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Ulaanbaatar/MONTSAME/ In regard with an approval of the State Budget 2018, Finance Minister Ch. Khurelbaatar made a briefing on November 14 at the State House. Beginning the report, he highlighted that the country’s economic growth is predicted to be 4.2 percent next year. “The state budget revenue will be MNT7.2 trillion whereas the expenditure will be MNT9.6 trillion. Subsequently, the total budget deficit will be MNT2.7 trillion. It is, however, an improved indication, as compared with 2017. In 2017, the budget deficit has equaled 9.5 percent of GDP, but next year it will go down into 8 percent.
82 schools and 127 kindergartens to be newly built and three-shifts of schools to be eliminated
MNT1.6 trillion has been budgeted for education sector next year. It is planned to build 82 schools and 127 kindergartens nationwide. Unfinished buildings of schools and dormitories will be solved. As a result, schools will have no three shifts. Tuition loans will be continually issued to students and the loans will not be disbursed through commercial banks, but through the Educational Loan Fund from next year to reduce burdens.
Health insurance premium for herders to be reduced by 50 percent
MNT893.1 billion was budgeted for health sector in 2018. It aims to put a basis of a reform in health financing system, to improve sufficiency of hospital services and to expand its scope. The Health Ministry will be in charge of health insurance beginning from next year. MNT376 billion, which will be solely expended on health services will be accumulated to the Health Insurance Fund. By doing so, it is believed to create inclusive health insurance and expand primary health care services. Moreover, health insurance premium to be paid by herders, the unemployed and private business owners will be reduced by 50 percent. A national program on ‘Hepatitis-free Mongolia’ will be also funded completely.
Retirement pensions and benefits to be raised
In light of a policy to stabilize a standard of living, retirement pensions and benefits have been planned to be increased. For instance, pensions of 396.6 thousand people will be raised by MNT119.5 billion in harmony with inflation rates. According to the decision to lower a retirement age for herders by five years, MNT44.6 billion will be transferred into the Retirement Pension Fund. Also, a program ‘Mothers with salary’ will be commenced from January, 2018. In accordance with the program, every mother who cares a child aged 0-3 years at home will be given a monthly benefit of MNT50,000. Single parent who has three or more children aged 0-18 years old will be given a quarterly benefit of MNT240,000. A total of MNT72.8 billion will be spent for the program.
MNT 7 billion to be disbursed to every aimag
With a purpose to intensify rural development and construction, MNT147 billion will be disbursed to all aimags, MNT 7 billion to each. MNT 10 billion has been also budgeted to rebuild the Central Wastewater Treatment Plant in Ulaanbaatar city.
Granting of license as a present to be banned
Next year’s state budget reflects to accumulate income from regulations of land and license relations. It was decided to eliminate tax-free trades and inappropriate use of minerals licenses and land ownership certificates; therefore, the state budget revenue will be increased by MNT36 billion by means of reporting information of minerals licenses, land ownership certificates and their holders transparently and entirely and selling openly. “Also, licenses will be disallowed to give each other as a present, except to close relatives such as brothers or sisters” said Finance Minister.
Bank of America Merrill Lynch says India is likely to achieve strong growth over the next decade and will overtake Japan in nominal GDP. It is well on track to become the world's fifth largest economy by 2019.
According to the report, the country has already overtaken Brazil and Russia becoming the second biggest BRICS economy after China. It is also projected to pass France and the UK as the world's fifth largest economy behind Germany by 2019.
“We see India crossing Germany and Japan in nominal GDP in dollar terms by 2028. This assumes the Indian economy grows at ten percent (in nominal US GDP) in the next decade, well ahead of Japan's 1.6 percent,” said the report.
It has outlined three key drivers which will help India stand among the large emerging economies. Those are falling dependency ratios, financial maturity, as well as increasing incomes and affordability.
It would be difficult for India to “replicate South Korea’s export-driven industrialization as its dependence on oil imports implies Delhi cannot depreciate its currency,” said the report.
It added that services have “climbed by ten percent to almost 70 percent of world GDP in the past 20 years. Not surprisingly, they have emerged as a key driver of India's growth as well.”
A recent report by the International Monetary Fund (IMF) has also projected India's outstanding growth. It said the country will overtake Germany in 2022 as the world's fourth-largest economy and will push its former colonial ruler UK out of the five top economies this year.
The IMF Managing Director Christine Lagarde said there was much potential, calling India a “bright spot.”
Ulaanbaatar /MONTSAME/ On November 14, Deputy Prime Minister U. Enkhtuvshin met Suresh Babu, Ambassador of the Republic of India.
During the meeting, they shared views on establishing oil refinery and IT outsourcing center with soft loan from the Government of India, on launching a direct flight as well as preparations for Asian Ministerial Conference on Disaster Risk Reduction to be organized next year in Ulaanbaatar.
The sides had the same opinion that Indian PM Narendra Modi’s visit has elevated bilateral relations and cooperation into a new level and they expressed their satisfactions with successful implementation of matters negotiated during the visit.
A feasibility study on oil refinery and pipelines will be conducted by an Indian company and the feasibility study is scheduled to be complete and transfered next year. “Mongolian government pays a special attention on the implementation of this project which is strategically important for Mongolia,” pointed out Deputy PM.
U. Enkhtuvshin said that relevant ministers will be assigned to intensify the project on establishing IT outsourcing center and developing it into Data Center. He also thanked for the decision of Indian side to train emergency staff of Mongolia in the framework of organizing the Asian Ministerial Conference on Disaster Risk Reduction.
The parties also believe that opening of a direct flight between two counties will boost tourism and business development and attract Indian investors. To this extent, the bilateral trade turnover which is currently about USD27 million, is likely to rise. Furthermore, big construction projects will be intensified.
In addition, they discussed about establishing a cyber-safety training center and developing relations and cooperation in border protection, defense, education and cultural sectors.
A year after coming to the brink of default, Mongolia is seeing the benefit of a good housekeeping seal of approval from the International Monetary Fund.
The resource-rich country wedged between Russia and China has the best performing stock market benchmark in the world for 2017, and it’s able to borrow on the open market again. Last month, the country attracted more than $5.5 billion for an $800 million sale of bonds in dollars. Investors are looking past Mongolia’s gaping budget deficit, weak credit profile and political uncertainty, taking comfort in an IMF lending program approved in May.
“We are happy to hold Mongolia bonds as the IMF anchor and higher commodities prices will continue to support the economic recovery,” said Mark Baker, a Hong Kong-based portfolio manager at Aberdeen Standard Investments, who bought the sovereign’s new 2023 bond. “With short-term sovereign external debt maturities rolled over and the next maturity not due until 2021, refinancing pressure is off.”
That’s helped its stocks, as well. The Mongolia Stock Exchange Top 20 Index is up about 74 percent so far this year, the biggest gain among all the benchmarks tracked by Bloomberg. Venezuela’s advance incorporates a realistic exchange rate for the country that’s been declared in default. Leading the Mongolian gains have been resource companies including coal miner Tavantolgoi JSC.
Much of the gains in the country’s equities came in the wake of the IMF program signed in May that provided about $5.5 billion in assistance.
It’s all quite a turnaround for Mongolia, which last year garnered only $750 million of bids for a $500 million bond sale, despite a coupon more than 5 percentage points higher than the notes sold last month. In November 2016, Moody’s Investors Service cut its debt rating deeper into junk due to “heightened uncertainty” over the government’s ability to meet its debt service obligations. Fitch Ratings followed suit with a downgrade because of deteriorating fiscal conditions and increased external liquidity risks.
With backing from the IMF, Mongolia is now able to benefit from the continued abundance of liquidity in the global financial system, and the attendant hunt for securities that offer extra yield over safe-haven benchmarks. Premiums on speculative-grade dollar bonds as a class have continued to drop relative to Treasuries, and reached a record low earlier this year.
That hunt for yield troubles Guillermo Felices, a London-based senior portfolio manager at the asset management arm of BNP Paribas SA, who says demand has become out of whack with credit and economic fundamentals.
“People are comfortable extending the search for yield,” he said in an interview in Hong Kong on Nov. 10. “Investors need to put the money somewhere and in order to meet the yield target they extend risks, going to riskier countries that then compress those yields. This is without fundamental justification.”
Still, conditions in and out of the country look favorable, at least for now. The country welcomed its fifth president since 1992, when Battulga Khaltmaa took office in July with an anti-corruption agenda. The upturn in coal prices will help its borrowing requirements for 2018 decline to 14 percent of GDP versus previously expected 20 percent, Moody’s said in its Oct. 30 note. Some measures of coal prices have climbed 18 percent since the end of June.
The bottom line for Baker at Aberdeen when it comes to the country’s bonds: “I wouldn’t expect significant spread gains given current valuations, but carry remains attractive.”...
ULAANBAATAR (GoGo Mongolia) Today, Mongolian Parliament approved the State Budget of 2018, Social Insurance Fund Budget of 2018 and Health Insurance Fund Budget of 2018.
Regarding the budget approvals, Minister of Finance Ch.Khurelbaatar answered journalists' questions and introduced the key changes to the State budget at the Government House.
Some indicators of the State budget of 2018:
4.2 percent GDP growth
8 percent budget deficit share in GDP in 2018, decreased from 9.5 percent of 2017
Cabinet plans to bring this indication down to 4.5 percent in 2020.
Minister of Finance emphasizes the importance of decreasing the state budget deficit share in GDP as a good sign. In 2018, the Cabinet plans to:
Improve economy and reduce debt induced pressures
Supplementary revenue will be transferred to the previous debt payments
Increase investors' involvement in stock exchange
Reduce interest rates of commercial banks
Reduce Government bond trade and improve debt management
Continue fiscal stability
Revive foreign investors' faith and accelerate big project implementations
Support private sector by flexible tax policy
Reform the tax system to become more transparent, simple and fair.
Russian scientists have developed a new generation of innovative fertilizers that, they say, are capable of increasing crop productivity by 25 per cent. The fertilizers are based on nanopowders of transition metals such as iron, copper, and cobalt.
According to the researchers, who are based at the National University of Science and Technology MISiS, Ryazan State Agrotechnological University and Derzhavin Tambov State University, as a key element of enzymes, such microelements directly affect a plant’s immunity and viability, which leads to its level of resistance to pests and diseases.
“We have developed a fertilizer of a new generation based on nanopowders of metals, which allows us to significantly optimize the technology of a number of agrochemical actions, and to be exact — to reduce them to a one seed treatment by a product containing the essential microelements in nanoform. These particles of transition metals have a powerful stimulating effect on plant growth in the initial growth phase. Thus, the future plant is provided with a supply of necessary microelements at the stage of seeding, which allows us to improve field germination, increase resistance to adversity, and, ultimately, to get a [better] harvest—as the experiments have shown these figures increase by 20-25 per cent," said in a press release Alexander Gusev, the head of the project and a senior research associate at the NUST MISIS Department of Functional Nanosystems.
Gusev added that the main difficulty these kinds of projects face is that highly mobile nanoparticles tend to quickly stick together and form large aggregates. However, the researcher's team was able to solve the problem by using organic stabilizers and the ultrasonic processing of colloidal solutions.
"Now, after receiving encouraging field research results, it is necessary to find out how a new fertilizer will act in different soils, in relation to different plant cultures, and it is also necessary to comprehensively assess its environmental safety before recommending it for widespread use," the scientist said.
Nevertheless, Gusev is optimistic about the low environmental footprint of his fertilizers. In this study, he says that microelements would be able to enter into a plant’s structure without damaging the soil. Normally, microelements are introduced into the soil in the form of soluble salts, which are absorbed by plants in part and the rest is washed out by rains and watering; such discarded portion tends to leak into groundwater systems and disrupt their balance.
Besides the ecological benefits of the new fertilizers, the scientists predict they will also produce positive economic outcomes. They say its consumption is about one gram of dry substance per tonne of processed seed. At the same time, the number of procedures involved is reduced, which would decrease the costs of labour and agricultural equipment....
The Mongolian People’s Party (MPP) is to appoint a new leader. The selection will be made at a party congress to be held on 21-22 November. According to a source, D.Khayankharvaa from the ‘32’ group in parliament is expected to be a nominee for the top post, along with Prime Minister U.Khurelsukh and N.Demberel. A total of 1100 delegates will participate in the congress.
The MPP won 65 seats out of 76 seats in parliament in the June 2016 general election.
The US is being pushed out of the grain market as Russia's bumper wheat harvest has dragged down prices to record lows. Russian agricultural exports are booming thanks to a weaker national currency and massive investment.
“We are pushing America aside in some markets, and we are satisfied with this,” said Russia’s Agriculture Minister Aleksandr Tkachev.
This year Russian farmers are expected to harvest the biggest crop in over a century. Russia will produce at least 83 million tons of wheat in the current growing season, according to estimates by The Wall Street Journal.Lower prices and close proximity to large markets gives Russia an advantage, according to the General Director of the Institute for Agricultural Market Studies Dmitry Rylko.
“A relatively weak ruble is good for the Russian wheat market. We see either gradual or rapid growth for our exports,” the expert told RT.
However, the figure announced by the Russian government earlier this year is much more impressive. The Moscow-based grain consultant ProZerno estimates a harvest of over 130 million tons. It is 2.6 percent more than the previous record set in 1978 before the Soviet-Afghan War.
“Today our task is to set reasonable prices across the country. The grain crop of 130 million tons, there is more to come. It may reach up to 200 million tons. The main thing is to find new sales markets,” said Tkachev.
The US agricultural sector has faced lousy weather this season, meaning fewer acres of wheat were sowed in 2017 than ever before. US wheat output is expected to decline by a quarter compared to the previous season.
Unfavorable conditions along with Russia’s resurgence pushed wheat prices at the Chicago Board of Trade down almost 25 percent to $4.19 a bushel (about 27 kilograms) compared to July, when Russia began a record wheat harvest. The US Wheat Associates trade group announced the shutdown of its office in Egypt, the world’s biggest wheat importer.
“We literally can’t compete on the price of wheat in those markets compared to Russia,” said the trade group’s spokesman Steve Mercer, as quoted by the WSJ.
According to the US Agriculture Department, American wheat will make up just 15 percent of global exports in 2017, down from half four decades ago. The plunge was also caused by more grain grown in Europe and India. The US will produce half as much as Russia, according to the department.
Last year, Russia managed to become the world’s leading producer and exporter of grain, after shipping 34 million tons from its 119 million ton harvest. Exports of Russian wheat are expected to increase to 40 million tons this year, according to the agriculture ministry.
“No one is leaving the market. The Americans are rather better at corn and soybean farming, and they are successfully doing that while losing position in wheat,” Rylko told RT.
Reverses of Mongolia’s 500- and 1,000-togrog coins showing the fossil skeleton of an Ichthyosaur. (Images courtesy Coin Invest Trust)
Mongolia’s latest contribution to its “Evolution of Life” series features one of the better known fossil skeletons: a 250 million year-old Ichthyosaur.
The head of one of these creatures features on the reverse of a 38.61 mm, 1 oz .999 fine silver 500 togrog and a 11 mm 0.5 g .9999 fine gold 1,000 togrog proof.
Mintages are 999 and 15,000 respectively. The coins have been struck by B. H. Mayer’s Kunstprägeanstalt, Munich, for Liechtenstein’s Coin Invest Trust.
Ichthyosaurs were large marine “fish-lizards” similar in many respects to the modern dolphins, although quite unrelated to them.
They will always be associated with 12 year-old Mary Anning, who is credited with recovering the first complete Ichthyosaur skeleton on the coast of England’s Dorset in 1811.
Ulaanbaatar /MONTSAME/ Minister of Mining and Heavy Industry D.Sumiyabazar pledged to take urgent measures in response to the logjam of coal trucks, stretching over 100 km at the Gashuunsukhait border crossing in southern Mongolia.
The Minister looked over the situation at the Gashuunsukhait border crossing in the course of his three-day working visit to Umnugobi aimag over the weekends. J.Bat-Erdene, Minister of Road and Transport Development and L.Enkhbold, Member of Parliament also visited the site. The officials met local authorities, representatives of the mining companies and coal transporters to seek solutions.
The situation at the Gashuunsukhait border crossing arose after national Naadam festival when the People’s Republic of China significantly reduced its daily coal truck passage, causing a 90-km-long line of trucks at the border crossing as of November 12.
According to B.Davaasuren, Head of the Customs Division of Gashuunsukhait border crossing, the Chinese side explained that the decision was made due to - smuggling of goods such as meat and guns from Mongolia and major events such as the 19th National Congress of the Communist Party.
Before the situation emerged, about 1,200-1,500 coal trucks passed the Gashuunsukhait border crossing on daily basis. In accordance with the Chinese decision, about 500-600 trucks now pass the border crossing in a day.
G.Battsengel, CEO of Energy Resources LLC, explained the logjam cause linking with increase in number of coal transport trucks. As of today, over 100 entities have acquired coal transport permits for about 7000 trucks.
The authorities of the mining companies and the drivers requested the Ministers to solve the issue in the near future. As the situation has not been improved over the last four months, the drivers are spending at least two weeks in the logjam.
The Ministers also familiarized with the operations of Energy Resources LLC, Erdenes Tavan Tolgoi JSC, Tavan Tolgoi Incorporate Company and Oyu Tolgoi LLC.