Bank of Mongolia, IMF Collaborate to Improve Monetary Policy Framework www.montsame.mn

The Bank of Mongolia (BoM) has collaborated with a technical assistance team from the International Monetary Fund (IMF) to upgrade its monetary policy framework and implementation.

During the mission, the IMF team evaluated the central bank’s policy apparatus, operations, and economic forecasting models, and offered concrete recommendations to improve their overall reliability and effectiveness. The team also provided valuable advice on refining the central bank’s monetary policy approach. It recommended further developing monetary policy instruments, including open market operations, reserve requirements, standing facilities, and foreign exchange auctions, and expressed its readiness to continue providing technical assistance.  

Since 2014, the BoM has used a quarterly projection model to formulate monetary policy, forecast economic developments and analyze the effects of alternative policy choices. According to the central bank, the recent technical assistance mission conducted a comprehensive review of the model’s structure, exchange rate and interest rate calculations, and economic outlook projections to identify areas for improvement.

The joint effort also focused on improving forecast accuracy, strengthening model application and development, and building capacity among BoM specialists.

Narantsogt Sanjaa, Governor of the BoM, thanked the IMF technical team for their professional support and advice, emphasizing that the collaboration has helped refine the monetary policy framework and shape its future development.

At the end of the meeting, both sides highlighted opportunities to continue their cooperation in improving monetary policy analysis and economic forecasting methodologies, enhancing the quality of policy decisions, refining monetary policy instruments, and strengthening the monetary policy transmission mechanisms.

Saudi Energy Minister Signs MoUs on Energy Cooperation with Mongolia, Tanzania, Cyprus, and Mauritius www.english.aawsat.com

Saudi Minister of Energy and Minister of Industry and Mineral Resources Prince Abdulaziz bin Salman bin Abdulaziz signed in Riyadh on Monday four memoranda of understanding with ministers from Mongolia, Tanzania, Cyprus and Mauritius to strengthen cooperation across a range of energy fields.

The MoUs were signed on the sidelines of the 25th WPC Energy Congress, hosted by Saudi Arabia through October 15 under the theme “Pathways to an Energy Future for All."

Prince Abdulaziz and Mongolia’s Deputy Prime Minister Togmid Dorjkhand signed an MoU to strengthen cooperation between the two countries in oil and gas and their derivatives, refining, petrochemicals, electricity, power interconnection, renewable energy, energy efficiency, energy storage, and technologies and solutions related to climate change mitigation, including Circular Carbon Economy solutions.

The MoU covers cooperation in digital transformation, innovation, cybersecurity applications and artificial intelligence in the energy sector. It seeks to develop strategic partnerships between the two countries to secure materials, products and services across energy sectors and their supply chains and technologies; promote the development and use of sustainable petrochemical materials in construction and other sectors; strengthen cooperation between energy companies; and support them in implementing large-scale electricity projects and harnessing renewable energy in both countries.

Prince Abdulaziz signed an MoU with Tanzania’s Minister for Energy Juma Zuberi Homera to strengthen cooperation between the two countries in the supply of refined petroleum products and explore opportunities related to associated infrastructure, assess opportunities in liquefied natural gas, exchange technical expertise in oil and gas exploration, and explore opportunities in petrochemical production.

The MoU covers electricity, renewable energy, energy efficiency, and the exchange of technologies and solutions related to climate change mitigation, including clean cooking solutions and Circular Carbon Economy technologies and solutions. It further includes exploring opportunities related to the Oil Sustainability Program and transport and fuel infrastructure, as well as cooperation in digital transformation, innovation, cybersecurity applications and artificial intelligence in the energy sector.

Prince Abdulaziz and Cyprus’s Minister of Energy, Commerce and Industry Michael Damianos signed an MoU establishing a framework for cooperation in oil and gas and their derivatives, refining, petrochemicals, electricity, clean hydrogen and its derivatives, renewable energy, energy efficiency, energy storage, and technologies and solutions related to climate change mitigation, including Circular Carbon Economy technologies and solutions.

The MoU covers cooperation in digital transformation and cybersecurity applications in the energy sector, as well as efforts to advance and support shared international policy priorities through relevant multilateral negotiations, including under the United Nations Framework Convention on Climate Change, the Paris Agreement and the international legally binding instrument on plastic pollution.

It further provides for cooperation on the development and use of sustainable petrochemical materials in construction and other sectors, the development of appropriate infrastructure to expand energy access, and cooperation between companies operating in energy-related fields.

Prince Abdulaziz signed an MoU with Mauritius’s Minister of Foreign Affairs, Regional Integration and International Trade Dhananjay Ramful covering cooperation in oil and gas and their derivatives, refining, petrochemicals, electricity, clean hydrogen and its derivatives, renewable energy, energy efficiency, energy storage, and technologies and solutions related to climate change mitigation, including Circular Carbon Economy technologies and solutions.

The MoU also covers cooperation in digital transformation and cybersecurity applications in the energy sector.

It provides for efforts to advance and support shared international policy priorities through relevant multilateral negotiations, including under the United Nations Framework Convention on Climate Change, the Paris Agreement and the international legally binding instrument on plastic pollution.

It covers cooperation on the development and use of sustainable petrochemical materials in construction and other sectors, as well as the development of appropriate infrastructure to expand energy access.

Fire in Mongolia approaches China's border, 2,000 firefighters mobilized www.ecns.cn

More than 2,000 firefighters have been deployed along the border with Mongolia in northern China's Inner Mongolia Autonomous Region to contain a wildfire spreading toward Chinese territory, local authorities said.

The fire broke out in Mongolian territory along the border in Dong Ujimqin Banner, Xilingol League, at about 1 p.m. on Oct. 9. Driven by terrain and wind, the blaze moved closer to China. 

Local authorities activated an emergency response and mobilized the Inner Mongolia Mobile Fire and Rescue Corps, along with local professional and semi-professional firefighting teams. Crews have been stationed along sections of the border, patrolling with firefighting equipment ready to respond.

Efforts to contain the fire were still underway as of the latest update, and the blaze had not crossed into China. 

(By Evlyn)

Mongolia thanks India for unwavering support for its first-ever oil refinery www.newsonair.gov.in

Mongolian President Ukhnaagiin Khurelsukh today visited the Oil Refinery Construction site at Altanshiree Soum in Mongolia’s Dornogobi Province and thanked Prime Minister Narendra Modi for India’s unwavering support for the strategically important project.
 
 According to the India Embassy in Ulaanbaatar, Khurelsukh expressed satisfaction with the progress of the strategically important project, which is expected to enable Mongolia to produce its own refined fuel.
 
During the visit, he also interacted with the engineers and workers involved in the construction and appreciated Indian Ambassador to Mongolia Atul Malhari Gotsurve’s role in advancing the project.
 
During Prime Minister Modi’s visit to Mongolia in 2015, a Line of Credit (LOC) of one billion US dollar was approved for development of infrastructure, which the Government of Mongolia decided to utilise for construction of its first-ever oil refinery in Dornogobi Province with a capacity of 1.5 million metric tonnes per annum (MMTPA).

IMF Warns Over Debt, Deficits If Mongolia Spends Mining Windfall www.bloomberg.com

The International Monetary Fund has warned Mongolia risks swelling its deficit and the debt burden by
relying on windfall revenues from a mining boom to finance generous fiscal policies. 
“The envisaged fiscal expansion is likely to lift the deficit and debt paths,” the IMF said in a statement after a
staff visit. “Downside risks to the outlook have intensified, reflecting global and regional instability and domestic
pressures for further tax cuts and spending increases.” Lawmakers are considering a budget for next year that would
hike social spending rather than build buffers in case prices slump for Mongolia’s natural resources. It’s home to the giant
Oyu Tolgoi copper-gold mine, operated by Rio Tinto, which is being expanded to boost sales of the metal underpinning
electrification, the global energy transition and increasing demand from data centers. 
Mongolia’s official data on Friday showed a 79% surge in copper revenues for the first nine months of the year as prices
climb for the red metal. 
Copper has overtaken steel-making coal as Mongolia’s biggest export thanks to higher prices paired with greater
volumes. China buys up nearly all of Mongolia’s natural resources, consuming 93% of its total exports.
Despite the mining boom, the IMF warned of fiscal vulnerabilities if lawmakers chose to use revenues to raise
pensions, public worker wages and social programs. The fund said spending would be financed by a one-time dividend from Oyu
Tolgoi and volatile mining revenues.
“Fiscal policy should focus on rebuilding buffers and reducing vulnerabilities,” it said. “The proposed tax cut
package should be reconsidered, and requests for further reduction in non-mining taxes should be resisted.”
Elsewhere in the economy, spikes in the cost of food and fuel have pushed inflation well above levels targeted by the
central bank in 2026. Fuel is in short supply, at least partly due to Russia’s war with Ukraine, and Mongolia has called on
China and South Korea to assist with more supplies.
Wait times and queues at fuel stations have gotten so bad in the capital city that protesters demonstrated in the streets
earlier this month, blocking trafficking at a main motorway in front of the Government Palace where Mongolia’s parliament
convenes.
The IMF now projects 6.2% economic growth for 2026 on stronger mining activity. Inflation, however is likely to remain
above the central bank’s target for 2027. Mongolia’s central bank held its policy rate at 12.5% in
September, citing uncertainty abroad, as well as higher oil and energy prices.
“If the proposed fiscal expansion were implemented, monetary policy should be tightened further,” the IMF said. 

Mongolia’s Annual Inflation Rate Reaches 12.9% in September www.montsame.mn

Consumer goods and service prices nationwide rose by 12.9% in September this year compared with the same period last year and by 0.6% from the previous month.

According to the National Statistics Office, in September this year, prices increased year-on-year by 13.5% for goods, 11.2% for services, 20.8% for food items, and 10% for non-food items.

The annual inflation rate rose from 9% in September 2025 to 12.9% in September this year. This was driven by price increases in imported goods excluding gasoline and other fuels, which contributed 2 percentage points, and domestic goods excluding meat and solid fuels, which contributed 4.4 percentage points.

Of the 12.9% inflation rate, 5.6 percentage points were attributable to price increases in food, beverages and water; 2.2 percentage points to transport; 1.2 percentage points to education services; and 0.9 percentage points to clothing, textiles, and footwear.

The 0.6% month-on-month increase in consumer goods and service prices in September was mainly driven by a 3.2% rise in transport prices.

In Ulaanbaatar, prices for 418 types of goods and services are surveyed for the consumer price basket. Of the 430 types of goods and services in the overall basket, 238 are imported, accounting for 55.3% of the total.

In September this year, prices in the meat and meat products category rose by 46.9% year-on-year, driven by increases of 48.4% in beef prices and 58.5% in mutton and goat meat prices.

PM Urges Copper Smelter Acceleration www.montsame.mn

Prime Minister Uchral Nyam-Osor inspected the progress of the USD 772 million copper concentrate smelting and processing plant project to be built based on the "Erdenet Mining Corporation" SOE, instructing officials to accelerate construction and finalize contract negotiations within November.

The project is being implemented in the form of an industrial and technological park as part of Mongolia's objective to process copper concentrate domestically rather than exporting it raw, produce value-added products, and diversify its economy.

Upon commissioning, the plant will be capable of processing 560,000 tonnes of copper concentrate annually and producing 124,000 tonnes of cathode copper. The project's feasibility study, detailed environmental impact assessment, and relevant technological documents have been approved. Financing of USD 68 million has been invested in the infrastructure of the industrial and technological park, with the first phase already received and full completion targeted for 2027.

Out of 55 companies from over 20 countries that expressed interest in investing and cooperating, 13 companies from 7 countries submitted proposals. China's NFC was selected as the strategic investor, and negotiations regarding financing, equity, and construction contracts are currently underway.

Prime Minister issued directives in four areas to accelerate project implementation:

Intensifying negotiations with the investor to increase the economic benefits accruing to Mongolia and clarify the investor's duties and responsibilities, followed by finalizing the draft contract for presentation to a cabinet meeting.

Creating conditions to utilize sulfuric acid produced by the plant in domestic industries, primarily supplying it on a priority basis to the Zuuvch-Ovoo project of the Mongolian-French joint venture "Badrakh Energy" LLC and other projects.

Having the cabinet resolve to transfer the operating license for the "Erdenet" industrial and technological park in the territory of Bayan-Undur and Jargalant soums of Orkhon aimag to the "Erdenet Mining Corporation" SOE.

Resolving exploration licenses for commonly distributed minerals and limestone required to neutralize sulfuric acid for the plant's construction.

Furthermore, instructions were given to promptly resolve legal, regulatory, and infrastructure issues related to the operation of the industrial and technological park and to finalize the construction plan.

Commissioning the plant will not only allow for the domestic processing of copper concentrate and increase the added value of export products but will also foster the development of ancillary industries, create jobs, and enhance the competitiveness of the industrial sector.

Mongolia's Exports Surpass USD 16 Billion in First Nine Months www.montsame.mn

Mongolia traded with 161 countries in the first nine months of this year, reaching a total foreign trade turnover of USD 25.9 billion.

According to the National Statistics Office, exports reached USD 16.2 billion, while imports stood at USD 9.7 billion, resulting in a trade surplus of USD 6.5 billion.

Compared to the same period last year, total trade turnover increased by 34.6% or USD 6.7 billion, exports rose by 51.2% or USD 5.5 billion, imports expanded by 13.8% or USD 1.2 billion, and the trade surplus grew threefold, adding USD 4.3 billion.

The USD 5.5 billion surge in exports over the nine-month period was driven primarily by increased exports of copper ore and concentrate (up by USD 3.1 billion), coal (up by USD 2 billion), combed cashmere (up by USD 124.2 million), unwrought and semi-manufactured gold (up by USD 104.2 million), tungsten ore and concentrate (up by USD 61.8 million), and fluorspar ore and concentrate (up by USD 58 million). Conversely, exports of refined copper and copper alloys fell by USD 49.1 million, molybdenum ore and concentrate dropped by USD 29.8 million, sheep and goat meat decreased by USD 24.8 million, and horse meat declined by USD 9.4 million.

On the import side, the USD 1.2 billion year-on-year increase was mainly influenced by higher imports of diesel fuel (up by USD 549 million), auto gasoline (up by USD 83.2 million), heavy machinery such as bulldozers and excavators (up by USD 67.2 million), new tires (up by USD 56.3 million), and iron/steel structures and parts (up by USD 43.7 million). Meanwhile, imports of passenger cars decreased by USD 74.4 million, trucks fell by USD 46.4 million, and smartphones dropped by USD 14.3 million.

In September alone, exports declined by 17.6% or USD 384.6 million compared to the previous month, while imports grew by 12.4% or USD 149.8 million. 

Mineral products, precious stones, jewelry, and textiles accounted for 97.5% of total exports. Mineral products, machinery and mechanical appliances, electrical equipment, vehicles and their parts, and base metals and articles thereof constituted 71.4% of total imports.

During the first nine months, average border prices for key commodities saw mixed trends compared to the same period last year:

Gold: Increased by USD 1,373.9 per ounce

Copper Ore & Concentrate: Increased by USD 1,204.5 per tonne

Coal: Increased by USD 5.1 per tonne

Iron Ore & Concentrate: Decreased by USD 1.6 per tonne

In terms of trade destinations, coal made up 40.4%, and copper ore and concentrate accounted for 46.9% of total exports to China. Unwrought and semi-manufactured gold comprised 99.6% of all goods exported to Switzerland.

Coal exports through the Gashuunsukhait border port accounted for 41.1% of Mongolia's total coal exports, representing a 4.4 percentage point decrease year-on-year. Regarding imports, petroleum products constituted 76.5% of goods imported from Russia, passenger cars made up 76.4% of imports from Japan, and freight trucks accounted for 6% of imports from China. Imports of auto gasoline reached 684,900 tonnes (up 9.6% year-on-year), while diesel fuel imports reached 1.5 million tonnes (up 7.5% year-on-year).

Infrastructure for Mining-Metallurgical-Chemical Complex Reaches 70 Percent Completion www.montsame.mn

Prime Minister Uchral Nyam-Osor inspected the progress of the copper concentrate smelting and processing plant project and the "Mining-Metallurgical-Chemical Complex" industrial and technological park site, based on "Erdenet Mining Corporation" SOE.

"Erdenet Mining Corporation" SOE is implementing the copper concentrate processing plant project within the framework of the "Mining-Metallurgical-Chemical Complex" industrial and technological park, located in Bayan-Undur and Jargalant soums of Orkhon aimag.

Prime Minister highlighted that, in addition to producing value-added pure copper, the copper concentrate smelter is a strategically significant project aimed at manufacturing high-tech end products, accelerating the growth of ancillary small and medium enterprises, introducing advanced technologies, creating jobs, diversifying the economy, and maximizing returns. The Prime Minister instructed officials to step up construction efforts and finalize contract negotiations by November.

A total investment of USD 68 million has been allocated toward the infrastructure of the industrial and technological park. The first phase has already been commissioned, with full completion slated for 2027.

A 1,200-hectare area has been designated under special state needs for establishing the park. The complex will house:

Copper concentrate smelting and processing plant

Ferromolybdenum processing plant for molybdenum concentrate

Copper nanopowder plant

Cable wire factory

In addition, testing is currently underway for the "Oyuut" substation. According to the Media and Public Relations Department of the Government of Mongolia, this substation will not only supply electricity to the industrial and technological park but also ensure reliable power distribution across more than 140 soums.

"With the construction of a 4.4 km railway line from Erdenet Station, it is now possible to unload imported goods directly at the industrial park site, which is currently being connected to Erdenet Mining Corporation by rail. Clean water supply and sewage systems have been resolved, subgrade works for a 12.7 km paved road are underway, and fencing around the park's territory has been completed," stated Batmunkh T., Chief Engineer of "Erdenet Mining Corporation" SOE.

Mongolia Opens 127-Kilometer Railway to Bypass Capital www.montsame.mn

Mongolia officially commissioned a strategically vital 127.1-kilometer railway connecting Bagakhangai, Khushig Valley, and Emeelt on October 11, marking a major step in expanding the country’s rail network and reducing severe traffic congestion in the capital.

The newly completed Class III railway features 177 kilometers of total track length, three sidings, four stations, and 1,279 meters of bridge structures spanning eight locations. Among the infrastructure highlights is a 476-meter bridge crossing the Tuul River, supported by 20 piers and 38 girders, making it the longest bridge in Mongolia. The project also boasts the country’s highest bridge, standing 22 meters tall and spanning 176 meters, as well as 127 reinforced concrete culverts designed for water passage and civil underpasses.

President of Mongolia Khurelsukh Ukhnaa attended the opening ceremony, praising the more than 160 domestic enterprises and 4,000 engineers, technical personnel, and local workers who completed the large-scale engineering project in just over a year using more than 1,500 pieces of heavy machinery.

President Khurelsukh emphasized that the bypass line will play a critical role in Ulaanbaatar’s expansion, supporting new satellite cities and meeting the demands of rapidly growing exports, manufacturing, trade, and logistics while creating jobs and attracting investment. He directed relevant authorities to focus on maintaining operational reliability, increasing transport capacity, adopting flexible tariff policies, lowering logistics costing, and strengthening human resources.

The new line is projected to reroute 20 million metric tonnes of freight around Ulaanbaatar in its first year, eventually scaling up to 25 million metric tons annually. Officials estimate this will remove approximately 1,800 heavy-duty trucks from city streets daily, significantly easing traffic at major rail-road intersections. Previously railway crossing closures delayed city traffic by an average of 144 minutes per day: the new route is expected to reduce those delays by 21 to 120 minutes.

Safety and urban planning benefits are also immediate effective today, 34 categories of hazardous and explosive cargo will no longer pass through central Ulaanbaatar. Plans are underway to construct a multi-purpose freight terminal at the 87.8-kilometer mark and a dedicated hazardous cargo terminal at the 102-kilometer mark. Additionally, 13 freight terminals currently operating within the capital will be relocated in phases, freeing up land for public use.

The railway is also expected to anchor the economic development of the satellite city surrounding Chinggis Khaan International Airport in Khushig Valley, driving progress in trade, manufacturing, free trade zones, and multimodal transport logistics.