The Mongolian tughrik has since late January been steadily losing value against the dollar, while inflation has been mounting. There are several reasons for this, including increases in the prices of Russian gas, energy and wheat due to effects of the war in Ukraine.

Furthermore, Mongolia’s dollar income is down, as a result of a decline in exports caused by China’s “zero-Covid” policy and consequent border closures. These have also interfered with imports from China, driving up the prices of most finished goods and value-added products in Mongolia, affecting everything from toothpaste to cleaning supplies. Additionally, the lack of foreign tourists and the decrease in exports over the past two years has caused fewer dollars to be available.

Dollars enter Mongolia via imports, loans, remittances, tourism and aid. Most of these dollars wind up in the central bank, the Bank of Mongolia (BOM). The BOM determines how many dollars they wish to add to their foreign currency reserves. The remainder are auctioned off to commercial banks, twice a week. The commercial banks bid on the dollars based on demand and expected demand from their clients.

Several money changers in Ulaanbaatar have reported that, just before Russia’s invasion of Ukraine in late February, a number of Russians came to Mongolia, buying up dollars, further driving down supply. When asked why money changers and bankers would have sold off all their dollars, knowing what was happening in Ukraine, a data scientist who tracks economic phenomena in Mongolia said that the bankers and money changers sell at the market rate, according to supply and demand. “They aren’t concerned with macroeconomic factors.” he explained.

A commercial banker provided a very similar answer, saying that the BOM is concerned with regulating the price of the tughrik, or MNT, but bankers and money changers are just businesspeople who perform services for their clients. Additionally, they are effectively bound to sell at the market rate, irrespective of their personal prognoses. Bankers and money changers generally wait for geopolitical events to reflect in prices, rather than altering prices or ceasing trading in a particular currency of their own accord.

The current shortage of dollars in Mongolia results from both decreased supply and increased demand. As citizens see their MNT accounts decreasing in value, they wish to convert their cash to dollars. Although the tughrik price of dollars has been increasing steadily, demand continues to grow. In March and April, commercial banks and the Naiman Sharga currency exchange market imposed limits on the volume of exchanges. The BOM assured the public that there would be no problem transferring larger amounts of money in an emergency, such as for medical expenses or paying tuition to foreign universities. The central bank also stated that they did not impose restrictions on currency conversions, but that these were imposed by the commercial banks. In March, the banks’s daily conversion limit was MNT 50mn (around $16,550). By mid-April, however, the limit had been reduced to MNT 300,000 (around $99.30).

In Ulaanbaatar, there are three primary markets for foreign currency: banks, money changers and Facebook. Private citizens actually sell hard currency through Facebook at a premium, in a Facebook group called ВАЛЮТ АРИЛЖАА ТОХИРОЛЦОО (“Currency Trading Negotiations”). The difference between the bank rate, that of money changers and the offers on Facebook can be hundreds of MNT.

On Facebook on April 15, one person offered to buy dollars for MNT 3,140 while another was offering MNT 3,150. They were selling for MNT 3,150 and MNT 3,160, respectively. On the same day, banks were buying for MNT 3,470 and selling for MNT 3,530. Money changers advertised various prices: One was buying at MNT 3,420, while another was buying at MNT 3,460. Their respective selling prices were MNT 3,510 and MNT 3,550. On the same day and at the same time, the BOM official rate was buy MNT 3,250 and sell MNT 3,551. In theory, one could buy via Facebook at MNT 3,150 and sell to the bank for MNT 3,470. Consequently, Mongolia has strict rules on commercial banks engaging in currency arbitrage, to avoid distortions in the currency market.

Apart from dollars, other foreign currencies are also in short supply. Many mining companies and international companies need a certain amount of Australian dollars, Canadian dollars or British pounds sterling to pay suppliers back home or repatriate profits. These currencies do not appear to be available in the Facebook market place, which relegates buyers to using the banks and money changers, where supply is low and rates are high.

Apart from dollars, yuan were readily available in large quantities on Facebook. Unlike dollars, however, the sellers did not make their exchange rates public, instead just leaving their contact information. Ostensibly, a buyer could call them and ask the rate, or possibly negotiate a better rate. A commercial banker, speaking on condition of anonymity, said he believed that other hard currencies might be mispriced because of their scarcity in Mongolia. Consequently, there could be arbitrage opportunities moving between three currencies and three markets.

Because of the shortage of dollars, foreign businesses are having trouble making international payments. Turbold, an employee at Oortsogiin Hondii, a non-bank financial institution, reported: “It’s getting difficult, not only for business owners but also for normal citizens. I tried to make a payment with my Visa card from the Trade and Development Bank, but wasn’t able to because I’d reached the daily limit of $330. Companies are probably using different currencies to make purchases.”

Naraa, a loan manager at State Bank, confirmed the shortage of dollars. When asked about other currencies, Naraa said: “If people want to convert, it seems like they can’t. The only currencies that may still be available are the dollar and yuan.” The fact that the yuan is still in large supply across banks, money changers and Facebook suggests that it is not particularly important for international payments and will not provide a viable alternative solution.

Many Mongolians expect the situation to worsen. Turbold, the Oortsogiin Hondii employee, said: “I’m sure, in the next three months, the dollar will reach its all-time high against the Mongolian tughrik.”

By Antonio Graceffo

This article was written with research assistance from Khangal Odbayar, Tengis Enkh-Amgalan, Suldbayar Nasanbat and Nomintuul Batsaikhan.

A total of 49 forest and steppe fires have been reported across Mongolia so far this year, which have destroyed 889,993 hectares of forest and grassland, the country's National Emergency Management Agency said Tuesday.

The number of registered wildfires is up 31.4 percent compared with the same period last year, and the significant increase is mainly related to dry weather conditions and people's negligence, the emergency agency said.

As of Tuesday, Mongolian firefighters have been battling to extinguish a wildfire which broke out in the northern province of Bulgan on Monday afternoon, it added.

The emergency agency is warning the public not to make open fires or throw cigarette butts on the ground amid current dry conditions.

Mongolia's weather is usually dry and windy during the spring season.

ION Energy Limited has revealed that its lithium exploration programs in Mongola have advanced following site visits to its Baavhai Uul and Urgakh Naran projects in late April, as the company awaits the results from brine collected and core samples.

The company said its flagship Baavhai Uul project has shown about 25% lithium anomalies to date, with further drilling results pending.

Results from core brine sampling at Urgakh Naran are also expected in the coming weeks.

This sampling was collected from the surface, with five of eight transient electromagnetic lines completed, the company said in a statement.

A total of 53 auger holes, to depths of 12 metres (m), 2m after the water table or basement depending on which was arrived at first, are being sampled every 2m and are bailed a minimum of twice 24 hours after being drilled before brine samples are collected.

ION CEO Ali Haji said the site visits further reinforced the potential of the company’s highly prospective, world-class assets in Mongolia.

“We are encouraged by the prospect of Baavhai Uul’s pending additional drilling results and Urgakh Naran’s current sampling,” Haji said.

ION technical advisor Mark King said he observed the geology and morphology for the Urgakh Naran site to be highly prospective “with some parallels to Nevada playa basins and South American salars.”

“It was heartening to see some artisanal salt harvesting in the surface evaporite layers, contained in the low-lying dry ponds and lakes: a good indication of brine presence,” he said.

ION Energy is exploring and developing Mongolia’s lithium salars as the company positions itself to be a leader in clean energy amid a global rise in demand for lithium.

The Asia-Pacific (APAC) RMR (Regional Major Rankings) concluded a few days back on 16th April as IHC Esports defeated both TYLOO and Renegades to qualify for the PGL Major Antwerp 2022. With this, the Mongolian esports organization made history by becoming the first-ever team from the country to compete in a Major.

Not only did IHC Esports defeat two of the favourite teams that were expected to win the APAC RMR, but they also went undefeated through the LAN qualifier to win it and claim $5,000 USD (INR 3,81,780) in prize money for their efforts.

IHC Esports creates history by becoming the first CS:GO team from Mongolia to qualify for a Major

After 9z Team became the first-ever non-Brazilian lineup from South America to qualify for a CS:GO Major, IHC Esports created history by becoming the first Mongolian team to do the same through the APAC RMR.

IHC started by defeating its Asian rivals TYLOO by a '2-0' scoreline, handing them close defeats on Mirage (16-13) and Ancient (19-16). This was followed by comfortable victories against Renegades on Inferno (16-10) and Mirage (16-4), as IHC won four consecutive maps (two matches in a row) to qualify for the Antwerp Major.

Talking about how they were able to achieve this victory, 24-year-old Yesuntumur "nin9" Gantulga, in an interview with HLTV, explained that they usually compete against TYLOO with insane pings during local online tournaments, but here on LAN they felt really confident in themselves and came through with a fantastic victory.

As for Renegades, they did not know what to expect from them and they tried to watch a few demos. Due to not being able to download any of them they decided to go into the match with a mindset of just playing their own game.

Three IHC players Tengis "sk0R" Batjargal, Byambasuren "bLitz" Garidmagnai, and Munkhbold "Techno4K" Sodbayar made it into the list of top five CS:GO players at the APAC RMR, holding an overall HLTV rating of 1.34, 1.31, and 1.11 respectively.

According to nin9, the players came into the APAC RMR just hoping to qualify for the Major, but they are now pretty confident in themselves and could do some damage, "teams should not take us lightly".

At its regular meeting today on May 4, the Cabinet made a decision to increase the frequency of flights being conducted by the national flag carrier, MIAT Mongolian Airlines, en route Ulaanbaatar-Frankfurt to five times per week.

However, as the flight frequency will create a larger deficit for the airline, the Government will provide a subsidy for the company. Corresponding officials were also tasked to introduce possible solutions for liberalizing the country’s air transport sector, and issuing VAT refunds to foreign tourists at next week’s Cabinet meeting.

The Cabinet’s decision to increase the flow of air transport was made in connection with a meeting that took place between Prime Minister L.Oyun-Erdene and representatives of the country’s tourism sector last week.

Mongolian Health Ministry ended its COVID-19 briefing from 1 May, 2022, citing declining case counts and hospitalizations, the state’s high vaccination rate. It has been two years since the first imported case of COVID-19 was reported on March, 2020 in the country. The Ministry assured that updates would continue online, but added that an in-person briefing would be held should it be necessary.

To date, Mongolia has reported more than 4.6 thousand confirmed COVID cases since that day. A total of 2179 residents died from the virus.

Almost 67 percent of Mongolia’s population of 3.4 million has received two COVID-19 vaccine doses, 1,037,670 people have received a third dose and 121,581 have received a voluntary fourth shot.

With a high vaccination coverage and declining daily infections, Mongolia has essentially returned to normal life. It has resumed in-person classes for all educational institutions and fully opened its borders to foreign tourists.

Separately, the nationwide medical checkups started from 1 May, 2022 for early detection of most diseases such as cancer, diabetes as well as cardiovascular and respiratory diseases which leading causes of death among Mongolians.

A total of MNT 60.8 billion is allocated from the State budget to the Health Insurance Fund to carry out this program.

Japan's Foreign Minister Hayashi Yoshimasa has called on Mongolian President Ukhnaa Khurelsukh to work for international solidarity in talks about the fighting in Ukraine.

Hayashi began his visit in Mongolia on Sunday. Mongolia shares a border and friendly relations with Russia.

Hayashi's meeting with Khurelsukh was on Monday.

The Mongolian president told Hayashi that his country finds an immediate ceasefire and de-escalation of the situation crucial. He also explained that the country has been providing Ukrainians with humanitarian assistance.

Hayashi noted Russia's military aggression to Ukraine constitutes a breach of international law.

He said Russia's acts shake the foundation of the whole international community, including Asia. He stressed that unity is crucial.

Regarding North Korea, the two confirmed that Japan and Mongolia will continue to cooperate in their response to the country, which includes the call for an immediate resolution of the abductions of Japanese nationals by North Korea.

Hayashi, who has been visiting Central Asia and Mongolia, is scheduled to return to Japan on Monday.

He plans to visit the Pacific island nations of Fiji and Palau over the weekend to exchange views on the situation in Ukraine and on responses to China's increasing maritime activities.

On April 30, Prime Minister L.Oyun-Erdene held a meeting with representatives of over 120 companies that run operations in the tourism and hospitality industry.

Previously, the Prime Minister held a meeting with tourism sector representatives in February 2021. After a year - on February 14, 2022, a policy discussion was also held under the theme, ‘New Revival Policy - Tourism’, following the announcement of the opening of the country’s borders to tourists and visitors from abroad.

At the start of the meeting, Prime Minister L.Oyun-Erdene highlighted that the country’s economy is going through a difficult time as challenges are being faced not only in the country but also globally, and expressed that the Government will pay special attention to the tourism sector as part of the measures to eliminate factors limiting the country’s development. He then informed the participants about works being carried out by the government in the sector as well as the current state of the situation, challenges being faced, and outlook.

Due to operations being halted over the last two years, it has become highly necessary for the sector to receive support from the government, noted the representatives.

In 2019, the sector made an income of MNT 1.6 trillion, creating monetary flow amounting to 7.2 percent of the country’s GDP. Due to the halt in operations, the tourism sector’s income decreased by over 70 percent worldwide in the last two years. As it is only from very recently that signs of recovery began to show, a thorough discussion took place on results of previous meetings as well as issues that can be resolved in the near future.

The participants informed the Prime Minister about various issues that are causing difficulties in operations, such as suspension of bank accounts due to non-payment of immovable property tax as well as others, and the need to postpone payment of social insurance contributions that have accumulated in 2020 and 2021. They also put forth requests and suggestions, which included taking appropriate measures to reduce the prices of tickets for flights being conducted by the national flag carrier to Frankfurt, and resolving certain issues that are faced when dealing with public organizations in charge of tax, social insurance, and monitoring and inspection.

At the end of the meeting, Prime Minister L.Oyun-Erdene announced that starting from this week, discussions taking place during the first hour of all Cabinet meetings will focus on preventing the rise in price and shortage of key commodities as well as issues concerning the tourism sector.

Noting that the sector’s operations affect many issues, he highlighted that the Government will put all its efforts into boosting the sector’s recovery in the next two years.

Issues such as the suspension of bank accounts due to non-payment of tax, and having MIAT Mongolian Airlines increase their number of flights and reduce their ticket prices will be resolved by the end of this week, he said.

With the recent completion of his six-year appointment, Chairman of the Board of Directors of Mobicom Corporation LLC Tatsuya Hamada will soon be returning to his home country. While living in Mongolia and serving as the company’s director for over the last six years, he closely spent time with the country itself and its people. In recognition of his contributions to the development of the country’s communications sector and socio-economic development, Mr. Tatsuya Hamada was awarded with the Order of the Polar Star, the highest state honor of Mongolia, as according to a decree issued by former President Kh.Battulga in May 2021. Furthermore, per the decision made by the Government, he was also appointed as Tourism Envoy of Mongolia and presented a certificate of envoy by Minister of Environment and Tourism B. Bat-Erdene last March. Thus, we took an interview from Mr. Tatsuya Hamada before he returned to Japan.

-Congratulations for being appointed as Tourism Envoy of Mongolia. What were your first impressions when you first came to Mongolia?

-I first came to Mongolia six years ago. The image I had in my mind at the time was those often found in travel photography books–a small boy with rosy cheeks standing in front of his cows, sheep, and horses. The moment I got off the plane, however, I was very shocked to find out that Ulaanbaatar city was entirely different from what I had expected. It was a large modern city with many tall buildings. Although I indeed looked at the country from the business sector’s perspective, I have a quite clear memory of the moment when I learned about the significant development of mining businesses and the sector of communications and IT at the time.

-You worked in our country’s communications sector for six years, which is not that short of a time. How do you see the sector’s development in Mongolia? Could you also tell us about what you think development trends will be like in the future?

-I would first like to talk about how it has been at Mobicom. When I came to Mongolia six years ago, the 3G network was most commonly found in the country. 4G was introduced in Mongolia from 2016. And now, we are holding talks on introducing 5G services. The 4G network was introduced in Japan from around November to December in 2011, while it was after 4-5 years that it was introduced in Mongolia. As for 5G, while it was introduced around March to April last year in Japan, it is currently expected to be introduced here in Mongolia by the end of this year. Like so, the development of Mongolia’s communication sector is nearly on the same level as those in Japan. I believe it is a great achievement.

As Mobicom’s 4G network has been introduced nationwide, in 330 soums of all 21 aimags, people began to use data to access the internet from their mobile phones. Smartphone usage has increased to about 85 percent from 43 percent six years ago. This is a considerably high statistic compared to the rest of the world. Mongolia is on the same level as developed countries for its development of the information and communications sector despite not being considered as an economically developed country.

-You've just mentioned that Mongolia is on the same level as developed countries for its development of the IT and communications sector. What do you think will become more important in order to further develop this sector?

-The use of various applications is increasing as daily usage of smartphones rapidly grow. I believe that the spread of the coronavirus has changed our lifestyle and the business environment through countermeasures such as lockdowns, which served as an impetus for the introduction and development of a variety of applications. Slight changes have also been made to certain functions of Mobicom Group's ‘MONPAY’ mobile application, and introduced in other countries. KDDI Corporation, a major shareholder of Mobicom, highly commends Mobicom's capabilities to develop applications - and talks and negotiations are underway on placing outsourcing orders in the near future. This means that not only Mobicom, but also Mongolia's information technology sector is becoming world-class and recognized internationally. I am confident that it will continue to make progress non-stop. In the near future, I believe that the IT sector will reach to the level where it is considered as important as the mining and tourism sectors in the country.

-Personally, I think that the field that "shined" the most during the COVID-19 pandemic has been the sector of information technology. Could you please give a few words to youth who are looking to work in this field?

-From 2017 to 2022, I used to voluntarily organize a certain activity called ‘Mobicom Class’. During those times, I was often asked questions such as, "I want to join Mobicom in the future, what should I do?" or "Now that I am studying this field, do you think I should continue to go with this career path?" My answer to these types of questions is "Will you be deciding your future life with what you have learned at the university?"

There are many young Mongolians studying abroad and acquiring MBAs and PhDs, but it is also important to talk about the future of what we can do after joining the specific company, rather than telling the entirety of what they have done in the past. It takes four years to study at a university, and six years if you decide to continue to study for a master's degree, but the most important thing to keep in mind is how long you expect to work for the company. In other words, the future depends on much more than this. So I would like to tell them not to decide the next 30 years of their life with just these 4-6 years. Although I think I have become specialized in this field to some extent due to being in the industry for 25 years, my university major was European history. However, I have no regrets about my major, and it was after joining the company that I learned all my current business skills, knowledge and know-how.

-Let me change the subject for a moment and ask you about your appointment as a Tourism Envoy. Is there anything you have in mind for the promotion of Mongolian tourism in Japan?

-In this era, it is possible to become acquainted with Mongolia through guidebooks, unlimited social media, and YouTube videos. However, I was given the opportunity to deeply experience it with my own five senses. I want to pass on to the Japanese people what I perceived when I saw it with my own eyes and heard it with my ears, such as the sounds of horses and the smell of grasslands. Prior to the pandemic, direct flights between Japan and Mongolia were conducted daily, which took about 5 to 6 hours with no issues. Thus, I want to introduce the Japanese people to how they can experience the natural beauty and formation that is not found in Japan. Mongolians are very hospitable people. There were many times I was able to experience this great hospitality, which gave me such an incredible feeling that I cannot describe with words.

On top of this, I was also born with a Mongolian "passport" (or a Mongolian spot which is a type of birthmark). All Japanese people are born with a blue spot. Of course, this is not a diplomatic passport, but I would like to note that the countries of Mongolia and Japan are close in terms of culture, society, and living standards.

-When do you plan on coming back to Mongolia next time? And what would you like to do the most?

-I want to come to the country during the Naadam Festival in July. For the past two years, the Naadam Festival was not celebrated due to COVID-19 restrictions.

When I go to Naadam festivals being celebrated in rural areas of the country as well as in the city, I love the warm atmosphere that I am greeted with, and the kind welcome and conversations that take place when I enter any nomadic household that I do not know at all. So I definitely wish to come around that time.

-Thank you.

Mongolia began providing electronic signatures to all citizens aged 16 and up on Monday, according to the country's General Authority for State Registration.

The electronic signatures will be provided to citizens of the aforementioned ages for a period of five years, said the authorities.

In 2020, the Mongolian government announced its five-year plan to build a "digital nation."

Mongolia is an East Asian country with a population of 3.4 million, of which 2.2 million are 16 years of age or over.