1 LEGAL DISPUTE OVER EMC OWNERSHIP COMES TO AN END WWW.ZGM.MN PUBLISHED:2018/09/20      2 ERDENES TAVAN TOLGOI REVENUE SURGES DUE TO HIGHER COAL PRICES WWW.NEWS.MN PUBLISHED:2018/09/20      3 RUSSIA AND MONGOLIAN BORDER CROSSING NO. 487 WWW.NEWS.MN PUBLISHED:2018/09/20      4 WORLD ECONOMICS REPORTS THAT MONGOLIA’S EMPLOYMENT RATE HITS A FIVE-YEAR HIGH WWW.GOGO.MN PUBLISHED:2018/09/20      5 USD HITS RECORD HIGH IN MONGOLIA DUE TO HIGHER IMPORTS WWW.CHINA.ORG.CN PUBLISHED:2018/09/20      6 READOUT OF VICE PRESIDENT MIKE PENCE’S MEETING WITH PRIME MINISTER UKHNAA KHURELSUKH OF MONGOLIA WWW.WHITEHOUSE.GOV PUBLISHED:2018/09/20      7 MONGOLIA LAUNCHES EU-FUNDED PROJECTS TO PROMOTE GREEN DEVELOPMENT, ENVIRONMENTAL PROTECTION WWW.XINHUANET.COM PUBLISHED:2018/09/20      8 COAL EXPORTS FROM TOP SHIPPER HOBBLED WITH MINERS FACING CONSTRAINTS WWW.MINING.COM PUBLISHED:2018/09/20      9 FRONTIER'S "INVEST MONGOLIA TOKYO 2018" WWW.MONGOLIANBUSINESSDATABASE.COM PUBLISHED:2018/09/19      10 U.S.-CHINA TRADE TUSSLE IS CREATING WINNERS IN SOUTHEAST ASIA WWW.BLOOMBERG.COM PUBLISHED:2018/09/19      УУРХАЙЧДЫН АЖЛЫН БАЙР НЭМЭГДЭЖ, ЦАЛИН ӨСЧ БАЙНА WWW.GOGO.MN НИЙТЭЛСЭН:2018/09/20     “ЭРДЭНЭТ”-ИЙН 49 ХУВИЙН ӨМЧЛӨЛ ТОЙРСОН ХУУЛЬ ЗҮЙН МАРГААН ЭЦЭС БОЛЛОО WWW.ZGM.MN НИЙТЭЛСЭН:2018/09/20     СЗХ-НД МӨНГӨ УГААХТАЙ ТЭМЦЭХ НЭГЖИЙГ БАЙГУУЛАХААР БОЛЛОО WWW.MONTSAME.MN НИЙТЭЛСЭН:2018/09/20     БНХАУ: ОЛОН ТАЛТ, ЧӨЛӨӨТ ХУДАЛДААГ ДЭМЖИЖ БАЙНА WWW.BLOOMBERGTV.MN НИЙТЭЛСЭН:2018/09/20     АТҮТ: БҮРТГЭЛТЭЙ АВТОМАШИНЫ 60 ОРЧИМ ХУВЬ НЬ ҮЗЛЭГ ОНОШИЛГООНДОО ХАМРАГДСАН WWW.BLOOMBERGTV.MN НИЙТЭЛСЭН:2018/09/20     ЭДИЙН ЗАСАГ УРТ ХУГАЦААНЫ ТЭНЦВЭРИЙГ ХАНГАХАД ТӨВЛӨРНӨ WWW.ZGM.MN НИЙТЭЛСЭН:2018/09/20     ЯПОН УЛСТАЙ АЯЛАЛ ЖУУЛЧЛАЛЫН САЛБАРТ ХАМТАРНА WWW.DNN.MN НИЙТЭЛСЭН:2018/09/20     МОНГОЛ, АМЕРИКИЙН ХАРИЛЦАА ШАТ АХИЖ, ӨРГӨТГӨСӨН ИЖ БҮРЭН ТҮНШЛЭЛИЙН ТҮВШИНД ХҮРСНИЙГ НОТЛОВ WWW.NEWS.MN НИЙТЭЛСЭН:2018/09/20     ШЕНГЕНИЙ БОГИНО ХУГАЦААНЫ ВИЗИЙН МЭДҮҮЛГИЙГ УЛААНБААТАР ХОТОД АВНА WWW.MEDEE.MN НИЙТЭЛСЭН:2018/09/19     2018 ЭХНИЙ 7 САРД МОНГОЛЧУУД ГАДААД РУУ ЭМЧИЛГЭЭНД ЯВАХДАА 19.5 САЯ АМ.ДОЛЛАР ЗАРЦУУЛЖЭЭ WWW.BLOOMBERGTV.MN НИЙТЭЛСЭН:2018/09/19    

Events

Name organizer Where
Frontier's "Invest Mongolia Tokyo 2018" Frontier Securities Tokyo Japan
"Open to Export" ICC WTO International business award ICC WTO London

NEWS

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Credit rating on MMC raised www.montsame.mn

Ulaanbaatar /MONTSAME/ Long-term credit rating on Mongolian Mining Corporation (ММС) or Energy Resources LLC raised to ‘B-’ from ‘D’ and revised to ‘Stable’ by S&P Global Ratings. In other words the company’s operation and financial condition has been evaluated positively.

In review which made by S&P says "We completed our review on MMC’s operation and capital structure. It is appreciated that coking coal price is expected to be stable for next 12 months and the company can meet cash flow from internal resource entirely at current condition and retain liquidity.

Currently credit rating on Mongolia is ‘В-/ В’. Corporate credit rating does not excess credit rating on the country and it associates certainly with each other. For that reason credit rating on MMC assigned to ‘B’, mentioned in the review as well.

Energy Resource LLC has successfully accomplished structural reform on credit in 2016.

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December 13, 2017 trading report www.mse.mn

On December 13, 2017, 854,159 shares of 22 firms listed as Tier I, II, and III were traded. 6 firms’ shares increased in price, 12 decreased and 4 remained unchanged. Khunnu Management /HBZ/ was the top performer, increasing 14.99 percent, whereas E-Trans Logistics JSC /ETR/ was the worst performer, decreasing 14.90 percent.

The MSE ALL Index decreased by 1.78 percent to stand at 1,200.94 points. The MSE market cap stands at MNT2,557,178,728,873

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Aspire Mining attracts $16.5 million to advance coking coal project in Mongolia www.proactiveinvestors.com.au

The company aims to take the Nuurstei Coking Coal Project into production within 18 months.

Aspire is starting a drilling and exploration program
Aspire Mining Ltd (ASX:AKM) has successfully completed its fully underwritten $16.5 million pro-rata renounceable entitlement offer at an issue price of $0.012 per share.

The funds will be used to expedite development of Aspire’s 90% owned Nuurstei Coking Coal Project in Mongolia.

Aspire aims to take the project into production within 18 months.

The company is now planning to undertake a drilling and exploration program at the Nuurstei project.

Rights issue details

Eligible shareholders had the opportunity to subscribe for six new shares for every five shares held at an issue price of $0.012 each.

The rights issue was fully underwritten by Patersons Securities Limited and sub-underwritten by the company’s major shareholder Noble Group (SGX:CGP).

Noble subscribed for the full amount of its entitlement (circa $2.97 million) and took up a further amount of $0.59 million on a priority sub-underwriting basis.

This takes Noble’s voting power in the company to 19.9% on an undiluted basis.

Drilling and exploration program commencing

Aspire has planned a $2 million drilling and exploration program at the Nuurstei Coking Coal Project.

The program aims to increase current resources and establish an ore reserve, which will then lead to a new resource model planned to be completed in the first quarter of 2018.

Capital costs for the development of Nuurstei have been further refined, with the current estimate of US$13 to US$14 million to be confirmed in the feasibility study process.

The end objective of these studies is to confirm an economically viable mining operation commencing within an estimated 18 month period.

David Paull, managing director, said: “Further to our announcement on Tuesday 5 December, we are pleased to have successfully raised the full amount of $16.5 million from the fully underwritten rights issue.

“The underwriting was supported by a strong panel of institutional sub-underwriters seeking to position themselves as shareholders and we welcome them in that capacity.

“Our focus is now squarely on confirming the feasibility and commencing the development of the Nuurstei Coking Coal Project.”

Debt reduction on track

Aspire intends to pay $0.19 million of the funds raised under the rights issue to Noble which, when combined with Noble’s participation in the rights issue, will result in a total reduction of $3.75 million in the amount owing to Noble.

This completes the first of a further series of transactions designed to reduce the existing US$6.65 million debt owing under the Noble Facility to US$1.8 million.

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Audit of Oyu Tolgoi and Erdenes TT planned www.news.mn

The Parliamentary Budgetary Standing Committee held a meeting on Tuesday (12 December) to discuss the draft 2018 audit bill.

According to the Mongolian National Audit Office, the institution is planning to audit to country’s biggest mining companies such as Oyu Tolgoi, Erdenes TT as well as the Governmental Vehicle Fleet, the Civil Aviation Authority, the Mineral Resources and Petroleum Authority, Presidential Election Spending, reports on implementing ASEM 2016-2017, the State Housing Corporation, and Ministry of Defence investment spending.

The projected cost of the audit as set out in the bill is over MNT 700 million.

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Mongolia and the US agree to intensify labor cooperation www.montsame.mn

Ulaanbaatar /MONTSAME/ Minister of Labor and Social Protection S.Chinzorig discussed Mongolia-US labor cooperation with Manual P.Micaller, Charge d’Affaires of the US Embassy in Mongolia on December 12.

The Minister talked about how the Mongolian Government considers eradication of poverty and unemployment a priority, and the International Monetary Fund’s Extended Fund Facility program is proving effective, citing the projected 5.5 percent economic growth in the country. “Although budget discipline has seen improvement, there are provisions that take a step back as far as social protection is concerned and rule out policy to protect low-income citizens,” he noted.

Minister S.Chinzorig also emphasized the need to take Mongolia-US cooperation in labor and social protection to a new level, requesting assistance from the Embassy. “Closer cooperation in labor and social protection will help protect the rights of Mongolians living and working in the US, ensure social guarantee and create an integrated database,” he said.

For his part, Mr. Micaller expressed the US’ interest to work closely with the Labor Ministry, informing that he was holding talks with the members of the new Cabinet regarding ways to strengthen Mongolia-US comprehensive partnership. “Improvement of population livelihood through diversification of the economy and increased employment is an important area of focus in bilateral cooperation. The US is ready to assist Mongolia in all areas in order for it to successfully implement the IMF program and revive its economy,” he said.

Mr. Micaller also touched upon the Millennium Challenge Corporation’s Second Compact Agreement with Mongolia, which is being drafted and will definitely boost the social and economic development of Mongolia.

The Charge d’Affaires also conveyed Washington’s appreciation of Mongolia’s contribution to peaceful resolution of the tensions in the Korean Peninsula and inquired into an issue regarding the workers from the Democratic People’s Republic of Korea (DPRK) in Mongolia, which has surfaced in western media.

Minister S.Chinzorig answered that the Government had taken a decision to not extend the labor agreements of over 1,100 workers from the DPRK in the country, enforcing a UN Security Council's resolution. Labor agreements will not be newly established either. “However, there is no discussion of returning all workers at once. The current workforce will have left the country by June, 2018,” the Minister said. During a press conference held on December 5, Minister of Foreign Affairs D.Tsogtbaatar said that the DPRK Ambassador in Mongolia had been informed of the matter.

The sides also touched upon Mongolia’s request for inclusion in the US H-2 visa category, which is yet to be resolved by Washington.

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Altai Krai continues to supply agricultural produce and products in Mongolia www.chelorg.com

Altai Krai in the 11 months of this year was sent to Mongolia 419 consignments with a total weight of almost 8.2 thousand tons, mostly agricultural products and food, said on Tuesday the Ministry of agriculture of the region.

According to the Ministry, collaboration between the Altai Krai and Mongolia is conducted on an ongoing basis. In 2017, this country, Altai Krai exported feed crops, whey, cereals and cereals cereal, flour, vegetable oil, eggs, ice cream and other kinds of agricultural products and food products.

«For 11 months in Mongolia sent 419 consignments with a total weight of almost 8242 tons. In great demand among foreign partners are feed the Altai production — bran, ration, feed. In the total sales volume they occupy a major share», — stated in the message.

The Agency notes that the agreement on the supply of feed to the affected this year by drought khovdsky aimag was reached in August of this year during a working meeting head of the region Alexander Karlin, Governor chodskeho aimag of Mongolia Damdin by Alcanzando.

In addition to the feed, food, Altai Krai exports crops. This year in the Mongolia ship food oats and millet, flax, canola, soy. In December, along with the designated products sold in the region Mongolia beef cattle productivity. Sale made two breeding farms of the region — «Industrial» Biysk district and Kolos Loktevsky district.

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Deputy Prime Minister discusses cooperation issues with Chinese delegation www.theubpost.mn

Deputy Prime Minister U.Enkhtuvshin participated in the fourth World Internet Conference, which was held in Beijing last week.

As a part of the conference, Minister U.Enkhtuvshin met with First Secretary of the Central Secretariat of the China’s Communist Party Wang Huning to discuss some aspects of mutual cooperation and current challenging issues of cooperation between the two countries.

U.Enktuvshin pointed out that the government of Mongolia is ready to closely cooperate with Chinese authorities to make next year’s meeting of the council of mineral resources, energy and infrastructure cooperation between the two countries mutually beneficial and to implement projects that will have significant impact on the two nations’ economic development.

The Deputy Prime Minister asked Huning to focus on accelerating projects that will be implemented with Chinese non-refundable aid and soft loans, as well as on arranging a meeting on the non-refundable aid of two billion CNY that China’s President Xi Jinping offered during his visit to Mongolia in 2014. The Mongolian side is keen to start negotiating about making amendments to an intergovernmental agreement on border checkpoints and their procedures signed by the two governments in 2004, and addressing the border issues regarding the slow passage of trucks carrying coal from Mongolia to China.

Huning stated that as China has outlined to carry out open relations and cooperation with the world’s countries, especially with neighbor countries under the country’s strategic plan created by China’s Communist Party during its 19th national congress, held from October 18 to 24, there will be new collaboration opportunities between the two countries.

The Chinese official stated that he hopes that the two nations will develop mutually beneficial economic cooperation, as well as humanitarian cooperation. He added that the two governments should work together to increase the current trade turnover of 4.6 billion USD between the two countries to 10 billion USD by 2020, but noted that it will depend on the global market.

He stressed, “When implementing projects and programs between the two countries, China abides by the statement by Xi Jinping that China will respect Mongolia’s stance and interests, but the two countries face challenges of cooperation due to some misunderstandings between our two nations.”

Huning said that state authorities in charge of border, customs, mining, export and import will work to address challenging issues between the two countries, and this matter will be discussed during the next meeting of China-Mongolia intergovernmental commission.

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World Bank to stop funding oil and gas projects www.mining.com

The President for the World Bank, Jim Yong Kim, said Tuesday the institution will stop all lending for oil and gas projects after 2019, with the exception of certain gas projects in the poorest countries facing exceptional circumstances.

Even though in 2013 the bank announced it would stop financing coal-fired generation projects, oil and gas investments still account for about 2% of its $280-billion asset base.

"We're determined to work with all of you to put the right policies in place, get market forces moving in the right direction, put the money on the table, and accelerate action," Kim said in a speech delivered in Paris. "That's the only way we can meet the commitments we made two years ago, and finally begin to win the battle against climate change."

The head of the World Bank is attending, together with dozens of government and industry leaders from different countries, an international climate summit being hosted by French President Emmanuel Macron. The meeting marks the second anniversary of the signing of the Paris Agreement on Climate Change.

Kim also explained that his organization is on track to meet its target of 28% of its lending going to climate action by 2020, as well as the goals of its Climate Change Action Plan – developed following the Paris Agreement.

According to the exec, starting next year, the World Bank will begin reporting greenhouse gas emissions from the investment projects it finances in key emissions-producing sectors, such as energy. It will also be applying a shadow price on carbon in the economic analysis of all IBRD/IDA projects in key high-emitting sectors.

Kim said that bolder announcements surrounding the Washington-based development bank’s path towards a greener future will be made at the 24th Conference of Parties, which will take place in Poland in 2018.

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Sberbank and Alibaba abandon joint venture talks www.ft.com

Plans for an ambitious partnership between Russia’s biggest bank and China’s top ecommerce group have fallen apart after nearly a year of negotiations, people familiar with the talks have told the Financial Times. 

Sberbank, which holds half of all Russian retail deposits, and Alibaba, which recorded $547bn of gross merchandise volume last fiscal year, had planned to bring that clout to bear in an ecommerce push in Russia, where more than half the 140m population use the internet daily. 

The proposed tie-up was an attempt to leverage state-run Sberbank’s vast client base with the Chinese ecommerce juggernaut to sell items to customers through the bank’s app.

But the companies abandoned the discussions after falling out over how it would work, the people said. 

Sberbank said: “We don’t comment on rumours.” Alibaba declined to comment. 

Herman Gref, Sberbank’s chief executive, is friendly with Alibaba founder Jack Ma and has long been keen for the bank to move into technology-dominated sectors, which he sees as essential to stay relevant in a digital world. Last month, he said the bank would prioritise moves into ecommerce and medicine in addition to finance. 

“About 50 per cent of businesses [in Russia] work in trade and it’s all intermediary functions. With the growth of ecommerce all physical intermediaries will be a thing of the past” in five or six years, Mr Gref said. 

In August, however, Sberbank announced a new joint venture with Yandex, the Russian search engine group, that is trying to turn Yandex.Market, a shopping comparison site, into a fully fledged ecommerce company. The bank invested Rbs30bn at a valuation of Rbs60bn ($1bn) and expects to conclude the deal by the end of the year. 

A person briefed on the discussions said Mr Gref turned to Yandex after talks with Alibaba fell through over who would control the joint venture, which Sberbank saw as an attempt to gain access to its customer database without offering much in return.

But another person familiar with the companies’ thinking said the talks fell through later, after Sberbank invested in the Yandex joint venture and tried to partner it with Alibaba. “Alibaba doesn’t want to work with some comparison website,” the person said. 

Russia is one of the biggest markets for AliExpress, Alibaba’s cross-border ecommerce business selling from China into international markets. Cross-border retail grew 37 per cent last year to more than Rbs300bn ($5bn), about a third of the total online market.

Alibaba is holding early-stage discussions with other potential partners in Russia, but “it has to be a deal that makes sense”, the person said.

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Mining product export makes up 78.8 per cent of gross export www.montsame.mn

Ulaanbaatar/MONTSAME/ Every month, the Ministry of Mining and Heavy Industry calls regular press conference titled ‘Transparent and accountable mining’, at which policy, activity and objective of the sector are openly publicized to public. As usual, Mining and Heavy Industry Minister D.Sumiyabazar made this month’s press conference on December 12 to inform about mining sector’s review on 11 months of 2017.

Over the 11 months of 2017, the sector accumulated MNT1,416 trillion to the state budget with nine types of taxes, fees and royalties. It shows an increase of MNT764 billion or two-fold against the same period of previous year.

In the past ten months, mining and extractive industries produced 40 million tons of coal, 1 million ton of copper concentrate, 17.4 tons of gold, 4.7 thousand tons of molybdenum concentrate, 6.7 million tons of iron ore, 3 million tons of iron ore concentrate, 104 thousand tons of fluorspar, 17 thousand tons of spar concentrate and 69 thousand tons of zinc concentrate.

Moreover, the export of mining products made up 78.8 percent of the country’s gross export.

As of December 11, 2017, 7.14 million barrel or 968 thousand tons of crude oil were extracted, of which 7.06 million barrel or 960 thousand tons of crude oil were exported, accumulating MNT178.7 billion to the state budget.

Within the framework of IMF Extended Fund Facility, it was decided to increase rates of excise duties on petroleum and diesel fuel stage by stage in July and October of 2017. With its resolution dated November 15, 2017, the Government decided to increase the excise duty on petroleum with up to 90 octane, which will be imported through Sukhbaatar, Zamyn-Uud and Ereentsav border checkpoints, by MNT30,000 per ton, the duty on petroleum with 90 octane and higher by MNT50,000 per ton and the duty on diesel fuel by MNT100,000 per ton. The resolution came into force from November 30.  
As of December 5, Mongolia had a 38-day reserve of oil products for domestic need.

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