1 MONGOLIA-CHINA AGREE TO COLLABORATE IN INCREASING MEAT EXPORT WWW.MONTSAME.MN PUBLISHED:2018/09/21      2 U.S. AND MONGOLIA SEEK TO STRENGTHEN ECONOMIC RELATIONSHIP WWW.STRTRADE.COM PUBLISHED:2018/09/21      3 MONGOLIA, U.S. LEADERS DISCUSS BILATERAL TIES WWW.XINHUANET.COM PUBLISHED:2018/09/21      4 BELT AND ROAD SIGNIFICANT TO MONGOLIA, PEOPLE AROUND WORLD -- ACADEMIC WWW.ENG.YIDAIYILU.GOV.CN PUBLISHED:2018/09/21      5 PETRO MATAD UPDATES MONGOLIA EXPLORATION WWW.OGJ.COM PUBLISHED:2018/09/21      6 RIO TINTO’S EXIT FROM COAL PAYS OFF, TO RETURN $3.2B FROM SALES PROCEEDS TO SHAREHOLDERS WWW.MINING.COM PUBLISHED:2018/09/21      7 OPENING CEREMONY OF SAINSHAND SALKHIN PARK HELD WWW.MONTSAME.MN PUBLISHED:2018/09/21      8 ALIBABA’S MA SAYS TRUMP’S TRADE WAR ‘DESTROYED’ HIS PROMISE TO CREATE JOBS FOR 1MN AMERICANS WWW.RT.COM  PUBLISHED:2018/09/21      9 LEGAL DISPUTE OVER EMC OWNERSHIP COMES TO AN END WWW.ZGM.MN PUBLISHED:2018/09/20      10 ERDENES TAVAN TOLGOI REVENUE SURGES DUE TO HIGHER COAL PRICES WWW.NEWS.MN PUBLISHED:2018/09/20      НУРАХ ДӨХСӨН БАЙРУУДЫГ ШИНЭЧЛЭХ КОМПАНИ ОЛДОХГҮЙ БАЙНА WWW.ZGM.MN НИЙТЭЛСЭН:2018/09/21     МОНГОЛ УЛС ВАШИНГТОН, ПЁНЬЯНЫ ХЭЛЭЛЦЭЭРТ ЗУУЧЛАХАД БЭЛЭН ГЭДГЭЭ ЗАРЛАЛАА WWW.EAGLE.MN НИЙТЭЛСЭН:2018/09/21     УЛСЫН ХЭМЖЭЭНД 85.3 МЯНГАН ТОНН ТӨМС ХУРААН АВААД БАЙНА WWW.MONTSAME.MN НИЙТЭЛСЭН:2018/09/21     ЗГ: БУЦАЛТГҮЙ ТУСЛАМЖИЙГ УСНЫ НӨӨЦИЙГ САЙЖРУУЛАХ, ХЭРЭГЛЭСЭН УСЫГ БУЦААН АШИГЛАХАД ЗАРЦУУЛНА WWW.BLOOMBERGTV.MN НИЙТЭЛСЭН:2018/09/21     ҮСХ: УЛААНБААТАРТ АЖИЛЛАГЧДЫН САРЫН ДУНДАЖ ЦАЛИН УЛСЫН ДУНДЖААС 121.7 МЯНГАН ТӨГРӨГӨӨР ИХ БАЙНА WWW.BLOOMBERGTV.MN НИЙТЭЛСЭН:2018/09/21     МОНГОЛ УЛСЫН ИХ ХУРАЛ, ЕВРОПЫН ПАРЛАМЕНТ ХООРОНДЫН XII УУЛЗАЛТААР ХАМТАРСАН МЭДЭГДЭЛ ГАРГАЛАА WWW.DNN.MN НИЙТЭЛСЭН:2018/09/21     ТӨРИЙН АЛБАНЫ УДИРДАХ АЖИЛТНЫ УЛСЫН ЗӨВЛӨГӨӨН БОЛЖ БАЙНА WWW.UNUUDUR.MN НИЙТЭЛСЭН:2018/09/21     2019 ОНЫГ МОНГОЛ, АМЕРИКИЙН ЗАЛУУЧУУДЫН ЖИЛ БОЛГОНО WWW.EAGLE.MN НИЙТЭЛСЭН:2018/09/21     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    

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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Ukraine says no to Russian coal, gas – favours nuclear power www.mining.com

In spite of a blockade on shipments of anthracite coal from occupied Donbas to Ukrainian thermal power plants (TPPs) since this past winter, the country has thus far avoided blackouts. Moreover, Ukraine has managed to increase power generation by 2.1 percent year over year in January–April (Interfax-Ukraine, May 13). This was mainly thanks to heavy reliance on nuclear energy, but warm weather and lower consumption by industry also helped. Ahead of the next heating season, which kicks off in October, Ukraine is going to replace Donbas-sourced anthracite with imported coal, while also converting its thermal power plants to use alternative fuels.

Ukrainian nationalists began to block roads leading into the Moscow-backed so-called Donetsk and Luhansk “people’s republics” (DPR, LPR) at the end of January, protesting against what they saw as profiteering from the war by Ukrainian tycoon Rinat Akhmetov at consumers’ expense (see EDM, February 24, 28). They claimed that the government agreed to pay for coal extracted at Akhmetov’s mines, located in the Russia-controlled areas, according to the so-called Rotterdam-plus formula, so it was as expensive as if it were shipped from the Netherlands (Zn.ua, February 17). Because of the blockade, Ukrainian TPPs were left without anthracite from the DPR and LPR territories, and the government warned in February that almost a third of Ukraine would face blackouts by April. Still, the protests gained momentum, and in March Ukrainian President Petro Poroshenko banned all cargo traffic with the occupied eastern territories. As a result, five out of the six Ukrainian TPPs that used to burn anthracite stopped operations in April (see EDM, March 29).

But even with many of its TPPs offline, Ukraine was not plunged into blackouts, thanks to a combination of factors. February and March were unusually warm, so less coal was used for heating. Industry also consumed less power because the Donbas blockade not only affected power generation, but also subdued output in metallurgy and the engineering industry. For example, after growth last year and in January, metal production plunged year on year by 4.3 percent in February and by 2.2 percent in March (Ukrstat.gov.ua, accessed on May 16). Also, thermal power was partially replaced with nuclear power, so the share of nuclear plants in power generation jumped from 52 percent in 2016 to 57 percent in January–April (Interfax, May 15). However, Ukraine cannot continue to heavily rely on nuclear reactors, as it will be necessary to shut them down for scheduled maintenance later in the year. Meanwhile, domestic power consumption is likely to grow, as the economy continues to expand.

To remedy this situation, Ukraine plans to increase coal imports, while adapting its TPPs to use lower-quality G-grade coal, which is extracted outside the occupied areas and can be easily imported, in place of anthracite. The Ukrainian government does not want to increase coal imports from Russia on principle, because of the war, so Prime Minister Volodymyr Groysman suggested buying coal from as far as the United States, South Africa and Australia (Ukrinform.ua, March 21). However, that might be prohibitively expensive, given the transportation costs involved.
On April 25, Sakhnakhshiri, a company based across the Black Sea in Georgia, won a tender to deliver 700,000 tons of coal to Ukraine to the state company Tsentrenergo, which runs two of the five power plants stopped due to the coal shortage. Sakhnakhshiri is to deliver coal to Ukraine in May–December. However, there have been doubts about this supplier, showing the pitfalls Ukraine may encounter while looking for a replacement to Donbas anthracite. Sakhnakhshiri faced only one competitor in the tender, a little-known firm registered in Poland but linked to a Ukrainian citizen, whose bid price was only $38 higher than Sakhnakhshiri’s. So there was little or no competition (Liga.net, April 26). Furthermore, Georgia’s former president Mikheil Saakashvili said on his Facebook page on April 27 that Sakhnakhshiri might end up buying coal for Ukraine in Russia, and he questioned the transparency of the deal. Georgia, said Saakashvili, could not produce so much coal of the quality asked by Tsentrenergo. Coal bought from Russia may turn out to be coal that was originally shipped to Russia by the DPR-LPR authorities.

Meanwhile, both the government and Akhmetov’s DTEK, Ukraine’s biggest private energy company, are working to convert their TPPs to G-grade coal. DTEK CEO Maksym Tymchenko said in an interview that one of his firm’s TPPs was currently being converted, and conversion of another plant was already planned (Epravda.com.ua, April 27). DTEK also began to buy anthracite from South Africa (Dtek.com, April 13). Energy Minister Ihor Nasalyk told a recent government meeting that power units at two of Tsentrenergo’s TPPs would use G-grade coal by the end of 2017. Along with the construction of new power transmission lines from nuclear plants and new hydropower units, this should allow Ukraine to replace about four million tons of Donbas anthracite in power generation, Kyiv hopes (Mpe.kmu.gov.ua, April 26).

Ukraine has learned to survive without natural gas purchases from Russia’s Gazprom (see EDM, February 11, 2016). This year, it is learning to live without coal from the areas controlled by Russia-backed militants. This is vital for Ukraine’s highly energy-dependent industry, which is expected to increase production this year, supporting GDP growth for the second year in a row, after deep recession in 2014–2015.

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The Future Course of Mongolia’s Foreign Policy Depends on Economic Gains www.thedialogue.co

By Dr. Vaishali Krishna

Like several post-Soviet states the landlocked location of Mongolia has significantly constrained its foreign policy options, though it has been able to attract many players who could help shape its foreign policy orientations. These players are the so-called “third neighbours” who are basically distant states having no geographical proximity with Mongolia unlike the two neighbours – China and Russia. Even though they are important partners at least at the diplomatic level in keeping a check on China and Russia to ensure Mongolia that it does not fall once again in the Cold War like situation.

Basically a chain of events such as the end of the Cold War, normalisation of Sino-Russian and Sino-Mongolian relations, as well as a shift to democracy and market economy paved the way for Mongolia to adopt an independent foreign policy in order to enter into international politics. The first and foremost desire of Mongolia was to keep its “national interest” intact while formulating its foreign policy because the main purpose of foreign policy for any country is to conduct foreign relations to the best possible advantage. It is for each individual state to decide as to what degree of its involvement in its relations with another state would guarantee and safeguard its national interest.

In terms of definition the national interest stands for “survival and security of the state”. According to Hans Morgenthau, the great realist thinker, all politics is struggle for power, and “as long as the world is politically organized into nations, the national interest is indeed the last word in world politics.” Therefore, it has often been seen that the nations arrange their priorities on the basis of their resources. However, the powerful nations with world-wide political, economic and military activities place high priority on security, while small nations with limited resources compel to reorder their priorities. Whatever may be the priorities, national interest is always considered as dynamic since it keeps on changing in accordance with the needs and requirements. That is what Mongolia has done in its foreign policy orientations.

Mongolia came up with its “Multi-Pillared” foreign policy, the basic tenets of which were explained in the Concept of Foreign Policy which was adopted by the Mongolian Parliament in 1994. Strengthening relations with China and Russia is a priority in Mongolia’s foreign policy, though this does not necessarily mean that it will be aligned with any one of these two neighbours or any third power. In fact, Mongolia aims to promote a balanced relationship with both of its neighbours. At the same time, Mongolia’s foreign policy objective cautions against becoming overly reliant or dependent, politically and economically, on any country.

Other than China and Russia, Mongolia is also diversifying its foreign relations through its ‘third neighbour’ policy, whereby it endeavours to align its interests with highly developed democratic countries and leading international organisations. The third neighbour countries have been identified in accordance with their potential contribution to Mongolia’s economic development and common values. These third neighbours include the United States, Germany, Japan, Turkey and India among others. Such a strategy of Mongolia to win over foreign partners away from China and Russia has been the result of changes witnessed both at the domestic as well as foreign front since the onset of the new millennium. This motivated Mongolian leadership to rethink about revising its existing foreign policy that was done in 2011.

Mongolia’s 2011 revised foreign policy concept somehow identifies China as the country’s largest security concern despite the fact that bilateral relations developed with China in the post-Cold War period appears to be one of the main factors in its external relations. That is also because Mongolia cannot afford neglecting China outrightly due to sharing a long geographic border line with China that helps Beijing dominate Mongolia economically. What is important to keep in mind is that Mongolia’s economy is almost entirely dependent on China as the latter has been Mongolia’s largest trade partner for a long time now, receiving 91 per cent of its total exports and providing 32 per cent of its imports. China is also the largest provider of foreign direct investment (FDI) to Mongolia so much so that it is very unlikely that in the near future Russia will provide a viable alternative for Mongolia for either exports or foreign investment.

An American expert on Mongolia, Alicia Campi is of the opinion that “although Mongolia is sensitive to Chinese activity [even] in the mineral sector, it is willing to let China become a significantly larger supplier of oil products, at least in the short term, to break the back of its dependency on more expensive Russian petroleum products”. In such a situation, it seems that Mongolia’s foreign policy has strongly been affected by its two geographic neighbours, and the third neighbours have not done much to the advantage of Mongolia so far as its national interests are concerned. Indeed, when geography comes into play, every resource has to go through either China or Russia, and the current situation indicates that most of the exports go through China. This is one of the key challenges that Mongolia cannot overcome due to its landlocked geographical location. The third neighbours have little options to make their viable economic presence in Mongolia, though in the democratic era the most important factor in Mongolia’s foreign relationship is tied to economics not politics. So, what course Mongolia’s foreign policy could take in future will depend on economic gains powered by external players where China has already taken a lead through its ‘One Belt, One Road’ project.

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TPP trade deal will continue without Trump www.bbc.com

Asia-Pacific trade ministers have agreed to resuscitate the controversial Trans-Pacific Partnership (TPP) trade deal, despite US President Donald Trump abandoning it.
Mr Trump signalled in January he would block the passage of the 12-nation pact in order to protect American jobs.
Trade ministers from the 11 remaining countries have met in Vietnam to get the deal back on track.
The representatives also agreed to help the US rejoin the deal at any time.
The bid to revive the TPP, which would have covered 40% of the global economy, was led by trade ministers from Japan, Australia and New Zealand.
New Zealand trade minister Todd McClay said the remaining countries "are committed to finding a way forward to deliver" the deal.
Door still open
Although the door will be kept open for the US to rejoin the pact, its trade representative Robert Lighthizer said it would not return to the TPP.
"The United States pulled out of the TPP and it's not going to change that decision."
"The president made a decision, that I certainly agree with, that bilateral negotiations are better for the United States than multilateral negotiations."
The remaining 11 countries pushing on with the deal are Japan, Canada, Australia, New Zealand, Singapore, Mexico, Peru, Chile, Vietnam, Malaysia and Brunei.

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Saudi, U.S. cement partnership by signing deals worth 280 bln USD www.xinhuanet.com

RIYADH, May 20 (Xinhua) -- U.S. President Donald Trump and Saudi King Salman bin Abdulaziz Al Saud signed on Saturday here a series of agreements worth 280 billion U.S. dollars, Arabiya local news reported.
The agreements cover military, commercial, energy and petrochemical sectors and are expected to offer hundreds of thousands of jobs in both countries, Arabiya said.
The agreements came at a U.S.-Saudi summit, which will be soon followed by Gulf-U.S. summit and Arab Islamic U.S. summit.
Trump arrived in Riyadh on Saturday morning as the first leg of his first foreign visits since his election as U.S. President.

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Softbank sets up new technology fund www.nhk.or.jp

Japanese telecom giant Softbank Group has officially announced a 93-billion-dollar fund to foster developments in cutting-edge technology.

Backers include government funds from Saudi Arabia and the United Arab Emirates, US tech giant Apple and US chip maker Qualcomm. Taiwan's Hon Hai Precision Industry, also known as Foxconn, will also invest along with its Japanese subsidiary Sharp.

Sources say that Apple has committed around one billion dollars and Larry Ellison, the founder of US software company Oracle, is chipping in another billion.

Softbank Chairman and CEO Masayoshi Son says technology has the potential to address the biggest challenges and risks facing humanity today.

He says businesses working to solve these problems will need long-term capital and support.

The fund has a target of 100 billion dollars

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US, Saudi Arabia agree on business deals www.nhk.or.jp

US President Donald Trump wrapped up the first day of his visit to Saudi Arabia by touting huge investment deals. He said the projects involved would lead to tens of thousands of new jobs in both countries.

Trump received a royal welcome Saturday as he arrived in Riyadh on the first leg of his first foreign tour since taking office. After meeting with King Salman bin Abdulaziz and other royal family members, he ended the day with a banquet and dancing.

Government officials of both countries say Saudi and US company representatives held talks on business projects worth at least 200 billion dollars.

Saudi Arabia's state-run oil firm, Saudi Aramco, signed 50 billion dollars' worth of agreements with 11 American firms, including General Electric.

US private equity firm Blackstone said Saudi Arabia's Public Investment Fund will provide 20 billion dollars for a new fund for infrastructure projects in the United States.

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Philadelphia Orchestra visit to Ulaanbaatar is now definite for June 1-5, thanks to key support from MIAT, Rio Tinto, Khan Bank and USG www.nambc.org

 
Despite prior reports that it might be canceled because of budget austerity measures affecting Ulaanbaatar City and the Mongolian Government, the long-anticipated Ulaanbaatar visit of the world-famous Philadelphia Orchestra (PO) will definitely take place during June 1-5 as a major component of the celebration of the 30th anniversary of US-Mongolia relations. The Philadelphia Orchestra will be the first Western orchestra to perform in the country; the visit is part of the orchestra’s East Asia tour that also includes China and South Korea. The PO musicians will be accompanied by a group of 15 prominent Pennsylvania business leaders who are patrons of the PO.
 
The visit was rescued by generous support by Rio Tinto, Khan Bank, the US State Department, and MIAT Mongolian Airlines. Together with leading Mongolian soloists, a core Philadelphia Orchestra contingent (30 out of 115 orchestra members) will perform a special Children’s Week concert for young Mongolian students on June 3, as well as a larger public concert at a venue to be announced on the same day. The orchestra will jointly perform with Mongolian military bands at the National Defense University on June 2 and PO Vice President Ryan Fleur will meet with Mongolian arts leaders to discuss support mechanisms for the performing arts. This visit has been a special interest for Mongolia’s Ambassador to the US B. Altangerel and US Ambassador Jennifer Z. Galt, who will host a reception for the PO delegation during the visit.
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IMF Board to again consider approving Mongolia US$5.5 billion Extended Fund Facility (EFF) on May 24 after repeal of mandatory FX deposit clause www.nambc.org

 
The 24-Member Executive Board of the International Monetary Fund has scheduled another review of Mongolia's request to implement the US$5.5 Extended Fund Facility (EFF) at its next meeting on May 24.The request was removed from the IMF board’s April 28 agenda because of concerns about the mandatory FX banking deposit requirement contained in an amendment to the revised banking provision, the so-called Resolution 29 or Subclause 11 requirement, which parliament subsequently repealed.
 
Finance Minister B. Choijilsuren recently told a journalist that the financing package within the EFF will be around US$5.5 billion, of which US$2.2 billion covers an extension of the swap line between the People's Bank of China with the Bank of Mongolia, plus an IMF loan of US$440 million with a 15 year term at less than 2% interest. In addition, the Asian Development Bank (ADB) will grant a loan of US$900 million, of which US$600 million will cover the state budget deficit and US$300 million to fund programs and projects. In addition, the World Bank pledged US$600 million with less than 2% interest for a 15 year term, of which Mongolia promised to apply US$440 million to the state budget deficit in 2017-2019, and Japan and South Korea are expected to together provide loans of US$1.3 billion, some of which may be in the form of Ex-Im Bank-style funding for purchasing Japanese and Korean goods and services.
 
Minister Choijilsuren said implementation of loan funds earmarked for programs and projects will await completion of already-started ministry project feasibility studies, slated to be finished by the second quarter of 2017, with disbursement anticipated during 2018-2019.
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Mongolian delegation visits Taiwan, attends CIECA and MNCCI joint meeting www.taiwannews.com.tw

 
The Chinese International Economic Cooperation Association (CIECA) and the Mongolian National Chamber of Commerce and Industry (MNCCI) signed a memorandum of understanding in 2002. Since then, the two organizations alternately held the “Joint Meeting between CIECA and MNCCI” at Taipei and Ulaanbaatar without interruption.
 
This year, CIECA held the meeting at Taipei and Mrs. Magvan Oyunchimeg, CEO of MNCCI, led a delegation of agricultural food products, beverages, construction, mining, IT and tourism business representatives and contractors began to arrive on May 14th.
 
Deputy Minister of Foreign Affairs François Wu, Chih-Chung delivered remarks at the welcoming dinner on May 15th. For the meeting on the 17th, 110 delegates from both sides attended the conference. Chairman Kuo, Lin-Wu of CIECA’s Mongolia Committee (Vice Chairman, Taiwan External Trade Development Council, TAITRA) and Mrs. Magvan Oyunchimeg jointly presided over the conference.
 
Experts and businessmen from both sides reported on business opportunities and exchanged views on “Mining”, “Renewable Energy”, “Investment Environment in Mongolia”, “E-Commerce” and “Experience Sharing”.
 
During their stay, Mongolian delegates have been arranged to visit the Export-Import Bank of the Republic of China which is responsible for financial business between the two nations, TAITRA, ANKO Food Machine Co., Ltd. and King Car Group’s Kavalan Distillery with the expectation of exploring substantive business opportunities.
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Baogang Group, MCC cooperate on mineral resources www.chinadaily.com.cn

 
Baogang Group signed a long-term cooperation agreement with Mongolian Mining Co (MCC), the largest privately owned coal mining company in Mongolia, on mineral resources on May 12, reports Baotou Daily.
 
According to the agreement, the two companies will cooperate in areas like coal mining, ore washing and selecting.
 
The move marks remarkable progress in international cooperation for Baogang Group, an iron and steel State-owned business based in Baotou, Inner Mongolia autonomous region.
 
Bordering Inner Mongolia autonomous region, Mongolia is one of the Belt and Road Initiative countries. It boasts rich mineral resources including iron and coal.
 
Baotou has formed partnerships with Mongolia in various areas over the past few years as part of the implementation of national strategies for China’s Belt and Road Initiative and the China-Russia-Mongolia Economic Corridor.
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