorities to bring fiscal policy in line with the overall goals and targets of the Fiscal Stability Law. Accordingly, they recommended that the operations of the Development Bank of Mongolia (DBM) should be included in the budget, which should aim at meeting the 2 percent of GDP structural deficit ceiling of the law over the next 2-3 years. While recognizing the role of DBM spending in boosting growth and development, Directors stressed the importance of an adequately frontloaded adjustment, including by streamlining subsidies and transfers and reprioritizing and rephasing capital spending. A few Directors stressed the need to preserve development spending while ensuring fiscal sustainability. Directors also encouraged the authorities to complete the set up of a sovereign wealth fund and to enhance public debt management capacity.

Directors emphasized that the ongoing large monetary stimulus provided through the central bank programs needs to be unwound to curb inflationary and balance of payments pressures. They endorsed the authorities' efforts to strengthen the monetary policy framework and to allow greater exchange rate flexibility to support external stability.

Directors commended the authorities' efforts to strengthen the financial sector, including strengthened capitalization and liquidity of banks. They advised further steps to reinforce the regulatory and supervisory framework to address banking sector vulnerabilities and contain risks, including those arising from unhedged foreign currency lending. In particular, Directors encouraged strict enforcement of existing prudential regulations, a strengthening of underwriting practices and loan classification, and the phasing-in of a forward-looking provisioning scheme. They also stressed the need to enhance the bank resolution regime, develop a legal framework for prompt corrective actions, and address deficiencies in the Anti-Money Laundering/ Combating the Financing of Terrorism (AML/CFT) regime.

To promote sustained growth outside the mining sector, Directors stressed the importance of continued reforms to strengthen the business climate, building on the authorities' recent success in passing a new investment law.

Mongolia: Selected Economic and Financial Indicators, 2010–14 (Strong Policy Scenario)

 

 

 

 

Projections

 

2010

2011

2012

2013

2014

 

Real sector (percent change)

 

 

 

 

 

Real GDP growth

6.4

17.5

12.3

11.8

9.6

Mineral

3.6

7.3

8.9

16.1

33.4

Non-mineral

7.0

19.7

12.9

11.0

5.0

Consumer prices (period average)

10.2

7.7

15.0

9.7

11.1

Consumer prices (end-period)

14.3

9.4

14.2

11.7

11.0

GDP deflator

20.0

12.1

12.0

7.4

11.0

Public and publicly guaranteed debt (in percent of GDP)

 

 

 

 

 

Total public debt 2/

35.9

38.8

63.0

67.3

65.8

Domestic debt

5.1

10.9

14.7

15.5

15.1

External debt

30.8

27.9

48.3

51.8

50.7

(In millions of US$)

2,061

2,219

4,837

4,988

5,636

Link to release

Related:

Selected Macroeconomic Indicators, December 18, 2013 – IMF, December 18

 

Dagong Maintains Mongolia's Credit Ratings as BB- with Stable Outlook

Dagong Global Credit Rating Co., Ltd., December 19, 2013 --

Dagong Global Credit Rating Co., Ltd. (hereinafter referred to as "Dagong") decides to maintain the local and foreign currency sovereign credit ratings of the State of Mongolia (hereinafter referred to as "Mongolia") as BB-, each with a stable outlook. The Mongolia government follows the same expansionary economic policies as its predecessor, which has helped the country maintain a high economic growth rate promoted by rapid development of the mining industry and related industries, in spite of high fiscal deficit ratio, high current account deficit and the fast banking sector asset expansion.

The main reasons for maintaining the sovereign credit ratings of Mongolia are as follows:

1.    The good bilateral relations with neighbors and geographical advantages near the China market will benefit the long-term development of Mongolia and significantly make up for the adverse impact of insufficient national management ability and unstable policy.

2.    With a high economic growth, the development of the mining industry continues to enhance the national wealth creation capacity. It is expected that Mongolia will be one of the fastest growing economies in the world, and its economic growth rate in 2013 and 2014 is estimated to be 12.5% and 11% respectively. However, the vulnerability of the economic development of Mongolia resulting from changes of domestic policy environment and fluctuations of international commodity prices will exist for a long time.

3.    The banking industry remains relatively robust and its non-performing loan rate decreased from 6.3% to 4.2% and the capital adequacy ratio maintained at the level of 15.1% in 2012. On one hand, rapid credit expansion offset the decreasing external capital inflows and boosted the economy to grow rapidly, but on the other hand, it led to high inflation and rapid expansion of the financial system assets.

4.    Slack budget discipline leads to huge off-budget expenditure and high fiscal deficit. Mongolia fiscal deficit rate was 10.9% in 2012, which was 7.4% higher than that in the prior year. The $1.5billion Chinggis bond issuance not only increased government debt but will also push up the 2013 fiscal deficit ratio to 11.4%. The deficit ratio is expected to decline to the 7.6% in 2014 with the introduction of budget amendment and the strengthened budget constraint.

5.    The production of Oyu Tolgoi copper-gold mine and the capacity expansion of Tavan Tolgoi coal mine will bring substantial foreign exchange earnings and relieve the increasing foreign debt repayment pressure due to high current-account deficit, less foreign direct investment inflows and expanded external debt.

Mongolia has been more dependent on the mining industry in economic development whereas the fragile global economy recovery and China's economic rebalancing will bring global commodity prices under pressure. However, with the Oyu Tolgoi mine go into operation, more exports will gradually improve the country's situation of high current account deficit and support solvency of Mongolia. In addition, Mongolia's continually strengthening economic and trade ties with China will promote the economic development of Mongolia given its abundant mineral resources and convenience geographical advantages - China, as its neighbor, is the largest mineral products market in the world. Therefore, Dagong maintains a stable outlook for both the local and foreign currency sovereign credit ratings of Mongolia in the next 1-2 years.

Link to release

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Politics

Standing Committees Reject Ministers' Dismissal

Ulaanbaatar, December 19 /MONTSAME/ The Standing Committee on budget Wednesday discussed a matter on dismissing the Finance Minister Ch.Ulaan.

Clarifying some specific matters about the applied reasons of the dismissal, the committee members interrogated the Minister, before conducting a voting on the proposal.

The members asked the Minister about further monetary activities of his Ministry, including extra-budgetary money circulation and stabilization of currency rates.

After this, a voting was conducted, where 13 out of 18 members present declined to dismiss the Finance Minister.

The same day, the Standing Committee on economics rejected the proposed dismissal of the Economic Development Minister N.Batbayar and agreed to introduce their decision to the parliamentary session.  

Link to article

 

NO LOVE LOST BETWEEN DP AND MPP

December 19 (Independent Mongolian Metals & Mining Research) --

MONGOLIAN PARLIAMENT UPDATE

During MPP Caucus media briefing on reasons why the Caucus is taking 2 day break(which can be summarized as breaching law, willfulness, pressuring, discrimination of and forcing decisions to minority, lack of consensus) veteran MPP MP Ts.Nyamdorj has said, according to official website of the Caucus buleg.com:

·         "Parliament is in crisis because of lack of consensus and understanding"," this is unprecedented in history of Mongolian Parliament"

·         "GOM is doing whatever it pleases and the Parliament completely lacks capacity to control it. While there is 1 trillion MNT shortfall in fiscall revenues and investment, loans are being taken from abroad to keep itself afloat"

·         "To compare this Parliament to a family, it has become like a husband and wife who's passions have went separate ways"

·         "Parliament crisis never leads to good things"

·         "I think that even it could be a time for people of Mongolia to account responsibility to the Parliament"

Ruling Coalition parties' Caucuses heavily criticized the MPP's move saying during the media briefing, according to major Mongolian portal gogo.mn:

DP Majority Leader D.Erdenebat:

·         Repeated irresponsible action by the MPP, political PR to get the Parliament stuck, MPP is sabotaging Parliament activities

·         If there will be no consensus with the MPP, it can be resolved by law. I desire attendance by 2pm. If there will be no participation  DP must resolve issue of 2 ministers by tomorrow in order not to breach the law

·         MP Ts. Nyamdorj explains state activities negatively and makes destructive actions, he should stop these unethical attacks

·         I regret the MPP is getting stuck all policy documents such as reviving the economy, industrialization of economy, import substitution and increase of exports, MPP has run away from reaching consensus on budget, transparency in gold trading and debt management issues

·         All sides should understand that current blow up is arising because of Mongolia's consumption economy and overdependence from imports

·         Majority has not done everything wrong. Every sensible person understands that excessive consumption, shrinking exports and shortage of foreign exchange underlies evolving last two years development. I regret that minority is putting brakes on import substitution, increase of exports and establishment of concentrating and processing industry

·         Coalition Government has duty to people of Mongolia and will work till the end for goal of economic reform.

PREVIOUSLY: 

In his attempted resignation statement, MP R.Amarjargal has said, among other things 

·         We lack social consensus and refuse political consensus, majority forcing minority is a defamation and destruction of Mongolian democracy and a crime against Mongolian state.

People of Mongolia have elected DP expressing their frustration with problems in the society. They gave  great hope and confidence to the DP. Unfortunately we did not deliver on this expectation, but made matters worse. Someone from DP has to accept responsibility for this.

Therefore, I resign because:

·         I am one of the founders of DP

·         I resign , most importantly, because i have conscience. I am accepting responsibility for irresponsible decisions of Parliament and Government to make an example of political responsibility. There must be a standard of political culture. I have no doubt whatsoever this is this right step in terms of political culture, responsibility and just plain ethics.

Link to MPP Caucus press release: http://www.buleg.com/Home/Detail?news_code=63

Link to gogo.mn report on Ruling Coalition parties' Caucuses media briefing http://news.gogo.mn/r/132817 (in Mongolian)

For subscription information please contact:        

Independent Mongolian Metals & Mining Research

Suite  271/16th floor, 

Uildverchin Estate by MDTOF LLC 

Narny Zam Street,60  Sukhbaatar District,1st khoroo, Ulaanbaatar 14253, Mongolia

Telephone: +976 75555560

E-Mail: dale.choi@mongoliametals-mining.mygbiz.com

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Business

Best Countries for Business 2013: Mongolia #54

December 2013, Forbes --

Link to Mongolia page

 

Mongolia, Russia and China Sign Joint Declaration to Develop Transit Transportation Corridor

December 19 /infomongolia.com/ The first intergovernmental consultative meeting themed "Northern Corridor" between Mongolia, Russia and China initiated by the Government in association with Ministry of Road and Transportation of Mongolia was held at the "Ikh Tenger" State Complex in Ulaanbaatar on December 18, 2013.

At the meeting Mongolian side was chaired by the Minister of Road and Transportation Amarjargal GANSUKH, Russia by Deputy Head of the Federal Agency for Railway Transport (Roszheldor) Igor Vladimirovich Mitsuk and China delegation by Deputy Director of the State Railways Administration Chen Lanhua.

During the trilateral dialogue, Department Director at the Ministry of Road and Transportation Yo.Manlaibayar delivered a speech on "State policy to adhere on railway transportation" in the frames of development of transit transportation and an Acting Director of Ulaanbaatar Railway G.Sereenendorj spoke about on current situation of Mongolia's railway and introduced its technical renewal issues to carry out.

At the meeting parties discussed vital issues such as turnover outlook between China and Russia, and China to Europe, also railway route to Mongolia, role functioning scale on transit transportation via Mongolian territory. Moreover, three parties touched upon on collaboration in Ulaanbaatar Railway's technical renovation and considered issues to enhance the routes Erlian-Jining and Ulan-Ude – Naushki.

Afterwards, parties signed a joint declaration to develop a transit transportation passing through the three countries' territory. In detail, Mongolia, Russia and China agreed to formulate a general plan and measures to implement in order to develop Ulan-Ude – Naushki – Sukhbaatar – Zamyn-Uud – Erlian – Jining trans-route within the first quarter of 2014.

Link to article

Related:

Mongolia and Its Neighbours to Develop Railway TransportationMontsame, December 19

 

Ex-Im Bank Finalizes Agreement for U.S. Export Transaction to Mongolia

WASHINGTON, Dec. 19, 2013 /PRNewswire/ -- Officials from the Export-Import Bank of the United States (Ex-Im Bank) and MIAT Mongolian Airlines (MIAT) participated in a signing ceremony today that finalized the export of a U.S. Boeing 767-300ER aircraft with GE engines to MIAT.

Ex-Im Bank Chairman and President Fred P. Hochberg, MIAT President and CEO Jargalsaikhan Gungaa, and PEFCO Vice President Vince Herman signed the financing documents. Altangerel Bulgaa, Mongolia's Ambassador to the United States, and representatives from GE and The Boeing Company were also in attendance.

The transaction, guaranteed by Mongolia's Ministry of Finance, was previously approved by Ex-Im Bank's board of directors and counts as both the Bank's first significant transaction in Mongolia and its first transaction with MIAT.

"There are numerous opportunities for U.S. exporters in Mongolia, and I hope that this agreement encourages more Americans to explore this diverse and exciting market," said Chairman Fred P. Hochberg. "By increasing MIAT's fleet, we are able to support high-quality jobs in both the United States and Mongolia."

"Aviation plays a strategic role in Mongolia's global interactions. Boeing is delighted that MIAT's latest 767-300ER marks the carrier's first direct purchase of one of our jetliners and continues the airline's reliance on quality U.S. made aircraft to meet its mission.  This, in turn, links Mongolia to the success of American aviation manufacturing and the many thousands of U.S. jobs it supports," said John Wojick, senior vice president, Global Sales & Marketing for Boeing Commercial Airplanes.

"MIAT is pleased to conclude its first financing transaction with the support of Ex-Im Bank," said President Jargalsaikhan Gungaa. "We are proud to be the first airline in Mongolia to acquire an aircraft directly from The Boeing Company and to finance an aircraft with the support of Ex-Im Bank. This is an important step for the aviation industry in Mongolia, and the confidence shown by Ex-Im Bank in Mongolia will have a positive impact on all industries."

Last year, Chairman Hochberg participated in a business-development mission in Mongolia, where he encouraged sourcing of U.S. products and services for regional infrastructure projects. Chairman Hochberg also oversaw the signing of a memorandum of understanding with the Development Bank of Mongolia to facilitate trade opportunities between the United States and Mongolia.

Link to release

 

Media, McDonald's and pranks in Mongolia

By Michelle Borok

December 16 -- Last week, Mongol TV, Mongolia's most publicity savvy television station, pulled a pricey prank on its competitors in television and print media. This, about a week after the CEO of the station was featured in The Hollywood Reporter. She was profiled for being a champion of a more transparent, rule-abiding, and professional media in Mongolia. Mongol TV wanted to keep the tide rolling in a concerted effort to make an international name for itself as a stand-out in Mongolian media.

Mongol TV generated a fake story about a Mongolian company opening up a McDonald's franchise in the heart of the city. This expensive prank roped in the hopes of expats, repats and well-traveled locals. They came up with a hokey opening weekend special of McMutton burgers and goat's milk milkshakes to cater to the tastes of the new audience. According to a Reuters correspondent who blogged about the hoax, Mongol TV says they shelled out nearly 4,000 USD to pull off the prank.

All nine online, print and television outlets that were pitched ran the story, charging between 107 and 599 USD to feature the ad, according to figures shared in their report exposing the hoax. The news of McDonald's entering the Mongolian market was proposed by a Mongol TV journalist posing as a public relations representative for "Wholesome Foods Mongolia", but many news outlets ran it like a news piece.

Rumors of McDonald's in Mongolia come and go over the years. Many see McDonald's in Mongolia as a benchmark in economic development, a sign of truly being able to embrace Western capitalism and to be embraced in return by foreign corporations. Others look at the detrimental health and environmental effects of the onslaught of imported American fast food, and the issue sparks debate each time it's raised. Reports of the world's most iconic American fast food chain finally setting up camp would indeed be newsworthy. The opening of Mongolia's first Kentucky Fried Chicken made international headlines in a way that its predecessor, Kenny Roger's Roasters, did not and now they're opening a second location with rumors of adding Mongolia's first drive-thru window. As the number of foreign coffee shop franchises in the city grow, so too may the foreign fast food chains.

While the lack of fact-checking that took place in the running of the McDonald's story seems somewhat alarming, a larger problem lies in the majority of Mongolian media outlets running paid advertisements as features without identifying them as paid promotion. Smaller websites picked up on the story and it was also force fed through social media by employees of Mongol TV. Paid features are a common practice here, so common that many media consumers assume that the majority of stories reported are driven by dollars. Companies buy space and airtime for featured interviews intended to promote their projects, and many media outlets are said to expect payment for the coverage. Those lobbying for policy can pay for coverage of agendas that suit their interests. It's up to the journalistic integrity of a paper, website or television station to decide how they will present the promotion to the public, but the media has waffled here. In simplified terms, the prevalence of the practice challenges the notion of a free press and represents an industry driven by profit and not the pursuit of public interest. Not adopting a policy of identifying advertorials (advertisement editorials) as paid promotional features will continue to compromise consumer trust.

The problem isn't a purely Mongolian one, despite Mongol TV's rallying cry. News outlets all over the world have faced criticism for decades for running press releases as news, and outrage about falsified news stories by journalists have cost the world's most renowned newspapers their reputation and tremendous legal costs. Media analysts are also looking critically at major websites providing content generated by non-professionals, authors who are unpaid, and lacking journalistic training or prior professional experience in publishing. Many of these websites post content intended to drive website clicks and social media sharing, all in an effort to present numbers on audience reach to potential advertisers. Voices that were once confined to the opinion and editorial pages of newspapers have become lead stories thanks to the democratization of modern media. It would be naive to think that with all these new developments, and a frenzied rush to create content in a minute-by-minute reporting environment, that businesses haven't been able to buy headlines with less scrutiny than before.

Without a doubt, change is needed - not just here, but everywhere. Does Mongolian media need a publicity stunt conceived by a foreign consultant for a television station driven by ratings to fuel that change, or can the change come from within the journalistic community? The change required to provide local journalists with the training, salaries, time and resources to establish new standards in reporting are tremendous - not impossible, but a far cry from what's available to them now. To suggest that Mongolian journalists and editors aren't eager for change is not only unfair, but inaccurate. Labeling the running of the McDonald's story as corruption across the board trivializes the real stories of corruption in Mongolia, stories that call for serious attention.

While Mongolia may never end up with a McDonald's, it's well on its way to acquiring American-style sensational reporting by its major television networks. Mongol TV is leading the way in daytime television that looks identical to popular morning news shows on Western networks, where the focus isn't on the public interest, but on nurturing the public's spending habits. The objective of these morning talk shows is to create a loyal audience of consumers of fashion, food, and other trends to support advertisers. Other stations are working towards the same goal, but Mongol TV's financial investment in developing this kind of programming to meet Western standards reportedly surpasses that of other local stations.

I'm not sure that Mongol TV's paying the competition to run their McDonald's story can be considered a productive investment in the strengthening of Mongolian media. Perhaps a 4,000 USD investment in supporting the burgeoning, united efforts of the nation's media to create progressive changes to access, transparency and ethics might have been better spent and less divisive. Only time will tell, and hopefully there will be more journalists - with ethical integrity and the support that quality reporting requires - to tell the story.

Link to post

 

Ethics in journalism – selling a fake to prove a point about Mongolia's media

December 18 (Amy Wilson-Chapman) Ethical journalism.

Some people laugh at that statement, arguing there is no such thing… unfortunately that's probably a reflection of today's media (globally) and not something any working journalist I have ever met is proud of.

Nonetheless, we have them. In fact, in Australia we're lucky enough to be taught them at university and most organisations have some form of in-house code.

We also have the Media Entertainment and Alliance. I'll be the first to admit I wasn't a member before I left, but they do have a code of ethics as well. When I worked in CanadaI was a member of the Canadian Association of Journalists, who have something similar.

My point is: there was a professional code that (and from now on I'm going to use the royal 'we' because it's the norm and unethical journalists in both these situations are the exception) we understood and followed.

However, every now and then the ethical and morally correct question rears it's confusing grey-coloured head.

Now let's switch to Mongolia. There is no professional code here (though one is being discussed), the media is an embryonic stage and are extremely underpaid (and appreciated).

The most startling thing is the corruption. It's the one thing that appears to boggle the mind of every expat journalist or person working in a communications field.

I don't use that word lightly, and it's not actually my word. A recent qualitative survey of the media landscape here by Friedrich Ebert Stiftung (a German foundation that works for democratic values globally) blatantly described the situation:

"Nowadays, people in Mongolia, follow the money, and so do, regrettably, media and journalists."

Though facilitated by a German organisation (read: outsider) the score/analysis was given by local professionals who know first-hand about the media's situation. Three of the six representatives said Mongolia did not meet the criteria "Journalists and media have integrity and are not corrupt." Two said the country met "a few aspects of the indicator" while one said it met "some".

The study highlighted free lunches, trips and editors asking for payment to cover costs. The former two are something all journalists in Australia (and Canada) enjoy regularly. Generally though we have to declare that interest at the end of a story – like when I flew to Qatar for the inaugural flight from Doha to Perth. But – and I really stress this to my Mongolian friends – nobody is perfect and Australians too get caught out. However, Australia also has critical media programs such as Media Watch to catch them and point out mistakes to the public.

(The study also found professional standards were low, just like salaries, and journalists had little editorial independence.)

'Corruption' is something people from all sectors in Mongolia have raised with me – big, small, private, international, domestic and non-profit organisations, even government employees – that local journalists, or their editors, are often searching for money to cover a story.

Organisations here factor 'paying' the press to come to their events. They're essentially buying space.  It often leaves some non-profit organisations with little media attention at their events.

Last week Mongol HD TV took it upon themselves to expose the corruption. It raised a lot of eyebrows, but it also got Mongolians – and expats – talking, which is something I wholeheartedly encourage.

I've been trying to get some facts confirmed without any luck so, for now, I'm using Facebook.

Jeppe Bybroe, head of news, development and consultant at Mongol TV, said:

"Mongol TV | HDTV's news team reveals and documents widespread corrupted journalism in Mongolia."

It was apparently the work of the aforementioned Danish consultant after he found out media outlets paid for coverage, according to this blog.

Someone from Mongol TV called nine media outlets, offering to pay for coverage of a fake story that McDonalds was going to open in Ulaanbaatar.

They all covered the story. Many ran it without any changes and no fact checking. I've been trying to confirm the facts… but have waited five days so will just quote the post from Facebook.

"In less than 24 hours the fake news story was reported on three major websites, it was told on the news in three major TV-stations (including the national state TV) and three major newspapers put the story on the frontpage," Byrboe wrote.

"The only thing the media asked for was cash and then they published the story." He said payment ranged between US$150 and US$700.

Of course, as the media does, once one outlet ran the story the rest followed. They, however, did not get paid.

Mongol TV then exposed the truth – the image below has been plastered around Facebook here – telling the audience how much each organisation paid.

The media outlet said the media's corruption was a "public secret" and now it could be discussed. Well, it certainly got people in my office talking and there was much attention given to the idea.

I'm told there has been some rumours that the journalist didn't say the story was 'news' and instead many organisations thought it was an advertisement, thus why they took the money. Again, I did try to confirm these details.

Some people, including journalists and their editors, felt betrayed by Mongol TV and didn't approve of the act. Mongol TV copped a lot of criticism in the following days, but also a lot of praise from those working in the media and with the media to raise the quality of journalism.

Here is one (English) interesting summary of the event by InfoMongolia.

I think there are two ways to look at this:

1. Mongol TV were exposing corruption in the media, which is critical to a democratic society, and the public has a right to know how their media is operating.

2. Mongol TV was in the wrong to lie, or impersonate someone, in a bid to get a story that definitely would have helped increase their audience. (They did promote the truth on their show after much speculation on a variety of other media).

I will leave it to you to decide, but it is an interesting reflection on how the media here works.

For those wanting to read more this piece about the public's distrust in Mongolian journalism was published in a variety of papers before being translated into English. Worth a read. 

Link to post

 

18.9kgs of Gold Caught Being Smuggled to China

December 17 (UB Post) Officials of the General Customs Office and General Intelligence Agency of Mongolia (GIA) discovered a stash of gold bars intended for smuggling at Zamyn-Uud soum, which borders China, on November 29.

Customs officials said that they found 13 bars of gold weighing a total of 18.9 kg while checking the baggage of four Mongolian nationals on an international train traveling from Zamyn-Uud soum to Erenhot, China.

The gold stash is worth 1.3 billion MNT at current prices. The GIA is currently investigation the case.

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Police Starts Inspection into Companies Exceeding Foreign Employee Quota

December 17 (UB Post) While unemployment in Mongolia is still not dropping, the number of Chinese and North Korean construction workers has been increasing year by year. Though most of them are contracted workers, visa violation, or expiration is a common issue, reported the Mongolian Immigration Agency.

Officials of the Division Against Economic Crimes of the Criminal Police Department has therefore started inspecting contractors to determine the reasons for exceeding foreign employee quota.

The companies that hire foreign workers have been allegedly violating laws by forging documents for their workers to let them stay and work illegally in Mongolia.

According to Unuudur daily news paper, a reliable source told them that several companies were found violating several clauses of the Law on Labor Exchange which states that the "quota for foreign workers in organizations in any economic sector must be revised every year based on the total staff number and foreign investment amount. The revised quota must be approved by the government of Mongolia," and "only visa providers will provide work permits to foreigners in Mongolia based on government approved quota for foreign workers after inspecting submitted materials."

In addition, the companies were found guilty of violating the government's decree on determining foreign workforce exchange rate per year by forging documents. The decree states, "businesses may hire foreign workers equal to five to 25 percent of their total employees."

The accused companies allegedly submitted materials to the authorities that had false information about the number of Mongolian employees to hire more foreign workers.

Center for Employment Service might be partially responsible for the violations as they don't check total staff number of the companies before issuing permits.

For instance, Khishigkhangai LLC brought 22 Chinese workers in 2011, 39 in 2012, and 85 in 2013, while Sain Construction LLC brought 47 in 2013. China-based Jung Yuan LLC brought 72 Chinese workers in 2011, 58 in 2012, and 47 in 2013. All of them submitted false documents regarding the number of Mongolian workers.

North Korea-based Kumrung LLC brought 38 North Korean workers to Mongolia in 2012 and 63 in 2013. It also falsely reported the number of Mongolian workers to bring more foreign workers.

The State Investigation Authority is currently investigating these cases.

Link to article

 

Videos highlight impact of Mongolian mining

20 December 2013 (University of Queensland) --

The dramatic expansion of Mongolian mine sites from initial diggings to their present size has been captured using satellite imagery for the first time by researchers at The University of Queensland's Sustainable Minerals Institute (SMI).

The two videos show satellite footage of the mine sites, the surrounding urbanisation, new roads and illegal small-scale or 'ninja' mining sites.

Produced using Landsat satellite imagery of Tavan Tolgoi coal mine in the South Gobi Desert and Sharyn Gol in the Northern steppe region of Mongolia, the videos cover an approximate 40-year time series depicting the growth and scale of impacts from mining.

UQ SMI Centre for Social Responsibility in Mining (CSRM) Project Manager Isabel Cane said the videos would be used to study changes to herder community livelihoods through social changes stimulated directly and indirectly by ecological impacts.

"The images visually display the mine-related environmental impacts that these sites are facing, and provide insights into the effects the mines are having on local communities," Ms Cane said.

She added that the videos would contribute to the broader goals of the research: to demonstrate changes in natural resources and to assist in predicting future sustainable development objectives for the affected communities.

The images are the first product of a two-year Australian aid project funded through the Australian Development Research Awards Scheme (ADRAS) entitled 'Managing the impacts of minerals development on women and men and their traditional livelihoods in Mongolia'.

The ADRAS project is part of a new Mongolia Research Hub focused on sustainable development in Mongolia.

It brings together current CSRM research in Mongolia, with information on the country and its rapidly developing mining sector.

 "The Hub will be a portal to access new outputs from expanding research on Mongolian mining and help build Australian engagement with the development potential in that country," Ms Cane said.

The Australian Government has recognised Mongolia as a priority country in mining for development, with the aim to ensure that mining revenue is distributed equitably, and that social and environmental impacts are managed well.

The CSRM currently has four research projects in Mongolia, partnering with such organisations as the International Mining for Development Centre (an Australian aid initiative), the Sirolli Institute, and other Mongolian stakeholders.

Find out more

Media: Isabel Cane, Mongolia Research Hub Project Manager, Phone 07 3346 4042, Email i.cane@uq.edu.au. Anna Moloney, SMI Communications Manager, Phone 07 3346 4233, Email a.moloney@uq.edu.au

SUSTAINABLE MINERALS INSTITUTE

The Sustainable Minerals Institute is made up of seven research centres whose disciplinary roots lie in people, environment and production. Established in 2001, the Institute's research covers all facets of mining from exploration to site rehabilitation. The Institute has approximately 350 staff including 100 postgraduate students. For more information go to www.smi.uq.edu.au

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Ulaanbaatar

Prime Minister arms traffic regulators with automated ticket devices to increase transparency

December 17 (UB Post) Starting from December 2, the traffic police will no longer issue cash fines for traffic violations.

All 400 traffic regulators in Ulaanbaatar have been armed with devices that recognize drivers' finger prints, electronic cards and driver's licenses, and that prints traffic fines, on November 30.

The devices were purchased at the total cost of 1.8 billion MNT with financing from the Prime Minister's 50 billion MNT budget.

The Prime Minister initiated the project to increase the transparency and ease of traffic regulation. The ticket devices were imported by Smart Solutions LLC, which prepared the devices for use. Now the traffic police will not have to interact with cash and the police services will set a transparent and fair standard.

The pocket sized devices provide no complications in traffic regulation duty.

Traffic police officers will be able issue fines an enter personal profiles of drivers that violate traffic regulations by simply scanning their identification card or driving license through the device, or by taking their finger print. Violation records, vehicle taxes and the insurance payments of drivers will be accessible through their profile.

The fines issued through the device must be paid within 14 days, and if the violators does not pay their fine by the due date, the amount will increase, or in extreme cases, the driver's license will be terminated. The fines are payable from any commercial bank.

Furthermore, each driver will be given 100 credits. Each time a violation occurs, a credit will be deducted. If a driver runs out of credit, their licenses will be terminated and they will be obligated to attend a driving course.

With the new device system and database, unqualified drivers who repeatedly break traffic regulations and cause traffic congestion will be easily detected and penalized. The database will also include information on the driving courses and driving instructors. Therefore, this central database will help enhance traffic responsibility and surveillance, according to traffic officials.

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Seven-story garage opens to meet growing demands

December 17 (UB Post) There are 321,159 registered vehicles in Ulaanbaatar as of August 2013, as reported by the Ulaanbaatar City Transportation Authority. This shows 50 percent growth compared to the number of registered vehicles in 2010. Most offices, companies and apartment towns do not have their own designated parking spaces.

As the number of cars on city streets has grown, it has become harder for drivers and city administrative authorities to solve parking issues and also avoid theft of vehicles and parts.

A seven-story garage has recently been completed in the 26th khoroo of Bayanzurkh District to meet the rapidly growing demand for secure parking. The garage was built according to international standards and has parking available for 350 vehicles.

The garage was built with iron and steel reinforcements and 45 vehicles can park on each story. Lanes for driving in and out of the garage are eight to nine meters wide, so drivers will easily be able pass each other while parking and exiting.

Initiator of the project and investor J.Ganbaatar said, "This garage fully meets fire prevention regulations with smoke and heat sensor systems, as well as sprinklers. It is designed with an air conditioning system, and equipment to block the outflow of circulating air and heat it to prevent the freezing of parked vehicles in winter in case the central heating system is damaged and stops heat distribution. Surveillance cameras and warning systems are installed. Two elevators in the garage are operational 24/7."

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Mogi: ummmm, I won't ever got this club becaaaaaause it's in 3rd micro-district and it's too far?

Alcohol free night club opens

December 17 (UB Post) The first ever alcohol free night club "Zaluus-21" (Youth-21) has recently opened and is encouraging young people to spend their free time and have fun without using alcoholic beverages.

The club is located at the Third Micro-District and was established by the Healthy and Active Life Club with the support of the "New Government for Changes" and financing from the Health Support Fund.

Prime Minister N.Altankhuyag attended the opening ceremony and noted, "This night club will call for young people to have fun, make new friends, socialize, and dance without the influence of alcoholic beverages."

Alcohol free night clubs have started operations at ten provinces and organizers reported that young people will soon be able to practice healthy lifestyles.

According to a study, 40 percent of Mongolian population above the age of 18 is considered alcohol addicts, specifically, 22 percent are men and 18 percent are women. (Mogi: I don't think we in Mongolia understand what at alcohol addiction really means. Probably thinks it's just anyone who is a regular user)

In developed countries, when alcohol addiction reaches over six percent, it is considered a threat to the national security. Furthermore, the World Health Organization (WHO) reported that a extinction becomes a very real threat to nations where the consumption of alcoholic beverages reach eight liters per capita (Mogi: haha, what? Mongolians are under threat of extinction!!!). Mongolia's consumption of alcoholic beverages per capita is almost 50 liters.

The WHO advised Mongolia to limit the availability of alcohol to reduce consumption.

Countries around the world enforce various policies on alcohol control. Scandinavian countries sell alcoholic beverages only in state owned shops, while European countries do not sell alcoholic beverages with higher than 3.5 percent alcohol in regular grocery shops. But there is no alcohol control policy in Mongolia, and a shop that sells alcoholic beverages for every 300 to 500 residents in Ulaanbaatar where more than half of the total population lives in.

The availability of a wide range of alcoholic beverages has given rise to many social issues among young people. A report conducted in 2009 among teenagers showed that 70 percent of children between the ages of 14 and 16 have used alcoholic beverages more than once which is a clear sign of the severity of the issue.

Alcohol control will benefit both society and economy in many ways. For instance, studies show that an alcoholic addict spends around 20 to 100 million MNT for alcoholic beverages in his or her lifetime.

The government has been taking robust actions to tackle alcohol-derived depression and attitude, and it recently reported positive results.

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Diplomacy

China and Mongolia Stress Promotion of Cooperation on Interconnection

December 17 (Ministry of Foreign Affairs of the PRC) From December 16 to 17, 2013, the Consultation at Department and Bureau Level of Chinese and Mongolian Foreign Ministries was held in China. Luo Zhaohui, Director-General of the Department of Asian Affairs of the Chinese Foreign Ministry and Tumurkhuleg Tugsbilguun, Director of the Department of Neighboring Countries of the Ministry of Foreign Affairs of Mongolia co-chaired the Consultation. Both sides exchanged opinions on China-Mongolia relations and international and regional issues of common concern.

Both sides held that China and Mongolia, as important neighbors to each other, should take the year of 2014, the 65th anniversary of the establishment of China-Mongolia diplomatic relations and the 20th anniversary of the signing China-Mongolia Friendship and Cooperation Treaty, as an opportunity to jointly do well in holding commemorative activities related to China-Mongolia Friendly Exchange Year, earnestly implement Mid and Long-term Development Outline of China-Mongolia Strategic Partnership and continually push forward China-Mongolia strategic partnership on the principle of mutual respect, equality and mutual benefits.

Both sides agreed to continually deepen China-Mongolia pragmatic economic and trade cooperation according to overall thought of three in one and advance as a whole, which involves mineral resources development , infrastructure construction and financial cooperation.

Both sides agreed that the overall situation of Asia-Pacific region is generally stable, the momentum of regional cooperation is good, the interconnection cooperation in railway and highway develops well and free interconnection of aviation and navigation is smooth. China appreciates Mongolia's efforts in joining in some cooperation mechanisms of East Asia. Both sides unanimously agreed to keep close communication on safeguarding peace and stability of the region.

Link to release

 

Kuwait, Mongolia discuss ways for judicial bilateral cooperation

KUWAIT, Dec 19 (KUNA) -- Kuwait's Ambassador to Mongolia Khalid Al-Fadhli met at his office on Thursday with the Mongolian Minister of Justice and Home Affairs Khishigdemberel Temuujin. (Mogi: so, even a Minister goes to see an ambassador at the embassy, for Kuwait, of cooooourse. Even the President goes to see the Emir when he's in town)

During the meeting, the two sides discussed a number of issues of joint interest between the two countries, ways for possible judicial bilateral cooperation, and bilateral cooperation in the field of criminal evidence laboratories.

They also discussed construction of an orphanage in the Mongolian city of Ulan Bator, as well as the judicial reformations that took place in Mongolia recently. 

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Social, Environmental and Other

Japanese researcher fears Mongolian nomads suffering from radiation exposure

December 18 (The Asahi Shimbun) A Japanese researcher has turned to the nomads of Mongolia to help her document the extent of radioactive contamination in the landlocked Asian nation.

Ryoko Imaoka, an associate professor of Mongolian studies at Osaka University, has been supplying used cameras to the nomads of the Mongolian steppe so they can document the frequency of deformed livestock, which appears to be on the increase, particularly near uranium mines.

"With the transition to a market-based economy rapidly in progress, environmental pollution is becoming a serious problem," said Imaoka, 51. "When eating their livestock, nothing goes to waste--even the last drop of blood. That is Mongolian culture. (The disposal of nuclear waste there) would definitely affect the people."

A French-Mongolian joint venture started experimental drilling three years ago in southern Mongolia in the search for uranium. Shortly thereafter, increased reports of deformities and birth defects in livestock near the area started to appear.

Even though the correlation between mining and the deformities has yet to be proven, reports included the birth of two-headed lambs and blind camels. Other animals are also suffering from skin ulcers and blood clots in their bodies.

News of the birth defects comes amid reports that both Japan and the United States are or were looking at the possibility of dumping spent nuclear waste in Mongolia.

In the abandoned mining town of Mardai, in northeastern Mongolia, one of the possible storage sites considered by Japan and the United States, radioactive waste left over from the large-scale Soviet mining operations still remains.

The Society of Mongolian Studies, which Imaoka belongs to, featured the nuclear issue in its journal this summer. It also carried an essay from Imaoka.

In addition, she is translating a Japanese booklet into Mongolian on how to protect children from radiation exposure.

Imaoka was born in Sakai, Osaka Prefecture. While in junior high school, a television drama depicting the life of Genghis Khan first sparked her interest in Mongolia. She later studied Mongolian at university, which led her to specialize in topography.

Visiting the Gobi Desert every year, she has witnessed how the lifestyle of the nomads' has changed over the last two decades.

Her Mongolian husband is a car mechanic. She said, when welding in the desert he sometimes uses livestock dung for fuel.

"Mongolians value the cycles of nature. They taught me that one is responsible for taking care of what one has made until the very end," she said. "I don't want to see this country turned into a nuclear waste dump."

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Mongolian Women Urge Amendments to Domestic Violence Law

December 18 (The Asia Foundation) Every year, a "16 Days of Activism against Gender-Based Violence" campaign is held across the globe, including in Mongolia, to increase awareness about this global pandemic.

This year in Mongolia, the spotlight was shone on domestic violence through another campaign called "Our Voices," which provided survivors of domestic violence an opportunity to voice their struggle. According to UN data, domestic violence affects at least one in five women in Mongolia. In the last three years, 43 people have been killed and 982 injured as a result of domestic violence in Mongolia. Eighty-seven percent of these victims are women. Domestic violence is a hidden crime in Mongolian society with a very few victims actually reporting cases to the police, so like in most countries, there are many more silent victims of domestic violence than the official statistics reveal. Because 34 percent of Mongolia's population is under the age of 18, its youth are especially vulnerable to domestic violence.

In 2004, Mongolia passed its first domestic violence law that aims to "protect the rights of victims, to provide safety, to impose liability on offenders, to define roles and responsibilities of the government, non-government organizations, citizens, and other entities to combat and prevent domestic violence." (The Asia Foundation provided support to the Women Lawyer's Association and the National Coalition against Violence in the drafting process of the law.) While this was an important step forward in advancing women's rights, human rights activists and organizations in Mongolia are concerned that the law needs to be further strengthened to provide adequate protection to victims of domestic violence. Since the law was enacted, only 41 protective restraining orders have been issued, and none have been enforced by a court.

In the autumn session of parliament which started in October and will continue until February 2014, parliamentarians will consider various important amendments to the law, including:

• Defining domestic violence as a criminal offence and not just a family problem;
• Recognizing that domestic violence includes physical and mental harm, such as harassment, controlling, threatening, stalking, and sexual violence or unwanted sexual acts;
• Outlining clearly the duties and responsibilities of the police and courts, as well as social workers and health workers to prevent and respond to domestic violence urgently, and;
• Requiring that restraining orders are monitored, and that they are extended and enforced depending on the violation of the order.

The mission of the Our Voices Campaign, organized by the local NGO, National Center Against Violence (NCAV), is to push parliamentarians to pass the proposed amendment to the existing law to define domestic violence as a criminal offence as well as to encourage youth to talk about domestic violence more openly.

As part of the campaign, four women told their personal stories as survivors of domestic violence through a series of photography and story-telling exhibitions that were presented at public spaces including universities, markets, and the central square. The exhibition aimed to inspire the general public to talk more openly about domestic violence and encourage the government to take action. [Read their stories.]

The campaign was accompanied by a website and social media campaign to directly reach out to Mongolia's youth. Youth were also directly engaged in spreading the word about domestic violence by volunteering to hand out information at the exhibitions which have been shown in Ulaanbaatar and Darkhan and talking to other young people about what domestic violence is and how to get help. The campaign has been successful in emphasizing the important role young people have to play in addressing domestic violence by standing up for their friends, mothers, and sisters and making sure this scourge of violence is not passed onto the next generation.

Funding for the Our Voices Campaign was provided by the UNFPA and the U.S. Embassy. For more information, visit http://mn.our-voice.net/.

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Mongolia launches Disaster Warning System

December 17 (UB Post) The government has started a 11.6 billion MNT project "Establishing Earthquake Warning System" at the National Emergency Management Agency (NEMA). The first stage of the project was completed and the Disaster Warning System was officially launched on December 6. It aims to warn the public about approaching natural disasters and minimize possibility of disaster-related casualties.

The project is part of the "Cyber Governance" program in Mongolia, implemented by the Korean government.

KT Corporation was in charge of the project and planned works were completed it on schedule. The Information Technology, Post and Telecommunications Authority has been monitoring the project progress.

The project considered technologies used in south eastern nations such as Japan, Thailand and Korea where disaster warning systems are highly developed. For instance, disaster warning system in Japan predicted the deadly earthquake and tsunami in 2011 and 2012 before a few minutes they happened which saved lives of thousands.

The NEMA, National Agency for Hydrology, Meteorology and Environmental Monitoring, and Research Center for Astronomy and Geophysics (RSAG) will formulate the disaster reports, and deliver it to the Emergency Management and Report Center (EMRC) of the NEMA. After that, the warnings will be directly delivered to siren towers across Ulaanbaatar, Mongolian National Broadcaster (MNB), Mobicom, Skytel, Unitel, G-Mobile, Orbitnet and radio stations to warn the public.    

The EMRC has been newly established at the NEMA and 20 officials of the center will be in charge of the Disaster Warning System. The system joined over 90 organizations throughout Ulaanbaatar. Also, 60 siren towers have been installed at the roofs of tall buildings in each of the nine districts.

The EMCR will distribute a warning with up to 160 characters to television channels MNB, UBS, Mongol HD and to over ten radio stations for emergency broadcasting.

Deren soum of Dundgovi Province, Mogod soum of Bulgan Province and Tsagaannuur soum of Selenge Province are located in seismically active zones, according to the RSAG. The above mentioned soums are located 170 to 300 km from Ulaanbaatar. When earth quakes occur, its seismic waves spread 2.5 to 3.8 km per second.

The disaster warning system's main purpose is to warn the residents about the disaster in time for evacuation or other emergency protocol. If earthquake occurs in Mogod, 300 km from Ulaanbaatar, the RSAG will receive information about the disaster through satellite 78 to 120 seconds before seismic waves reach Ulaanbaatar. The warning will be delivered to siren and broadcasting  organizations in five to ten seconds and they will warn the public about the earthquake to residents in 73 to 110 seconds.

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Munkhdul Badral Bontoi

Founder & CEO

Email: mogi@covermongolia.mn

Mobile: +976 9999 6779

Skype: mogibb

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