|Frontier's "Invest Mongolia Tokyo 2018"||Frontier Securities||Tokyo Japan|
|"Open to Export" ICC WTO International business award||ICC WTO||London|
New Delhi, Aug. 6: India is confronting an old ghost and a difficult demand from a key China critic it wants to win over as an ally: Mongolia's new President, who wants New Delhi to cough up a much-delayed loan and gift his country an Indian Institute of Technology.
Khaltmaagiin Battulga, a former wrestler who was elected President in July, complained about the loan and pitched for the IIT during his first meeting with India's ambassador in Ulan Bator after taking office, two officials told The Telegraph.
The envoy, T. Suresh Babu, had sought the July 20 meeting to hand over invitations from Prime Minister Narendra Modi and then President Pranab Mukherjee for Battulga to visit New Delhi, the officials said.
But the conversation quickly shifted to how keen the Mongolian leader was to develop his landlocked country's information technology capabilities, and how crucial to the project was the $20m loan India had promised eight years ago but failed to release.
Battulga also asked Babu to tell Modi that he wanted an IIT in Ulan Bator, which the Mongolian President promised to personally supervise.
New Delhi has repeatedly rejected past proposals from other countries for IITs, principally because of a resource and faculty crunch.
India has, however, frequently faced accusations from international partners that it does not deliver on key promises on time, and the latest complaints risk complicating its efforts to woo Mongolia's new leader at a time New Delhi is locked in increasingly tense exchanges with Beijing.
The criticism and the proposal are also reminders that foreign leaders' concerns about China aren't enough to automatically drive them closer to India unless New Delhi proves itself a viable alternative as an economic and developmental partner.
"Delay in the release of payment to vendors and stalling of projects affects our image and leads to questions on our credibility to complete key projects in a timely manner," foreign secretary S. Jaishankar had told a Parliament panel in 2015, the year Modi became the first Indian Prime Minister to visit Mongolia.
"(The) MEA (ministry of external affairs) thus requires predictable and full funding."
During his campaign for the presidency, Battulga had repeatedly emphasised that one of his key goals would involve making Mongolia "debt-free" -- code for "less dependent on China". Currently, over 60 per cent of Mongolia's foreign trade is with China.
For India, whose troops have been in a standoff with their Chinese counterparts on a Himalayan plateau for more than a month now, Battulga's election offered a window to deepen ties with a country that has traditionally depended on its two giant neighbours, Russia and China.
Battulga's election also reflects a growing political trend within Mongolia --- of seeking to break out of the diplomatic sway of Moscow and Beijing by seeking "third neighbours".
Modi's 2015 visit to Ulan Bator was part of New Delhi's efforts to pitch India as a credible "third neighbour". During the visit, the Indian leader had promised a $1-billion line of credit -- India's largest ever soft loan to Mongolia.
Modi had also been quick to congratulate Battaluga and invite him to India, through a letter that Babu was asked to personally deliver to the new President.
But Battulga was prompt to remind Babu, when the Indian diplomat called on him, of the unreleased loan promised by then Prime Minister Manmohan Singh to the previous Mongolian President, Tsakhia Elbegdorj, during his India visit in September 2009.
Battulga told Babu that Mongolia's concerns on the loan were being addressed "very slowly", one of the officials said.
The Mongolian President also told the Indian envoy that the $20m Indian loan would be useful to his country's plans to develop its information technology sector. Mongolia, he said, could spend that money on training professionals.
He then proposed an IIT in Ulan Bator that, he told Babu, the Mongolian presidency would oversee. India has in the past turned down similar requests from Singapore and the UAE.
In addition, Battulga pressed Babu on the establishment of a joint information technology university that had been discussed during Modi's 2015 visit. Babu told Battulga that India was working with the Mongolian foreign ministry on that proposal.
The Mongolian President also complained to Babu that bilateral trade between the countries - just $11m in 2016-17 - was "insufficient".
Bilateral trade between India and Mongolia last year was a third of the levels just two years ago, when it was worth $33m....
HONG KONG -- Having established a dominant position in its home market, Chinese e-commerce giant Alibaba Group Holding is now looking to boost its presence in Hong Kong, rolling out its Tmall retail website for local consumers and releasing a version of its Alipay mobile payment service in Hong Kong dollars.
But Alibaba faces more than a few hurdles, not least because Hong Kong shoppers remain largely suspicious of the quality of goods and services provided by mainland-based companies. E-commerce is also still less prevalent in the territory than in other Asian markets. If Alibaba can succeed in establishing a stronger presence against these odds, it will be an important step toward achieving its global ambitions.
On the offensive
Alibaba officially launched Tmall in Hong Kong in mid-June, enabling local shoppers to take advantage of cheaper daily goods imported from the mainland. Some of these items, which include everything from food to household products, cost less than half of what they do on HKTV Mall, the biggest online retail platform in the territory, operated by Hong Kong Television Network. Speed is another draw. Because Alibaba has a warehouse in China's Guangdong Province, which is adjacent to Hong Kong, Tmall users in the territory can receive next-day deliveries, according to the company.
Meanwhile Ant Financial, Alibaba's financial unit, is stepping up efforts to expand Alipay's user base in the city. After receiving approval from the Hong Kong Monetary Authority, the city's de facto central bank, Ant Financial in May started offering an Alipay mobile wallet and payments app dedicated to local-currency transactions.
In mid-July, Ant Financial held a meeting with major Hong Kong retailers, including shopping mall, supermarket and convenience store operators and small and midsize merchants, to promote Alipay. Venetia Lee, general manager of Alipay Hong Kong, Macau and Taiwan, said the number of registered users in Hong Kong has already surpassed 100,000 and that her company aims to sign up at least 8,000 local merchants to accept payments via Alipay by the end of this year.
Mongolia: Buy-to-Let Apartment Boom in Capital as Expats Pursue Trillion-Dollar Mineral Wealth www.newsweek.com
Stood, square-jawed, beside the gold-hued Zaisan Monument in Mongolia's capital, the proprietor of a Hong Kong real estate portfolio beholds the flurry of activity below him in Ulaanbaatar. Like the Saker falcon, revered for its keen eyesight — and still beloved by the nomads who inhabit Mongolia’s steppe — the investor (named James) is also hunting, in a sports coat of Italian silk, which glints, subtly, in the morning sunshine. His intended quarry is not small mammals — but the newly completed residential stock which dots the central business district of Ulaanbaatar. He’s here to buy. This east Asian capital commands far juicier returns than anything he’d acquire on home turf.
In a country where explosive growth in the construction sector has been repeatedly stymied by stark recession, James knows his attention cannot alight on dormant building sites. As he explains, the debt market — which is known for its cripplingly high interest rates — has arrested the completion of older developments. Moribund projects have not been released to market. Many may form ghost-towns on the sidewalk for years to come. Any attempts to rejuvenate buildings begun during recessions past will likely idle. There’s a growing and immediate need to house incoming workers, in apartments that pass the prime (or “luxury”) bar mandated by international conglomerates. With Mongolia recording a 43.9% increase in industrial output in the first half of 2017 alone according to the National Statistics Office of Mongolia, expatriates are returning to the city in numbers which will likely be higher than this country has ever known. The 44.2% increase in trade with China during the first two quarters of 2017 only further illuminates why expatriates are arriving in droves.
Since the collapse of the Soviet Union — but primarily in the last decade — Ulaanbaatar has oscillated between construction boom-town, and a city shaken by stark recession, forged by predatory lending patterns and bad loans. While the city’s house price index has shown only modest growth since its initiation in 2013, buy-to-let properties in the city’s most desirable buildings are delivering very strong returns for investors. Kacper, who owns ten apartments, is a Central Asian businessman — with investment channeled from both Beijing and Moscow. Like others, his mantra of “buy in Baatar” — which echoes in marble board-rooms, expat dining-spots, and even neighboring countries — makes financial sense. It’s a lucrative formula, forged forward by a class of moneyed apartment buyer who possesses liquid capital and fosters trust with foreign investors.
“Expatriate workers are returning to Mongolia in droves, and mining companies have shown an economic commitment which outstrips any involvement we’ve known before,” Kacper explains. “The demand for high quality apartments that are actually complete and ready for market, outstrips what can be delivered this year,” he reiterates. Even as he eats French fries fried three times over in one of Ulaanbaatar’s swankier eateries, he scours the cityscape himself — like a golden eagle, in Must de Cartier shades. He skips dessert to countersign for his latest acquisition — with a wide prospector’s smile, and a rose-gold pen by Dupont.
While no substantive study has been conducted to measure the actual availability of rental stock in Ulaanbaatar compared to demand, four real estate developers I spoke to concluded that requests from expatriates for residential rental stock will come close to either meeting or exceeding the limits of their portfolio by the 4th quarter of 2017. During the first two quarters of 2017, mineral extraction — which still contributes as much as 50% to Mongolian GDP — showed exceptional results.
Figures from the National Statistics Office (NSO) illustrate the change in Mongolia’s fortunes in no uncertain terms. Coal exports in June were 281% higher than those in the same month of the preceding year. Possessing the 12th largest copper deposits in the world, the metal accounted for nearly 50% of exports in 2016. Correspondingly, the final quarter of 2016 and first quarters of 2017 led to a flurry of announcements to either commence or expand extraction by mining companies. All analysts concur that rising copper prices can only result in substantial capital inflows. As Kacper notes, “Mongolia can only cash in.”
There no doubt whatsoever that Kacper is correct. The mining licences issued thus far illustrate his point. Rio Tinto is not only continuing planned investments, but has restarted exploration for copper after a five year pause. Aspire is raising a private placement to develop its Nurestei coal-coking project. Kincora has acquired a new exploration license for copper and gold. Petro Matad has extended its options for oil exploration in the Taats Basin. The government has doubled the amount of land for exploration, prompting Xanadu Mines to predict a boom of similar size.
Most mining staff come to Mongolia for short periods of time. They tend not to be apartment buyers, as often they have family and settled lives elsewhere. What they do tend to have, however, is large housing allowances, underwritten by even larger multinational funds. Executives crave amenities and home comforts. They do not care for long commutes on congested highways. Much like both James and Kacper they express a preference for City Centre districts such as Sukhbaatar, and, to a lesser extent, Chingeltei.
Lee Cashell, who is CEO at Asia Pacific Investment Partners, believes that yields of 9%-12% are fully achievable in brand new, prime buildings. He’s also clear that these investors are likely to ride the crest of the UB buy-to-let wave:
“Rents are likely to grow rather than decline, meaning better returns on initial acquisition prices. There are strong prospects for capital appreciation too. Prices have tended to reflect economic growth. The International Monetary Fund (IMF) predict an 8% expansion by 2019, placing Mongolia’s among the fastest growing economies in the world. When you combine this with the poor financial position of many developers, and a lack of land, there’s already an upward pressure on sales prices.”
In the recently opened Belgian beer bar in the Shangri-La complex, as foreign contract workers mingle over Lindemans Framboise and moules frites there’s a sense that “Minegolia” may well be back in business for foreign buyers.
But while construction is a familiar industry to Mongolia, which will still be stimulated by mineral extraction, if handled appropriately the pressure for a luxury finish in an unremitting climate can also foster many of the new skill-sets sought by local developers and tradesmen. Focus on construction which simultaneously provides local people with transferable skills will benefit Mongolia — in a manner which FDI, alone, cannot always provide....
Ulaanbaatar: The Asian Football Confederation (AFC), under the AFC League Development Programme, staged the first-ever Media and Commentator Workshop in the Mongolian capital of Ulaanbaatar which concluded yesterday.
More than 30 members of the Mongolian Football Federation, Mongolian Premier League, Mongolian Premier League clubs and national television and media attended the workshop in the Mongolian Football Federation headquarters.
The workshop, opened by MFF General Secretary Shijir Ulziikhuu, covered the key areas of communications, media management and, with the experienced and much-respected Asian football commentary expert Dez Corkhill, television production and commentary.
In closing the workshop, MFF President, Ganbaatar Amgalanbaatar, said: "This has been an extremely important week for Mongolian football as the public absorb our great game through television and the media.
"It is therefore vital that we help our clubs, our media and crucially our television companies on ways they can promote the game in our country.
"We are grateful to the AFC and the AFC League Development Programme for organising and delivering this workshop and we hope that this week marks not the finish of this education process but the start of project which, in the future, delivers top quality football commentary and reporting to a country that is becoming more and more excited by the game.
"We are already seeing through the engagement with our arrangement with the national television station and a live streaming platform, which has been organised in conjunction with the AFC, that viewer numbers are increasing and that has to be good for the future of the game in Mongolia."
The workshop participants not only had the opportunity to create media plans for the promotion of the clubs but also the national commentators were given live training during a Mongolian Premier League game at the MFF headquarters.
Dez Corkhill added: "There is great potential in Mongolia and the commentators understood the need to celebrate football as well as inform the public. This workshop has been a great success and I know all the participants have left better informed and better prepared than ever before."
Japanese trading firms are enjoying windfall profits from higher resource prices. All 5 major traders have reported bigger earnings in the April-June quarter compared with the same period last year.
Itochu posted a record net profit of about 977 million dollars, up 48 percent in yen terms.
The company owns coal and iron ore mines overseas. It's also making gains from investments in Chinese firms.
Quarterly net profit at Mitsubishi Corporation rose 17 percent to about 1.06 billion dollars. Earnings at Mitsui & Company surged 81 percent to about one billion dollars. Sumitomo's profits more than tripled to 706 million dollars, while Marubeni's earning rose 11 percent to 486 million dollars.
Itochu CFO Tsuyoshi Hachimura told reporters that China is on a steady footing, with solid exports and domestic demand, including personal consumption.
He said the only concern is the actions of the Trump administration. He said frictions between the US and China could have repercussions worldwide.
Ulaanbaatar /MONTSAME/ On August 4, Chief of Staff of the President of Mongolia Z.Enkhbold has delivered an official letter on cooperation on offshore account with the international organizations to the Ministry of Finance.
Official letter stated: “The President of Mongolia Khaltmaagiin Battulga is working on returning illegal assets from offshore account and reducing credit stress.
In the scope of this initiative, we are planning to cooperate with the international organizations and projects including the Organisation for Economic Co-operation and Development /OECD/, the Global Forum of Transparency and Exchange of Information for Tax Purposes, and Base Erosion and Profit Shifting.
These organizations have already suggested Mongolia to become their member in 2012 and in 2016. In the scope of the President’s initiative against offshore account, to study opportunities for Mongolia to joining the above mentioned organizations and projects. Please provide information about the implementation progress of this work”.
Residents in desert areas in northern China's Inner Mongolia autonomous region have shaken off poverty and embarked on much better-off lives, after desert tourism driven by innovation was brought in.
The Kubuqi Desert in Ordos, the seventh-largest in China with an area of 18,600 square kilometers, was once the source of frequent sandstorms hitting the country's northern areas.
The desert's harsh environment resulted in poverty for local residents, most of whom only lived on raising livestock.
In the past 30 years, great efforts were made to tackle the desertification and improve residents' living standards.
Then, an innovative business model that incorporates governments, companies and locals was introduced with the aim of greening the region and creating jobs.
With guidance of governments and investment by the companies, farmers and herdsmen started to plant herbs, build solar power stations and develop tourist facilities.
In 2006, local governments and Elion Resources Group－a company engaged in ecological environmental protection－invested in building a new village.
Doodgatsaa village gathered 36 scattered households and provided them with free training, after which villagers started to run their own businesses.
"In the past, we lived in shabby houses built with dry grass and mud," said Tserenbaabuu, a 41-year-old herdsman in the village.
Tserenbaabuu and his family now live in a 110-square-meter house.
He added their total income has increased to 200,000 yuan ($30,300), 10 times as much as in the past when raising livestock was the only source of earnings.
It is the prospering of tourism in the region, he says, that has changed their lives.
A national 4A tourist site－Qixinghu Desert Eco-tourism Spot－emerged, as developers began tapping desert tourism resources. It attracts more than 120,000 tourists annually.
The site helped boost tourism in nearby villages, including Doodgatsaa village which has been equipped with 32 home-style hotels.
In partnership with two herdsmen, Tserenbaabuu bought 20 vehicles for off-road driving in the desert, with the help of banks in Ordos.
"A vehicle can hold three tourists, and traveling across the desert will cost each of them 240 yuan," he said.
He also hired 10 villagers as drivers and pays 4,000 yuan to each monthly from May to October, the peak season for desert tourism.
To support the business, he constructed a family hotel that can hold 20 tourists, accompanied by a restaurant to serve meals.
"When the hotel is full at peak season, I can earn 2,000 yuan each day," he said.
A household like his can earn 120,000 yuan annually on average, up from around 10,000 yuan before 2006.
"It's really a great change for me," Tserenbaabuu said.
China has total desert area of more than 2.6 million square kilometers, according to the sixth Kubuqi International Desert Forum held last week.
The experiences accumulated in the Kubuqi Desert can be a model to share nationwide and worldwide, said attendees at the forum....
The logistics terminal in Jiangsu province's Lianyungang Port, built by China and Kazakhstan, has served as an important platform to improve economic cooperation, according to officials.
The first project between China and the countries involved in the Belt and Road Initiative, the Lianyungang logistics terminal has imported and exported 7.77 million metric tons of goods since it went into operation in 2014.
Goods imported and exported from January to July this year increased by 49 percent over the same period last year, according to the center.
Wang Qinmin, vice-chairman of the Chinese People's Political Consultative Conference and president of the All China Federation of Industry and Commerce, said China and Kazakhstan have paid great attention to bilateral relations, deepened political trust and expanded cooperation in many areas since they forged diplomatic ties 25 years ago.
Wang made the speech at the fifth China-Central Asia Cooperation Forum, which was held on Wednesday and Thursday in Lianyungang. More than 200 officials from China and Central Asia, including Uzbekistan, Tajikistan and Kyrgyzstan, attended the forum.
President Xi Jinping first proposed the Belt and Road Initiative in 2013. It comprises the Silk Road Economic Belt and the 21st Century Maritime Silk Road, with the aim of building a trade and infrastructure network that connects Asia with Europe and Africa along ancient trade routes.
The Lianyungang logistics terminal started construction soon after the proposal emerged, with investment in the first phase reaching 606 million yuan ($90.2 million).
"The Kazakhstan partners didn't expect that the construction could be finished in eight months," said Liu Bin, general manager of the logistics terminal. "They thought at least two to three years were needed, considering the mountainous environment.
"The logistics terminal started to make a profit the same year it started operations. It serves companies of the two countries well."
Su Yang, manager of the terminal's production business department, said freight trains running from Khorgos, a city in the Xinjiang Uygur autonomous region near the border with Kazakhstan, to Almaty now take just six days.
"It used to take 12 days to transport good between the two cities. With the joint effort of the two countries, the transportation time and costs have been greatly reduced," he said. "The freight trains between Lianyungang, Khorgos and Asian and European countries will benefit the economy, especially companies along the route."
Last year, more than 1,200 trains transited through Kazakhstan, with rail freight for the two countries reaching 8.2 million tons.
China and Kazakhstan have agreed to develop more international freight train services, starting from China and going via Kazakhstan to Central Asia, Europe and Gulf countries, making rail freight a major solution to trade between Asia and Europe by 2025.
Former Minister of Health and Sports G.Shiilegdamba has been sentenced to 5.1 years in prison for corruption. In addition, O.Davaasuren was sentenced to 1.6 years in prison for giving bribes, G.Ganchimeg, former state secretary of the Health Ministry was fined for MNT 19 million and E.Gantulga, an executive of ‘Metro Network’ LLC for 14 million.
G.Shiilegdamba was arrested on corruption charges in November, 2015. The Independent Agency against Corruption (IAAC) actually managed to catch former Minister and Secretary-General of Mongolian People’s Party G.Shiilegdamba accepting a bribe of nearly 500 million MNT in his office and immediately arrested him on corruption charges.
Overview: As of June 2017, cumulative trade turnover increased by 36.4% or USD 1344.4 million from that of the previous year and reached USD 5,036 million compared to the same period of previous year. Exports increased by 42% or USD 912.9 million and imports increased by 28.8% or USD 431.5 million. During the reporting period, trade balance recorded surplus of USD 1,175 million, which was USD 481.4 million higher than that of the previous year.
Please review more on https://www.mongolbank.mn/…/externalsector/tra…/2017/06e.pdf