|"Open to Export" ICC WTO International business award||ICC WTO||London|
Ulaanbaatar /MONTSAME/ The Ministry of Foreign Affairs hosted the first meeting of the National Committee for ensuring the implementation of Trade facilitation agreement (TFA) of World Trade Organization (WTO) on October 11. It was chaired by Ts.Munkh-Orgil, Acting Minister of Foreign Affairs and Head of the National Committee.
Addressing the meeting, Ts.Munkh-Orgil noted that establishing the TFA provides landlocked countries like Mongolia with opportunities to reduce the cost of transit transportation, to improve services of border checkpoints in accordance with international standards and to receive aid for empowering trained staff. He added Mongolia takes a responsibility to realize the TFA’s clauses in several phases.
At the meeting, attendees approved the National Committee’s rules and decided to set up sub-committees. They exchanged views on altering the law on customs in conjunction with the TFA’s implementation as well.
Together with landlocked countries in 2003, Mongolia made the initiative of creating the TFA, which has purposes to reduce barriers to importers and exporters by simplifying the rules and control over goods crossing borders and to minimize the delivery cost. The TFA was adopted in 2014, and came into force on February 22, 2017.
The National Committee was established in accordance with the governmental resolution of May 10, 2017, with a responsibility to manage the Agreement’s implementation.
Alibaba Group Holding Ltd announced on Wednesday the launch of a global research academy that it hopes will join the ranks of, and potentially outrival, Bell Labs and Microsoft Research.
The investment of 100 billion yuan ($15.2 billion) over three years in the Alibaba DAMO Academy takes the internet giant one step closer to fulfilling its ambition to serve 2 billion people in two decades, said chairman Jack Ma.
During the company's annual computing conference in Hangzhou, Zhejiang province, Ma said the investment will help it get a head start in the internet of things, quantum computing, fintech and human-machine interaction.
At this point in the group's development, Ma said it is imperative to have a research body to solve problems facing people, economies and broader society.
"Backed by Alibaba's vast resources, the academy needs to outlive Alibaba … and ought to shoulder the responsibility to serve the whole of society," he said, adding that the academy will need to finance itself in the long run.
The name DAMO stands for "discovery, adventure, momentum and outlook". The word is often depicted in Chinese martial arts fictions as an avenue in the Shaolin Monastery where masterful monks practice skills and experience enlightenment.
The project includes opening seven new research labs in China, the United States, Russia, Israel and Singapore, recruiting related talents on top of its 25,000 engineers and scientists.
Chief Technology Officer Zhang Jianfeng will head the academy, assisted by a global advisory board that includes some of the world's technology luminaries, such as George Church, a leading light of the Human Genome Project, as well as Michael Jordan, a mastermind in artificial intelligence.
The firm will also tie-up with over 200 universities and research institutes worldwide to co-develop technologies that aim to improve the lives of technology end-users or boost business security and efficiency.
The company has spared no efforts to boost its technology arsenal. In March, it established independent research and development teams in a plan dubbed NASA to focus on foundational and disruptive technology research.
The company is particularly delving into consumer-facing solutions. Alibaba's payment affiliate Ant Financial unveiled a biometric identification technology open platform dubbed ZOLOZ, through which organizations can apply Ant's facial recognition, human-machine interaction, and other technologies to a variety of business and civic scenarios.
Ulaanbaatar /MONTSAME/ The Council of the European Union adopted a decision on the conclusion of the Mongolia-EU Framework Agreement on Comprehensive Partnership and Cooperation on October 9.
The negotiations for the Mongolia-EU Framework Agreement started in 2010 and were concluded in 2013. As all EU member states approved the Agreement at parliamentary levels, the European Parliament gave its consent to conclude the Agreement on February 15, 2017.
After the European Parliament’s approval that paved the way for the Agreement’s entry into force, the EU Council has thus adopted the conclusion at its meeting this week. The Council decision on the conclusion of the agreement closes the ratification procedure and allows the agreement to enter into force. The Agreement will enter into force on November 1, 2017.
Once it enters into force, The Agreement will supersede the current legal framework of the 1993 Agreement on Trade and Economic Cooperation between the European Economic Community and Mongolia.
It will provide the basis for a broader and more effective engagement by the EU and its Member States with Mongolia moving forward. The Agreement will broaden the scope of Mongolia-EU partnership and strengthen bilateral cooperation in commerce, economy, development assistance, agriculture, rural development, energy, climate change, research, innovation, education and culture.
The Framework Agreement consists of 65 Articles with a Preamble and nine Titles, which include the nature and scope of the Agreement; bilateral, regional and international cooperation; cooperation on sustainable development; cooperation on trade and investment issues; cooperation in the area of justice, freedom and security; cooperation in other sectors; means of cooperation; the institutional framework; and final provisions.
The Agreement covers a number of cooperation areas of mutual interest such as trade and investment, sustainable development, financial services, taxation, industrial policy and small and medium-sized enterprises cooperation, science, technology, culture, energy, transport, environment, health, civil society and tourism.
The Framework Agreement’s entry into force will allow Mongolia to intensify its cooperation with the EU, cooperate in new fields and take bilateral relationship to a new level. The Framework Agreement will also become a stimulus to strengthen Mongolia’s relations with EU member states. The EU adopted a decision to establish its Representative Office in Ulaanbaatar in July, 2017.
DETROIT/TOKYO (Reuters) - General Motors is checking whether its cars contain falsely certified parts or components sourced from Japan’s Kobe Steel <5406.T, the latest major automaker to be dragged into the cheating scandal.
“General Motors is aware of the reports of material deviation in Kobe Steel copper and aluminum products,” spokesman Nick Richards told Reuters, confirming a Kyodo News report. “We are investigating any potential impact and do not have any additional comments at this time”
GM joins automakers including Toyota Motor Corp and as many as 200 other companies that have received parts sourced from Kobe Steel as the scandal reverberates through global supply chains.
On Wednesday fresh revelations showed data fabrication at the steelmaker was more widespread than it initially said, as the company joins a list of Japanese manufacturers that have admitted to similar misconduct in recent years.
Investors, worried about the financial impact and potential legal fallout, again dumped Kobe Steel stock, wiping about $1.6 billion off its market value in two days. On Thursday in Tokyo, the shares stabilized and were up 1.1 percent by around 0150 GMT, compared with a 0.3 percent gain in the Nikkei 225.
Kobe Steel President Hiroya Kawasaki said on Thursday his company would do the utmost to investigate the reason for the tampering and take measures to prevent further occurrences. He was speaking before meeting an industry ministry official to discuss the matter.
The steelmaker admitted at the weekend it had falsified data about the quality of aluminum and copper products used in cars, aircraft, space rockets and defense equipment, a further hit to Japanese manufacturers’ reputation for quality products.
Kobe Steel said late on Wednesday it found 70 cases of tampering with data on materials used in optical disks and liquid crystal displays at its Kobelco Research Institute Inc, which makes and tests products for the company.
It also found one case of falsified data on iron powder products - material used for car parts such as gears - that were shipped to a customer.
An internal probe carried out since it discovered the issues in its aluminum and copper business has not found other cases of data tampering, Yoshihiko Katsukawa, a managing executive officer at Kobe Steel, told a news conference on Wednesday.
The EBRD has become a shareholder in Kincora Copper Limited, a copper exploration company active in Mongolia, with the acquisition of a 6.16 per cent stake for the equivalent of approximately €940,000 through a private placement. Kincora is listed on the TSX Venture Exchange. Its main shareholders are Origo Partners (24.5 per cent), the company’s management and a number of natural resource specialist institutional investors.
The company holds a number of licences in the Ömnögovi region in southern Mongolia, which contains important gold and copper resources including the underexplored Devonian copper belt. These resources include the Oyu Tolgoi deposit, operated by Rio Tinto, which is one of the world’s largest copper operations and the Tsagaan Suvarga deposit, currently under development by the Mongolia Alt Corporation. The EBRD is providing finance for both projects.
Despite growing interest, the Ömnögovi region remains widely untapped and offers substantial opportunities for Mongolia’s overall economy through the discovery and development of the next generation of mineral deposits. With a population of just over 3 million and a size of 1.5 million km2, Mongolia is one of the most sparsely populated countries on earth. Extreme climate conditions have a severe impact on the living conditions, but the country’s natural resources offer attractive opportunities for local and international investors.
By investing in Kincora, the Bank is promoting modern copper porphyry drill testing and a district scale reconnaissance exploration programme in the Devonian copper belt, alongside high environmental and social management standards and practices. The EBRD funds will be solely used by Kincora’s Mongolian subsidiaries to support an extensive drilling programme and potential further explorations at two key Devonian-age prospects.
Eric Rasmussen, Director, Natural Resources commented: “We are pleased to support the exploration plans of Kincora with an equity investment. It is strategically important for Mongolia to attract quality investors into metals and minerals exploration in order to realise the high potential for mining.”
Sam Spring, Kincora’s CEO, commented: "We are delighted to welcome the EBRD as a shareholder. The Bank has unique knowledge of, and relationships in Mongolia and has provided finance to assist the development of the two existing economic copper projects in the Devonian belt. In the last two months, Kincora has attracted two new significant investors who are well known in the industry and has undertaken extensive due diligence.”
Mongolia became an EBRD country of operations in 2006. The Bank is currently the largest multilateral investor in the country with about €1.42 billion (US$ 1.7 billion) invested in 92 projects in the private sector to date. The EBRD is one of the largest natural resources investors in the country and is playing a pioneering role in the development of renewable sources of energy such as wind farms....
Last week the price of lead spiked on the London Metal Exchange hitting the highest level since August 2011 at just over $2,600 a tonne.
The price of the metal used mainly in automobile and motorcycle batteries has since softened but is still trading up 27% year-to-date.
News from top producer and consumer China may provide further upside for lead. In a sign that already tight primary lead supply is getting tighter, Chinese smelters just lowered their treatment and refining charges to as much as half the average over the first half of 2017.
TC/RCs paid by mining companies to turn concentrate into metal are a good indication of conditions in the spot market. Platts News reports spot TCs for imported lead concentrates in China fell to $20–$30 per tonne in October down from $30–$40 in September.
According to metals consultants Beijing Antaike, TCs averaged $40.80 during the first six months of the year but compares to charges as high as $130–$150 per tonne in June 2016:
China's mined lead demand is forecast to hit 3.478 million mt in 2017, up 12% year on year, with its mined lead output this year seen at 2.03 million mt, down from 2.23 million mt last year, due to domestic environmental controls, Antaike data showed.
China's mined lead imports in 2017 are estimated to be 1.236 million mt, higher than 705,000 mt last year, with the domestic mined lead deficit seen at 211,000 mt this year, widening from deficit of 170,000 mt last year, Antaike said, noting that the above estimates did not consider the lead contained in imported zinc concentrates.
Reuters reports that deficits on the global lead market are narrowing however. In August the lead shortage shrunk to 4,600 tonnes from 31,900 tonnes in July, data from the Lisbon-based International Lead and Zinc Study Group showed on Wednesday.
For January to August, the lead market had an output deficit of 119,000 tonnes compared with a surplus of 49,000 tonnes in the same period last year.
Analysts polled for October's FocusEconomics Consensus Forecast estimate that the lead price will average just over $2,300 per tonne during the final quarter of this year and moderate further through 2018.
This month, six panelists left their forecasts for lead unchanged for Q4 2017, three made downward revisions while eight raised their forecasts.
Macquarie analysts are the most bullish – predicting price to average $2,600 this quarter and add another $50 through the first half of 2018. Deutsche Bank considers lead overpriced at the moment and forecasts the metal to dip below $2,000 in H2 2018.
The Asian Development Bank (ADB) has forecasted the economic growth of Mongolia would increase by 4% in 2017 and by 3% in 2018. This is more positive expectation compared to the forecast by last April.
The World Bank (WB) assumed that the Mongolian Gross Domestic Product (GDP) would grow up by 2.8% in 2017 and by 3.1% in 2018. In 2019, it is possible to exceed over 7%, the WB said. Meanwhile, representatives of the International Monetary Fund (IMF) reported the GDP of Mongolia is expected to increase by 2% in this year after monitoring the first stage of a program being implemented in Mongolia.
Deputy Governor of the Bank of Mongolia (BoM) B.Lkhagvasuren explained its decision to keep the policy rate at 12%, saying the reason was a debt pressure expected from the next year as well as a political state. The inflation rate is expected to increase by end of this year, but it will be stable from beginning of 2018. The country’s foreign exchange reserves is expected to reach USD 3.8 billion by 2019, the BoM added.
Mongolia's Untapped Lending Market Has Earned This Japanese-Backed Fintech Startup A $30M Valuation www.forbes.com
In Mongolia, where the average monthly income is $390, informal loans between friends or family members are commonplace as credit and small bank loans are hard to get. On the other hand, small informal loans are almost expected to not be paid back.
“There is no leverage system for people to repay, so in the worst case they lose their friends,” says Anar Chinbaatar, 35, CEO of fintech startup AND Global.
He and two friends cofounded the company in 2015 after, one day out for a smoke, he finally got tired of friends asking to borrow money from him. His startup, which launched the mobile app LendMN, introduced mobile-based microlending to the North Asian country where borrowers are blacklisted from significant financial services such as mortgages if they default on a small loan from the bank.
But the lending industry is fractured, and AND -- meaning “friend” in Mongolian --- wants to work toward accessibility, transparency and accountability in microlending, the CEO says.
After raising $1 million in seed funding in April 2016, the company received another $4 million with a $30.8 million valuation in August from influential backers in Mongolia and Japan including former Japanese parliament member Takami Yuichi, investor Satoshi Matsumoto and his wife Yasuyo Matsumoto. It is also advised by Oko Davaasuren, an influential Mongolian investor from TechStars.
The company, which has issued over $1.9 million in loans as of this month, plans to use the new investment to fuel expansion into the Philippines and Japan and develop new technology such as a blockchain project while preparing for an initial coin offering in December.
“Our main target is serving underbanked people who cannot get financial services and who are paying loan sharks,” Chinbaatar says.
Fractured Lending Industry
Mongolia’s archaic banking industry lacks a credit scoring system, with banks and financial institutions instead sharing a spreadsheet-like database of customer info to evaluate borrowers, he says. Traditional bank loans of any size require lengthy paperwork, collateral and five days to process. Collecting collateral from the borrowers -- which could range from cars and houses in the capital Ulan Bator to flocks of sheep in the countryside -- is costly for banks, he added. People often resort to loan sharks, which charge a high interest rate of 10% per week -- but smaller loan sharks commonly even charge that rate per day, according to Bayar Volodya, 37, cofounder and chief operating officer.
AND wants to do away with loan sharks and raise customers’ financial education and responsibility. They seek to fill the cracks of Mongolia’s fragmented lending system through human interaction and artificial intelligence. The biggest problem to solve was accurately assessing borrowers’ creditworthiness.
“In the first year, we were advised by almost 100 bankers, risk managers and loan appraisers, and 99 of them says it was an impossible, stupid thing,” Chinbaatar says. Only one person, a broker for Mongolia’s biggest bank, saw a possibility and advised them on a concept for a credit scoring model.
LendMN lets users choose the lending amount and repay time period, processes the request in a few minutes -- compared to days with a traditional bank.
AND developed a machine learning-based system that assesses a range of data points from conventional information like banking, income and expense records to unconventional sources like social media, smartphone use and education and employment history.
The company sought to introduce cross-border peer-to-peer lending with funds from Japan, but found the plan infeasible as investors didn't want to take such a risk for a low return. Nonetheless, lending with its own funds, the company’s lending operation turned a profit within two months of commercial launch in April 2017, and now claims some 8,000 credit-approved active users.
LendMN’s initial customers surprised Chinbaatar. While at first he thought people would borrow small money for drinking, buying cigarettes or other entertainment, current data shows they are more financially responsible, using it for special needs to make ends meet.
Claiming a low 1.5% default rate, transaction sizes average around $70. Interest rates range from 3%-10%, compared to Mongolian bank and credit cards that charge 3.5% for prime borrowers. In contrast with banks, AND does not require collateral for its personal and business microloans -- stirring concern over disruption in the industry.
“When we launched, all the Mongolian banks had an emergency meeting over the weekend about how to tax or block us,” Chinbaatar says , but suggests it turned out to be a good thing for competitive innovation in the local industry. “Right after that, a lot of banks started working on new products, creating innovation departments to work on Facebook and chat bots.”...
The International Monetary Fund has reported a brighter outlook for the global economy.
The organization released on Tuesday its latest World Economic Outlook.
Its analysts have upgraded their global-growth forecast. But they are warning of possible instability in emerging economies.
The IMF raised the outlook for next year to 3.7 percent growth due to an improving labor situation. That figure is up one-tenth of a percentage point from the previous prediction given in July.
The IMF also revised upward its growth forecasts for the major economies, including Japan, the US, China and Germany.
The US Federal Reserve is set to begin shrinking its balance sheet.
And the European Central Bank is to decide whether to start tightening its monetary policy.
The IMF says if those policy moves take place rapidly, then money could flow out of emerging nations and flood into the US and Europe. That could trigger instability in financial markets of the emerging economies.
The IMF report is to be presented to a meeting of G20 finance ministers and central bank chiefs later this week. The G20 delegates are expected to discuss in Washington the issues raised by the IMF.
Round four of the renegotiation of NAFTA, the three-nation trade pact, begins Wednesday, and little, if any, progress on the thorny issues has been reported from any party. Some business groups are becoming extremely concerned about Trump's agenda.
"There are several poison pill proposals still on the table that could doom the entire deal," Ted Donahue, CEO of the U.S. Chamber of Commerce, said in a speech in Mexico City on Tuesday.
The Trump administration did not respond specifically to Donahue's remark, but had already criticized a similar comment from the Chamber last week regarding NAFTA talks.
"The President has been clear that NAFTA has been a disaster for many Americans, and achieving his objectives requires substantial change. These changes of course will be opposed by entrenched Washington lobbyists and trade associations," U.S. Trade Representative spokeswoman Emily Davis said.
Related: Trump's latest trade spat with Canada is over wine
Time to reach an agreement is running out: Mexican leaders have long warned that talks must end by early next year before their presidential election campaign gets underway in July. By the spring, they say, it'll be too difficult politically to ratify a new trade deal.
U.S. leaders acknowledge that talks should get done as soon as possible.
But some of the Trump administration's demands aren't going over smoothly.
One of the most controversial issues has to do with how cars are manufactured. In NAFTA, it's called "rules of origin." The rule determines the portion of a product that must be manufactured in North America in order to avoid import taxes.
For example, at least 62% of the parts in a car sold in North America must come from the region to avoid being hit with taxes at the border. It doesn't matter if the car parts are made in Mexico, Canada or the U.S., as long as they were produced in North America.
Companies are still free to decide where in North America different parts of a car are made. In fact, before a car reaches a dealership, its parts have frequently crossed the northern and southern borders multiple times.
But Trump's trade team wants to make a big change to that rule in an attempt to force manufacturing companies to create more jobs in the United States.
Instead of one rule for all of North America, the administration wants one rule for how much has to be produced in the United States, and another rule for how much needs to come from the entire region.
"You're pitting the countries against each other, not integrating them further," says Doreen Edelman, a trade lawyer at the firm Baker Donelson. "It is a deal breaker."
Mexico's top negotiator, Economy Secretary Ildefonso Guajardo, echoes a similar sentiment. In an interview with CNNMoney in April, he dismissed the idea of two separate standards for rules of origin.
"There is no one trade agreement in the world that has country-specific content. It doesn't exist," Guajardo said. "Content has to be measured regionally."
Meanwhile, significant issues, such as agriculture trade, government procurement contracts and protecting foreign investments in North America, need to be broached. A deeply divided trade spat over aviation has also emerged between the U.S. and Canada, with each side lobbying for their respective plane producers.
The U.S. is also advocating for a "sunset clause" that would make the agreement expire every five years unless each country decided to sign on for another five years. That's expected to meet resistance too.
"What kind of predictability is that for long-term investment?" adds Edelman, the trade lawyer. "There's no way for business to prepare."