On June 4th and 5th, fourteen companies from Spain came to Mongolia to operate, while more Spanish companies are currently coming to conduct further business as opportunities flourish in non-mining sectors. The Spanish Institute for Foreign Trade (ICEX), Mongolia National Chamber of Commerce and Industry (MNCCI), and the Spanish Embassy to Beijing – which covers Mongolia as well – worked together to organize an event with Spanish and Mongolian representatives at the Multilateral Partnership Meeting.
Officials from both nations discussed the current economic situation of Mongolia and the investment environment to pursue ideas on how they can collaborate with each other. The Spanish companies focus on non-mining sectors. They are interested in working with Mongolia in sectors such as green development, green technology, energy infrastructure, water recycling, and light.
According to Javkhlanbaatar S., the director of the Invest Mongolia Agency, there are huge opportunities available to both countries in terms of investment. The new Investment Law that was recently passed holds many benefits with cooperation. During the last two months, the agency has participated in multiple Investment Summits on a weekly basis discussing the current state of each of the economic sectors. There is a huge interest from the Spanish side in agriculture and green economy.
During the first quarter of the year, Mongolia received a total investment of USD 623 million. Representatives hope to achieve USD 300 million from foreign direct investment and USD 330 million from package investment. Although these numbers are estimates, the package investment numbers are higher because it is a better indicator of the financial situation in Mongolia. Javkhlanbaatar S. said that 80 companies registered since January 2014 at the Invest Mongolia Agency, showing promising growth.
However, investors are worried about the sustainability of the Investment Law in the long-term. According to Demberel I., the advantage of the new law is that it complies and matches with the international standard. On the flipside, the Investment Law is too general compared to the previous regulation. He also claims that he does not see the law beneficial for small- and medium-sized businesses in terms of attracting investment.
SOURCE: Mongolian Economy