Economists agree that it is important to attract more investors during this time when foreign reserves are decreasing by large numbers. Over the past five months, foreign currency reserves have dropped by 28.6 percent. On a year-on-year basis, the number has decreased by 52.6 percent. As a result, Mongolia has been hosting many forums and meetings with foreign investors, despite these summer months being a time to celebrate Naadam festivities.
Yesterday, the Mongolian National Chamber of Commerce and Industry hosted Mongolian and Chinese businesspeople in the Liaoning Province to mark their 65th year of diplomatic relations. The Foreign Affairs Ministry of Mongolia announced that the year of 2014 is a year of friendly bilateral exchanges. This meeting aimed to incorporate Mongolian businesses within the Chinese market since over 50 percent of foreign direct investment comes from the People’s Republic of China.
Chinese companies are currently operating in many sectors in Mongolia, most importantly in the mining, construction and trade services sectors. Mongolia receives 80 percent of all exports from China and in return, China imports 30 percent of all Mongolian products. In 2010, the Concession Law was passed. This allowed better access for Chinese investors so they could invest in bigger and better projects.
The Liaoning Province of China is interested in three main sectors: Agriculture, mining and roads. Mongolians want to push further investment into their agricultural sector because more investment would help them become more profitable over time since the processing of raw materials is an expensive procedure.
During the meeting, no contracts were signed. Rather, Mongolians provided more information to Chinese businesspeople about the investment climate. Another meeting will be organized in Liaoning this autumn as yesterday’s meeting mainly served to provide information and link the related businesspeople together.
SOURCE: Mongolian Economy