The Mongolian Economic Forum 2025 began at the State Palace. Prime Minister G.Zandanshatar opened his first government forum by delivering a speech. 
He stated, “The two-day economic forum aims to provide a clearer picture of the policies ministers appointed a month ago will pursue in the future. It will be interesting to see whether participants unanimously name mining or highlight other sectors such as information technology and agriculture. About 500 government officials, 700 private sector officials, and 900 NGO representatives have registered to attend the conference. Mongolian citizens have paid one million MNT and foreign citizens 500 USD to attend the event.”
Economist B.Lkhagvajav expressed his position by stating, “The economic forum has become a platform for praising the government, but this year it is changing.” During the event, CEO of Bizcon Audit LLC L.Otgonbayar said, “The tax code needs to be changed because the excessive structure of the state needs to be reduced. It is good that the government is talking about reducing it by nine percent. However, the people working in this structure should do their job and not pressure the private sector. Corruption, bureaucracy, and the need for unnecessary documents are destroying the favorable environment for doing business.”
L.Otgonbayar emphasized that the development of the private sector is very important, but the current situation is unclear and incomprehensible. For example, even if businesses submit the nine documents required for obtaining a permit, additional requirements appear again due to the difficulties in the internal organization of state institutions. Therefore, a specialized, compact and clearly principled government is needed. The Prime Minister believes that building a strong Mongolia based on the private sector is the right approach and that entrepreneurs need a peaceful and happy environment. However, the current tax environment is very stressful. Inspectors treat entrepreneurs like law enforcement officers and pressure them to pay. Some citizens are burdened with debts and loans and barely manage to pay salaries. In such a situation, however, authorities may close their accounts and impose fines, which causes difficulties, he underlined.
Having worked in auditing for 24 years, L.Otgonbayar noted that there have been no changes in the tax system and the attitude of inspectors during that time. The benefits and exemptions provided by law are not actually implemented. For instance, authorities refuse to make calculations or approve applications for benefits. This situation is very difficult for micro and small business owners, pushing many to give up, liquidate, emigrate, or enter civil service soon after starting a business. The decrease in the number of business owners will negatively affect budget revenues in the short and medium term, which will in turn reduce funding for important sectors such as education, health, and law enforcement.
Signs of a favorable environment for entrepreneurs are emerging, along with a change in mentality that could create opportunities for progress. Recently, foreign representatives misunderstood the wealth fund, thinking the government planned to take 34 percent of invested capital. The prime minister clarified that exploration would be treated differently depending on whether it was funded with public money, which helped correct this misconception. 
Even though the tax authority has gone digital, uncertainty and harsh treatment of taxpayers persist. Inspectors continue to harass businesses regardless of deadlines set by law. The unlimited amount of interest and penalties imposed makes the tax authority akin to a direct moneylender. For example, if a businessman files an incorrect report, they impose unlimited penalties, despite there being a maximum interest rate for commercial loans. The requirement of a 10 percent advance payment when applying to the Dispute Resolution Board itself reflects an unfair system, which is making the environment increasingly difficult for entrepreneurs, the businesses expressed. 
Economist B.Lkhagvajav shared his views by briefly reviewing the forum’s results over the past 15 years. Between 2006 and 2010, major issues such as the Oyu Tolgoi agreement and changes to the mining law were resolved through public debate and protests. In 2010, the government shifted these issues to the forum, creating a space for open dialogue among scientists, researchers and civil society representatives. The first two forums were very effective in discussing policy issues. Unfortunately, in recent years, the forum became a platform primarily for praising the government. However, with a new government and the resignation of the previous prime minister, this forum marks the beginning of real conversations and new opportunities. Facing a budget cut of 3 trillion MNT and a looming crisis, the forum must confront reality and have frank discussions. The Investment Law has not been revised since 2013, but talk of revision at the forum does not inspire confidence. The law contains only one provision stating that investments of 10 billion MNT or more are tax-exempt for ten years. Unfortunately, this provision is not implemented in practice, he highlighted. 
Some participants also expressed, “The state often enters into one-sided contracts that harm the private sector. For example, companies that have won tenders have not received payment for three years, leading to tragic outcomes such as suicides due to loan interest. The Pharmaceutical Association alone is owed 200 billion MNT by the state. These contracts must be reviewed, and contracts between the state and the private sector must be equal. The Mongolian National Chamber of Commerce and Industry has full authority to act as an arbitrator to resolve contract disputes and can issue fairer decisions than courts.”
One of the most pressing issues is the permit system, which currently includes 384 types of permits issued by the state. There is a proposal to transfer this authority to the chamber, as the current system constitutes excessive state intervention in the economy. The number, structure and necessity of permits must be updated based on thorough research. For example, standards are needed for the number of pharmacies allowed per district. The chamber has experience in this work; in the construction sector alone, three types of permits have been issued in the last ten years. This is not just a regulatory issue but also a corruption problem. Moving to a fair and accountable system is the main role of the Transparent Forum, they said.

Published Date:2025-07-16