Feb. 2 (Xinhua) -- Chinese Premier Li Keqiang on Monday extended congratulations to Luvsannamsrai Oyun-Erdene on taking office as Mongolia's prime minister.

In his congratulatory message, Li said China and Mongolia are friendly neighbors connected by mountains and rivers and bilateral relations have maintained sound momentum for development.

Since the outbreak of the COVID-19 pandemic, Li said, the two peoples have helped and supported each other and achieved positive results in their joint fight against the virus, writing a new chapter in their traditional friendship.

Under the new circumstances, China-Mongolia relations are facing new development opportunities, he said, adding that China is willing to work with Mongolia to lift the China-Mongolia comprehensive strategic partnership to a higher level. Enditem

Fitch Ratings-Hong Kong/London-01 February 2021: The appointment of a new prime minister, Luvsannamsrai Oyun-Erdene, on 27 January from within the ruling Mongolian People’s Party (MPP), and the quick formation of a new cabinet signal that the sudden collapse of the previous administration will not compromise economic policy continuity or the near-term growth outlook, says Fitch Ratings.

The resignation of the previous prime minister following protests in the capital, Ulaanbaatar, over the government’s handling of the coronavirus pandemic highlights the fragile hold that recent administrations have had on power, with four prime ministers over the last five years. Nonetheless, Mongolia’s recurring bouts of political volatility are captured in the current ‘B’/Stable rating, which we affirmed in May 2020. Recent developments also appear unlikely to affect access to financing from multilateral and bilateral creditors, which has provided an important cushion during the pandemic.

The political changes could have a greater impact on sovereign creditworthiness if they result in a shift in the government’s policy approach towards strategic mining projects, such as the massive Oyu Tolgoi (OT) copper-gold mine. In affirming Mongolia’s rating in May, we indicated political instability sufficient to significantly disrupt strategic mining projects or FDI as a factor that could contribute to negative rating action.

Media reports suggest the recently re-appointed Minister of Justice and Internal Affairs had previously pushed for amendments to the financing and development agreement for OT, in which the government is a minority shareholder. However, the new prime minister has yet to take a formal position on the matter. Relations between the government and the mine’s major investor, Rio Tinto (A/Stable), have long been fractious, and an approaching presidential election, due on 9 June, appears likely to provoke further calls to revisit the project’s commercial terms.

Our assumption remains that the government will proceed with caution, seeking to avoid significant disruptions to the mine’s development that would have severe implications for Mongolia’s near-term macroeconomic stability. We also believe Rio Tinto will proceed in a similar fashion, given the considerable investment it has already made in the country. The new prime minister previously headed the government’s Oyu Tolgoi working group, and Rio Tinto appointed a Mongolian as Copper Chief Executive in January.

The protests were fuelled by dissatisfaction with the government’s heavy-handed approach to social distancing measures, including border closures that have left many Mongolian nationals stranded overseas, as well as calls for greater economic relief. Mongolia’s case levels remain comparatively low, but control measures were tightened in late-2020 after the discovery of locally transmitted Covid-19 infections, which has further dampened economic activity.

An upturn in mineral exports has served to offset the negative impact on domestic demand, as China’s imports of Mongolian coal and copper have ramped up in line with its investment-driven recovery. Mongolian exports fell by 28.2% yoy in 1H20, amid temporary restrictions on shipments as part of virus containment efforts, but recovered sharply in 4Q20.

We expect strong export growth to continue through 1H21, owing largely to base effects, but sequential demand from China is likely to ease later in the year as the authorities there pare back fiscal stimulus measures. Combined with a recovery in domestic activity, we forecast this will push GDP growth in Mongolia to 6.1% in 2021, following an estimated contraction of 5.2% in 2020.

Mongolia remains vulnerable to external shocks in light of its narrow economic base, heavy reliance on external funding, and low foreign-reserve buffers. However, near-term external risks have declined after the issuance of a USD600 million sovereign bond in late-September. Foreign reserves stood at USD4.5 billion at end-December, against approximately USD2.4 billion in sovereign external debt maturities over 2022-2023.

Contact:

George Xu

Associate Director, Sovereigns

+852 2263 9629

Fitch (Hong Kong) Limited

19/F Man Yee Building

68 Des Voeux Road Central, Hong Kong

Andrew Fennell

Senior Director, Sovereigns

+852 2263 9925

Oliver Schuh

Senior Director, Corporates

+44 20 3530 1263

Duncan Innes-Ker

Senior Director, Fitch Wire

+852 2263 9993

Media Relations: Alanis Ko, Hong Kong, Tel: +852 2263 9953, Email: alanis.ko@thefitchgroup.com

Wai Lun Wan, Hong Kong, Tel: +852 2263 9935, Email: wailun.wan@thefitchgroup.com

The above article originally appeared as a post on the Fitch Wire credit market commentary page. The original article can be accessed at www.fitchratings.com. All opinions expressed are those of Fitch Ratings.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTPS://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEB SITE AT WWW.FITCHRATINGS.COM. PUBLISHED RATINGS, CRITERIA, AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE, AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE CODE OF CONDUCT SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR WHICH THE LEAD ANALYST IS BASED IN AN ESMA- OR FCA-REGISTERED FITCH RATINGS COMPANY (OR BRANCH OF SUCH A COMPANY) CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH RATINGS WEBSITE.

A law firm representing a former Mongolian official caught up in an investigation into alleged corrupt mining payments connected to one of the world’s largest copper and gold deposits is launching an international pressure campaign to get the charges dropped.

Amsterdam & Partners has defended former prime minister Chimed Saikhanbileg for the past year against what the firm calls a “series of fabricated criminal charges aimed at weakening democratic opposition in the country and seizing control over the country’s mineral wealth.” Now the firm, which is based in Washington and London, has also registered as a foreign agent for Saikhanbileg as it prepares to advocate on his behalf with policymakers and the media in the United States and abroad.

In addition to its pre-existing legal representation, the firm will now offer pro bono services that aim to influence US policy “by highlighting the declining state of the rule of law and the increasing incidents of human rights abuses in Mongolia under the current government,” Amsterdam said in its lobbying filing with the US Department of Justice. The firm “plans to carry out these activities by means of lobbying, promotion, public relations and preparation and dissemination of informational materials.”

A member of the opposition Democratic Party, Saikhanbileg served as prime minister in 2014-2016, helping to oversee the expansion of Anglo-Australian mining giant Rio Tinto‘s Oyu Tolgoi copper mine. The site, the largest financial undertaking in Mongolia’s history, is on track to become the fourth largest copper mine in the world by 2030.

“While the Mongolians are looking for a better relationship with the United States, they seem to be consistently backpedaling when it comes to rule of law.”

Saikhanbileg was arrested and briefly detained by Mongolia’s anti-graft agency in the spring of 2018 along with former prime minister Bayar Sanj, who helped negotiate the original 2009 agreement to develop the Oyu Tolgoi mine. The two men are accused of misusing their power in helping broker the investment and development deals unlawfully and without approval from the Mongolian parliament.

The probe was launched after the leaked Panama Papers revealed transfers to a Swiss bank account in the name of former Mongolian finance minister Bayartsogt Sangajav, who is also under investigation.

Part of the lobbying and public relations push is the dissemination of a 48-page white paper that details what Amsterdam & Partners calls the “persecution” of Saikhanbileg and warns of democratic backsliding in Mongolia.

“Mongolia is at a crossroads,” the white paper argues. “Long hailed as an ‘oasis of democracy’ in a difficult region of the world, there are worries that

this may be changing. Threats to the judicial independence of Mongolia’s courts and the instrumentalization of the country’s anti-corruption body and public prosecutor to serve political ends have set off alarm bells both inside Mongolia and throughout the international community.”

In an interview with Foreign Lobby Report on Monday, Amsterdam & Partners founder Robert Amsterdam said Saikhanbileg was “horribly treated” by current President Khaltmaagiin Battulga. Amsterdam said his firm aims to create political pressure on the government of Mongolia so it will drop the charges and Saikhanbileg, who has lived in the United States since being allowed to travel for urgent medical attention in 2019, can return home.

“These are allegations that have nothing to do with him personally. They have to do with the policies that he was involved in dealing with, and allegations that he abused his power by engaging in negotiations that were incredibly beneficial for the country,” Amsterdam said. “While the Mongolians are looking for a better relationship with the United States, they seem to be consistently backpedaling when it comes to rule of law.”

Amsterdam is registered as a foreign agent on the account along with lawyer Andrew Durkovic.

Julian Pecquet contributed to this report.

BY: Mikayla Easley

Mikayla Easley is a graduate student at the University of Missouri researching U.S. media coverage of Russia. In the past she’s worked at the Columbia Missourian and Vox Magazine as a reporter and editor, covering state government, public health and public safety. She is also a proud University of Michigan alumna.

Ulaanbaatar /MONTSAME/. On February 2, Prime Minister of Mongolia L.Oyun-Erdene, accompanied with government officials met with representatives from business entities and non-government organizations engaged in the construction industry in the country.

At the outset of the meeting, the newly-appointed Prime Minister highlighted that the government of Mongolia will give all round support to implement its policy to provide its population with housing accommodations. “For instance, a working group will be formed composed of representation from all sides in connection with the development of ‘Youth – 1, 2, and 3’ public housing projects of apartment complexes.”

Citizens who are provided with opportunities to live in housing apartment and access to quality healthcare services and educated are the key to build a ‘wealthy’ middle class, considers the PM.

After briefly introducing about Singapore’s experience in public housing, PM Oyun-Erdene exchanged views on how to achieve productive cooperation through public-private partnership with the participants of the meeting, and heard their views on pressing issues.

Representatives from the Mongolian National Construction Association assured that more than 160 entities and 100,000 employees are committed to contribute to carry out the government’s goal to provide 150,000 household families with housing, which was reflected in the government’s action plan. The representatives further stressed the importance of upgrading and expanding urban infrastructure and services and tackling issues surrounding property and land use in order to put the goal to increase apartment areas into action.

Mayor of Ulaanbaatar city D.Sumiyabazar who was present at the meeting noted that the capital city has pledged to provide its citizens with green and affordable housing apartments equipped with advanced technologies and that correspond with their income.

Minister of Finance B.Javkhlan assured that the ongoing housing mortgage program will continue as normal in the next four years and around MNT 60 billion of loan is expected to be disbursed to borrowers each month, and advised the construction companies to arrange their working plan in accordance with this.

After hearing the positions of all sides at the meeting, Prime Minister Oyun-Erdene has informed that a working group will be established, headed by Chief of Cabinet Secretariat Ts.Nyamdorj and comprised of representatives from corresponding government ministries, the Bank of Mongolia and nongovernmental sector.

He highlighted that young families in Mongolia as well as more than 200,000 families living in Ger districts in Ulaanbaatar city often find it hard to purchase apartments under the government’s housing mortgage program with 30-percent down payment and vowed to implement a long-term policy with 9 goals and 47 targets, which seeks to solve urban infrastructure challenges and build satellite cities in areas located 25 kilometers within Ulaanbaatar city, such as Bagakhangai, Terelj, Aerocity, Baganuur, Emeelt and so forth. When doing so, development of the satellite cities will be shaped under various categories of tourism, agriculture and trade, etc.

Ulaanbaatar /MONTSAME/ In 2020, MNT 2.4 trillion was spent from the state budget on preventing and combating COVID-19 pandemic and reducing its adverse impacts to the society and economy while MNT 1.7 trillion is budgeted for this year.

At its irregular meeting dated on February 1, the Financial Stability Council discussed this matter as well as measures taken within it by the Government, the Bank of Mongolia (BoM) and the Financial Regulatory Commission (FRC), their results, current condition of thestate budget and economy and further planned actions.

In addition to how to effectively activate economy in the future, they talked over the outcomes of the ongoing decisions including decreasing monetary policy rate and banks’ reserve requirement ratio each to 6 percent, putting off loan repayment by the citizens and entities until July 1, 2021, postponing repayment of mortgage loan and encouraging SMEs and non-mining exports by providing loan source with long-term re-financing.

Minister of Finance B.Javkhlan, President of the BoM B.Lkhagvasuren, Chairman of the FRC D.Bayarsaikhan, Executive Director of the Deposit Insurance Corporation D.Duulal and other officials attended the meeting.

LONDON (Reuters) - Britain made a formal request to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership on Monday, seeking membership of the 11-country deal to open new avenues for post-Brexit trade.

Announcing the move, trade minister Liz Truss said it would position Britain “at the heart of some of the world’s fastest-growing economies”.

The request comes on the first anniversary of Britain’s formal departure from the European Union before a transition period that ended at the end of 2020.

Britain is now adapting to the new terms of trade with the European Union, where frictionless trade has been replaced with a thin agreement that, in many cases, is making exporting to the EU more complicated and expensive

The CPTPP removes 95% of tariffs between its members: Japan, Canada, Australia, Vietnam, New Zealand, Singapore, Mexico, Peru, Brunei, Chile and Malaysia.

Britain has argued that the principle benefit of leaving the EU is the freedom to strike trade deals around the world, and is moving quickly to try and find a consensus on the need to revitalise global trade after a period of increased nationalism.

Reporting by Michael Holden, writing by William James; editing by Costas Pitas and Kate Holton

Russia’s gas exports to Europe hit a record high in January, according to analysts at VTB Capital, as pressure over the controversial Nord Stream 2 pipeline continues to mount.

Gazprom — Russia’s state-controlled monopoly gas exporter — delivered 19.4 billion cubic meters (bcm) to Europe in January, the Interfax news agency reported Monday. That is a 45% increase in deliveries compared with the same month in 2020, and a record high for monthly European shipments, VTB Capital analyst Dmitry Loukashov said.

At current spot prices for gas, the deliveries have a market value of more than $4.5 billion.

The record comes as Western pressure on Germany to ditch the Nord Stream 2 pipeline grows following the poisoning and arrest of Kremlin critic Alexei Navalny. European ally France on Monday added its voice to those urging Berlin to ditch the 10-billion-euro project, which is almost complete but has been frustrated by multiple U.S. sanctions efforts to stop Western ships and insurance companies cooperating with the construction.

The pipeline would double Gazprom’s capacity to pipe gas directly to Germany under the Baltic Sea, reducing reliance on the current transit route through Ukraine. Opponents to the project say it has a geopolitical element and would increase Europe’s reliance on Russia and the Kremlin for its energy supplies.

Gazprom’s shipments to China, which commenced at the end of 2019 through the high-profile Power of Siberia pipeline, also continued to rise, Loukashov noted, surpassing contracted volumes to hit 1bcm in January.

Feb. 1 (Xinhua) -- Mongolia on Monday reported 35 new COVID-19 cases in the last 24 hours, bringing its total infections to 1,814, the country's National Center for Communicable Diseases (NCCD) said.

The latest confirmed cases were locally transmitted or detected in the country's capital Ulan Bator, the NCCD said in a statement.

Meanwhile, 25 more patients were discharged from hospitals after full recovery, bringing its total recoveries to 1,358, it said.

The Asian country has recorded two COVID-19-related deaths since it confirmed its first case of COVID-19 in March 2020. Enditem

Ulaanbaatar, 1 February 2021 – The integration and inclusion of Sustainable Development Goals (SDGs) in the national development goals and priorities is vital in accelerating SDGs achievement in Mongolia by 2030. Ministry of Finance and UNDP led technical working group on developing an Integrated National Financing Framework (INFF) for sustainable development organized its first meeting. With the support from United Nations and European Union, increasing number of countries including Mongolia are pioneering the INFF development nationally.

The working group facilitates participation of wide range representatives including development financing, policy makers, international organisations and private sector to generate and engage in more frequent dialogue among these representatives who are driving national development.

INFF will support aligning of the national development policies with financing through mobilizing private sector resources for national development while enhancing the efficiency of various public financial sources to accelerate the achievement of the SDGs and national development priorities.

The financing strategy will build on the ongoing public financial management reform with strategic focus on private sector financing. The private sector financing, prioritized in Mongolia’s INFF development, can be effectively leveraged to address many of the development challenges including creating jobs, promoting businesses and investment and addressing the climate-related risks and challenges.

‘The Government of Mongolia is placing significant importance to the development of INFF and included it in the Government’s Action Programme 2020-2024 to be developed and implemented in partnership with various stakeholders under the Ministry of Finance’s leadership” said Ms. S. Mungunchimeg, the Deputy Minister of Finance.

“The INFF development is very timely as Mongolia and many others are facing formidable challenges due to Covid-19 pandemic that is threatening not just to slow down but to roll back Mongolia’s progress toward the SDGs. The INFF will have to play a vital role in the coming years in mitigating and addressing these challenges” said Nashida Sattar, UNDP Mongolia Deputy Resident Representative.

The working group is planning to present the draft INFF roadmap in June 2021.

***

UNDP is the leading United Nations organization fighting to end the injustice of poverty, inequality, and climate change. Working with our broad network of experts and partners in 170 countries, we help nations to build integrated, lasting solutions for people and planet. Learn more at mn.undp.org or follow at @UNDPMongolia.

For media inquiries:

Erdenesukh Otgonbayar

Communications Analyst | UNDP | Tel: +976-

Washington, DC: The Caucasus, Central Asia, and Mongolia Regional Capacity Development Center. The CCAMTAC is the newest addition to the IMF’s global network of now 17 regional capacity development centers. Following the signing of the Letter of Understanding between the Governor of the National Bank of Kazakhstan Erbolat Dossaev and the IMF Managing Director Kristalina Georgieva on December 14th of 2020, the inaugural CCAMTAC steering committee meeting met on January 28 and endorsed the launch of the center starting February 1, 2021, as well as a work program for its first few months of operation.

Based on a comprehensive assessment of member countries’ Capacity Development priorities, the CCAMTAC will host seven long-term advisors focusing on the following areas:

· Macroeconomic analysis: macroeconomic frameworks for financial programming, forecasting and policy analysis.

· Fiscal policy: public financial management, macro-fiscal issues, revenue administration.

· Monetary and financial sector: central bank operations and financial regulation and supervision.

· Macroeconomic statistics: national accounts, prices, and government-finance and debt statistics.

The center will cooperate closely with IMF Headquarters and regional training centers, in particular the Joint Vienna Institute (JVI), Singapore Training Institute (STI) and China-IMF Capacity Development Center (CICDC), to maximize synergies between training, hands-on technical assistance, and peer exchanges.

Kazakhstan, the host country, is a major contributor to the CCAMTAC, along with other member countries, development partners, and the IMF. Switzerland, Korea, Poland, and the Asian Development Bank are the first development partners to have contributed, and additional contributions to the center’s five-year budget are expected soon.

Ms. Aliya Moldabekova, Deputy Chairperson of the National Bank of Kazakhstan and Chairperson of the inaugural steering committee meeting noted “that Kazakhstan will be honored to host the center in Almaty and looks forward to its physical opening and a close collaboration in the region”.

Mr. Jihad Azour, Director of the IMF’s Middle East and Central Asia Department stressed “the IMF’s commitment to step up its strategic engagement with the region through the CCAMTAC, and to make it a center for innovation”.

In summarizing CCAMTAC’s vision, IMF Deputy Managing Director Sayeh noted “together we want to set-up a modern 21st century regional capacity development center. By collaborating closely, I am confident that CCAMTAC will be able to address existing and emerging needs and contribute to a strong and sustainable recovery from the unprecedented crisis that has affected us all.”

Background Information

A global network of now seventeen regional technical assistance and training centers anchor IMF support for economic institution building and are complemented by global thematic funds for capacity development. They are financed jointly by the IMF, external development partners, and member countries.

Follow IMF Capacity Development on Social Media:

Twitter: @IMFCapDev Facebook: IMFCapacityDevelopment

IMF Communications Department

MEDIA RELATIONS

PRESS OFFICER: NADYA SABER

PHONE: +1 202 623-7100EMAIL: MEDIA@IMF.ORG

@IMFSpokesperson