BUSINESS COUNCIL of MONGOLIA NewsWire

www.bcmongolia.org info@bcmongolia.org

Issue 424 – April 22, 2016

BCM NewsWire provides short summaries of news collected from around the world. Each article is

kept to a maximum of 150 words for brevity, but click on the link next to “Source” to read the full

article.

NEWS HIGHLIGHTS:

Business:

OT expansion project hiring to launch in July, says Erdenet OT exec;

OT Crosses 2 mn tons milestone concentrate shipments;

Development Bank inks oil loan agreement with Russia's VTB;

Consortiums bid for oil refinery contract;

Mines lead in tax payments for 2014, 2015;

Aspire Mining, Noble Group claim JORC 12.85 mts coal resource at Nuurstei;

Xanadu continues to find high grade gold at Oyu Ulaan;

Archetype acquires Asia-Pacific operations of Tebodin;

Chinese firm to build highway to Khushig airport;

State Bank to release MNT21 bn in herders loans;

Governor takes miner to court for forged documentation;

Prophecy to clear TDB loan;

Allen & Overy advises on Mongolia’s sovereign bond offering;

NAMBC appoints Frank Herbert as first Canadian chairman;

BCM SUMMIT RECAP;

Oyu Tolgoi gives trades training in Khanbogd.

Economy:

Mongol Bank: currency auctions, swaps, 1-week bills, T-bills;

IMF forecasts 0.4% economic growth in 2016;

Q1 2016 records surplus, but smaller than last year's;

Tugrug's April appreciation only temporary, says Mongol banker;

Foreign workforce down to make room for jobs for citizens;

Car parts exempt from VAT for stimulus of automobile assembly;

SCO Summit may consider Russia-Mongolia-China economic corridor project;

Russia may grant Mongolia a loan in rubles;

Mongolia negotiates with Iran for crude;

Numbers of foreign visitors, tourists drop;

The seesaw of meat prices;

Crimes fall in Q1 2016;

Saikhanbileg government orders emergency response for measles outbreak;

National Oncology Center receives new equipment;

Mongolia to launch satellite in 2017;

Environmentalists demands cancellation of exploration licenses near Tuul River;

Education Ministry finances small-scale education projects;

Asia Foundation engages artisinal miners for land reclamation.

Politics:

Mongolia opposition party pact fails ahead of June election;

Parliament to vote on economic zone at Khushig;

Parliament's remaining independents join MPP;

KhUN retains Borgil as party leader for stability in months before election;

U.S. donates 30 new land cruiser vehicles;

Alaska's National Guard team provides backup for Mongolian soldiers in Afghanistan;

hundreds rally for Battulga during police raid;

Grave robbers caught;

Stressing the importance of NATO’s cooperation with the Asia-Pacific region;

Government reform is the way out of crisis—EDITORIAL.

BCM Updates:

Announcements;

Knowledge Sharing Sessions;

Advocacy Notes;

Working Groups News;

BCM in the University Classroom Series;

Cooperation & Member discounts;

Member Vacancies;

Websites Update - Presentations, Mongolia Reports, Interviews;

Media Coverage & Social Networks.

Economic Indicators:

Inflation;

Central Bank Policy Rate;

Currency Rates.

*Click on titles above to link to articles.

SPONSORS

Khan Bank Invest Mongolia Agency

Mongolian Business Database

BUSINESS

OT EXPANSION PROJECT HIRING TO LAUNCH IN JULY, SAYS ERDENET OT EXEC

The Oyu Tolgoi copper-gold mine will begin hiring hundreds of Mongolians to build the underground

mine that will unlock 80% of the mine wealth there starting from July, Erdenes Oyu Tolgoi Executive

Director D. Ganbold told told News.mn. Work on the mine will help reboot economic activity in the

country after four years of decline, said Ganbold. Revenue generated from the project will also

help finance government programs such as its aim to cut mortgage rates on its 8 percent subsided

lending to 5 percent, he said. “Some work even started before signing the agreement. The

Mongolian side pushed for development the underground for March.”

Initial development on the mine launched last December following the signing of a project financing

agreement worth upwards of $4.4 billion. The first round of spending will go towards the purchase

of equipment and supplies, including locally made goods.

Source: UB Post

OT CROSSES 2 MN TONS MILESTONE CONCENTRATE SHIPMENTS

Oyu Tolgoi LLC on 20 April announced the milestone of two million tons of copper concentrate

shipped in the first quarter of 2016. “Our exceptional performance over the quarter—setting new

records in production, while improving our safety performance—speaks to the commitment and skill

of the Oyu Tolgoi workforce,” said Andrew Woodley, chief executive officer.

In the first quarter, concentrator throughput increased 3.1 percent over the fourth quarter in 2015,

with average throughput of approximately 106,000 tons per day. Concentrate production in the first

quarter remained high resulting from increased throughput and strong copper grades. Turquoise Hill

has increased its 2016 gold in concentrates guidance to between 255,000 and 285,000 ounces from

210,000 to 260,000 ounces given stronger-than-expected gold production for the quarter. Turquoise

has expects production of 175,00 to 195,000 tonnes of copper in concentrate for the year.

Source: Oyu Tolgoi LLC

DEVELOPMENT BANK INKS OIL LOAN AGREEMENT WITH RUSSIA'S VTB

The Development Bank of Mongolia concluded a commercial financing contract with Russia’s VTB

Bank on 20 April for USD300 million in oil products from Russia.

Source: News.mn

CONSORTIUMS BID FOR OIL REFINERY CONTRACT

Mongolia has opened up bidding for a contract to build an oil refinery in the country as it looks to

develop an oil industry to diversify its exports and secure energy independence. Companies from

Canada (CPP-Max), China and Britain (ISN) have bid for the project.

Next up for tender will be a contract to build a 540 kilometer oil pipeline between Dornod Soum

and Bor-Undur Soum.

Source: Zuunii Medee

MINES LEAD IN TAX PAYMENTS FOR 2014, 2015

Mining is still keeping the economy afloat, despite troubles in the economy from falling foreign

investment and China's waning demand for Mongolia's mineral exports. Mongolia's two largest copper

mines paid some of the highest taxes in the country since 2014. The Oyu Tolgoi mine paid MNT336.6

billion and 560 billion in taxes in 2014 and 2015, respectively. That compares with MNT462.4 billion

and 381 billion in 2014 and 2015 by Erdenet Mining Corp.

Mongolia's largest holding company, MCS Group, which partially owns the coal mining company

Mongolian Mining Corp., paid MNT223 billion and MNT224 billion in 2014 and 2015.

Source: Udriin Sonin

ASPIRE MINING, NOBLE GROUP CLAIM JORC 12.85 MTS COAL RESOURCE AT NUURSTEI

Aspire Mining Ltd. now has a 12.85 million ton JORC resource at the Nuurstei coking coal project.

Aspire's 45 percent owned ownership is through its 50-50 Ekhgoviin Chuluu Joint Venture with Noble

Group, which currently has a 90 percent interest in Nuurstei. Aspire now has the option to purchase

Noble's 50 percent interest in the ECJV through to March, 2017.

Thirty-seven percent of the resourced is indicated, while the remainder is inferred, capturing the

1.6 kilometer long coal seam which dips from surface down to 200 meters. Nuurstei has potential to

be developed as a shallow open pit mining operation with a low strip ratio, and other coal projects

in the area will be assessed for consolidation with Nuurstei.

Source: Proactive Investors

XANADU CONTINUES TO FIND HIGH GRADE GOLD AT OYU ULAAN

Xanadu Mines Ltd. has yielded high-grade gold assays of up to 145 grams per ton from recent trench

sampling at the Stockwork Zone II discovery the Oyut Ulaan copper-gold project. The trench results

at the project, which Xanadu owns 90 percent, confirm the existence of a continuous zone of

shallow high-grade narrow vein gold mineralization.

“The rapid delineation of high-grade gold, in multiple structures, at surface and now confirmed

through trenching is an outstanding achievement by the company’s exploration team,” said

Xanadu’s chief executive officer, Andrew Stewart. “Although early-stage, these untested

possibilities and the high gold grades of surface rock samples and the first trench results combine to

suggest that the targets may form potentially mineable bodies.”

Source: Proactive Investors

ARCHETYPE ACQUIRES ASIA-PACIFIC OPERATIONS OF TEBODIN

Multi-disciplinary construction consultancy, Archetype Group, has acquired the Asia Pacific

operations of Tebodin, a consultancy and engineering company with offices across South East Asia.

The 4 March where agreement sees the architectural and engineering services group Archetype

finding in Tebodin a partner with a services portfolio that is complementary to its portfolio. This

acquisition will strengthen Archetype’s Industrial division and will provide a complementary

extension to the company’s activities in building and real estate as well as environment and

infrastructure. Both companies together will represent a force of over 1,100 employees and is

expected to generate an annual turnover of USD40 million.

“With the acquisition of Tebodin, we reinforce our expertise and market presence in Vietnam,

Thailand, India, Myanmar and Indonesia and allows us to extend our reach to China, which is in line

with our development strategy,” said Pierre-Jean Malgouyres, general director of Archetype Group.

Source: Archetype Mongolia LLC

CHINESE FIRM TO BUILD HIGHWAY TO KHUSHIG AIRPORT

Chinese Railway Co. 4 will lead construction of a highway between the new international airport at

Khushig Valley and Ulaanbaatar. Construction will span 34 months.

Source: Udriin Sonin

STATE BANK TO RELEASE MNT21 BN IN HERDERS LOANS

State Bank has received 5,906 applications from herders for subsidized loans since the roll out of

the state-backed lending program. The bank plans to loan MNT21 billion in loans to herders for

expanding their production with 10 percent annual interest.

Source: Undesnii Shuudan

GOVERNOR TAKES MINER TO COURT FOR FORGED DOCUMENTATION

The governor of a town in Tuv Aimag is challenging licenses issued by the Mineral Resources

Authority, saying that the government never consented to them. “I did not give approval to Yos

Company when they proposed gold exploration in our county in 2013,” said M. Ganbat, governor of

Tseel Soum. “Their exploration area of 3,000 hectares was in our county's protected area with

ancient burial grounds, a salt water lake and plants that carry medical value.”

A trial launched on 14 April against against Yos, with the town claiming that the company forged

Ganbat's signature and the city seal for a contract. A Court Analyze Institute has confirmed that

claim to be true. Tuv Aimag’s Representative Khural passed a resolution to cancel the license in

2009.

Source: Udriin Sonin

PROPHECY TO CLEAR TDB LOAN

Prophecy Development Corp. will pay off and close out a USD1.5 million line of credit facility with

the Trade and Development Bank (TDB) of Mongolia LLC at end of this month, it reported on 20

April. Prophecy has also agreed to issue about 2.6 million common shares to Nargil Molor, an insider

of the company, at a deemed price of USD0.015 per common share to settle all remaining and

outstanding debts owed to her.

Source: Prophecy Development Corp.

ALLEN & OVERY ADVISES ON MONGOLIA’S SOVEREIGN BOND OFFERING

Allen & Overy advised Mongolia's joint lead managers for its sovereign bond offering. The USD500

million issuance, which closed last Wednesday, was done under the Government of Mongolia’s

Global Medium Term Notes Program (in respect of whose establishment Allen & Overy advised the

arrangers). The bonds were sold internationally on a combined Rule 144A / Regulation S basis, with

US qualified institutional buyers accounting for a substantial portion of the total demand.

Credit Suisse, Deutsche Bank, ING and J.P. Morgan were joint bookrunners, and together with

Golomt Bank LLC and TDB Capital, acted as joint lead managers of the offering.

Source: Conventus Law

OYU TOLGOI GIVES TRADES TRAINING IN KHANBOGD

Twenty-one Khanbogd residents celebrated 14 April as they completed a unique training program

from Oyu Tolgoi LLC strengthening their skills as they enter the job market. The six month Oyu

Tolgoi Pre-Apprenticeship program started in October 2015, where the trainees undertook

specialized courses in electrical trades, welding, and mechanics and received internationally-

recognized Australian trades. The skills that the program focused on are in high demand in the

mining, construction and infrastructure sectors, equipping the participants to enter the job market.

“Today is a special day for all involved in this meaningful project,” said Labor Minister Garidikhuu

Bayarsaikhan at a graduation at the Khanbogd Technical Training Centre. “Thanks to the

cooperation between Oyu Tolgoi and its partnering institutions, these bright young people are

trained to internationally-accepted Australian trades certification standards.”

Source: Oyu Tolgoi

COCA-COLA HELPS WASH UB STREETS

The Coca-Cola factory owned by MCS Group is recycling the water it consumes for street cleaning in

Ulaanbaatar. The so-called "gray" water used by the factory is being delivered to street cleaners

that will operate every Tuesday and Thursday at Chinggis Square on mornings and on IkIkh Tuiruu,

Baga Tuiruu, Narny Zam, Peace Avenue and Chinggis Avenue in the late evenings.

Source: News.mn

NAMBC APPOINTS FRANK HERBERT AS FIRST CANADIAN CHAIRMAN

The North America-Mongolia Business Council's board has nominated Frank Herbert, president of

Centerra Gold, as its first Canadian chairman. NAMBC Chairman and Wagner Equipment Chief

Executive Officer Bruce Wagner announced Herbert, who has been vice chairman of NAMBC since

2012 as his proposed successor at the Ottawa Annual Meeting & Investors Forum. Prior to becoming

Centerra’s president last year, Herbert had been General Counsel since 2004 and before that was in

private practice as a partner with a major Canadian law firm and practiced with a leading firm in

London, Britain.

Also proposed was Teddy Baldwin, a partner in the Washington D.C. office of Baker & McKenzie, as

secretary-treasurer to succeed Gene Theroux and Ambassador Pam Slutz as a director after she

retires from the chairmanship.

Source: NAMBC

BCM APPOINTS NEW EXECUTIVE DIRECTOR

Mergen Chuluun has been appointed as Executive Director of the Business Council of Mongolia

(BCM), Chairman Byambasaikhan Bayanjargal announced to an audience of over 200 at the Blue Sky

Tower and Hotel during the BCM Summit on 21 April.

Previously, Mergen Chuluun was the Managing Director for Wagner Asia Automotive, the authorized

importer and dealer for Ford and Land Rover vehicle brands as well as Michelin, BF Goodrich, and

Kumho tire brands. While there, he founded Mongolian Automobile Distributors Association

(MADA). He was also elected to serve on the Ford Dealer Advertising Fund (FDAF) Board for Asia

Pacific Region.

Prior to Wagner Asia, he founded & managed Webguru, Mongolia’s first web development & internet

marketing agency, from 2008 to 2011. From 2009-2010, Mergen ran Mongolia’s first ever podcast, a

weekly talk show called Mongolia Business Podcast that focused on doing business & investing in

Mongolia. He also founded Sweet Road LLC, under Tsakhiur LLC in 2007. From 2003-2007, Mergen

worked as financial analyst in distribution and manufacturing industries in USA.

Mergen graduated from Colorado State University with Bachelor of Science in Business

Administration with majors in Finance, Computer Information Systems, & Entrepreneurship. He also

attended Harvard Business School Executive Education YPO-WPO Presidents’ Program in 2014 and

2015.

Mergen is also Education Chair for Young Presidents Organization (YPO) Mongolia and Board Member

for North Asia Region, President for Rotary Club of Ulaanbaatar, and a Chairman of Board of

Advisors for AIESEC Mongolia.

Mergen replaces Jim Dwyer after 9 years of guidance to the BCM staff and as a leader of hundreds

of business organizations and other member groups advocating for fair business practices in

Mongolia.

Source: BCM

BUSINESS SECTOR SOUNDS OFF ON TODAY'S ECONOMIC CLIMATE AT BCM SUMMIT

Over 200 visitors attended the BCM Summit in Ulaanbaatar on 21 April to discuss how the business

community can resolve issues plaguing Mongolia's business sector under the banner "supporting

sustainable business growth and development in Mongolia." Executive Director Jim Dwyer in his

opening remarks noted that the summit provided a unique opportunity that gave participants the

chance to deliver their suggestions to government when the Business Council of Mongolia's delivers

its summary from the event. Speakers over the course of the day included some of Mongolia's top

businessmen and analysts spoke at the event, including Peter Morrow is the founding Chairman of

American University of Mongolia; Ch. Khashchuluun, Executive Director, National Council of Private

Sector Support; and Andrew Woodley, chief executive of Oyu Tolgoi LLC.

Highlights from the event include advice on how businesses can best manage today's economic slow

down from Matthew Pottle, managing partner of PricewaterhouseCoopers Mongolia, as a possible

assistance plan to the government from the IMF. Tuyen D. Nguyen, IFC Resident Representative for

Mongolia, noted that the the IFC still had in hand an austerity plan that focuses on cutting

unnecessary public spending along with assistance for managing today's tough economic conditions.

"There is room for flexibility," he said.

Source: BCM

ECONOMY

MONGOL BANK: CURRENCY AUCTIONS, SWAPS, 1-WEEK BILLS, T-BILLS

The Bank of Mongolia on 21 April rejected USD6.8 million and CNY5 million in bids from commercial

banks in currency auctions. It also rejected USD4 million in buying bids from banks. Also that day, it

accepted tugrug swaps with commercial banks for an equivalent of USD72.5 million, but rejected

dollar swaps worth USD20 million.

The Bank of Mongolia on 20 April issued one-week bills worth MNT73 billion at a weighted interest

rate of 12 percent. Also that day, the central bank received MNT10.5 billion in bids for the auction

of 12-week treasury bills with a face value of MNT3.25 billion (compared with an original face value

of MNT5 billion) that were sold at a discounted price with a weighted average yield of 13.19

percent. It canceled the auction of two-year bonds with a face value of MNT10 billion because of a

lack of bids.

Source: Bank of Mongolia

IMF FORECASTS 0.4% ECONOMIC GROWTH IN 2016

The International Monetary Fund (IMF) is forecasting 0.4 percent economic growth for this year,

which would make it the fifth straight year of slowing growth under the Democrat's rule of

government. Analysts say the sluggish growth is a reflection of the global fall in mining products'

prices. This IMF estimate falls slightly below the recent World Bank’s forecast of 0.8 percent.

Source: News.mn

Q1 2016 RECORDS SURPLUS, BUT SMALLER THAN LAST YEAR'S

The trade balance recorded a USD359.9 million surplus for the first quarter of 2015, but slightly

lower by $376 million compared with the same period in 2015. Total trade turnover fell by 12.4

percent, including a 11 percent drop in export revenue. The total from imports was all down down,

by 14.6 percent.

Source: Montsame

TUGRUG'S APRIL APPRECIATION ONLY TEMPORARY, SAYS MONGOL BANKER

This month's appreciation of the tugrug that has given some hope for a stabilization of the currency

is only a temporary phenomenon, according a central banker. The present decreased value for the

U.S. dollar-tugrug exchange rate is temporary,” said B. Batdavaa, head of foreign exchange reserve

management for the Bank of Mongolia. The central banker said that low inflation of 1.7 percent and

a 2.1 percent reduction in money supply both helped boost the tugrug's value.

The currency may also have been buoyed by the recent USD750 million bonds taken out by the

government, and Oyu Tolgoi may have a similar impact, he said.“In the third quarter of 2016,

USD300 million of OT financing will come, which will be good news for us. However, our main

commodity’s international market price is not recovering, that would be our main problem.

Therefore, the present decrease of the US dollar exchange rate is temporary.”

Source: Undesnii Shuudan

FOREIGN WORKFORCE DOWN TO MAKE ROOM FOR JOBS FOR CITIZENS

The foreign worker population is down 40 percent, according to Labor Minister G. Bayarsaikhan, as

the government tightens regulations on work visas in the country to make jobs more available for

the local population. Mongolia has 45,000 students studying in university, including 17,000 with

studies in construction who they would be competing with for jobs with foreign workers.

The Ministry is making it a priority to ensure that young people have access to jobs first as Mongolia

has had up to 37,000 foreign workers in construction in a year.

Source: Zuunii Medee

CAR PARTS EXEMPT FROM VAT FOR STIMULUS OF AUTOMOBILE ASSEMBLY

The value-added tax on imported car parts for assembly in Mongolia will be dropped in the hopes of

reducing manufacturing costs in the country. The tax exemption would cut operational costs by 15

percent for assembly plants building automobiles such as those for public transportation buses.

Assembly plants have paid MNT834 million a year in customs and tax on parts. Mongolian has built

up to 20 buses a year compared with a total capacity of between 100 and 150 vehicles. The country

currently imports around 2,000 vehicles a year.

Source: News.mn

SCO SUMMIT MAY CONSIDER RUSSIA-MONGOLIA-CHINA ECONOMIC CORRIDOR PROJECT

This year’s Shanghai Cooperation Organization (SCO) summit in Uzbekistan may consider the

creation of a Russia-Mongolia-China economic corridor on the sidelines, Russian Foreign Minister

Sergei Lavrov said Thursday. The Uzbek capital of Tashkent hosts the six-member military,

economic and political alliance’s next summit on 23 and 24 June.

"We consider it important to make efforts to implement the ‘roadmap’ of cooperation between the

three countries, as well as the rapid completion of the program to create the economic corridor

between Russia, Mongolia and China, which could be put to the approval of the leaders on the

sidelines of the SCO summit," Lavrov said in a speech at the Mongolian Foreign Ministry.

Source: Sputnik News

RUSSIA MAY GRANT MONGOLIA A LOAN IN RUBLES

Russia and Mongolia are discussing the possibility of granting Ulaanbaatar a ruble loan, Russian

Foreign Minister Sergei Lavrov said on 14 April. “Now we have no legal impediments to renewing the

credit relations between Russia and Mongolia, and this possibility is now being discussed,” he said

after talks with his Mongolian counterpart Londrina Purevsuren.

The Russian foreign minister did not divulge any further details on the terms of credit cooperation.

On April 13, Lavrov held a press conference for journalists from Mongolia, Japan and China, where

he spoke of the Southern Kuril Island dispute, tensions in the Korean peninsula and the prospects

for integrating China’s Silk Road project and the Eurasian Economic Union.

Source: Russia Beyond the Headlines

MONGOLIA NEGOTIATES WITH IRAN FOR CRUDE

An Iranian petroleum official announced Iran and Mongolia have resumed negotiations on Iranian

crude oil sales to the East Asian country through China’s route. Seyyed Mohsen Ghamsari, executive

director for international affairs at National Iranian Oil Company (NIOC), touched upon the latest

status of talks between Iran and Mongolia over crude exports saying “Mongolia marks a newly-

emerged market for the sale and export of Iran’s oil.”

He deemed China as one possible route for exporting Iranian crude to Mongolia: “negotiations are

being held with Mongolian officials in order to finalize the oil export path through China.” During

the earlier meeting with Mongolia’s Minister of Foreign Affairs Lundeg Purevsuren, Iranian Oil

Minister Bijan Zanganeh had emphasized the possibility of exporting 50,000 to 60,000 barrels of

Iranian crude oil to the East Asian country via Chinese companies.

Source: Mehr News

NUMBERS OF FOREIGN VISITORS, TOURISTS DROP

The number of Mongolians entering the country for the first quarter of this year has fallen by 10.4

percent. About three-quarters of the 63,600 individuals who entered the country did so with 30-day

admittance in the country, and about a quarter stayed for more than 90 days. The remaining 2.7

percent stayed up to 90 days.

Tourism was also down by 7.9 percent for the quarter compared with the same period in 2015.

Annual tourism will probably dip some from the last year given that the dozens of nationalities,

mostly European, added to the list of passports with visa-free status were removed at the the start

of the year. The visa-free status, which allows those passport holders to enter the country freely

without preparing a visa ahead of time, was not renewed because of security concerns for this

year's Asia-Europe Meeting (ASEM) and a lack of reciprocation from those countries.

Source: Undesnii Shuudan

THE SEESAW OF MEAT PRICES

Meat prices in Mongolia are shooting up again, and consumers are growing irate with the

discontinuation of price controls set by the government. Prices climbed between MNT1,000 and

MNT1,500 a kilograms in markets after prices dropped in the fall from a flood of supply. Herders

began culling their cull before winter in the expectation of a harsh winter following a summer

drought, which are the ingredients from the natural disaster known as “dzud” where many livestock

die. The price for a lamb carcass has dropped to MNT3,500 per kilogram at the start of 2016.

Last year, the Bank of Mongolia discontinued its Price Stability Fund, which bought up meats to put

in reserve to release when their was scarcity in the market. The Ministry of Food and Agriculture

also began financing meat operations in the country, sending out MNT100 billion to producers, but

the program never went forward.

Source: Unuudur, UB Post

CRIMES FALL IN Q1 2016

Crime is down 8.6 percent for the first quarter of this year compared with the same period in 2015.

Police registered 7,200 crimes so far this year, with the largest drop in violent crimes that resulted

in death, by 212 less infraction. Traffic violations and white-collar crime were also down, by 158

and 112, respectively.

Total costs from damages from crimes was MNT20.2 billion for the quarter. Domestic violence was

up 46 percent, with 4% of total victims children and 41 percent women.

Source: Montsame

SAIKHANBILEG GOVERNMENT ORDERS EMERGENCY RESPONSE FOR MEASLES OUTBREAK

Government has established an emergency working group to manage outbreaks of the measles

throughout the country that have resulted in the reported deaths of 59 infants,. The Cabinet

Secretariat on 18 April ordered the formation of the body operating under the National Emergency

Commission to administer vaccinations for children under one year old. The Cabinet has also issued

an ordinance that employers should be willing to give two hours of paid leave so they have time to

vaccinate their children.

A budget of MNT982 million has been set for the program, which includes costs of sanitation goods

and their delivery to health centers. Another MNT450 million is being considered for the purchase of

special equipment to pay for the goods. According to the National Research Center for Infections

Diseases (NRCID), Mongolia has registered 700 patients with measles. Of 59 fatalities it reported

from the disease, 76 percent of fatalities occurred among children under eight months old.

Source: Montsame, Zuunii Medee

NATIONAL ONCOLOGY CENTER RECEIVES NEW EQUIPMENT

India has donated equipment to improve Mongolia's treatment of cancer. Parliament Speaker

Zandaakhuu Enkhbold and India's speaker for the lower house, Lok Sabha, were in attendance at a

commissioning ceremony of equipment made by Bhabbatron II at the National Center for Oncology.

Source: Montsame

MONGOLIA TO LAUNCH SATELLITE IN 2017

National University of Mongolia (NUM) plans to launch the country's first satellite by spring 2017, it

announced this week. NUM is participating in the Birds project, an international effort by the

Japanese government to facilitate Mongolia, Ghana, Bangladesh and Nigeria to launch satellites for

taking photos from the atmosphere, broadcasting news and connecting to an international network

of ground stations.

Japan Kyushu University is monitoring the manufacturing of equipment and launch of the satellites

in cooperation with local universities such as NUM at a cost of USD100,000 for the construction of

facilities and USD225,000 for the launch. NUM is set to provide USD50,000 to its launch and plans to

collect the remainders from donations.

Source: Mongolia.GoGo.mn

ENVIRONMENTALISTS DEMANDS CANCELLATION OF EXPLORATION LICENSES NEAR TUUL RIVER

Environmental groups are sounding the alarm for lawmakers that neglect of the city's main water

source, the Tuul River, during Ulaanbaatar's rapid growth is putting it on the verge of collapse. The

head of a conservation group for the river called the Save our Queen Tuul River, B. Jangar, this

week in a letter to Parliament made a plea that the lawmakers cancel the 64 mineral exploration

licenses located near the river, saying their activities are drying it up. Activists claim that the

industrial waste from factories built up alongside the river have also had a major role in the drop in

water levels at some rivers.

Responding to the claims, the head of Ulaanbaatar's Department of Environment and Green

Development, Kh. Marat, said that not a single company was licensed to explore or mine in Tuul

River safety zones. “We didn’t issue 50 illegal licenses,” he said. He added, “The companies are

exploring within the basin, not in safety zones.”

Source: News.mn, UB Post

EDUCATION MINISTRY FINANCES SMALL-SCALE EDUCATION PROJECTS

The Ministry of Education will deliver MNT2.6 billion in aid to 427 schools to fund 450 small-scale

projects. The projects costing between USD2,000 and USD3,000 each will focus on improving

education quality and will be implemented in three stages.

Source: Unuudur

ASIA FOUNDATION ENGAGES ARTISINAL MINERS FOR LAND RECLAMATION

The Asian Foundation has launched a new program aimed at restoring land where mining operations

run by artisinal miners have ceased. The “Engaging Stakeholders in Environmental Conservation – II”

project (ESEC II) implemented by the Asia Foundation jointly with the Ministry of Mining launched a

key foundation product of the project – the Frugal Rehabilitation Methodology (FRM). The event

brought together over 150 participants who represent a diverse range of stakeholders both

international and local, including officials from central and local governments, local environmental

inspectors, artisinal mining NGOs and international organizations. The project has received financial

support from the Swiss Agency for Development and Cooperation (SDC).

A toolkit designed for the project aims to help artisinal mining groups to demonstrate their

environmental responsibility through best practice and provide support to the formalization process

through encouraging and guiding positive engagement with stakeholders on social and

environmental responsibility.

Source: Asia Foundation

POLITICS

MONGOLIA OPPOSITION PARTY PACT FAILS AHEAD OF JUNE ELECTION

An electoral pact between the two main opposition parties in Mongolia collapsed this week,

weakening the odds of victory for the Mongolian People's Party (MPP), which oversaw the world's

highest economic growth five years ago, in crucial polls set to take place in June. Negotiations fell

through on Wednesday between the MPP, which ruled when Mongolia was a one-party state under

Soviet hegemony before 1990, and the breakaway Mongolian People's Revolutionary Party (MPRP).

The two sides disagreed over how seats would be divided in an electoral pact, according to a

statement from the MPP. "It would have been a hit with the electorate because they're splitting

each other's votes," said Dale Choi, analyst and head of the Mongolian Metals & Mining research

group, about the proposed campaign pact. "It absolutely would have given the MPP the upper hand."

The MPP currently has a small lead over the Democrats, according to poll published this month from

the Sant Maral Foundation. The poll gives the MPP a 14.6 percent approval rating from voters,

higher than the 11.1 percent scored by the incumbent Democratic Party. The MPRP was the third

most popular party, with a 6.8 percent approval rate.

Source: Reuters

PARLIAMENT TO VOTE ON ECONOMIC ZONE AT KHUSHIG

Parliament will vote on whether to create a special economic zone near the new international

airport under construction where there will the possibility for special conditions for trade or

permission granted to allow gambling for a casino. The Cabinet Secretariat on 18 April backed a

resolution for parliament to establishing a free-zone at a new international airport being built in

Khushig Valley in Tuv Aimag.

Source: Montsame

PARLIAMENT'S REMAINING INDEPENDENTS JOIN MPP

Parliament's last two independent MPs have joined the Mongolian People's Party as parties movie to

consolidate power for the upcoming election in June. On 18 April, Ts. Davaasuren and Kh.

Bolorchuluun's joining of the MPP leaves no more independents left in Parliament, following

Sainkhuu Ganbaatar's decision to join the National Labor Party (KhUN).

Source: Undesnii Shuudan

KHUN RETAINS BORGIL AS PARTY LEADER FOR STABILITY IN MONTHS BEFORE ELECTION

S. Borgil will remain the leader of the National Labor Party (KhUN), the Supreme Court ruled, as

members argue over the top position in the months leading up to the election in June. The decision

was meant to create some stability.

Source: Udriin Sonin

U.S. DONATES 30 NEW LAND CRUISER VEHICLES

The United States government has donated 30 new Toyota Land Cruiser vehicles for Mongolia's

peacekeeping efforts. A ceremony for the delivery of the vehicles was held this week, attended by

the State Secretary of Defense B. Batsaikhan, U.S. Ambassador Jennifer Galt, and other officials.

Last year, the U.S. government granted MNT7 billion in aid to Military Unit No. 311 for renovations

and repairs.

Source: Montsame

ALASKA'S NATIONAL GUARD TEAM PROVIDES BACKUP FOR MONGOLIAN SOLDIERS IN

AFGHANISTAN

Two Alaska Army National Guardsmen deployed to Afghanistan earlier this month as U.S. liaisons in

support of the Mongolian Expeditionary Task Forces (METF) in Afghanistan. Collin Welch and

Timothy Ring are the twelfth team from the AKARNG to pair with the METF since the arrangement

began in 2009. They will serve as tactical advisors and liaisons in support of Operation Freedom’s

Sentinel. As liaisons, the team will be the METF’s direct link to the U.S. Forces-Afghanistan and the

Base Support Group at the New Kabul Compound in Kabul, Afghanistan, and other sites in the

country. “We will be the direct link between U.S. Central Command and the Mongolian Armed

Forces (MAF),” said Welch, who deployed for a similar mission in Africa when he was a member of

the Kansas Army National Guard in 2010.

The strong relationship between Mongolia and the AKARNG prompted the MAF, when they

volunteered to deploy to Afghanistan, to request liaison officers from the AKARNG to facilitate their

communication and cooperation between the U.S. and NATO elements there.

Source: Defense Video & Imagery Distribution System

HUNDREDS RALLY FOR BATTULGA DURING POLICE RAID

The investigation into politician and celebrity businessman Khaltmaa Batulgaa is heating up into a

fiasco in the months leading up to the election in June, with many claiming the case to be a

conspiracy against him. The former Industry and Agriculture minister is suspected of embezzlement

from a bank account held by Samsung C&T where funds were placed by the Development Bank of

Mongolia to finance a railway construction project. Mild hysteria broke last week out as politicians,

celebrities, protesters and spectators gathered at the Bayongol Hotel on 11 April as police began

raiding the offices Batulgaa.

Five armed special police officers began guarding the Bayangol Hotel Office entrance at

approximately 16:00 and oversaw entry and exit. “The police investigation is getting out of hand,”

said MP J. Batzandan, calling the investigation illegal. Batulgaa's daughter, B. Namuun, said the raid

was likely an extortion tactic to convince him not to run for office.

Source: UB Post

GRAVE ROBBERS CAUGHT

Authorities have fined five individuals a total MNT500,000 for grave robbing at Dundgobi Aimag.

Mongolian law only allows the excerpt of ancient tombs for research and conservation, only.

Source: Unuudur

STRESSING THE IMPORTANCE OF NATO’S COOPERATION WITH THE ASIA-PACIFIC REGION

Experts presented their final results and analyses of an academic Science for Peace and Security

research project aimed at tracing NATO external images among the Alliance’s Global Partners in the

Asia-Pacific on 8 March at the Canberra-based Australian National University. The Alliance’s images

in NATO’s five Global Partners in Asia-Pacific (Australia, Japan, Mongolia, New Zealand and

Republic of Korea) were analyzed for their visibility, local resonance, perceived capability and

legitimacy as well as emotional charge. The highest visibility was observed in the Japanese media of

all types, the lowest was in the Korean media. Analysis also indicated the highest visibility in

military media.

Source: NATO

GOVERNMENT REFORM IS THE WAY OUT OF CRISIS—EDITORIAL

Mongolia’s economy is heading to a halt as a result of dwindling foreign investment, cash deficit

and businesses drowning in debt becoming unable to pay their employees' salaries .Both President

Tsakhia Elbegdorj and Prime Minister Chimed Saikhanbileg at a recent forum proscribed today's

economic ills on misguided governance and the failure to take advantages of opportunities when

they arrive, such as pushing mining projects forward when coal prices were at their peak.

Politicians were “dancing on the butter they wasted,” said Elbegdorj.

Although Parliament Speaker Zandakhuu Enkhbold has argued that the economic downfall is purely

a result of external market factors—the economic slowdown in China and commodities supercycle—

the hardships we face today are largely down to the capability and quality of public governance.

With elections around the corner, this period of economic decline is great opportunity to

demonstrate society's need for reform in public governance. Today is a golden opportunity for

Mongolians to reform our public governance.

Source: Mongolia.GoGo.mn

BCM UPDATES:

ANNOUNCEMENTS

2016 COAL & METALS MONGOLIA, 6-7 MAY, CORPORATE HOTEL AND CONVENTION CENTER

Join to learn about Mongolia's major infrastructure and coal assets at Coal & Metal Mongolia

conferences—now an annual event. Hear from Mongolian government officials and expand your

business contacts while learning about infrastructure in Mongolia and how to the capital investment

environment can become more competitive. Over 500 guests are expected and 80 companies

exhibiting their services.

For more information, call 9911-6135, 7011-5590. BCM members can receive a 10 percent discount

at registration by emailing saruul@bcmongolia.org for a special discount code.

_________________________________________

EXPO MONGOLIA – THE PLACE TO BE IN MAY 2016 FOR DOING BUSINESS!

A perfect time for international investors, associations and private companies to start business in

Mongolia and to play a key role in future development. Therefore Expo Mongolia, the international

trade fair in Buyant-Ukhaa Sport Complex, Ulaanbaatar, is the meeting place for all industries.

From 23–25 May in the Buyant-Ukhaa Sport complex, official pavilions and individual exhibitors are

warmly welcomed to the unique networking platform in the expanding eastern market to establish

business contacts and to present new innovations to trade professionals from Mongolia and

surrounding countries.

BCM members will have 10% discount on registration. Please contact saruul@bcmongolia.org to get a

special discount code. For more information please visit www.expomongolia.com.

Please contact us via e-mail: em@expomongolia.com. Tel: +976 94009471 , +976 70009471

BCM ADVOCACY NOTES

Revisions to latest draft of Labor Law bill

Ministry of Labor has recently made revisions to the latest draft, particularly in areas of joint

agreement and annual leave. Currently, this draft is being reviewed and commented by other

Ministries. Labor Minister Bayarsaikhan.G reconfirmed his intentions to submit the draft for the

autumn Parliamentary session.

The latest draft can be found here.

BCM WORKING GROUP NEWS

Legislative Working Group

BCM’s Legislative Working Group’s meeting was held on Thursday, April 14, 12th floor Express

Tower, with 13 members in attendance, representing Minter Ellison, Hogan Lovells, Oyu Tolgoi, ELC

Law Office, Newcom, PATC (Professional Accounting and Tax Consulting) and MCS.

Agenda of the meeting:

16:00-16:10 Opening remarks and introduction of plan for 2016 - Legislative WG Co-Chairs

16:10-16:40 Overview and update of recent changes to the draft labor law - Sebastian Rosholt,

Minter Ellison

16:40-17:10 Proposed tax legislation revision - Anthony Woolley, Hogan Lovells

17:10-17:30 Issues in VAT law and the CIT draft law - Munkhtur T, Director of Business

Development, MCS

Meeting began with BCM’s Executive Director Jim Dwyer’s introduction of the newly appointed Co-

Chairs of the Legislative Working Group: Sebastian Rosholt of Minter Ellison and Anthony Woolley of

Hogan Lovells. Jim extended his gratitude to both gentlemen for volunteering as Co-Chairs.

Sebastian’s presentation focused on the changes in the February to March drafts of the Labor Law,

highlighting the positive developments especially on the annual leave days and the negative

developments that were added into since the December draft. Sebastian also emphasized that some

of the negative developments from the employer’s perspective presented in his presentation were

the provisions originated from the December draft.

Anthony gave a comprehensive overview of the tax regime of Mongolia up to the current draft of

the Corporate Income Tax (CIT) law. The CIT Law draft was scheduled for discussion at the

Budgetary Standing Committee on 11 April, but was postponed. The presentation covered changes

in the threshold of the standard tax rates, affiliated parties, tax returns, tax exemptions and cross

referrals to other legislation.

Munkhtur from MCS shared with the group specific risks project developers see in the current

proposed CIT Law. Main concerns are in regards to the VAT on the purchased PPE, works performed

by non-residents and the tax levied on sales of securities.

Bayar, Managing Partner, ELC Law Office, suggested that these concerns from the businesses could

be further explored with BCM’s Tax WG and advocated immediately. WG Co-Chairs agreed to the

suggestion and assured the group that after a consultation with Tax WG chair and key members, a

statement by the BCM’s Legislative WG will be issued.

It was agreed that the recommendations on the CIT law will be incorporated in the 1st Annual BCM

Summit Proceedings for further advocacy.

For more information about this meeting, please contact Khulangoo Purevjav, Working Group

Coordinator of BCM, at khulangoo@bcmongolia.org.

_________________________________________

Capital Markets Working Group

BCM’s Capital Markets Working Group’s meeting was held on Tuesday, 5 April at Suite 1201, 12th

floor Express Tower, with 15 members in attendance, representing OT, BDSec, Khan Bank, Golomt

Bank, TDB, XacBank, Mongolia Growth Group, Ernst & Young Mongolia Audit, Nova Terra, Wagner

Asia Equipment LLC and Mahoney Liotta.

Agenda of the meeting:

16:00-16:10 Opening remarks and re-cap from last meeting

(Capital Markets WG Co-Chairs)

16:10-16:50 Guest speaker: "Oyu Tolgoi Project Financing"

(Dorjpalam Kh., Senior Advisor Corporate Finance, OT LLC)

16:50-17:10 Member time: Update on Custodian Banking

(Ariunjargal Ch., Head of Custody Services Dept., Khan Bank)

Nick Cousyn, Co-Chair of the Capital Markets Working Group, provided a recap of the last meeting

to the members and updated the members on the latest market news of the Government of

Mongolia’s coming into the market twice with Credit Suisse syndicated loans.

Ms. Dorjpalam Kh, Senior Advisor Corporate Finance of OT LLC, gave a comprehensive overview of

the Oyu Tolgoi Project Financing. The presentation covered key topics: the significant benefits to

Mongolia, list of project financing participants, financing plan with its tranches and key financing

terms. Participants were mostly interested in knowing the drawdown of the financing and how the

financing schedule is tied to the technical certification of the underground development.

Ms. Ariunjargal Ch., Head of Custody Services Department at Khan Bank, updated the members on

the engagement with Financial Regulatory Commission (FRC) on the issue of Custodian Banking

Services, in particularly failed trade management and establishment of the market infrastructure at

Mongolian Stock Exchange through Millennium IT. Due to the re-organization at the FRC, its

Chairwoman’s resignation to run for office in the parliament, regulations required for the failed

trade management have not been finalized at the Government level. On the recent FRC Working

Group tasked on the custodian banking issue, brokerage firms and commercial banks have clarified

impending issues on the T+1 and T+2 settlement issue.

During the discussion period, BCM reminded the members of the 1st Annual BCM Summit scheduled

on 21 April and encouraged members to send up to 3 issues and challenges faced by the business

and sector in relation to the regulatory environment and related recommendations on those issues

that need to be addressed by the political parties and the next government.

For more information about this meeting, please contact Khulangoo Purevjav, Working Group

Coordinator of BCM atkhulangoo@bcmongolia.org.

_________________________________________

Risk Working Group

BCM’s Risk Working Group’s meeting was held on Wednesday, 9 March at Suite 101, 12th floor

Express Tower, with 9 members in attendance, representing Mandal General Insurance, MIG

Insurance, XacBank, Wagner Asia, Bagatumurch LLC, State-owned Agricultural Reinsurance JSC and

National Emergency Management Agency.

Agenda of the meeting:

16:00-16:10 Introduction and Opening remarks by Risk WG Co-Chairs

16:10-16:50 Status Report on dzud condition in the countryside, Tuya Ch., Specialist, National

Emergency Management Authority of Mongolia/NEMA/

16:50-17:20 "Index-based livestock insurance scheme and Introduction of state-owned Agricultural

Reinsurance JSC", Enkhtaivan G., CEO of Agricultural Reinsurance JSC

Captain Tuya Ch., NEMA, gave the members a comprehensive overview of the dzud and dzud-like

situation in 18 aimags and 98 soums of Mongolia. As of 9 March 2016, the total tally of perished

livestock is 360,000. While this number is incomparable to the 2010’s record high loss of 6,310,800

livestock, Captain Tuya emphasized that at any dzud situation, it is the herders that are afflicted

the most as they are faced with enduring long cold days without basic medical assistance and the

ever-increasing need to tend after their cattle, their main source of income. Captain Tuya’s

presentation was complimented with a weather assessment presentation, which can be found here.

Specialist Oyunbat N., Agricultural Reinsurance JSC, presented the index-based livestock insurance

scheme and how it evolved into laying the very foundation of the state-owned Agricultural

Reinsurance JSC. Members were interested in knowing the reason behind the decline in the number

of policyholders, if the Agricultural Reinsurance JSC is exploring the bloodline insurance and the

JCS’s global reinsurers. Members in attendance were distributed “Mongolia: Dzud Emergency

Response Preparedness” snapshot by OCHA (Office for the Coordination of Humanitarian Affairs)

For more information about this meeting, please contact Khulangoo Purevjav, Working Group

Coordinator of BCM at khulangoo@bcmongolia.org.

_________________________________________

Tax Working Group

BCM’s Tax Working Group’s 2016 kick-off meeting was held on Wednesday, 2 March at Suite 101,

12th floor Express Tower, with 16 members in attendance, representing Oyu Tolgoi, PwC, Deloitte

Onch Audit, Sumitomo Corporation Mongolia office, International SOS, WCS, MahoneyLiotta, Lehman

Lee & Xu and PATC.

Agenda of the meeting: 16:00 - 16:10 Opening remarks (Chair, Tsendmaa Choijamts, PwC) 16:10 -

17:00 Introducing new VAT law (Altankhorol O, Senior state tax inspector, Revenue department of

the General Department of Customs and Taxation) 17:00-17:30 Q&A session and discussion on TWG

plans for 2016 (Members, state tax inspector)

Ms. Altankhorol, General Department of Customs and Taxation of Mongolia, reviewed the newly

adopted Value-Added Tax (VAT) law of Mongolia, which took effect on 1 January 2016. The

presentation covered key policy changes, changes in the other related regulations and frequently

asked questions from businesses. Members in attendance were interested in the procedural changes

in the new VAT law, such as the registration and de-registration as a VAT payer, VAT-exempt goods

and services and VAT zero-rated goods and services.

Ms. Tsendmaa Ch, Tax Executive Director of PwC Mongolia, shared with the members Tax Working

Group’s draft plan for 2016. As Chair of Tax Working Group, MS Tsendmaa, informed the members

of the intent of engaging representatives from the government entities to the WG meetings in order

to learn more about legal and procedural changes and to exchange expert views with

representatives from government bodies.

Next meeting is scheduled for May. For more information about this meeting, please contact

Khulangoo Purevjav, Working Group Coordinator of BCM at khulangoo@bcmongolia.org.

_________________________________________

Business Ethics Working Group

Business Ethics Working Group meeting was held on 1 March at Express Tower from 16:00 to 17:30

with 12 members in attendance representing Atlas Copco, Transparency International, Mandal

General Insurance, US Embassy, Wagner Asia, Deloitte Onch Audit, Asia Foundation, Valliant Art and

Interiors, World Vision and the Institute of Finance and Economics.

Agenda of the meeting: - Introduction of members and guests (Anders Berglund, Atlas Copco) -

Recap from the last meeting (Christine Hudetz, TI Mongolia) - Insurance sector transparency (Zaya

Bolorbold, Mandal Insurance) - Discussion on topics and plan for 2016 (Christine Hudetz, TI

Mongolia).

The meeting begun with recap of the last meeting: development of the draft plan for 2016 and

collective agreement on the need to reach-out for more local companies as members of the

Working Group. Given the delicacy of the issues the WG intends to cover at its meetings and the

subsequent low interest from BCM members to sign-up for this WG, nonetheless members have

agreed to continue with its meetings and aim to draw more attention from local companies.

Ms. Zaya, Mandal Insurance, presented an overview of the insurance industry and Mandal fight

against kickbacks and the adverse effects of kick-back culture within the industry. Attendees were

highly impressed with Mandal’s meticulous top-down approach against kick-backs, from its

philosophy to its hiring procedure. During the discussion time on plan for 2016, Wagner Asia has

volunteered for a presentation in November and Asia Foundation offered to share its study findings

on corruption in Mongolia.

Co-Chair reminded the members of the next meeting topic item: Gift giving policy on Tuesday, first

week of May. For more information about this event, please contact Khulangoo Purevjav, Working

Group Coordinator of BCM at khulangoo@bcmongolia.org.

_________________________________________

Energy & Environment Working Group

BCM’s Energy and Environment Working Group’s 2016 kick-off meeting was held on Thursday, 25

February at the Open Society Forum’s meeting room with 17 members in attendance. Represented

were GGGI, US Embassy, XacBank, Mongolian Bankers’ Association, Arig Bank, Invest Mongolia,

Wildlife Conservation Society, Techenomics, Mongolian National Mining Association, Mongolian Wind

Association, Newcom Group, Economic Development Center and the newest addition to the Working

Group, the Institute of Energy Economics.

The meeting was organized under the theme of: "Green credit - private and public initiatives".

Agenda of the meeting:

- Sustainable Finance Initiative: Latest developments, progress towards private fund establishment,

Mr. Tumurkhuu, Head of Sustainable Finance Initiative Steering Committee and CEO of Arig Bank

- National concessions list: Latest developments, quick look at near-term projects, Mr. Ts.

Batbayar, Head of Concessions Division, Invest Mongolia

- Facilitated discussion on business implications of green finance and concessions opportunities in

Mongolia, Mr. Tumurkhuu, CEO of Arig Bank.

Mr. Tumurkhuu emphasized that the Sustainable Finance Initiative is in full swing with initial loans

being issued at 14 commercial banks of Mongolia since 2015. Mr. Batbayar, Division Head at Invest

Mongolia, shared latest developments on concession and the Agency’s efforts in improving the legal

environment for regulating concession issues in Mongolia. Mr. Jon Lyons, co-chair of the Energy &

Environment WG (EEWG,) facilitated the discussion on green finance and concessions opportunities

in Mongolia. Working Group members were mostly interest in the government’s guarantee to the

concessionaire and the updates of the Water Treatment Facility and CHP-ͷ concessions. As part of

BCM’s effort in increasing stakeholders from the government entities, Mr. Amarsanaa, Head of the

Institute of Energy Economics (IEE), an institute under the Ministry of Energy, attended the meeting

and agreed to introduce the IEE at the next Working Group meeting. For more information about

this meeting, please contact Khulangoo Purevjav, Working Group Coordinator of BCM at

khulangoo@bcmongolia.org.

BCM’s Logistics Working Group

BCM’s Logistics Working Group (LoWG) met on Tuesday, 8 December at MonEx office, 6F Vista Office

Building with 7 people in attendance representing Monex, Representative Office of Mitsui & Co.,

Ltd. in Ulaanbaatar, Khaan Shorgoolj LLC and KGB TEGBE-Dolgoon Delgerekh LLC.

Agenda of the meeting:

• Featured guest speaker: Bayarbat – “From Hand to Hand; Challenges Faced”

• Discuss and plan WG’s 2016 activities

Upon introducing new members, Enkhbat D.-Logistics WG Chair, invited the featured speaker, Mr.

Bayarbat, to deliver a presentation about KGB TEGBE-delivery services. Other than introducing the

company, Bayarbat’s presentation touched on wider aspects such as the culture of delivery service

in Mongolia at large, challenges his new up-and-coming company is facing and possible solutions in

the delivery logistics within Ulaanbaatar.

Meeting participants were interested in the expansion plans of the company, such as delivery

services within Mongolia, cargo service between USA and Mongolia, to which Bayarbat gave

comprehensive answers about the company’s plan for establishing cargo service between South

Korea and Mongolia initially and delving into other markets.

Enkhbat D., Chair of the Logistics WG (LoWG), presented his plan for reviving WG activities in 2016.

He again encouraged our members to read through the soft ideas laid out and provide comments.

Since logistics fosters many elements, it was decided to focus on a certain theme for each meeting,

so that members interested or operating in that topic area can actively participate and bring in

more insight.

The meeting was concluded with an action item for the BCM WG Coordinator to follow-up the

questionnaire and request customers to provide comments on the 2016 plan by COB 28 December.

For more information about this meeting, please contact Khulangoo Purevjav, Working Group

Coordinator of BCM, at khulangoo@bcmongolia.org.

_________________________________________

BCM Education Working Group

BCM’s Education Working Group was held on 26 November at the Executive Excellence International

Business Center, 10F Galaxy Tower from 16:00 to 18:00. Fifteen people attended the event

representing foreign mission in Mongolia, private sector, universities and consultants of donor

funded projects:

Foreign Mission: Canadian Embassy;

Universities: National University of Mongolia, Mongolian University of Science and Technology

Private sector: PwC, Minter Ellison

Donor organizations: Save the Children, Support to Mongolia’s Technical and Vocational Education

and Training Sector-EU, Cooperative Vocational Training in the Mineral Resource Sector-GIZ, The

Global Fund;

Meeting minutes summary:

Opening remarks by Education Working Group Chair - Saha Meyanathan. Saha related information

about being selected as the best Working Group of the year 2015.

Status update by Manlaibaatar Z., Deputy Director of IRIM on the pilot project results of the ADB

funded Higher Education Reform Project (HERP). The dissemination workshop for the Universities

will be organized first week of December.

During the Q&A session, Professor Purevdorj of MUST highly emphasized on the importance of

building the capacity of the professors, as they are the ultimate knowledge givers to the students.

The WG members were given a matrix developed by Dr. Saha, on three draft laws: TVET, Higher

education and Labor law. During a Q&A session, participants made remarks related to the Matrix, to

highlight a few:

For more information about this event, please contact Khulangoo Purevjav, Working Group

Coordinator of BCM at khulangoo@bcmongolia.org.

‘BCM IN THE UNIVERSITY CLASSROOM’ SERIES

BCM in the University Classroom

Dr. Oyun Sanjaasuren, Member of Parliament of Mongolia and Founder of Zorig Foundation, was

BCM’s distinguished speaker at the University of the Humanities. Her presentation titled

"Sustainable Development and Mongolia" was attended by over 200 select students from Geo-

ecology, Foreign Affairs and Economics Faculty. MP Oyun S., an active advocate for education for

sustainable development in Mongolia, shared a wealth of information accompanied by recent data

and study results.

During the Q&A session, students raised tough questions as to why the government actions targeted

at reducing air pollution and promoting green technology have not been delivering substantial

outcomes. MP Oyun emphasized that for any decision made by the Government, persistent and

strong willed approach is needed to reach an intended goal.

At the end of the lecture, MP Oyun urged students to practice their new found information about

sustainable livelihood as they transition into working life. Please click here to see full presentation.

Guest Speaker: Dr. Oyun Sanjaasuren

Presentation topic: "Sustainable Development and Mongolia"

Where & When: University of the Humanities, 18 April 2016

_________________________________________

‘BCM in the University Classroom’ is expanding to high schools!

We are pleased to share that Amartuvshin Sh, CEO of Axel Fischer Academy, spoke at American

School of Ulaanbaatar (ASU) on 12 April 2016. Mr. Amartuvshin's speech entitled "New Season" was

targeted for staff at the ASU, to empower them with a new sense of purpose and motivate them

further in their service in the education sector. We thank ASU for hosting us and making it available

during spring break. BCM extends gratitude to Amartuvshin Sh for taking the lead in our first ever

"BCM in the high-school classroom" lecture initiative.

Please be checking our posts on "BCM in the University Classroom" series, as interesting presenters

are lined up this month!

_________________________________________

Guest Speaker: Nomin Jargalsaikhan

Presentation topic: "What successful people do in their free-time?"

Where & When: Institute of Finance and Economics, 31 March 2016

Nomin.J, Director at Mongolia Talent Network, was BCM’s second speaker at the Institute of Finance

and Economics in 2016. Her presentation entitled "What successful people do in their free-time?"

was attended by 60 students from the Banking and Business Administration majors.

Ms. Nomin, who has background in psychology, shared remarkable observation and insight collected

from her interviews conducted with Executives from various industries. Ms. Nomin’s presentation

was comprised of a practical guide to making an efficient “to-do-list”, managing a regular working

day and creating own motivational icon. A record-breaking headhunter within the Mongolia Talent

Network, Ms. Nomin gave-away important tips to remember when writing a “stellar” cover letter

and common mistakes candidates make when giving a job interview.

For more information about this presentation and “BCM in the University Classroom” lecture series,

please contact Khulangoo P., Working Group Coordinator at khulangoo@bcmongolia.org.

_________________________________________

Guest Speaker: Narantuya Dangaasuren

Presentation topic: "Editorial policy-Print Media"

Where & When: University of the Humanities, 15 March 2016

Narantuya.D, Vice Director of News Agency, was BCM’s third speaker at the University of the

Humanities in 2016. Her presentation titled "Editorial policy-Print Media" was attended by 90

students from the Journalism and ICT Faculty of the University of the Humanities.

Ms. Narantuya’s presentation began with current assessment of journalism in general and focused

on the print media and how it is evolving in a digital era. Her 20 some years of journalistic

background coupled with experience in managing Mongolia’s top-rated news website

(www.news.mn) gave Ms. Narantuya’s presentation more unique and a true voice of Mongolian

media. Students did not shy away from raising controversial questions such as the issue of biased

editorial contents and the rise of unethical journalism in Mongolia. Ms. Narantuya did acknowledge

the existence of such unfortunate situation; however she gave hope to soon-to-be journalists by

informing them of the active and budding enthusiasm of the newly formed Media Council of

Mongolia. The presentation is available here.

KNOWLEDGE SHARING SESSIONS

A BCM Knowledge Sharing Session was organized on 21 March in partnership with our member,

Corporate Governance Development Center (CGDC), on the topic "Methods for analyzing current

organizational strategy and identifying the strategic vision". The session was led by Enkhbold

Chuluunbaatar, Ph.D., business strategy manager at CGDC and a senior lecturer in the Department

of Business Administration at the Institute of Finance and Economics. His research interests include

entrepreneurship, culture and creativity, and strategy management. The focus of the session was

given on how to define organizational vision based on identifying organizational resources and

assessing factors that create value in the organization. A total of 15 people representing 12 member

companies attended the session.

COOPERATION & MEMBER DISCOUNTS:

- Oxford Business Group (OBG) offers BCM members and the 1st Annual BCM Summit participants a

complimentary read-only, online subscription to all of OBG’s digital reports

- Axel Fischer Academy offers 20% discount to BCM members on “Equipping your rising star Leaders”

in a three months training

- PROSUM LLC offers 10% discount to BCM members on promotional products they distribute from

European producers

- Corporate Governance Development Center (CGDC) offers 20% discount on all of its trainings to

BCM members

- News.mn offers 20% discount of its products and services for BCM members

- Mongolian Economy offers 50% discount for its advertisements & paid articles on website and 55%

subscription discount on its online magazine for BCM members

- NPC&Mandal offers 20% discount to BCM members

- Birches Group offers 10% discount on Mongolia Compensation and Benefits Survey for BCM

members

- New Media offers 25-50% discounts to BCM members on its online accounting software, E-

commerce platform, web & mobile application development and job searching software.

For more information about announcements and discounts, click here or contact Otgongerel,

Partnership Manager at otgongerel@bcmongolia.org.

MEMBERS’ VACANCIES

- Thiess Mongolia is hiring an Electrical Engineer & Mechanical Engineer. Deadline for

Application: April 20, 2016. For more information: contact: 70129820

- Save the Children is hiring a Finance Assistant. Deadline for Application: 5 pm April 08, 2016. For

more information: contact 11-329371; secretary@savethechildren.mn

- Euro Khan is hiring a Sales Engineer. For more information: contact at 11-325867, email:

info@euro-khan.com

- Atlas Copco Mongolia LLC is hiring a Sales Engineer. For more information: contact at +976

70129294 or send your CV to e-mail address anders.berglund@mn.atlascopco.com

For more information about vacancies, click here. To post your vacancy on BCM website, contact

Dolgorsuren at dolgorsuren@bcmongolia.org.

WEBSITE UPDATES: PRESENTATIONS, MONGOLIA REPORTS, INTERVIEWS

PRESENTATIONS:

BCM Monthly Meeting, 28 March:

- Steve Rose, General Manager, Cummins Mongolia Investment - "Cummins supporting Mongolian

customers"

- Barrie Evans, Director, Churchill's - "Their life in your hands"

- P. Tsagaan, Chief of Staff, Office of the President - "Update on ASEM"

BCM Monthly Meeting, 22 February:

- A. Baatarpurev, Director of Markets Development Department, Financial Regulatory Commission -

"Financial Market Developments in Mongolia"

- Jennifer Bielman, Country Director, MercyCorps Mongolia - "Mercy Corps: Building Resilience in

Mongolia"

- D. Uuriintuya, Chairman, Mineral Resources Authority of Mongolia - "Mongolian Events during PDAC

2016 in Toronto"

- N. Munkhnasan, General Director, Monpolyment - "Overview of Monpolyment"

BCM Monthly Meeting, 25 January:

- Sodontogos Erdenetsogt , Chief/National Coordinator of National Secretariat for Development of

the Second Compact agreement between Government of Mongolia and the USA Millennium

Challenge Corporation -

“Development process of the second compact agreement between government of Mongolia and USA

Millennium Challenge Corporation”

- Gantugs D, CEO, Mongolian Mortgage Corporation - “MIK Holding IPO and RMBS Issuance”

_________________________________________

MONGOLIA REPORTS:

- IMF, “World Economic Outlook, October 2015: Adjusting to Lower Commodity Prices”

- ADB, Financial Systems of Financially Less Developed Asian Economies: Key Features and Reform

Priorities (Sep 2015)

_________________________________________

INTERVIEWS:

- Jim Dwyer, Executive Director, 30 March 2016, BCM interview to Mongolian National Broadcasting

TV

- VIP76 website, March 2016, “BCM Monthly meeting coverage”

- Jim Dwyer, Executive Director, BCM, Bloomberg TV, 27 January 2016, "Business community calls

for political stability

WEBSITE:

"According to Google Analytics report, as of 13 April 2016, the daily web traffic to the BCM

website was 67 visitors with 82 sessions. 76% were from Mongolia, 5% from United States and

3% from Japan."

The "Photo Gallery" in Knowledge Hub section of the new BCM website has the most recent photos

from BCM events.

As a BCM member you can now visit the official BCM website at http://bcmongolia.org to enjoy

newly introduced interactive features such as: edit your organization's profile information; post

vacancy notices from your organization; post cooperation proposals with other members or deals

you would like to offer to other BCM members; and start a forum and ask questions directly on the

web platform. Of course you can also visit our website for news information, interviews, event

photos, videos and announcements regarding BCM.

SOCIAL NETWORKS

The Business Council of Mongolia (BCM) has expanded its reach to your favorite social networks.

Keep up to date on the latest business deals in Mongolia and how the climate for investment is

improving each day with BCM.

Add BCM on Facebook at https://www.facebook.com/TheBusinessCouncilOfMongolia to read the

latest announcements and comment on events carried in the BCM NewsWire with the community.

Hear breaking news and announcements as they happen when you follow BCM on Twitter at

https://twitter.com/bcmongolia.

The bulk of the content on BCM’s new LinkedIn page is Mongolian language to better cater to BCM's

Mongolian-speaking audience and members. Please click on the below link to follow us on our new

LinkedIn page.

http://www.linkedin.com/company/business-council-of-mongolia?trk=company_logo.

Social stats: BCM now has 12,149 fans on our Facebook fans page, 1,988 connections on

LinkedIn network, and 2,039 followers on Twitter.

MEDIA COVERAGE

BCM’s column in the Mongolian Economy Magazine began in Edition 12, May 2015. The first column

featured an interview with Mr. I. Ser-Od: "Times like these demand that we be more creative and

proactive." The second column was published in Edition 15, July 2015: “Entrepreneurs Set Up Study

Tours of Businesses.” The third column was in the edition, September 2015: "Wagner Asia

Technology Innovations."

Elisabeth Ellis, a partner at Minter Ellison LLP was featured in November 2015 edition in the article

titled "In Order to Make the Labor Law More Effective."

_________________________________________

BCM now has a profile page at VIP76, one of the major online information networks in Mongolia.

From January 2013 to April 2016 we posted a total of 112 news items related to BCM activities,

economic and business related updates.

ECONOMIC INDICATORS

INFLATION

Year 2006 6.0% [source: National Statistical Office of Mongolia (NSOM)]

Year 2007 *15.1% [source: NSOM]

Year 2008 *22.1% [source: NSOM]

Year 2009 *4.2% [source: NSOM]

Year 2010 *13.0% [source: NSOM]

Year 2011 *10.2% [source: NSOM]

Year 2012 *14.0% [source: NSOM]

Year 2013 *12.5% [source: NSOM]

Year 2014 *11.0% [source: NSOM]

March 31, 2016 *1.7% [source: NSOM]

*Year-over-year (y-o-y), nationwide

Note: 1.1% y-o-y; 3.1% Core - Ulaanbaatar City, March 31, 2016

CENTRAL BANK POLICY LOAN RATE

December 31, 2008 9.75% [source: IMF]

March 11, 2009 14.00% [source: IMF]

May 12, 2009 12.75% [source: IMF]

June 12, 2009 11.50% [source: IMF]

September 30, 2009 10.00% [source: IMF]

May 12, 2010 11.00% [source: IMF]

April 28, 2011 11.50% [source: IMF]

August 25, 2011 11.75% [source: IMF]

October 25, 2011 12.25% [source: IMF]

March 19, 2012 12.75% [source: Mongol Bank]

April 18, 2012 13.25% [source: Mongol Bank]

January 25, 2013 12.50% [source: Mongol Bank]

April 8, 2013 11.50% [source: Mongol Bank]

June 25, 2013 10.50% [source: Mongol Bank]

July 30, 2014 12.00% {source: Mongol Bank}

January 14, 2015 13.00% {source: Mongol Bank}

January 14, 2016 12.00% [source: Mongol Bank]

CURRENCY RATES – 14 April 2016

Currency

US dollar USD 1,982.67

Euro EUR 2,240.32

Japanese yen JPY 18.08

British pound GBP 2,844.54

Hong Kong dollar HKD 255.58

Chinese Yuan CNY 306.18

Russian Ruble RUB 30.59

South Korean won KRW 1.75