|Frontier's "Invest Mongolia Tokyo 2018"||Frontier Securities||Tokyo Japan|
|"Open to Export" ICC WTO International business award||ICC WTO||London|
Turkey, Japan and Russia have calculated how much US tariffs would add to the cost of steel and aluminum exports to America, and submitted their claims to the World Trade Organization.
The countries followed similar moves by the European Union, India and China. Russia estimated that it would lose $538 million because of the US tariffs, which President Donald Trump imposed in March. Japan reported $440 million, while Turkey added a further $267 million.
Earlier, China, the EU and India estimated their losses at $612 million, $1.6 billion and $165 million respectively. The countries that have turned to the WTO say the tariffs – 25 percent on steel and 10 percent on aluminium – cannot be explained by the US security concerns, the issue on which Washington is basing its actions.
Under WTO rules, if any country seeks to cut its imports, thus protecting local producers, it should compensate its trade partners with a net increase in imports of other goods. Washington has refused to do so. Japan and Russia have not provided the details on retaliation, but Turkey has said it would target 22 American goods, ranging from nuts, rice and tobacco to cars and steel products.
Communications Regulatory Commission of Mongolia informed that the total number of Internet Protocol television (IPTV) users increased to 241.7 thousand by the end of 2017, which is 27.7 percent higher than the previous year.
According to the report, IPTV made up 11.7 percent of the total revenue in the mass media and communications sphere. Information and communications technology has rapidly improved the lives of people and the number of cable television channels drastically increased in recent years. It has been a while since the Over-the- Top technology was introduced to the public. For instance, based on this technology, the Unitel Group launched LookTV service, which enables users to access the media contents through their mobile phones and notebooks.
Ulaanbaatar /MONTSAME/ The International Labor Organization (ILO), government agencies, Mongolian Employers’ Federation (MONEF), Confederation of Mongolian Trade Unions (CMTU) and labour right advocates gathered on May 22 to discuss their joint action on forced labour, child labour and trafficking in persons for labour exploitation.
Since 2015, the ILO has received financial support from the European Union to implement core labour standards to realize decent work and support Mongolia’s bid for economic diversification. Aligning national labour laws and regulations with international standards is central in this partnership. The EU has provided further support to ILO-Mongolia cooperation to implement the project on ‘Sustaining GSP-Plus Status by Strengthened National Capacities to Improve ILS Compliance and Reporting-Mongolia Phase 2’, which promotes greater understanding about trafficking in person for labour exploitation and alignment of national laws and policies with the ILO Protocol of 2014 to the Forced Labour Convention, 1930 (No. 29).
Forced labour in its modern form is widespread. According to the ILO’s Global Estimates of Modern Slavery, trafficking in persons for labour exploitation in the private sector is on the rise and that there are about 16 million victims at any given time. The global community, including Mongolia, is committed to “tak[ing] immediate and effective measures to eradicate forced labour, end modern slavery and human trafficking and secure the prohibition and elimination of the worst forms of child labour, including recruitment and use of child soldiers and by 2025 end child labour in all its forms.” The Alliance 8.7 supports countries around the world to share knowledge and experiences.
A panel discussion on national response to trafficking and labour exploitation at the GSP+3 project launch welcomed action to tackle trafficking in persons for labour exploitation. Greater awareness about forced labour, labour exploitation and knowledge of international good practices on preventative measures and victim protection would contribute to improved services to protect both Mongolian and migrant workers in Mongolia and Mongolian workers going abroad. The ILO was recommended to implement the project with the stakeholders of Mongolia’s National Programme to Combat Human Trafficking (2017 -2021).
The details and progress on project implementation are available at the project office in Ulaanbaatar. The EU-ILO-Mongolia partnership for this project is within the framework of the EU’s action to support GSP+ beneficiary countries to effectively implement international labour standards and comply with their reporting obligations.
In a presentation at the Mongolia Economic Forum on Monday (May 21), Rio Tinto’s (ASX:RIO,LSE:RIO,NYSE:RIO) copper and diamond chief executive, Arnaud Soirat, handed out advice to Mongolia’s leaders on how to attract — and keep — foreign investment.
In short: stick to the rule of law and don’t meddle in projects, or investors and their money will flee.
Soirat described Rio Tinto’s multi-billion dollar Oyu Tolgoi copper mine as a “test case for future investment in Mongolia,” and noted that the world is watching what the government is doing.
The company has been experiencing difficulties in Mongolia over the last few months, with delays in the construction of an underground expansion weighing down profits. What’s more, it’s faced extra tax bills from the government and changing demands on power supplied to the mine.
The forum Soirat was presenting to was attended by the highest-ranking members of the government, including the president, the prime minister and members of parliament — which has been in dispute with mine operators this year.
Rio Tinto is the operator of Oyu Tolgoi through Turquoise Hill Resources (TSX:TRQ), and the Mongolian government owns a 34-percent stake in the mine.
Soirat was diplomatic in his presentation, schmoozing with Mongolia’s leadership, but delivering a sharp message: hands off.
“There is no doubt Oyu Tolgoi Underground is a complex and difficult project and it will require Rio Tinto’s balance sheet and technological competence to succeed,” he said.
“We are confident we can pull it off but we do need your trust, patience and support, please let us get on with the work of continuing to build a world class business,” Soirat added.
He used Chile as an example of what Mongolia could become in regards to copper production, saying that mining investment can act as a springboard for future diversification.
“Mongolia has all the ingredients to become a successful resource nation and to use her mineral revenue to fuel sustainable, long-term, diversified growth,” he commented.
He said that for Mongolia to maintain a course for success, it must become a stable investing environment with laws that the government abides by.
Further, he said that companies rely on “the sancity of key investment agreements” to ensure stability, and that “fair and consistent application of the law requires working with partners and investors so they have confidence in the system.”
The company will no doubt be hoping the message was heard loud and clear. Rio Tinto has so far invested US$7 billion in Mongolia, and Soirat said that by the end of the ongoing underground development works the company could have invested US$12 billion — more than Mongolia’s annual GDP.
Upon completion of the Oyu Tolgoi underground expansion, the mine is expected to produce 560,000 tonnes of copper a year.
Rio Tinto isn’t the only company Mongolia has been scuffling with; earlier in May, Mongolian Copper fended off more attempts by Ulaanbaatar to nationalize the 49 percent of the Erdenet copper mine that the government didn’t control.
Mongolian Copper Chairman Mukhbaatar Myagmar clearly feels the same way as his fellow miners, having warned previously that the government’s attempts to seize Erdenet could damage the country’s reputation as a place to invest....
Rio Tinto's copper and diamond chief executive Arnaud Soirat has put pressure on Mongolia to support its planned $5.3 billion Oyu Tolgoi mine underground expansion, saying foreign companies will be looking at it as a "test case" for future investment.
During his presentation at the Mongolia Economic Forum on Tuesday, the executive said the landlocked, mineral-rich country had all ingredients to become a “successful resource nation,” but only if it honoured agreements around issues such as tax and royalty payments.
Speaking to MINING.com earlier this month, Soirat drew a comparison between Mongolia and Chile, the world's top copper producing country whose economy was spurred by foreign mining investment.
The company, which in the last two years has stepped up efforts to find new copper deposits worth of being developed into mines, applied last year for exploration permits in the South American country’s northern region of Arica.
Soirat's comments come after five months of tensions between Rio and Mongolia, which has included a $155 million tax dispute and a corruption probe.
And while Soirat said that given the nature of very early stage exploration there, he couldn’t provide an update on that work, he noted that Chile continued to be a promising area for exploration. He attributed that not only to the country’s proven track record of discoveries, but also to its business-friendly environment — a characteristic Mongolia seems to be lacking.
Rio's board of directors approved an expansion of the massive Mongolian copper, gold and silver mine in the Gobi desert two years ago, but progress has been held back this year amid series of disagreements with the Mongolian government, including differences over taxes owed and a power contract.
In an effort to strengthen up ties with Asian country’s authorities, Rio announced in February the opening of the new office in Ulaanbaatar. Soirat told MINING.com that the team, which will expand to 80 people over the course of this year, has also been given the task to conduct fresh exploration aimed at finding the “next Oyu Tolgoi.”
He noted that the company is currently Mongolia’s largest foreign investor, having ploughed so far more than $7 billion into the first phase of its Oyu Tolgoi mine. Soirat said the company will continue to invest over $5 billion in the country, tied to the underground expansion of the giant project, at a rate of $1 billion per year.
Plans under threat
Those plans, however, risk being hindered as a result of a string of issues Rio Tinto has been facing in Mongolia in the last five months.
First, the country’s government served Oyu Tolgoi in January with a new bill for $155 million in back taxes — the mine's second tax dispute since 2014. Operator Turquoise Hill said at the time the charge related to an audit on taxes imposed and paid by the mine operator between 2013 and 2015. It added it's disputing the assessment.
Shortly after, the southern Gobi Desert-based mine had to declare force majeure after protests by Chinese coal haulers disrupted deliveries near the border.
In February, the government reinstated a decade-old agreement ordering the company to source power for Oyu Tolgoi domestically, a move could raise the costs of the ongoing expansion of mine, a strategic partnership between Mongolia’s government (34%) and Turquoise Hill (66%), of which Rio Tinto owns 51%.
A month later, the Mongolian Anti-Corruption Authority (ACA) asked it to provide financial data related to the mine, in relation to a probe about possible abuse of power by authorized officials during negotiation of the 2009 Oyu Tolgoi investment agreement.
The mining giant is also facing increasing pressure from shareholders about its alleged lack of transparency about pledges to the Mongolian government and escalating costs for the expansion. It has also been questioned about its treatment of minority shareholders at Turquoise Hill.
Oyu Tolgoi was discovered in 2001 and Rio gained control of it in 2012. Soirat noted that, as part of the underground expansion of Oyu Tolgoi, Rio has just finished the Avarga Chamber, one of the world’s largest underground excavations. “It’s as big as five Olympic swimming pools and 1,300 metres underground,” he told MINING.com.
Once finished, the extension is expected to lift Oyu Tolgoi’s production from 125–150kt this year to 560kt of copper concentrate at full tilt from 2025, making it the biggest new copper mine to come on stream in several years....
The Millennium Challenge Corporation (MCC) of the United States of America will grant non-refundable aid of USD 350 million to Mongolia under the Second Compact Agreement. The agreement was discussed during an official visit by the Mongolian Foreign Minister to the United States.
Mongolian Foreign Affairs Minister D.Tsogtbaatar met with the Acting CEO of the Millennium Challenge Corporation (MCC) Jonathan Nash and other officials to finalize the Second Compact Agreement.
The MMC funding will be spent on a project to increase the Ulaanbaatar water supply and the parties are ensuring preparation to establish the agreement during a bilateral high-level meeting.
The first MCC compact was a five-year USD284.9 million agreement and six projects were implemented in 2008-2013, designed to increase economic growth and reduce poverty by investing in property rights, health, vocational education, energy and environment and transportation.
In according with the IPOs of the last few months, the number of people engaged in the stock market is increasing. Companies including And-Energy, iTools, and LendMN recently issued an IPO. The majority of the investors were Mongolians, accounting for 98 percent of And-Energy’s IPO, 88 percent of iTools’s IPO, and 44 percent of LendMN’s IPO. Also, Mongolians took part in 82 percent of the secondary market trade.
Although the active public participating in the stock market trade is favorable, their short-term investment strategy leads to price volatility, said analysts. Several companies are expected to issue an IPO this year. The analysts predict that the limited purchasing power of the public could slow IPOs in the primary and secondary market. The analysts said that foreign and domestic investors and social foundations should involve in the stock market.
An International Monetary Fund (IMF) staff team led by Mr. Geoff Gottlieb visited Ulaanbaatar from May 2-17 to conduct discussions on the fourth review of the three-year Extended Fund Facility (EFF).
At the conclusion of the visit, Mr. Gottlieb remarked “Macro-economic performance under the program remains positive, with all quantitative targets met. Fiscal results in the first quarter of 2018 have been much better than expected with a 21-percent improvement in revenues. Net international reserves improved by USD 200 million over the same period.
On fiscal policy, Mr. Gottlieb highlighted that the authorities’ program for 2018 envisages continued budgetary restraint and strengthening tax administration. In addition, the authorities are taking concrete steps to improve public financial management particularly with respect to concessions, public investment projects, and the operations of the Development Bank of Mongolia.
“In the financial sector, the authorities are moving ahead with the strengthening of the banking system as part of the follow-up to the recently completed Asset Quality Review. Banks that are undercapitalized will have until end-December to raise capital. A law that sets out, under appropriate conditions, when public funds can be used to stabilize banks is expected to be passed shortly. The authorities are also moving ahead with reforms that will allow for more rapid NPL resolution and strengthening banks’ balance sheets,” emphasized Mr. Gottlieb.
The IMF underlined that it is critical to maintain progress in building reserves to help insulate the economy from external shocks. “Sound macro-economic policies accompanied with structural reforms of the banking system will help durably reduce interest rates,” recommended the IMF in its report.
Driven by strong external demand, Mongolia’s economy continues to recover; key macro- economic goals, including to reduce the fiscal deficit and boost international reserves, have been achieved.
This progress notwithstanding, risks to the program remain, including lower external demand for commodities, a slowdown in structural reforms, rising domestic spending pressures, and adverse changes to the investment climate.
To safeguard the program’s continued success, the focus should remain on strengthening the banking system, ensuring a prudent fiscal policy, remaining vigilant against inflation, building foreign exchange buffers, and improving public financial management.
Chinese formula and maternity-care stocks jumped after the country was said to be close to ending limits on the number of children a family can have, though the gains could be short-lived as a baby boom seems unlikely.
Maternity goods firm Shanghai Aiyingshi Co. and incubator firm Ningbo David Medical Device Co. both surged by as much as the 10 percent daily limit. Beingmate Baby & Child Food Co. climbed as much as 5 percent in Shenzhen on a day of muted moves in China’s stock markets, while Guangdong Qunxing Toys Joint-Stock Co. advanced. Even piano makers enjoyed a boost, with Hailun Piano Co. and Guangzhou Pearl River Piano Group Co. advancing.
"The removal of birth limits won’t necessarily bring about a baby boom, so it’s likely a speculative trade that won’t last long," said Zhang Gang, Shanghai-based strategist with Central China Securities Co. "Big funds wouldn’t want to engage in such short-term trades, and the sector is just not big enough to handle the inflows."
China’s cabinet is looking at what might happen if the country ended its roughly four-decade-old policy, said people who asked not to be named while discussing government deliberations. The country is facing the prospects of a rapidly aging population and has had to deal with criticism from foreign governments over its family-planning policies.
Baby-related stocks in Japan also rose, with Pigeon Corp., Unicharm Corp. and Nippon Shokubai Co. adding at least 2 percent. Chinese tourists are known to go on shopping binges for high-quality consumer products on trips to countries like Japan.
The benchmark Shanghai Composite Index slipped 0.4 percent as of 11:06 a.m. local time.
Ulaanbaatar/MONTSAME/ Foreign Affairs Minister D.Tsogtbaatar, who is visiting the United States, met US Secretary of State Mike Pompeo, Under Secretary of State for Political Affairs T.Shannon, and Principal Deputy Assistant Secretary in the Bureau of East Asian and Pacific Affair Susan Thornton on May 21, exchanging views on Mongolia-US relations and cooperation.
During the meeting, the sides reciprocally affirmed that they are for Mongolia-US partnership relations based on common values and strategic interest and shared views on regional and international cooperation matters, the second MCC compact that Mongolia’s government is working to establish with the US Millennium Challenge Corporation as well as other issues.
The same day, the Minister visited the John Hopkins University and delivered speech on ‘Changing world: changing roles of small countries’ and answered to interested questions about Mongolia’s foreign policy and the latest process in the region.
The event brought together about 80 attendants including scholars and researchers of US scientific and research institutes, students and representatives of public organizations and embassies in Washington D.C.