[Bold promoted Rio energy chief; MATD jumps 25%; MNT gains for 2 days; GoM treasury auctions fail; and Mongolia to join APTA]

 November 17th, 2016      162

Please click Display Images or Download Pictures to properly view this newswire

Thursday, November 16, 2016

Follow Cover Mongolia on LinkedIn, Twitter, FacebookInstagram, YouTube and Blogspot

Jump to: Int'l Market - Local Market - Economy - Politics & Legal - Business - Ulaanbaatar - Diplomacy - Health & Education - Culture & Society - Nature & Environment - Sports - Art & Entertainment - Travel

Headlines in Italic are ones modified by Cover Mongolia from original

 

HEADLINES

Int'l Market

·         Bold replaces Davies as energy chief as Rio Tinto fires two top executives over Guinea payments

·         Is this £11mln market cap junior really sitting on 23bn barrels of oil?

·         SOCO Says Payment from PetroChina's Mongolian Oilfield Delayed But Confident on Outlook

·         MEC: Notice of Board Meeting to Approve Interim Results

Local Market

·         MSE Trading Report: Top 20 +1.23%, ALL 0.82%, Turnover ₮6.1 Million Shares

Economy

·         Mongolia's MNT jumps 1.4% in 2 days

·         BoM issues ₮210 billion 1-week bills, total outstanding +59.2% to ₮376.35 billion

·         GoM issues ₮50 billion 12-week t-bill at 16.99% discount from announced ₮150 billion

·         No bids received for ₮40 billion 39-week treasury auction

·         No bids received for ₮25 billion 52-week treasury auction

·         Household income falls 9% from 2015 to ₮853,300 a month

·         Mongolia makes up 11% of China's coal import this year

·         Copper eases for second day as dollar gains ground

·         How China's bid to curb coal output has backfired, encouraging production and increasing mining accidents

·         China's Steel, Iron-Ore Prices Beaten Down as Speculators Panic

·         Trump and Modi Take Shine off Gold

·         Oil edges lower on higher U.S. crude inventories, strong dollar

Politics & Legal

·         The Nationalization of Erdenet Copper – Challenges for SOEs

·         National State Emergency Commission instructs authorities to prepare for winter challenges

Business

·         Amendments to Marrakesh Agreement will serve for landlocked countries' interests

·         Mongolia will accede to Asia-Pacific Trade Agreement (APTA)

·         Christian Strenger: Corporate transparency mitigates risks

·         Asian "super grid" the first step towards a global, interconnected, renewable energy grid

Ulaanbaatar

·         Construction of new Ulaanbaatar airport at 99 percent

·         'UB Resort' to open at Khui Doloon Khudag

Diplomacy

·         Mongolia did not receive food aid from Kazakhstan

·         Estonia's new Ambassador to Mongolia presented his credentials

·         Ambassadors from Greece, Malta, Bosnia and Estonia present credentials

·         Mongolia and Brazil to boost cooperation in healthcare

·         Roundtable meeting on Northeast Asian security underway in Ulaanbaatar

Culture & Society

·         FEATURE: Japanese woman living nomadic life in Mongolia

·         'Deel' craze hits Mongolia

·         What's driving Mongolia's rising divorce rate?

·         PalaeoChron Field Trip to China and Mongolia

Sports

·         King Tug prepares for seventh professional fight

·         Yokozuan Hakuho climbs to 3rd in all-time record wins with 1,000th victory

·         Aldar sport club represents Mongolia at World Military Shooting

·         "Strong-Girl" M.Ankhtsetseg - Mongolia's rising star

·         Mongolia to host "Children of Asia" sports festival in 2020

Art & Entertainment

·         Ariunbaatar performing Carmen as Escamillio in S.Korea

 

ARTICLES

Int'l Market

TRQ closed -1.76% to US$3.35, RIO trading +0.23% this morning at A$57.07

Bold replaces Davies as energy chief as Rio Tinto fires two top executives over Guinea payments

November 17 (Reuters) Rio Tinto has axed two of its top 10 executives amid an investigation over around $10 million in payments to a consultant who helped it secure rights to develop the world's largest untapped iron ore reserves in Guinea.

The mining giant said on Thursday it had terminated the contracts of Energy and Minerals chief executive Alan Davies and Legal and Regulatory Affairs Group executive Debra Valentine after reviewing the findings to date of an internal investigation into 2011 contractual arrangements with the advisor.

Davies, with Rio Tinto for nearly 20 years, said there were no grounds for his termination and that he would take legal action.

"I have not been privy to Rio Tinto's internal investigation report, nor have I had any evidence of the reasons for my termination of my employment given," he said in an emailed statement.

"My rights are fully reserved, and I have been left with no option but to take the strongest possible legal action in response."

Valentine could not immediately be reached for comment.

The scandal at the world's second largest miner erupted last week after Rio Tinto said it had become aware of emails from 2011 that referred to payments to a consultant providing advisory services on its Simandou project in the West African nation of Guinea.

It follows Rio's announcement last month that it had agreed to sell its 46.6 percent stake in Simandou to state-owned Chinese metals producer Chinalco, and has raised worries that the project could falter.

Rio's board concluded that Davies, who was in charge of the Simandou project at the time, and Valentine had failed to maintain the standards expected of them under its global code of conduct, though the decision did not pre-judge the course of any external inquiry into the matter, the company said in a statement.

It alerted U.S., UK and Australian regulators about the payments last week. Chief Executive Jean-Sebastien Jacques said in an internal email that staff were "shell-shocked" by the discovery and any investigations could take several years.

The leaked emails showed then-chief executive Tom Albanese, then-iron ore boss Sam Walsh, and Davies discussed a $10.5 million payment to Francois de Combret, a former Lazard investment banker with a long history operating in Guinea.

Albanese was replaced by Walsh in 2013, and Walsh retired in July. Albanese, now chief executive of Vedanta Resources, declined to comment on the situation last week, when asked about it on a Vedanta earnings call.

"This treatment of me and my past and recent colleagues is totally at variance with the values and behaviors of the company to which I have devoted my professional life," Davies said in his statement.

Davies will be replaced by Bold Baatar, who will join the Executive Committee as Energy & Minerals chief executive. Baatar had been serving as the managing director of marine and vice president of Iron Ore Sales and Marketing.

Chief Financial Officer Chris Lynch has temporarily stepped in to run the legal and regulatory affairs function while the company looks for a new chief legal counsel.

A Rio Tinto spokesman was not immediately available to comment on what had been found between last week and now to result in Davies and Valentine being fired. Valentine had been due to retire in 2017 and had already stepped down.

The company said they would not be paid any bonus for 2016 and it would cancel all their unvested awards from previous years.

Link to article

Link to RIO release

Back to Headlines

MATD jumped 24.79% Wednesday to 3.78p

Is this £11mln market cap junior really sitting on 23bn barrels of oil?

The numbers suggest this tiny oiler may have tapped into a super-major oil field.

November 16 (Proactive Investors) Shares in the Mongolia-focused oil explorer Petro Matad Limited (LON:MATD) were up 27% in early afternoon trade after it updated on its oil estimates.

It has two blocks in the country – IV and V – which were subject to modelling and "play evaluation work".

The numbers it came up with for the six high-graded basins it looked are, frankly mind-boggling.

READ the full presentation

It reckons the Upper Jurassic-Lower Cretaceous horizon may have been host to 90bn barrels of oil, of which 9-23bn barrels is assumed to have been 'trapped' and therefore ripe for extraction.

The numbers suggest Petro Matad may have tapped into a super-major oil field.

However the market capitalisation of the company - £11mln – says there is a great deal of market scepticism around the story.

That said, the market makers seemed to like what they heard, marking the stock 0.82p higher to 3.85p.

Link to article

Link to MATD release

Back to Headlines

SOCO Says Payment from PetroChina's Mongolian Oilfield Delayed But Confident on Outlook

LONDON, November 16 (Alliance News) - Oil and gas explorer SOCO International PLC on Wednesday expressed confidence in its outlook but said a payment due from the buyer of its assets in Mongolia has been delayed.

SOCO said Daqing Oilfield Ltd Co, which bought SOCO's Mongolian assets in 2005, has advised the USD52.7 million SOCO was due to receive this month will be delayed due to an additional technical information request related to the asset made by Daqing parent China National Petroleum Co.

The delay, SOCO said, is expected to be at least 30 days, though no specific date on when the payment will be received has yet been provided.

SOCO said its financial position, however, remains robust, with USD83.0 million in cash on its books at the beginning of this week and no debt on its balance sheet.

At the company's Te Giac Trang and Ca Ngua Vang fields in Vietnam, production net to SOCO's working interest averaged 10,042 barrels of oil equivalent per day in the ten months to the end of October.

The group reiterated its full-year production will be at the lower end of its 10,000 to 11,500 boepd guidance due to development drilling starting later in the year and additional shutdowns on the fields.

"Whilst the delayed payment of the Mongolian subsequent payment is not helpful, it is viewed as only an additional delay as they acknowledge the debt. We have a strong balance sheet, steady cash flows, no debt, low operating costs and attractive Vietnam production economics, all of which are significant differentiators for the company within our sector," said Ed Story, SOCO's chief executive and president.

SOCO added it is considering a number of potential other opportunities to expand its portfolio.

Shares in SOCO were down 1.5% to 133.25 pence on Wednesday morning.

Link to article

Link to SIA release

Back to Headlines

276 closed +2.4% Wednesday to HK$0.425, +167% in last 3 months

MEC: Notice of Board Meeting to Approve Interim Results

November 16 -- The board of directors (the "Board") of Mongolia Energy Corporation Limited (the "Company") announces that a meeting of the Board of the Company will be held on Tuesday, 29 November 2016 for the purpose of, among others, approving the announcement of the interim results of the Company and its subsidiaries for the six months ended 30 September 2016 and transacting any other business(es), if any.

Link to release

Back to Headlines

Local Market

MSE Trading Report: Top 20 +1.23%, ALL 0.82%, Turnover ₮6.1 Million Shares

November 16 (MSE) --

Link to report

Back to Headlines

Economy

Reds are when MNT fell, greens when it rose. Bold reds are rates that set a new historic high at the time.

BoM MNT Rates: Wednesday, November 16 Close

 


11/16

11/15

11/14

11/11

11/10

11/9

11/8

11/7

11/4

11/3

High

Date

USD

2,424.44

2,446.56

2,459.55

2,452.98

2,453.39

2,428.08

2,420.95

2,413.08

2,406.41

2,396.13

2,459.55

11/14/2016

EUR

2,595.61

2,636.05

2,652.50

2,674.61

2,681.43

2,699.54

2,676.48

2,668.87

2,670.39

2,664.86

2,681.43

11/10/2016

JPY

22.15

22.63

22.85

22.97

23.23

23.49

23.18

23.10

23.31

23.34

23.49

11/9/2016

GBP

3,024.73

3,052.82

3,073.70

3,083.03

3,050.91

3,011.06

3,008.64

2,994.15

3,000.07

2,959.82

3,183.26

8/13/2014

RUB

37.53

37.34

37.35

37.58

38.73

38.06

37.98

37.75

37.71

37.73

54.32

6/27/2014

CNY

352.89

356.85

359.86

359.93

361.23

358.50

357.22

356.16

355.89

354.49

361.23

11/10/2016

KRW

2.07

2.09

2.09

2.10

2.13

2.12

2.13

2.11

2.10

2.10

2.13

11/8/2016

SGD

1,708.80

1,732.94

1,736.91

1,739.27

1,752.48

1,746.32

1,741.75

1,736.22

1,736.67

1,731.87

1,752.48

11/10/2016

CAD

1,803.36

1,810.32

1,813.56

1,817.49

1,832.67

1,816.20

1,811.88

1,802.35

1,794.29

1,793.24

1,832.67

11/10/2016

AUD

1,824.39

1,847.15

1,857.94

1,862.79

1,886.29

1,864.77

1,865.83

1,854.21

1,846.56

1,838.91

1,886.29

11/10/2016

HKD

312.56

315.40

317.07

316.19

316.37

313.14

312.16

311.12

310.28

308.97

317.07

11/14/2016

CHF

2,418.76

2,456.51

2,478.64

2,488.06

2,492.52

2,497.77

2,484.68

2,468.62

2,469.00

2,468.58

2,497.77

11/9/2016

Bank USD rates at time of sending: Khan (Buy ₮2,400 Sell ₮2,450), TDB (Buy ₮2,400 Sell ₮2,445), Golomt (Buy ₮2,400 Sell ₮2,450), XacBank (Buy ₮2,408 Sell ₮2,448), State Bank (Buy ₮2,400 Sell ₮2,459)

USD (blue), CNY (red) vs MNT in last 1 year:

Link to rates

Back to Headlines

BoM issues 210 billion 1-week bills, total outstanding +59.2% to ₮376.35 billion

November 16 (Bank of Mongolia) BoM issues 1 week bills worth MNT 210 billion at a weighted interest rate of 15.0 percent per annum /For previous auctions click here/

Link to release

Back to Headlines

GoM issues 50 billion 12-week t-bill at 16.99% discount from announced 150 billion

November 16 (Bank of Mongolia) Auction for 12 weeks maturity Government Treasury bill was announced at face value of 150.0 billion MNT. Face value of 50.0 billion /out of 50.0 billion bid/ Government Treasury bill was sold at discounted price and with weighted average yield of 16.990 %.

Link to release

Back to Headlines

No bids received for 40 billion 39-week treasury auction

November 16 (Bank of Mongolia) Auction for 39 weeks maturity Government Treasury bill was announced at face value of 40.0 billion MNT. Government Treasury bill was not sold due to absence of both competitive and non-competitive bids.

Link to release

Back to Headlines

No bids received for 25 billion 52-week treasury auction

November 16 (Bank of Mongolia) Auction for 52 weeks maturity Government Treasury bill was announced at face value of 25.0 billion MNT. Government Treasury bill was not sold due to absence of both competitive and non-competitive bids.

Link to release

Back to Headlines

Household income falls 9% from 2015 to ₮853,300 a month

November 16 (UB Post) On November 14, the National Statistics Office (NSO) reported on the social and economic performance of the country for the first 10 months of 2016.

The NSO highlighted that budget expenditure and debt incurred surpassed 2016 budget revenue, resulting in a budget deficit of 2.32 trillion MNT. The total expenditure and debt incurred by the government reached 6.81 trillion MNT, a 1.40 trillion MNT increase compared to 2015.

According to NSO analysts, the reason for the increase in debt is mostly attributed to a 758 billion MNT increase in operational expenditure, a 138 billion MNT increase in capital expenditure, and a 442 billion MNT hike in loans issued compared to 2015. Since the NSO published a report on the economy in September, budget deficit has increased by 268.7 billion MNT.

The NSO reported that average household income was 853,300 MNT, a 84,400 MNT decrease compared to 2015. Analysts highlighted that average salary earnings have declined by 28,000 MNT and agricultural income fell by 37,700 MNT, citing these declines as the two main reasons for the decrease in average household income. NSO analysts also reported that average household expenditure has reached 962,000 MNT, a 10,400 MNT decline compared to last year.

According to the NSO's Q3'16 labor study, the eligible workforce of the country has reached 1.26 million people, with 681,400 men and 581,800 women. The number of registered unemployed has reached 118,800, with men accounting for 72,700 and women 46,100. The unemployment rate in Q3 reached 9.4 percent, which is a 3.1 percentage point increase compared to last year, and a one percentage point decrease compared to Q2'16.

Link to article

Back to Headlines

Mongolia makes up 11% of China's coal import this year

Ulaanbaatar, November 16 (MONTSAME) Coal price has doubled against the same period of last year to reach USD 103.7 per ton. As of September 2016, Mongolia made up 11 percent of the total coal import of China, Mongolia's main coal consumer.

Mongolia's coal export reached its peak in 2011, having constituted 47 percent (USD 2.3 billion) of the country's annual export. The economy grew by record 17.3 percent that year. In 2011, Mongolia supplied 26 percent of China's coal import.

Link to article

Back to Headlines

Copper eases for second day as dollar gains ground

SINGAPORE, Nov 16 (Reuters) - London copper slid for a second session on Wednesday as the dollar strengthened, easing after last week hitting its highest in over a year.

FUNDAMENTALS

* Three-month copper on the London Metal Exchange had dropped 0.9 percent to $5,473.50 a tonne by 0120 GMT. The market climbed to its highest since June 2015 at $6,025.50 a tonne on Friday.

* The most-traded copper contract on the Shanghai Futures Exchange slid 1.7 percent to 44,170 yuan a tonne.

* The dollar stood near an 11-month high against a basket of currencies early on Wednesday, after upbeat U.S. data gave the greenback's week-long rally fresh impetus.

* Copper recorded its biggest weekly gains last week since 2011 with an 11.2-percent rise, in a rally that was buoyed by U.S. President-elect Donald Trump's promises of infrastructure spending.

* Copper had earlier found support on expectations of improved demand in top consumer China.

* Total net long position of funds trading copper on the LME rose 18 percent to 63,870 lots last Friday from the previous week, the LME's Commitments of Traders Report (COTR) showed on Tuesday .

* Hedge funds and money managers raised their net long positions in COMEX copper to the highest on record at 59,263 lots in the week to Nov. 8, U.S. Commodity Futures Trading Commission data showed on Monday.

Link to article

Back to Headlines

How China's bid to curb coal output has backfired, encouraging production and increasing mining accidents

A rise in electricity consumption as winter approaches, much produced by coal-fuelled power stations, is also adding to smog blanketing cities in the north

November 16 (South China Morning Post) Government efforts to curb coal production capacity in China have backfired, according to analysts, driving up prices, encouraging production and increasing the risk of mining accidents in the rush to produce more of the fuel.

A rise in electricity production last month, mainly produced by coal-fuelled power stations, is also contributing to the smog smothering much of the north.

The government wants to reduce the amount of coal produced as part of attempts to reduce the economy's previous reliance on heavy industry and cheap manufacturing in favour of the service and high-technology sectors.

The curbs in coal production, however, have led to shortages of the fuel and a rally in prices, encouraging higher production.

Doubts cast over whether China can cut back huge coal and steel sectors as prices of commodities rebound

Beijing's failure to keep a lid on coal prices and the wide swings in the market reflect the inherent contradiction between state planning and a market economy, analysts said. The government has taken control of the industry to a level rivalled only by the days of the command economy decades ago.

China's economic planning agency directly decides how many days large coal mines can operate, but the government often finds itself behind the curve, forced to encourage output when oversupply is great and squeeze supply when demand picks up.

Larry Hu, the head of China economics at Macquarie Securities, said the National Development and Reform Commission was working in vain to accomplish two opposite goals.

If it continues to cut capacity, the price rally will probably continue. If it wants to keep a lid on prices, efforts to reduce capacity must be shelved. "In essence, it's not a market-driven economy but a planned one," Hu said.

Beijing has set a target of eliminating 250 million tonnes of coal output in 2016 and said in the first nine months of the year it had shut down more than 1,600 mines.

The closures, however, helped spark a rare price rally.

The benchmark steam coal price at Qinhuangdao, the country's major coal port, has doubled from a year ago. The rally encouraged many private coal mines to restart idled pits, sometimes illegally, and to dig deeper and faster to fill trucks waiting at their gates.

The hastened production has come at a human cost. An accident at an "illegal" mine in Liaoning province killed at least 11 in July. Two months later another accident occurred in Ningxia, killing at least 18 miners. Two weeks ago, an explosion at a small mine in Chongqing killed 33 workers, according to the nation's production safety watchdog.

As coal prices rise, mine owners have a strong incentive to reopen facilities "leading to a noticeable increase in coal mine accidents", the State Administration of Work Safety said after the Chongqing accident. An investigation found the mine had dug in areas it was not permitted to in an effort to extract more coal.

China asks coal miners to cap prices for 2017 supply contracts: sources

The fuel is in such strong demand partly because Beijing abruptly stepped up efforts to limit production in July after the economic planning agency found that less than 30 per cent of its annual coal reduction target had been achieved. By the end of September, the agency declared 80 per cent of the yearly target had been met.

China's output of coal dropped 12 per cent in October from a year earlier, according to data from the National Bureau of Statistics on Monday.

At the same time, however, electricity output rose eight per cent with thermal power generation, a major consumer of coal, up 11.9 per cent.

The agency was also caught off guard by the price rally. Over the past two months, it has held meetings with managers and bosses from state-owned coal mines on a weekly basis telling them to work longer hours to produce more coal and bring down prices despite the strong demand.

The agency has acted as an energy matchmaker, encouraging mines and power plants to sign "long-term supply contracts" to stabilise prices. It also forced an industry website to suspend the publication of a daily coal price index, which had pointed to strong price growth.

Xu Kunlin, a economic planning agency official, said at a press conference last Wednesday that the market had temporarily lost its sanity but economic planners remained rational.

"We must have a clear understanding of the recent price rises. It's a result of temporary demand change fuelled by speculative individuals," Xu said. The price rally "contains irrational elements and is not a long-term trend", he added.

Winter is coming: China scrambles to boost coal output after production cuts work 'too well'

The government could well be right. A market crash took place in coke and coal futures trading in China on Friday evening on reports that the government will investigate speculative trading.

Fu Minjie, an associate professor at the National Academy of Economic Strategy, said it may be wrong to solve an economic problem by relying on government officials and state firms answering to government commands instead of relying purely on market forces.

"Overcapacity reduction, ultimately, is a political assignment," he said.

Link to article

Back to Headlines

China's Steel, Iron-Ore Prices Beaten Down as Speculators Panic

Iron-ore futures in China lead declines after a frantic rally

November 16 (WSJ) SHANGHAI—China's steel-related commodities tumbled again Wednesday, led by steep declines in iron-ore futures, as a flurry of tighter trading rules and worries about increased regulatory scrutiny extended a selloff.

On Friday, the Shanghai, Dalian and Zhengzhou commodity exchanges raised transaction fees and margin requirements for a wide range of contracts, including thermal coal, iron ore and rubber. The three exchanges have also taken restrictive measures on more than a dozen clients since Monday for violating trading rules.

Fears over the heightened regulatory supervision have prompted panic selling in several commodities, including steel rebar and copper, since Monday overnight trade after a frenzied rally that sent prices of some steel-related products surging more than 50% since the beginning of October.

On the Dalian Commodity Exchange, the most actively traded iron-ore futures slumped 6.5% to 577 yuan ($84.19) a metric ton Wednesday, following a 6% drop Tuesday after it hit a two-year high Monday. Coking-coal futures reversed a 4.8% intraday loss to close up 0.4% at 1,569 yuan a ton, while coke futures dropped 1% to 2,057 yuan a ton.

In Shanghai, benchmark steel-rebar futures dropped 3.9% to 2,816 yuan a ton after falling as much as 6%, while hot-rolled-coil futures fell 3.6% to 3,205 yuan a ton.

"Stricter regulatory rules have caused some level of panic selling and curbed risk appetite among traders," said Zhou Tao, an analyst at Citic Futures. "Coke and coking-coal prices have particularly been under regulatory pressure."

However, analysts say a shortfall in coke supply, amid low inventory at steel mills and sustained infrastructure spending by the government, provides fundamental support for the rally.

On Friday, the Shanghai Futures Exchange banned investors in steel rebar from opening intraday positions of more than 10,000 lots, while the commodity exchange in Dalian raised transaction fees and margin requirements for coke and iron ore and limited intraday open positions for coke and coking coal to fewer than 1,000 lots.

Analysts say that since a three-day rally in iron-ore futures last week, short sellers—or investors betting on price declines—have lowered their positions to avoid a margin call, which would require them to put up more money to cover their debts.

Measures to rein in the property market and tepid trading in equities have lured speculative funds to seek quick yields elsewhere, driving up futures prices of commodities ranging from iron ore to soybean meal.

"The rally in coke prices sparked this round of speculative frenzy, primarily due to sharply lower output as a result of supply-side reform policy," said Zhang Pin, researcher at Chinatsi.com, which monitors steel prices in China.

China's top economic planner said last week that the country had already met the target of cutting 45 million tons of steel capacity this year.

Ms. Zhang said her firm's application to co-host a conference on iron ore with a futures company was rejected by the commodity exchange in Dalian this month over fears it would trigger an investment frenzy.

The Dalian Commodity Exchange couldn't immediately be reached for comment.

Analysts say Beijing is concerned about a swath of cash inflows that may amplify swings on the futures market, and is wary of triggering the sort of panic selling that led to last year's stock-market crash in China.

Reports Tuesday that a large futures company based in Zhejiang was being investigated unnerved some investors, traders say. The Dalian and Zhengzhou commodity exchanges both denied investigations into any futures firms, according to state-run Shanghai Securities News on Wednesday.

Last week, the China Securities Regulatory Commission warned futures companies to look more closely at the source of funds coming into the market to avoid market risks.

Link to article

Related:

China iron ore tumbles 7 pct as selloff extends, steel falls furtherReuters, November 16

Iron ore prices on a rollercoaster ride as analysts wait for fundamental clues Sydney Morning Herald, November 16

The forces driving iron ore's rollercoaster ride – The Australian, November 16

Back to Headlines

Trump and Modi Take Shine off Gold

U.S. election result has failed to produce an uncertainty boost, while rupee voiding has chilled key India market

November 16 (WSJ) Gold is being let down by India and Donald Trump.

Ahead of last week's U.S. presidential election, investors looking to bet on a victory by Mr. Trump bought gold assets on the theory that the resulting policy uncertainty would be a boost for such havens. But a week after his win, gold is hovering close to a six-month low of around $1,230 a troy ounce as investment flows out of gold-focused exchange-traded funds and gold futures.

Instead of uncertainty markets seem to be expecting a strong U.S. economy, sending the dollar higher and gold—which generally has an inverse relationship with the dollar, the currency in which it is priced—lower.

BMI Research cut its average-price forecast for 2017 to $1,300 an ounce from the previous $1,400.

The Indian half of the gold-price pincer is also policy-driven. In a surprise announcement last week, Prime Minister Narendra Modi—seeking to curb counterfeiting, flush out tax-evading tycoons and uncover bribes stored in cash—voided the highest-value currency(500 rupee and 1,000 rupee bills, worth about $7.50 and $15, respectively), requiring them to be turned in for new notes by Dec. 30.

The result has been a cash crunch just ahead of the gold's peak demand time, the wedding season, which this year runs from Nov. 20 to Dec. 14. India vies with China as the world's top market for physical gold, between them accounting for half of global demand.

"The entire trade has come to a halt," says Mukesh Mehta, president of India Bullion and Jewellers Association. "India seems to be moving towards a cashless economy."

Compounding the cash crunch is market chatter that India may temporarily ban gold imports to choke off conversions of illegal cash stashes.

"That would negatively impact gold prices," said Simona Gambarini, commodities economist at Capital Economics.

This has been a hard year for gold in India. Gold imports in the first nine months of 2016 were off an estimated 50% from a year earlier, driven down in part by a 1% excise tax on manufactured gold products that took effect earlier this year, prompting jewelers to close their shops in protest for several weeks starting in March. There was a brief surge in sales during October's festival month, but this week many jewelers' shutters are down again. Traders cite the drop in demand and also merchants' concern that tax authorities will be especially vigilant about gold sales during the currency changeover.

As for the Trump effect, some analysts believe they just got the timing wrong.

"We still think that some of his policies are inflationary and that would not be bad for gold," a traditional inflation hedge, says Ms. Gambarini of Capital Economics. "Markets (for risk assets) are being too optimistic based on the basis of a couple of speeches since he became president-elect."

Link to article

Related:

PRECIOUS-Gold holds gains as dollar retreatsReuters, November 16

Gold selloff pauses as dollar rally slowsMarketWatch, November 16

Back to Headlines

Oil edges lower on higher U.S. crude inventories, strong dollar

November 16 (Reuters) Oil prices edged lower on Wednesday before the U.S. releases its weekly petroleum inventory report after an industry group said weekly U.S. crude stockpiles rose beyond expectations and a strong dollar weighed on commodities.

Brent LCOc1 futures were down 28 cents, or 0.6 percent, at $46.67 a barrel by 10:09 a.m. EST. U.S. crude CLc1 fell 32 cents, or 0.7 percent, to $45.49 per barrel.

Both contracts gained almost 6 percent on Tuesday on news the Organization of the Petroleum Exporting Countries would renew efforts to limit production.

A strong dollar also weighed on oil, with the index measured against a basket of currencies .DXY hitting a near 14-year high on Wednesday.[USD/]

Weekly U.S. crude oil stocks surged by 3.6 million barrels last week, the American Petroleum Institute (API) industry group said, exceeding analyst expectations of a 1.5 million barrel rise. [API/S]

"Prices are down on the build in U.S. crude oil stocks reported by the API last night," said Tamas Varga, oil analyst at London brokerage PVM Oil Associates.

The U.S. Energy Information Administration will release its weekly petroleum status report at 10:30 a.m. EST on Wednesday. [EIA/S]

The build dampened Tuesday's rally on news that OPEC members were meeting ahead of an official group gathering on Nov. 30 to build consensus for a deal to limit output, and by oil pipeline attacks by militants in Nigeria.

A number of energy ministers from OPEC countries are likely to meet informally in Doha on Friday to try to build consensus over decisions taken by the full group in September in Algiers, an Algerian energy source said.

Those informal meetings could include energy ministers from Saudi Arabia and Russia. But Iran's oil minister will not be attending, sending the country's OPEC governor instead, sources said.

"Key in this regard will be talks between the Saudis and Russia...We see enough cooperation between these two oil power houses to keep a significant amount of OPEC premium embedded in the market," Jim Ritterbusch, president of Chicago-based energy advisory Ritterbusch & Associates, said in a note.

Dutch bank ABN Amro, meanwhile, lowered its oil price forecasts on Wednesday, expecting Brent and U.S. crude to average $50 a barrel in the fourth quarter.

"We estimate the possibility of an actual OPEC production cut as 50-50," said Hans van Cleef, senior energy economist at ABN Amro.

In a bullish signal for the oil market, the International Energy Agency (IEA) said on Wednesday oil consumption will peak no sooner than 2040 despite the entering into force of the Paris climate deal which intends to wean the world off fossil fuels by the end of the century.

Link to article

Related:

OPEC pushes for consensus on oil cut, gaps narrowing: sourcesReuters, November 16

Oil Prices Slide as Investors Cash In on Earlier Gains – WSJ, November 16

Back to Headlines

Politics & Legal

The Nationalization of Erdenet Copper – Challenges for SOEs

By Mendee Jargalsaikhan

November 15 (Mongolia Focus) At a recent Standing Committee hearing, Ts. Nyamdorj, Vice Speaker of the Mongolian Parliament asked to meet with the new shareholders of the Erdenet Mining Corporation, especially the secret boss (link). The deal, which saw 49% of ownership transferred from Russian to Mongolian ownership indicates the Kremlin's desperate economic situation as well as declining geostrategic interests in Mongolia (link). This secret deal has also triggered another round of debates on the role of state ownership of big mining projects, ranging from the press conference of Ts. Nyamdorj (link), to President Elbegdorj's reactionary and emotional press conference (link), and to a well-known politician and now the representative of the new owner to the board, Da. Ganbold's lengthy explanations (link). Now, as usual, all parties silenced after a major allegation, forcing the public to ponder – whether this silence indicates a major compromise for the sake of national security or parties working hard to divide up the cake.

State ownership has a strong public appeal in Mongolia since people perceive foreign mining companies as entities which strip the country of its natural resources without investing into the local development and taking responsibility for environmental damages.  The public assumes that the increased state involvement address these challenges.  But, it was not the case in Mongolia unless the political leaders constrained patronage politics and corruption by simply implementing fine regulations – passed by them.

The patronage politics around the state-owned enterprises have its own dynamics.  If one party makes a landslide victory as in 1996, 2000, 2012, or 2016, they will replace the management teams of the state-owned enterprises and promote party-affiliated politicians or local supporters to run the state-owned enterprise.  This creates a situation where these party affiliated politicians generate funds for their own party networks and some even benefit their own cronies.  However, if a coalition is formed, such as in the 2004 and 2008 elections, both parties negotiate how they would share these honey pots.

The other major challenge is corruption.  Evidences of shady deals by Erdenet Mining Corporation, allegations around the Erdenes Tavan Tolgoi coking coal and the outrageous high pay of state owned enterprise leaders were disclosed to the public around the election cycles – just like the parliamentary election of 2016.  But, neither the law enforcement authorities nor political leaders demonstrate the true commitment of investigating these evidences.

Cases such as the Erdenet buy-out indicate the competition among political and business factions over the state assets.  On one hand, the state ownership sounds appealing to voters.  But, on the other, political leaders won't demonstrate resolve to constrain their patronage politics and fight against the corruption. Whoever manage to assert their influence in the state-owned enterprise, they would do their best in strengthening the patronage networks of  political parties, factions, and even a little crony-hood.  Unless high-ranking political leaders, President, Speaker, Prime Minister, and party leaders, agree to limit the patronage and greed for the public, more importantly the national sake, the state ownership is merely a greedy scheme.  If they adhere to the professionalism, the cake will be bigger for all rather than sliced into little pieces.

For our two previous posts on the "privatization" of Erdenet, see:

About Mendee

Jargalsaikhan Mendee, a PhD candidate of the Political Science Department of the University of British Columbia. View all posts by mendee

Link to post

Back to Headlines

National State Emergency Commission instructs authorities to prepare for winter challenges

November 16 (UB Post) In Tuesday's meeting of the National State Emergency Commission (NSEC), the meeting's attendees discussed winter preparation in agriculture, energy, roads, transportation, and health, as well as preventing the spread of infectious disease among livestock in the western provinces.

The Institute of Meteorology, Hydrology, and Environment reported that November 17 to 25 will bring some of the coldest weather in a decade. According to the weather outlook for the next month, half of the country is expected to experience heavy snowfall. Cabinet ministers and other government agency heads have said that herders have moved to different camps with seven million livestock to look for better pasture conditions.

Minister of Energy P.Gankhuu said that Thermal Power Plant IV currently has enough coal reserves for 18 days, Thermal Power Plant III has coal reserves for 12 days, Thermal Power Plant II has coal reserves for nine days, and the Darkhan, Erdenet, and Amgalan thermal power plants have 27 to 40 days of reserves.

The Minister of Roads and Transportation pointed out that road repairs are at 95 percent completion, and roads from Khovd to Bulgan soum, from Bulgan to the border, and from Khovd to Altai have had barriers built to prevent road closures due to heavy snow.

Head of the NSEC, Deputy Prime Minister U.Khurelsukh instructed Minister of Food, Agriculture and Light Industry P.Sergelen to monitor herder's movements, to introduce herders to the advantages of livestock insurance, and to locate optimal pastures.

The Minister of Health has been instructed to collect data on the number of children, pregnant women, seniors, and people with disabilities living far from medical centers, to make sure that hospitals are prepared to respond with emergency services.

U.Khurelsukh instructed the heads of local disaster management agencies to be prepared to dispatch vehicles and rescue services in the case of disaster conditions, and instructed province governors not to ask herders for taxes or to place additional pressures on them. He also instructed the authorities to abide by quarantine and sanitation regulations concerning livestock product transportation in the eastern and central provinces. The Deputy Prime Minister set up a task force to oversee winter preparation, evaluations, consultation, and decision-making.

Link to article

Back to Headlines

Business

Amendments to Marrakesh Agreement will serve for landlocked countries' interests

Ulaanbaatar, November 16 (MONTSAME) Minister of Foreign Affairs Ts.Munkh-Orgil presented a draft bill on ratifying the Protocol on the amendments to the Marrakesh Agreement on Establishing the World Trade Organization, and draft amendments to the Law on Custom Tariffs and Duty, on November 15.

Mongolia joined the WTO in 1997, becoming a party to the General Agreement on Tariffs and Trade (GATT) and the Agreement on the Rules of Origin.

The parliament passed the Custom Tariffs Law in 2008 and amended it in 2015. However, certain provisions of the law are in conflict with Mongolia's duties before the above mentioned international agreements. For instance, the Mongolian customs require certificate of origin from goods for imports, otherwise impose a doubled amount of customs duty. The regulation has been causing difficulties, having lengthened the period of custom clearance obtainment.

The protocol on amending the Marrakesh Agreement – the Trade Facilitation Agreement was initiated by landlocked countries such as Mongolia, Bolivia and Paraguay in 2003, and was backed in 2013.

The Agreement will be take force after ratification by 110 countries, the two thirds of all parties of the Marrakesh Agreement. The Trade Facilitation Agreement has been ratified by 96 countries, so far.

With the adoption of the Trade Facilitation Agreement, landlocked countries will be able to enjoy assistance and support from the development partners, to implement foreign trade-oriented projects, to reduce costs of external trade, to increase exports, to improve road and railway systems and to alleviate commerce and transport through various projects.

Link to article

Back to Headlines

Mongolia will accede to Asia-Pacific Trade Agreement (APTA)

November 16 (gogo.mn) Mongolia expressed its interest in acceding to Asia-Pacific Trade Agreement (APTA) in 2009 and applied tariff concessions on 377 items. 

The APTA, previously named the Bangkok Agreement, signed in 1975 as an initiative of ESCAP, is a preferential tariff arrangement that aims at promoting intra-regional trade through exchange of mutually agreed concessions by member countries. APTA has five members namely Bangladesh, China, India, Republic of Korea, Lao People's Democratic Republic and Sri Lanka. ESCAP functions as the secretariat for the Agreement.  

APTA member countries account more than 60 percent of Mongolian foreign trade turnover, more than 90 percent of export and 30 percent of imports. By acceding the APTA, Mongolian products to be exported are able to enjoy tariff concessions with an average of 40 percent in the Chinese and South Korean markets. 

The draft law on accession to APTA was discussed and supported by the Government of Mongolia on Apr 20, 2015. However, the accession has delayed due to the Government of Mongolia issued a resolution on Mar 28, 2016 to increase custom duties of some imported goods, such as wooden door and window. 

Mongolia mainly imports wooden door and window from China and South Korea. As of 2015, total imported wooden door and window reached US$ 5.6 million and Mongolia was projected to earn US$ 1.1 million from import and custom duties. However, the custom revenue was declined by US$ 330 thousand by offering tariff concessions of 30 percent on these items. But the revenue loss can be fully recovered as tariff concessions on Mongolian products, such as coal will save US$ 9.6 million to the country, considered by the Government of Mongolia.

The coal, main export commodity of Mongolia will enjoy tariff concessions of 30 percent while coking coal export expects to be offered tariff concessions of 50 percent. 

In addition, investment to Mongolia from APTA member countries will be increased while it will show positive impact on the economy. 

Moreover, Mongolia is exploring the possibility of establishing free trade agreements with China and South Korea. The implementation result of APTA will be significant in assessing the opportunities and risks of free trade agreements to be established with these countries.

The draft law on accession to APTA will be finalized by the Government of Mongolia.

Link to article

Back to Headlines

Christian Strenger: Corporate transparency mitigates risks

November 16 (Mongolian Economy) Christian Strenger is an Honorary Professor and Academic Director of the Center for Corporate Governance at the HHL Leipzig Graduate School of Management. He is also a member of the supervisory boards of Deutsche Asset & Wealth Management Investment GmbH (Frankfurt) and TUI AG (Hannover) as well as Chairman of the Board at The Germany Funds (New York). The German Corporation for International Cooperation invited him to present a speech in Ulaanbaatar on October 12. Our magazine was able to sit down with him after his speech.

- You have been here for some days now, and you have met some prominent people of Mongolia. What is your impression?

- It is a country with enormous opportunities. However, there are many things that should be improved. What I think is most important is a change in attitude towards corporate governance. The key pillars of transparency, handling of conflicts of interest and related party transactions are important elements that should undergo change. There are many prerequisites in place, such as a governance code, a scorecard and laws. What is particularly missing, as I am told, is proper enforcement. Too many people regard the idea of corporate governance as an academic exercise, one that is a 'nice to have'. Therefore, the key people have to understand that value of good governance is vital for them and they are the ones who have to make the changes. 

- So what do you suggest?

- Adopt and increase transparency, because this is the key to governance in any country or company. There should be greater obligations to report in a timely and transparent fashion. Starting with the Mongolian governance code, which in many countries is mandatory to show compliance in the annual report and on the company's website. Transparency is something that is difficult for many people, as it might hurt them in terms of their own interests – as a major owner of a company, for conflicts of interest and related party transactions, to give details of their remuneration. This needs to change in order for people to accept that the leaders and officials are really serious about transparency. There is a good chance from a timing point of view, as there is a new government and the country's financial situation in a shape where you have to make changes. One of the reasonable demands of outside financing sources, the international institutions, is that the country adopts a better governance regime. If the necessary changes are made, you can expect that they will say, "OK, it's a tough time, but because of the changes the country is on the right way forward."

- Mongolian people are somewhat familiar with word "governance," but it seems many still do not understand the core essence. So, where does good governance begin, and how can you tell that a company has good governance? 

-  The simple translation of good governance is good housekeeping, like at home. This means that people have to know exactly who has to do what and the particular responsibilities of the individual and that applies to all people in charge, whether it's a non-executive, a director, the CEO or the chairman. If their roles and duties are properly explained, then people will understand the governance model and the obligations resulting thereof. In Europe, younger people would not join a company if they cannot that a company is properly governed and managed.

- Globally speaking, what is the current state of governance, and where is it heading?

- It's moving forward in a satisfactory way. It made big moves between the years 2000 and 2010. Now you have slower progress in the more developed countries. That is clearly because all the ground rules are in place and they are observed, so there is not so much to be done. However,  to achieve best practice quality, you have to adjust the code regularly reflecting important developments. A governance code is never like a law, which sits there forever in a very rigid fashion, but needs regular updating to take account the changes in the real world.

- What are some of the trends of those changes?

- Internationally, one trend deals with proper remuneration for the executives. There is a strong move from rewarding managers for short-term performance in favour of longer-term performance, because too often the incentives for managers were to achieve a quick profit. This is an issue in countries where compensation is playing an important role, for example in the US and the UK. There you have people earning between 5-50 million dollars, and nobody is too concerned if it is properly earned. What is no longer accepted is when an executive has just a good performance in year 1, gets a big bonus but underperforms or makes a loss the following year. 

- Is that one of the key issues in the future of good governance?

- There aren't so many big issues left. What is now surfacing in many countries is higher importance of environmental and social responsibility in addition to governance, usually called ESG (Environmental, Social and Governance). 

- As for companies that are facing problems with good governance, will they keep facing them in the future if they don't make the changes you mentioned?  

- If you had a problem and if you make the necessary changes, you have to prove that you are doing the right thing for quite a few years. Only then people will accept that it is a changed economy, a changed company and even a changed country. This is the task ahead. Good governance is a firm expectation of institutions that provide funding. The problem starts if you don't do things properly – false accounting, cheating on emissions – and you try to hide it. Once you get found out, the reaction of the market in particular, but also the other stakeholders is dramatic. The share price can drop by 50 percent, people may boycott your products among other sources of discontent. The real impact is always negative. It takes many years to build a good reputation, and you can ruin it in just one day. 

- Are there any particular differences between developed countries and developing countries when they try to implement these key factors of good governance?

- In major developed countries, you have a clear understanding and acceptance of good governance. Nevertheless there are still few people thinking they don't need to do it. However, they do harm the reputation of the rest. In the emerging countries and economies, you have to address the problem that ownership is either in the hands of the state, their families or other big holders. They are not used to give things up, so their problem is adjusting to good governance concepts, such as transparency and the other key points outlined above.

- Are these problems the main issue of companies that operate in developing countries, especially ones like Mongolia, where businesses are often in the hands of one person or one family? 

- Whoever is in charge ­– a person, a family, the state – has to understand that their future is dependent on taking the stakeholders properly along the way. If they ignore this, it will be become clear that they are not good citizens. If you have regulatory matters to deal with, such as in mineral resource companies, you have to deal with many authorities. The authorities themselves will treat you a lot better if you have a good record with high transparency. In many ways, firms who implement good governance can rightfully expect better treatment. 

- Do you think there needs to be a legal environment that is devoted to implementing good governance in a company or state? 

- There is already a legal environment in place. There are always a few things that need to be added. The real problem lies mostly in the proper enforcement. The rules are there, but too few really pursue them actively. This leads to the thinking that if the big people are not being properly pursued, then I can do the same.

- At what point should the state limit its involvement in any kind of company activity regarding governance? In Mongolia's case, there seems to be limit to all the kinds of involvement by the state. 

- The state is governed by the politicians, and they have to understand that they also have to enforce the rules they set and not ignore people who violate the rules. The state should also consider the possibility to privatise more companies. By having people own shares, there will be much higher interest from the general public as minority shareholders demand better governance. 

-  There are many politicians in government that have their own companies and run their own businesses. Do you think that Mongolia is open to the idea of corporate governance? 

-  I would hope so. But I hear about the needs for significant improvement. The country needs people with strong stature to push the changes through. If you look at all the reasons why governance is important – better access to and lower cost of financing, better relations with authorities, better relations with customers – it is quite evident that it may be a little extra work in the short-term, but it will be beneficial for the owners of the companies in the foreseeable future.

- Perhaps they see that, but they may not be willing to let people know that they see. 

- Particularly if you take money from the public you have to play by the rules. So at least listed companies must adhere to the rules. 

- Do you think it's a good idea for politicians to run their own companies?

- It will be difficult to avoid this as they seem to change every four years. But they should live by the rules. A simple rule could be that if you are elected to parliament or have some other political role, then you have to report regularly on how you dealt with your company interests and make it transparent. Transparency generally avoids wrongdoing, because if you have to publish any material insider transaction without delay, you will think twice before you do it.

Link to interview

Back to Headlines

Asian "super grid" the first step towards a global, interconnected, renewable energy grid

November 14 (New Atlas) An Asia-based group of entrepreneurs has put forth a vision for a global, interconnected energy grid that connects energy users with renewable generation sources half a world away. Starting with an Asia wide super grid, GEIDCO is aiming for a connected world by 2050.

Clean, renewable energy will soon be cheaper than traditional polluting sources - but there's still a big problem. It tends to get generated in inconvenient places, at inconvenient times that don't necessarily match up with where it's needed.

Part of this problem could be solved with grid-level battery storage – if anyone can come up with a big enough, cheap enough, workable solution for that. But an international group of entrepreneurs is working on an extremely ambitious scheme to link the entire globe together into an interconnected power grid that would let renewable energy be generated and used at any time, from anywhere.

GEIDCO - the Global Energy Interconnection Development and Co-operation Organization is a China-based group that now has agreements with energy companies in China, South Korea, Russia and Japan, as well as utilities, equipment manufacturers and universities from 14 countries.

It's simple enough; whenever there's a big power load somewhere, there's somewhere else in the world where that demand matches up with a generation spike. When it's noon in the Gobi desert, and solar generation is at its peak, it's dinner time in the UK and everyone's boiling kettles.

The first step for GEIDCO is to build a connected Asia Super Grid that could bring the theoretically huge renewable energy generation capabilities of North China's Gobi desert as far east as Japan.

The entire idea is contingent on ultra high voltage power transmission lines, thousands of miles operating at more than 1,000 kilovolts AC/800 kilovolts DC. High voltages reduce losses over long distances, and both Russia and Japan already have hundreds (in Russia's case thousands) of miles of ultra high voltage lines up and running. These pale in comparison to China's infrastructure; since 2009 China has built nearly 10,000 miles of UHV power lines, with about the same again to come online in the next two years.

The larger GEIDCO's interconnected web of renewable energy becomes, the more stable the supply is, because it's less dependent on individual sources, so moving toward a global energy network that shares power from Greenland to South Africa, Australia to Switzerland is the ultimate goal.

Of course, there's a lot of obstacles in the way – from geopolitics, to who's in control of the grid, to grid stability in an interconnected world, to the enormous infrastructure costs involved. But having already begun to face extreme levels of pollution due to its massive 1.35-billion population, China is pushing hard on renewable energy and making huge investments.

And of course, with Brexit and the Trump election in 2016, it seems the political climate may be moving away from globalism and toward national independence, which could put grid-level battery storage higher on the menu than projects like this in some places.

Still, GEIDCO's medium term target is to put intra-continental interconnected grids in place in each continent by 2030 and to have the continents linked up by 2050, all while bringing global clean energy generation capacity up to some 90 percent of the global total energy demand.

That's a heck of a vision, but one that has the potential to make a massive positive impact on the world.

Link to article

Back to Headlines

Ulaanbaatar

Construction of new Ulaanbaatar airport at 99 percent

November 16 (gogo.mn) The New Ulaanbaatar International Airport, a construction with the biggest foundation in Mongolia is designed with the capacity of up to 3 million passengers per year and have capacity to receive 1500 passengers per hour.  

In comparison, the current airport (Chinggis Khaan International Airport, the largest airport in Mongolia) serves about 900,000 passengers per year (2011 figures). Also, the cargo capacity is projected to increase 10-fold. 

The new airport is located 52 km south of Ulaanbaatar city center in Sergelen soum, Tuv province. It is also hoped to be an airline hub which connects Europe and East Asia, North America and South East Asia (through the Polar route).

In May 2008, a ¥28.8 billion (US$385 million) 40-year soft loan agreement at 0.2% interest was signed between the Government of Mongolia and the Japan Bank for International Cooperation to build a new international airport. 

Construction started in May 2013, and is expected to finish by January 2017. Currently, the construction process is at 99 percent. 

The airport is able to launch 6 planes from its passenger boarding bridges and 13 planes from its field. 5 planes with up to 300 passengers are able to take off at once, reported by the project manager. 

The airport expects to receive 3 million passengers by 2024 and 5 million passengers in 2032, according to the economic estimation. 

At that time, it is possible to expand the airport by increasing the number of passenger boarding bridges up to 20.

Link to article

Back to Headlines

'UB Resort' to open at Khui Doloon Khudag

November 16 (news.mn) A new ski resort is to be opened at Khui Doloon Khudag, 32 km from Ulaanbaatar. The location is best known for the horse racing which takes place in July during Naadam. Designed to provide leisure for the general public and to attract tourists in the winter season, the 'UB Resort' is being modernised with funding from the Ulaanbaatar City Administration budget. So far, a spot for playing an ice version of the traditional Mongolian game of knucklebones and an ice-skating rink have already opened at Khui Doloon Khudag. The 'Ulaanbaatar City Administration' has promised that the new ski resort will be the most affordable of its kind in Mongolia. When the ski resort opens at Khui Doloon Khudag, the 'Mongol Naadam Complex' will be able to operate throughout the year.

Link to article

Back to Headlines

Diplomacy

Mongolia did not receive food aid from Kazakhstan

November 16 (MONTSAME) Recently, a video of the president of Kazakhstan Nursultan Nazarbaev talking about a regular food aid to Mongolia raised some revolt in the social media environment and discontented the Mongolian public.

MONTSAME Agency clarified this issue from the Ministry of Foreign Affairs. A ministry official says the foreign ministry requested a formal explanation to the President's video from the Embassy of the Republic of Kazakhstan in Ulaanbaatar, to which the Embassy responded "This video was shot almost 20 years ago. We are concerned that such a publicizing of this video as though it has been made recently might impact negatively on our two countries' relations".

In 1999, Nursultan Nazarbaev, while paying a visit to Mongolia, observed the decline in Mongolia's annual harvest of that year and made an offer of aid of 5000 tons of grains for Bayan-Olgii province, where Mongolian Kazakh minorities settle. Mongolian side accepted the offer and handed in the aid to Bayan-Olgii province. Mongolia has not taken any type of food aid since then.

Link to article

Back to Headlines

Estonia's new Ambassador to Mongolia presented his credentials

November 16 (Ministry of Foreign Affairs, Estonia) Yesterday in Ulan Bator, new Estonian Ambassador in Mongolia, Marten Kokk presented his credentials to President Tshakiagiin Elbegdorj. Ambassador Kokk resides in Beijing.

During the conversation following the ceremony, Ambassador Marten Kokk and President Tshakiagiin Elbegdorj expressed their pleasure over the fact that Estonia and Mongolia have good relations and they discussed opportunities to strengthen them further. "Although this year is the 25th anniversary of establishing diplomatic relations, trade with Mongolia is modest. There is clearly room for development," Ambassador Kokk said. "Mongolia is one of the few democracies in its region and we should support it on its course of development," he added.

According to the Ambassador, cooperation between Estonia and Mongolia is strong in the ICT field. "Estonia continues to be ready to share our experience in the ICT field with Mongolia and introduce our e-solutions. There is great interest in them in Mongolia, especially in the e-Tax solutions," Kokk reaffirmed.  

Also, the Ambassador and the President talked about cooperation in education and culture, cooperation opportunities in international organisations and both countries' candidacies for the UN security council membership.

Ambassador Kokk was born in 1973 in Tallinn. He graduated from the University of Tartu where he studied law. From 1994 – 1999, Kokk worked on different positions in the Foreign Ministry's Legal Department. In 1999 he started to work at the Government Office of Estonia and from 2001 – 2006 he worked as the Director General of the Government Office. In 2006 Kokk returned to work at the Ministry of Foreign Affairs as the Undersecretary for Administrative Affairs and from the beginning of 2009 until the end of 2010 he was the Secretary-General of the Foreign Ministry. In 2011, Kokk was the Estonian Permanent Representative to OECD. Since September this year, Marten Kokk has been an Estonian Ambassador to China.

Ambassador Kokk speaks English, Russian and German.

Photos: https://www.flickr.com/photos/estonian-foreign-ministry/albums/721576765...

Link to post

Back to Headlines

Ambassadors from Greece, Malta, Bosnia and Estonia present credentials

Ulaanbaatar, November 16 (MONTSAME) On November 15th, the Ambassador Extraordinary and Plenipotentiary of the Hellenic Republic to Mongolia Leonidas Rokanas, the Ambassador Extraordinary and Plenipotentiary of the Republic of Malta to Mongolia John Aquilina, the Ambassador Extraordinary and Plenipotentiary of Bosnia and Herzegovina to Mongolia Anton Rill, and the Ambassador Extraordinary and Plenipotentiary of the Republic of Estonia to Mongolia Marten Kokk presented their Letters of Credence to the President of Mongolia Tsakhiagiin Elbegdorj. 

Following the credential handing ceremony, President Elbegdorj met with the newly appointed Ambassadors, respectively.
President Elbegdorj wished the Ambassador of Greece Mr. Leonidas Rokanas success in his work and congratulated on his appointment to Mongolia. The President also noted that Foreign Minister of Greece Nikos Kotzias attended the ASEM Summit in Ulaanbaatar, last summer. 

Diplomatic relations between Mongolia and Greece was established on March 3rd, 1967, and in 2017, the both countries will mark its 50th anniversary. 

At the meeting with Ambassador of Malta Mr. John Aquilina, President Elbegdorj highlighted that the Prime Minister of Malta Joseph Muscat attended the 11th ASEM Summit in Ulaanbaatar and noted that Mongolia and Malta enjoy good relations in education and politics.

During the meeting with Ambassador of Bosnia and Herzegovina Mr. Anton Rill, the President noted that the both countries have maintained good relations on the international arena and expressed his belief that Ambassador Anton Rill will make his own contribution to expand this relationship. 

At the meeting with Ambassador of Estonia Mr. Marten Kokk, President Elbegdorj noted that the Prime Minister of Estonia Taavi Roivas participated in the ASEM Summit in Ulaanbaatar and expressed belief that the newly appointed Ambassador will play an important role in enhancing the bilateral relations. The President expressed Mongolia's interest to learn from the experiences related to the e-Governance in Estonia. 

The President of Mongolia wished Ambassadors success in their future endeavors and good health, reports president.mn.

Link to article

Back to Headlines

Mongolia and Brazil to boost cooperation in healthcare

Ulaanbaatar, November 16 (MONTSAME) The Minister of Health, Mr A.Tsogtsetseg received on November 15 the Ambassador of Brazil, Mr Marcos Caramuru de Paiva and the First Secretary of the Embassy, Mr Winston Alexander Silva. The Minister expressed her hope that the health ministries of Mongolia and Brazil, the two countries with long-standing friendship, will strengthen the cooperation.

The Ambassador noted the main goal of this meeting is to boost cooperation in healthcare with Mongolia, and underlined Brazil is not cutting healthcare budgets even in these times of political and economic difficulties back in his country.

Governments of Mongolia and Brazil have established a cooperation agreement when the Health Ministry of Mongolia has been also accountable for the matters of sports and physical culture, and the first Mongolian team took part in the First Indigenous Peoples' Games, held in Brazil in July, 2016.

Link to article

Back to Headlines

Roundtable meeting on Northeast Asian security underway in Ulaanbaatar

November 16 (UB Post) A roundtable meeting on Northeast Asian security is taking place in Ulaanbaatar, from November 14 to 16. Global Partnership for the Prevention of Armed Conflict (GPPAC) Northeast Asia and Tsenkher Suld, a Mongolian non-governmental organization, are organizing the meeting to discuss regional issues.

The Vice-Chair of the GPPAC Board and Head of the Secretariat for GPPAC Northeast Asia are being joined by NGOs, scholars, and representatives from North Korea, the United States of America, Russia, China, Japan and the Republic of Korea for the roundtable discussions. The foreign representatives are holding six-party talks on Korean Peninsula security.

Head of the Security and Foreign Policy Standing Committee J.Enkhbayar addressed the meeting's attendees, noting that since Mongolia announced its status as a nuclear weaponfree zone 24 years ago, the Mongolian legislature approved the Law on Mongolia's Nuclear Weapon-free Status 16 years ago and Mongolia has been participating in international and regional nuclear weapon-free initiatives. He stated that many other countries support Mongolia's actions and the United Nations has promoted Mongolian contributions to building security cooperation.

The meeting's attendees exchanged views on establishing nuclear weapon-free regions in Northeast Asia and Mongolia's role in these efforts, enhancing the roles of non-governmental organizations, and promoting effective initiatives for strengthening peace.

Link to article

Back to Headlines

Culture & Society

FEATURE: Japanese woman living nomadic life in Mongolia

ULAN BATOR, Nov. 16 (Kyodo) --

Link to article (behind paywall)

Back to Headlines

'Deel' craze hits Mongolia

November 16 (news.mn) Modern Mongolians wear the traditional 'deel' (tunic) only on  national celebration days such as 'Naadam' and 'Tsagaan sar' - or so they did.... Following the release of a new song by pop singer 'Uka' (D.Ulambayar) there is a current fashion craze for wearing the 'deel'. In the song, entitled 'Let's travel to tomorrow's sun', released in July, Uka wears a traditional deel and a bright headscarf. Now, young people, are keen to post pictures of themselves wearing wear the 'deel' on Facebook.

Link to article

Back to Headlines

What's driving Mongolia's rising divorce rate?

November 16 (UB Post) Divorce is a rising problem, especially in recent years. What are the reasons why more and more people are ending their marriages? Unemployment, alcoholism, premature decisions, and impatience. Mostly, people don't actually think about what could happen after their marriages have ended, and they imagine that everything will be okay.

A lot of couples don't realize that marriage is a big responsibility, and that they should seriously consider making thoughtful and considerate decisions about marriage. The problem is that many people don't have the stamina to deal with the challenges they face in their life, and some of them just give up at the beginning of these challenges.

Challenges test couples and can bring partners together or split them apart. After a couple overcomes difficulties together, they can live with terms of mutual understanding and trust. The divorce rate has been increasing in Mongolia, especially in Ulaanbaatar, for a decade.

According to reports from the National Statistical Office, the crude divorce rate (CDR), which is the number of divorces per 1,000 individuals, has steadily risen from 2001 to 2015. For example, let's look at the ratio of marriages and divorces in Ulaanbaatar over the last three years,: 6,736 couples married and 2,054 couples divorced in 2013, so CDR was 1.5; 7,933 couples were married and 2,329 were divorced in 2014, and CDR was 1.7; and in 2015, 8,263 couples were married and 2,515 were divorced, and CDR was 1.8. According to reports from the United Nations Statistics Division (UNSD), Mongolia's CDR rose from 1.1 in 2010 to 1.3 in 2014.

The UNSD carries out demographic surveys around the world. Some countries have seen fewer cases of divorce, but the UNSD's data shows that many countries have seen dramatic increases like Mongolia has. I think that the way men don't own up to their responsibilities to make a living has led to many failed marriages.

In general, women have more patience than men, and they weather a lot of difficulties by being patient and resilient. Many of them cannot see the results they expect from their efforts and grow disappointed, then they decide to divorce their husbands. Many Mongolian women shoulder the immense responsibilities of their families alone, and they carry the huge weight of feeding their children.

When they are asked what the biggest threat they face in life is, they say alcohol. Some young women get pregnant out of wedlock by men they don't know well, or without considering if their boyfriends share their aspirations, desires, expectations, and dreams about life. After living together for a couple of years, they get bored with marriage, because they don't have the same aspirations and their marriage can't be worked out.

Alcohol abuse in low and middle-income Mongolian families has had a tremendous impact on marriages ending and domestic violence spurred by alcoholism. A woman living with domestic violence doesn't have any choice but to escape her abuser. Unfortunately, thousands of children and women are affected by divorces of this nature and they are emotionally damaged for their entire life.

T.Jargalsaikhan, a prosecutor in the Khan-Uul District, said that 97 percent of domestic violence offenders in Mongolia are men. President Ts.Elbegdorj has put forward an amended version of the Law to Combat Domestic Violence and MPs are scheduled to be reviewing it soon.

A divorced woman who asked not to be named said, "Parliament approves a number of laws, but it is important for people to adhere to the law. I divorced my husband because of financial challenges. I think many couples break up because of financial difficulties. Everybody agrees that it has been hard for guys to find a job, so the state needs to focus more on creating jobs than it does on approving laws."

A divorced man stated that looking for a job was very difficult in Ulaanbaatar, so he would hang out with his friends and drink when he felt down about being unemployed. His wife got mad at him whenever he was drunk, and then they broke up. Politicians talk about a number of projects that create small businesses and jobs, but there is no action taken. These are just political moves from election to election.

On the other hand, many Mongolian men don't have the capability of offering employers qualified experience. Couples should understand that there are more important things in a marriage than love, and they need to know that the two pillars of a healthy marriage are openness and honesty.

Link to article

Back to Headlines

PalaeoChron Field Trip to China and Mongolia

November 16 (PalaeoChron) In October, Thibaut went on a field trip to China and Mongolia to collect new samples for PalaeoChron. He first visited the Jilin University located in Changchun, the capital city of Jilin Province in Northeast China. Jílín Dàxué is a leading national research university that is also one of the most prestigious "Top 10" universities in China and the Center for Chinese Frontier Archaeology hosts the second top archaeology department in the country and national-level laboratory facilities. Thibaut gave a talk entitled "New methods for sample preparation prior to radiocarbon dating – Application to Middle-Upper Palaeolithic sites" to staff and students in the Archaeology department. He also visited the Archaeology Museum of the University which is hosting important Palaeolithic and Neolithic collections. These collections include material excavated by, or in collaboration with, the researcher of the Research Center for Chinese Frontier Archaeology of Jilin University.

Thibaut sampled bones from 4 Chinese Palaeolithic sites that have not been dated yet. His trip in the Jilin province was concluded with a visit to several archaeological sites including the Xianrendong site in Huadian City, Jilin Province.

Following this, Thibaut travelled to Ulaanbaatar (Mongolia) to meet colleagues at the Institute of History and Archaeology, Mongolian Academy of Sciences. The institute is in charge of coordinating and supervising ongoing excavations in Mongolia as well as post-excavation studies. The institute also hosts collections of important fossil remains including the skull from the Palaeolithic site of Salkhit which we were able to sample for dating and DNA analysis. This skull was discovered in 2006 by a mining company and was brought to the attention of the Mongolian Academy of Sciences. No chronometric dating has been published yet, and suggested dates range from early Middle Pleistocene to terminal Late Pleistocene. The archaic features of the skull fragment have led to a potential affiliation with archaic hominin species. If it is indeed Homo erectus or archaic Homo sapiens, the skull would highlight a much earlier spread of hominins further north and inland Asia than previously thought.

Finally, back in China, Thibaut met with Shuisheng Du who is Professor in archaeology at the Beijing Normal University. They travelled to Xiachuan in the Shanxi province. Several archaeological excavations have been undertaken over the last decades and revealed abundant late Palaeolithic remains including stone artefacts (mainly microlithic), broken animal bones and charcoals. The meeting with Shuisheng Du was also an opportunity to sample material from the Longquan cave (Lunchuan county, Henan Province). This site was discovered by the Luanchuan Cultural Relics Administrative Institute, and a systematic investigation was conducted in 2011 by a joint archaeological team from Beijing Normal University and Luoyang city. During the excavations, stone artefacts, animal bones were uncovered, as well as a unique bone point.

We hope that all these samples collected thanks to the very helpful collaboration of our colleagues in China and Mongolia will help us to improve our understanding of the dispersion of anatomically modern humans across Asia.

Link to article

Back to Headlines

Sports

King Tug prepares for seventh professional fight

November 16 (news.mn) The silver medal winner of the Olympic Games and World Boxing Championship, Mongolian boxer N.Tugstsogt will undertake the seventh fight in his professional boxing career. The much anticipated boxing match will take place in the USA on 8th of December. N.Tugstsogt said on Facebook, 'Hello everyone, I am now fully recovered from my injury. My next fight will be held in December'.

Since becoming a professional boxer, N.Tugstsogt has won his previous six fights.  He earned a victory in his sixth professional career fight against Rafael Vazquez of Puerto Rico on July 16th. He defeated Vazquez within one minute and 24 seconds in the first round.

N.Tugstsogt has been training during his transition from amateur to professional boxer under the supervision of a US trainer.

Link to article

Back to Headlines

Yokozuan Hakuho climbs to 3rd in all-time record wins with 1,000th victory

November 16 (news.mn) Mongolian sumo wrestler, 'Hakuho' M.Davaajargal claimed his 1000th victory on November 15th, the third day of Kyushu Basho professional sumo championship. Hakuho is now ranked in third place in the history of professional sumo. He is also the the 69th Yokozuna, or grand champion of professional sumo.

His predecessors Ozeki-titled Kaio won 1,047 bouts between 1988 and 2011 and Yokozuna-titled Chiyonofuji defeated his rivals in 1,045 bouts between 1970 and 1991. However, 'Hakuho' M.Davaajargal may well go on to break their records.

Link to article

Related:

Hakuho claims 1000th winMontsame, November 16

Back to Headlines

Aldar sport club represents Mongolia at World Military Shooting

November 16 (news.mn) 'Aldar' sport club is representing Mongolian Armed Force in 49th World Military Shooting Championship. The competition is taking place from November 12 to 20 at the Losail Shooting Range in Doha, Qatar. Total of 720 shooters from 50 teams, who have won Olympic medals participating in the competition. The last World Military Shooting Championship took place in South Korea in November 2015.

Abdul-Hakeem Al-Shennou, president of International Military Sports Council (CISM) visited Mongolia and met B.Bat-Erdene, Minister of Defence in October. During the visit, they discussed possibility of Mongolia to host CISM North East Asian Competition.

CISM established 1948, is one of the largest multidisciplinary organisations in the world. CISM has 134 member countries and aims for promote sport activity and physical education between armed forces as a means to foster world peace.

Link to article

Back to Headlines

"Strong-Girl" M.Ankhtsetseg - Mongolia's rising star

November 16 (news.mn) Female weightlifter M.Ankhtsetseg is Mongolia's rising star having set a new weightlifting record for Mongolia at the Rio Olympic Games. In her first big competition after Rio, nineteen-year-old M.Ankhtsetseg also won gold at the Asian Weightlifting Championships in Tokyo.  In the Japanese capital the young Mongolian competed in the women's 69 kg category and lifted 105 kg in a snatch and 130 kg in clean and jerk, becoming the Asian champion.

M.Ankhtsetseg participated in the competition without her coach Ts.Khosbayar due to financial difficulties. The Asian Championship costs MNT 3.6 million and World University Weightlifting Championships is MNT 5.4 million per person. In order to enable M.Ankhtsetseg to make it to Tokyo, the Selenge provincial administration, national wrestling champion G.Erkhembayar and two companies - 'Nomgoljin' and 'Esuudiin Batuud' provided the much needed financial support. Three athletes, one referee and one official were able to Japan.

The current challenge for M.Ankhtsetseg is the World University Weightlifting Championships which is currently taking place from 13th to 17th of November in Merida, Mexico. She is only athlete participating in the competition's women's 75kg category.  'Strong Girl' M.Ankhtsetseg already holds gold and silver medals from world championships and is ranked eighth in the women's 69 kg weightlifting category.

According to GoGo.mn, M.Ankhtsetseg and her coach Ts.Khosbayar  have received invitations from four other countries, namely, the USA, South Korea, Kazakhstan and Uzbekistan to represent them  South Korea has promised her a monthly salary of USD12,000 and a very attractive offer if she wins. However, M.Ankhtsetseg and her coach declined this offer, preferring to compete only for Mongolia.

Link to article

Back to Headlines

Mongolia to host "Children of Asia" sports festival in 2020

November 16 (news.mn) The Mongolian Government has approved a budget of MNT 6 billion for organising the "Children of Asia" international sports festival; 40% of the funding has come from sponsors. Ulaanbaatar has been selected as the next host of 'Children of Asia' in 2020.

The event has been held every four years since 1996 in Yakutsk, the capita of the Russian Republic of Sakha-Yakutia. On average, the games attract more than 3000 teenage athletes, their coaches and trainers from between 40 and 50 countries. They are challenged in 20 sports categories over the ten days of the games. The Mongolian national team has been taking an active part in the games and has made it to the top five.

Link to article

Back to Headlines

Art & Entertainment

Ariunbaatar performing Carmen as Escamillio in S.Korea

Ulaanbaatar, November 16 (MONTSAME) Ariunbaatar Ganbaatar, the Grand Prix winner of the 15th International Tchaikovsky Competition and Laureate of the Chinggis Khaan Order, is performing in the role of Escamillio of Carmen opera in Seongnam Theatre of South Korea, between November 17 and 22.

Ticket prices range from 25,000 to 200,000 Korean wons, depending on the seat location. The Carmen Opera by Georger Bizet is being staged for 130 years since it was first performed in 1875 in Paris.

Link to article

Back to Headlines

 

---

    

Suite 303, Level 3, Elite Complex

14 Chinggis Avenue, Sukhbaatar District 1

Ulaanbaatar 14251, Mongolia
Emailinfo@covermongolia.com
P Please consider the environment before printing this e-mail.