Tetra Tech Awarded $30 Million Mongolia Water Supply Program Management Contract www.business.financialpost.com

PASADENA, Calif. — Tetra Tech, Inc. (NASDAQ: TTEK) announced today that the government of Mongolia, through a Compact formed under the Millennium Challenge Corporation (MCC), awarded Tetra Tech a $30 million, seven year, single-award contract. Tetra Tech will provide program management services for a comprehensive water supply project in Mongolia to increase bulk water supply and meet future demand in Mongolia’s capital city, Ulaanbaatar.

MCC is assisting the government of Mongolia in addressing Ulaanbaatar’s water supply constraints with a project that includes installing new groundwater wells, an advanced water purification plant and a new wastewater recycling plant. As the Program Management Consultant, Tetra Tech will oversee and review detailed designs and environmental and social impact assessments, and provide planning, financial oversight, and program management services.

Under a previous MCC contract, Tetra Tech provided technical support services to the government of Mongolia to support innovative wastewater recycling and groundwater conservation projects. Tetra Tech evaluated the use of recycled wastewater at large combined heat and power plants (CHPs) in Ulaanbaatar and prepared impact assessments and feasibility studies. Tetra Tech also developed the process and design of a tertiary treatment wastewater recycling plant and connecting infrastructure to use recycled water at the CHPs.

“Tetra Tech is pleased to continue supporting MCC and the government of Mongolia in securing a safe and clean water supply for the people of Ulaanbaatar and supporting economic growth in Mongolia,” said Dan Batrack, Tetra Tech Chairman and CEO. “We look forward to using our expertise as a premier, high-end consulting, engineering, data analytics, and program management firm to support MCC’s innovative, evidenced-based work promoting stability and reducing poverty.”

About Tetra Tech

Tetra Tech is a leading provider of high-end consulting and engineering services for projects worldwide. With 20,000 associates working together, Tetra Tech provides clear solutions to complex problems in water, environment, infrastructure, resource management, energy, and international development. We are Leading with Science® to provide sustainable and resilient solutions for our clients. For more information about Tetra Tech, please visit tetratech.com, follow us on Twitter (@TetraTech), or like us on Facebook.

Any statements made in this release that are not based on historical fact are forward-looking statements. Any forward-looking statements made in this release represent management’s best judgment as to what may occur in the future. However, Tetra Tech’s actual outcome and results are not guaranteed and are subject to certain risks, uncertainties and assumptions (“Future Factors”), and may differ materially from what is expressed. For a description of Future Factors that could cause actual results to differ materially from such forward-looking statements, see the discussion under the section “Risk Factors” included in the Company’s Form 10-K and Form 10-Q filings with the Securities and Exchange Commission.

Defense Minister of Mongolia visiting China www.montsame.mn

Ulaanbaatar /MONTSAME/. Minister of Defense N.Enkhbold is paying a working visit to the People’s Republic of China upon the invitation of Chinese Defense Minister Wei Fenghe and held official talks with the Chinese minister.

Mongolian PM to attend enthronement of Japanese Emperor www.news.mn

Mongolian Prime Minister U.Khurelsukh flew to Tokyo earlier today in order to represent Mongolia at the enthronement of Naruhito, Emperor of Japan. The ceremony will take place on 22-23 October.

President Kh.Battulga: Participation of scholars is crucial for policy on minerals www.montsame.mn

Ulaanbaatar /MONTSAME/. The celebratory conference on the occasion of the 80th anniversary of the establishment of the geology sector in Mongolia took place at the State House on October 18.

Norway’s $1 trillion fund builds Rio stake after dirty mine sold www.mining.com

After freezing out Rio Tinto Group for more than a decade for owning a highly polluting copper mine, one of the world’s biggest sovereign wealth funds has brought the company back into the fold.

Rich Chinese outnumber wealthy Americans for first time – Credit Suisse www.rt.com

A new report by Credit Suisse shows that the number of rich Chinese people has surpassed the number of wealthy Americans for the first time as both countries continue to produce millionaires at fast rates.
“This year, for the first time, China recorded more members of the global top 10 percent (100 million) than the United States (99 million),” the Swiss bank reported in its annual wealth survey released on Monday.

B.Uyanga: DBM not only provides loans, but also supports development projects it financed www.montsame.mn

We interviewed B.Uyanga, Director of Credit Financing Department of the Development Bank of Mongolia.

- To start with, please introduce us the activities and goals of the Development Bank of Mongolia (DBM)?

The Development Bank of Mongolia (DBM) was officially inaugurated and began its operations in 2011. DBM works to provide financing of large-scale projects and programs for Mongolia’s development as well as to support and track the results of the development projects. The Law on Development Bank of Mongolia was revised in 2017 with primary amendments made to ensure that not less than 60 percent of the DBM’s funding to be provided for export-oriented projects and programs. In this respect, the DBM has been mainly financing projects, enterprises and factories that are working to export their outputs abroad. In addition, we provide funding to major projects of imports, infrastructure and power plant. According to the aforementioned law, all of these shall adhere to government’s midterm and long-term development policies.

- Could you tell us about the goals you have set for this year?

First of all, we are working on non-performing and problem loans by announcing this year as the year to deal with problem debts. Furthermore, DBM’s improvement of domestic regulation, loan issuing activities as well as internal restructuring, reorganization and enhancement of corporate governance are being carried out. Not to mention the main operations toward the country’s economic growth, to fund export projects and programs. Goals for this year focus by and large on these three directions.

Most importantly, apart from loan issuing activities, we are working together with government and non-government organizations to bolster the loan investments provided to entities and tackle challenges of exporting faced by them. For instance, DBM has been maintaining cooperation with ‘Export International Trade Center’ NGO since 2015, giving support to exporting entities to sell their products to the USA, Canada and Japan and European markets.

DBM’s efforts to assist the lending entities and projects include organizing meetings with government departments in charge of trade, chambers of commerce and other relevant organization of foreign countries, delivering information on documents required for exports and document preparation and studying what products made in Mongolia attract the most attention of overseas customers. This implies that when providing services and loans, DBM works together with the companies and development projects it funded until they are fully completed to show tangible results and profits with eventual intention toward the nation’s future growth.

Could you introduce loan and financing indicators of your bank?

As of today, our bank has loan portfolio of MNT 2.7 trillion. Besides giving direct loans to major projects and programs, we provide funding to commercial banks. In other words we finance small and medium sized enterprises through commercial banks. Currently, we have funded 15 programs through 11 commercial banks. Number of entrepreneurs and entities that received financing reached 1700 now. Whereas direct loans granted by our bank, has been given to 74 loan holders or such number of projects and programs.

1700 entities are not a small number. How effective are the loans being granted through commercial banks?

These loans are effective. Commercial banks take their risks at 100 percent, studying the loan requests themselves. Finally, they submit their request to our bank with suggested factories and entities to provide loans. After running selections, relevant ministries also send a list of the factories and entities that are considered proper to support. The commercial banks study these entities and our bank provides loans to the selected entities. There is not any risk on loans being given through commercial banks and repayment of loans is running at 100 percent without any problem.

What about loan disbursement by sectors or purpose?

40 percent of loan portfolio is allocated to processing industry, 24.2 percent to construction sector, 16.3 percent to indirect loans or commercial banks, 10.6 percent to mining, 8.3 percent to energy and 2.6 percent to other sectors.

I heard that the Development Bank would support ‘Export Mongolia-2019’ international business forum to be held in Mongolia on October 28-29. Could you elaborate it?

As we finance projects and programs targeted to export, our bank will involve the exporting entities that have got loans from our bank in the forum and provide information. ‘Export Mongolia’ forum will be held for the 5th time. Previously, only domestic companies and entities used to attend the forum, but this year many international organizations will take part and bilateral and trilateral meetings will be held in a wider range. Financial institutes, which promote businesses, will participate as well. We will introduce our projects and programs at the forum.

The Development Bank of Mongolia has right to draw its funds and financing from foreign sources. The bank issues various types of bonds and collaborates with international banks and financial institutes.

B.Bold

China, India will regain economic glory www.chinadaily.com.cn

That China is a leading country in the world should not surprise anyone because since 1680, it had been the No 1 economy, till imperialism attacked it.

Before that, India was in the lead. India, too, suffered very severely from foreign invasions and imperialism. Such factors affected both China and India.

By the year 2010, China had achieved a record double-digit growth in GDP. Several structural changes, particularly the decline in the share of agriculture, the rise in the share of manufacturing, and the rise in the share of services, with respect to the years before, were remarkable. So was the lower level of unemployment.

In the first few years after 1980, when modernization, reform and opening-up were introduced, the Gini Coefficient had gone up because higher incomes rose much faster than the middle incomes. (Gini Coefficient is defined as a measure of statistical dispersion intended to represent the income or wealth distribution of a nation's residents, and is the most commonly used measurement of inequality.) But by 2010, even it had come to decline.

China had accumulated huge foreign exchange reserves in US dollars, achieved a massive level of exports and a magnificent infrastructure. When Indians visit China, they say after their return: "Why can't India be like China?"

China's economic growth since the 1980s, which is visible in every corner of the country, is an amazing achievement indeed, and deserves an 'A+' for development, at least up to 2010. After 2010, the story changed a bit.

According to data from the International Monetary Fund, of which China is a member, GDP growth rate in 2010 was 10.63 percent. Then, it started declining. In 2018, it was 6.6 percent. In the first half of this year, it was at 6.3 percent.

The latest IMF forecast suggests China's GDP growth rate in 2024 will be 5.5 percent. Now, is this projection a cause for alarm? The answer is, it depends, because the old strategy of increasing growth has now outlived its purpose. China needs a new strategy now.

The rate of investment, however, had been going up till 2010. In 2010, it was at 47.71 percent of GDP. Now, it has declined to 44.38 percent, but is still very high, and probably higher than any other country's.

The net flows of foreign direct investment as a percentage of GDP had also declined over the years, from 3.47 in 2004 to about 1.36 in 2018. The household savings rate, however, has surprisingly gone up, from 28.24 in 2000 to 38.46 in 2013, and then moderated a bit to 36.14 in 2018, according to IMF data.

What is interesting is the incremental factor of the ratio. It was 4.62 in 2010, which climbed to 6.5 this year, suggesting the new policy lays emphasis on high efficiency in the use of capital.

A Renmin University of China study shows that the total factor productivity in growth of China's GDP was 4.3 in 2010, and then it declined to 3.6, which squares with the past inefficiency in the use of capital. Unemployment has also been declining - the rate was 4.5 in 2010, now it is 4.4. The Gini Coefficient was down to less than 38 in 2015.

The Chinese growth from 1980 onwards, especially after 1996, has been largely a story of more capital, more labor, suggesting longer-term focus, which is bound to bring diminishing returns. That's why, the GDP growth rate has been going down.

It is a correct strategy that China should now focus on innovation, which will take China from one curve to another, upward. That means, China can have higher growth rates for a longer time.

My new book Reset: Regaining India's Economic Legacy charts India's annual economic growth, which was 3.5 percent to 4 percent between 1950 and 1980, more or less the same as China's. But, after China introduced reform and opening-up, India's economic growth started accelerating.

But, in the past, adoption of a certain economic model did not yield the expected results. Comparisons clearly show a command economy, or a government-directed economy, does not run successfully to deliver high growth.

India suffered till 1991 when the Congress party-led coalition government headed by Narasimha Rao initiated major economic reforms, which increased growth from 3.5 percent to around 7 to 8 percent over the next five years.

Such high growth rates were sustained over the next several years. But after 2016, growth has decelerated. Now, it's down to around 5.5 percent. This had nothing to do with economic strategy but bad economic policies and questionable experiments that backfired badly. But India recovered, and high growth rate has returned.

Until recent decades, China's strategy has been what economists refer to as "switch trade". China imported semi-processed goods from East Asia, added value to them, and then exported them to Europe and the United States.

Data shows China had a negative balance of trade, or deficit, with East Asia. But it almost reached a surplus in trade with Europe and the US. That's how China made its progress and accumulated foreign exchange reserves.

The labor in East Asia had become quite expensive. So, it became cheaper for East Asia to send semi-processed goods to China. Now, countries like India and Bangladesh are competitors for China. So, China needs to rebalance its trade and change its foreign trade strategy.

China's labor is becoming expensive too, and more skilled. So, China needs to move away from setting up industries that basically service imports from East Asia. Instead, China should set up industries that are indigenous and can use innovation to produce new products. The country is already doing this quite well. China has beaten the US in 5G, and leads in artificial intelligence.

In the past, China went in for liberal financing. Infrastructure received money from banks that were supported by the government. But the private sector was not a big beneficiary. This needs to change now, and more financing should flow toward the private sector as well, to give impetus to innovation.

Lessons need to be learned from countries like Brazil and Argentina that were seen in the 1960s as economies that could become developed like the US and Europe, but were plagued by one crisis or another, and have not been able to realize their potential till now.

The experience of East Asia, which includes Japan, is also relevant. In 1995-96, the World Bank published a report called The Economic Miracle of East Asia, advising countries like India that were seeking growth to follow the basic principles of economic growth as pursued by East Asia.

But, in 1997, there was the Asian financial crisis. It was found later that the East Asian economic tigers were going to the market and giving short-term loans and investing in, or building up, long-term assets. The World Bank produced a sequel that reconsidered the "miracle". That should not happen to China.

The significance of the financial system cannot be overemphasized. One key aspect to note is that unlike the US and Europe, East Asian economies' financial system was not ready for the kind of high economic growth they witnessed.

Besides rising labor costs and outdated switch trade, China has to contend with high tariff walls that are being built around it, particularly by the US. China's infrastructure is nearing saturation point, and it's no more going to be the way to generate employment and higher skills. Even housing seems to be a bit saturated.

So, rebalancing of trade, combined with the Belt and Road Initiative, is going to be the key to future growth. China may want to consider giving higher rates of interest on savings and continue underlining innovation.

It is possible for China and India to learn lessons from their past that witnessed colonialism, imperialism, reparations for combat, monarchy. It is possible for the two nations to discover mutual areas of cooperation, particularly in research and development that can produce great value in the form of more innovation. One more area of cooperation could be mutual exchange of intellectuals.

This process has accelerated over the last four to five years. History is in cyclical mode. Two nations that were the world's economic leaders will regain lost glory. It's just a matter of time.

By:Subramanian Swamy

The writer is India's former commerce, industry and law minister; member of the ruling Bharatiya Janata Party; and member of the upper house of parliament. The article is adapted from his address to the international conference on China's 70 years as a republic, organized by Tsinghua University on Sept 22 in Beijing.

Government bond trades at securities market slump www.zgm.mn

- The Ministry of Finance plans to sell government bonds at the MSE based on blockchain technology.

FATF urges Mongolia to combat offshore www.zgm.mn

Having failed to adequately comply with the recommendations of the Financial Action Task Force (FATF), concerning anti-money laundering and counter-terrorism financing measures, Mongolia has been added to the FATF’s grey list along with Iceland and Zimbabwe, according to a FATF statement released on Friday in Paris. It is risking all foreign transactions and investments to halt, leaving Mongolia’s economy in uncertainty say some analysts as reaction to the decision.The country succeeded in getting out of the grey list in 2014 after taking actions to combat terror funding and money laundering. Mongolia has worked to address weaknesses in its technical compliance with the FATF’s standards since 2017. Meanwhile, its economy is in recovery following a bailout from the International Monetary Fund in 2017. Fund disbursement from the IMF program has been delayed since the end of last year as the central bank reviews a process of re-capitalizing domestic commercial banks. Since the completion of its mutual evaluation report (MER) in 2017, Mongolia has made progress on a number of its MER recommended actions to improve technical compliance and effectiveness, including by enhancing its money laundering (ML) and terrorist financing (TF) risk understanding, and introducing a comprehensive institutional framework to give effect to proliferation financing (PF) targeted financial sanctions (TFS) obligations, and enhancing its TF TFS legal framework through legislative measures and guidance, said FATF public statement.When government officials were discussing Mongolia’s potential inclusion in greylisting, Parliament Speaker Zandanshatar Gombojav said, “An international conference with the Asia/Pacific Group (APG) on Money Laundering and Financial Action Task on Money Laundering took place on September 12 to 13 in Bangkok, Thailand. Mongolia represented its report on work against financing terrorism and money laundering. Unfortunately, four indicators have been evaluated as unsatisfactory, and they have officially alerted us to resubmit the report.”