Archive for ‘Investment’

Dalanzadgad Expected to Have Highest GDP Per Capita

By , 21 April, 2011, No Comment

Dalanzadgad is the capital of the South Gobi province and fastest growing provincial capital in Mongolia.

Our Firm (Eurasia Capital) estimates that the population of Dalanzadgad will quadruple in the next five years and by 2015 this town will enjoy the highest GDP per capita in Mongolia. South Gobi is home to two crown jewels of Mongolia: Tavan Tolgoi, the world’s largest untapped coking coal deposit and Oyu Tolgoi, the world’s largest undeveloped copper & gold mine.  We anticipate Dalanzadgad becoming a regional center for dozens of mining companies and hundreds of firms in multi-billion dollar mining supply chain.

FYI, Erdenet, the second largest city in Mongolia has estimated US$6,400 GDP per capita, the highest in Mongolia.  Erdenet is the capital of the Orkhon province, founded in 1975 as a new industrial center after discovery of the world class Erdenet copper mine in 1974. Erdenet is home to Erdenet Mining Corp., Mongolia’s largest company, biggest taxpayer and exporter, and accounts for 13% of the country’s GDP.

Source: Eurasia Capital

Eurasia Capital Bullish on Japanese Investments in Mongolia

By , 22 November, 2010, No Comment

Below is a text from a newsletter I recently received from Eurasia Capital.  It is true that Japanese have been one of the most active early investors in Mongolia.  While investments from China today make up for around 80% of foreign direct investment (FDI) in Mongolia (according to some resources), Japan is still a significant presence here in Mongolia.  Enjoy reading.

Eurasia Capital: Japan and Mongolia: “Rising Sun” Looks for “Bluer Sky”

Towards strategic partnership. Japan, Mongolia’s fourth largest trading partner, is seen by the Mongolian Government as an important player for the development of the resource-rich country. In order to reduce its reliance on its two neighboring superpowers, China and Russia, Mongolia is seeking a “strategic partnership” status with the world’s third largest economy. Japan has been supporting Mongolia since the early 1990’s by providing extensive financial and technical assistance worth over US$1.3bn and helping in key aspects of democracy and transition into a market economy. Currently, Japan is actively involved in assisting in developing rural areas, protecting the environment, improving infrastructure, supporting SMEs and developing institutional and human resources in Mongolia.

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Hong Kong Listed Companies Rush to Mongolia

By , 22 July, 2010, No Comment

Hong Kong-listed Companies as Major Acquirers of Resource Assets in Mongolia. Over the last 12 months, Mongolia has become an attractive investment destination for the companies listed on the Hong Kong Stock Exchange (HKEx). Attracted by the country’s huge mineral resources, the HKEx-listed companies have become the biggest acquirers of Mongolia resource assets since the second half of 2009 ($966mn worth of M&A deals or over 90% of total). 

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US Embassy Seeks Mongolian Applicants for Humphrey Fellowships and Fulbright TA Program

By , 24 May, 2010, No Comment

US Embassy seeks Mongolian applicants for Humphrey Fellowships and Fulbright Foreign Language Teaching Assistant Program for 2010-2012; application deadline is July 19.

The US Embassy in UB invites any interested Mongolian citizen living in Mongolia to apply for two available grant programs that provide up to one year study and professional experience in the US. The Hubert Humphrey Fellowship is a one-year, non-degree professional exchange program that brings mid-career professionals to the US. For further information, including application and eligibility requirements, go to http://mongolia.usembassy.gov/sholarship_announcements/test.html

The Fulbright Foreign Language Teaching Assistant Program (FLTA) for 2011-2012 brings Mongolian teachers of English, and other foreign English teachers, to the US for the 2011-12 academic years to strengthen foreign language instruction at US colleges and universities while providing foreign teachers of English with the opportunity to refine their skills, increase their English language proficiency and expand their knowledge of American culture and customs .The grant is for one academic year and is non-renewable.  For further information, including application and eligibility requirements, go to http://mongolia.usembassy.gov/flta_announcement.html

Application deadline for both programs is 12 noon on July 19, 2010. Both programs are administered by the Public Affairs Section of the US Embassy,  Big Ring Road, XI  Microdistrict, Ulaanbaatar, UB – 13, P/O Box 1021, Telephone: 312372 or 329095 ext 4424 or 4729.

Source: NAMBC Newsletter May 11, 2010.  Visit NAMBC website here: North America Mongolia Business Council.

Erdenet Citizens Urge President to Go Ahead with Judicial Reforms

By , 15 March, 2010, No Comment

President Ts.Elbegdorj’s meeting last week with the citizens of Erdenet turned into an indictment of the way legal and judicial organizations worked in the province of Orkhon.

A woman said she had been practically living in courts trying to get the truth established after the court ordered her son to 8 years’ imprisonment for theft of two mobile phones. Many at the meeting sympathized with her, saying they, too, “knew how judges treat poor people and how they please those with money and power”. The audience urged the President to boldly carry on with his plans to reform the judiciary so that reliable justice was available to all.

Goldman Sachs May File Case on Olon Ovoot

By , 12 March, 2010, No Comment

Goldman Sachs is believed to have filed a case against Mongolia in an international arbitration court in matters relating to Mongol Gazar and the Olon Ovoot mines.  This news comes in the wake of unconfirmed but strong reports that the Mongolian Government has lost the case against the Russian-owned Altan Dornod.

Mr. B.Lhagvasuren, director of the Inspection Department at the Central Bank, has denied any information about Goldman Sachs filing any case
Mr. Ts. Myanganbayar, a business magnate, mortgaged the Olon Ovoot gold mine license to several banks and to Goldman Sachs to borrow a total of MNT 210 billion. Of this, Zoos Bank, now known as State Bank, gave him MNT 60 billion, Anod MNT 30 billion, and Goldman Sachs MNT 15 billion.

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“Mongolian Law and Legal Environment” with James Liotta of Lehman Lee & Xu

By , 21 December, 2009, 3 Comments

James Liotta Lehman Lee XuOverview: Mongolia has a developing judicial system, sometimes even described as “rotten to the core”.  People need to do due diligence before coming to Mongolia to do business.  Following the law to your best ability from the beginning will help prevent issues later.

For business news, the state budget containing 76 Billion tugrugs or 1 billion tugrug per each MP, has been passed, even after a veto by the President of Mongolia.  Millennium Challenge Account is investing more than hundred million USD for clean air and road infrastructure projects.  Boroo Gold mining company has agreed to donate 1 million USD for new national park being developed in Ulaanbaatar.

For “Mongolia Business” podcast update, we received some recommendations from one of our listeners.  We also received a five star review on iTunes.

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James Passin Bullish on Mongolian Stock Market

By , 26 November, 2009, 2 Comments

Today, while going through some articles on Mongolia, I ran across an article that happened to cover the Mongolian stock market by a stock market guru named James Passin.  It was a lucky find as the article mostly talked about Berrylium.  Anyway, please read on.

As you will find, James is very bullish on the local Mongolian stock market.

Source:

Mongolian Stock Market Overview

TER: Any other regional international plays that you can discuss with us?

JP: Ivanhoe Mines Ltd. (NYSE:IVN, TSX:IVN) , the Canadian exploration company, finally executed an agreement with the Mongolian government with respect to the development of Oyu Tolgoi, the world’s largest undeveloped copper mine. This is a massive mine that will generate $5 billion of revenue per year for over 50 years. While this is a positive development of Ivanhoe, a stock that we’ve been trading from the long side all year, it will be much bigger story for the Mongolian stock market.

Mongolia GDP is only about $5 billion, so Oyu Tolgoi, or OT as the mine is called, will transform the prospects for employment and per capita GDP growth. A great wall of domestic liquidity will support the local stock market, creating a new bull market which will last for decades. The local stock market currently has depressed valuation and almost zero liquidity. Mongolia has structural similarities to other emerging markets that started out with very low market capitalizations, such Vietnam or the smaller Gulf states. There are 24 mineral projects that have been deemed strategic by the Mongolian government and that represent potential sources of commodity exports. The Ivanhoe deal marks the beginning of the Mongolian mining boom and I think the most leveraged long-term way to play this mining boom is through the local stock market.

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