Ulaanbaatar, November 2, 2023 /MONTSAME/. During its regular session on November 1, 2023, the Cabinet made the following decisions:

Minister of Finance of Mongolia B. Javkhlan: The Development Bank of Mongolia Paid Off Its USD 500 Million Bond Spot

The Development Bank announced that 55% of its total loan portfolio, or 1.8 trillion MNT, is non-performing, and it is doubtful whether the bank can continue operating normally in the future.

In the past year, the Ministry of Finance, on behalf of the Mongolian Government, has exercised its shareholder rights to fully direct the Development Bank's activities towards the repayment of non-performing loans and has not issued any new loans. As of October 2023, the bank has recovered 1.5 trillion MNT in loans. In 2023, the Development Bank faces the challenging task of issuing a 500.0 million USD bond and a 30.0 billion yen bond, totaling 750.0 million USD, to repay its foreign debt. Thanks to the Government's successful fight against coal theft, coal exports have increased, resulting in a balance of payments surplus of 800 million USD and foreign currency turnover of 4.0 billion USD.

Minister of Finance B. Javkhlan presented how the Government successfully fulfilled its obligations to international investors and the Mongolian Government by paying off USD 500 million in bonds from its own resources. The Mongolian Government is currently pursuing a policy of paying off most of its loan and bond liabilities through debt settlement without burdening the economy. The fact that the Development Bank is repaying its external debt through loan repayments increases confidence that the bank will continue to operate normally.

Minister of Mongolia, Chief Cabinet Secretary D. Amarbayasgalan: A special Operating Regime Will be Established Once Again at Erdenes Tavantolgoi Joint Stock Company

At the Cabinet meeting, a report was presented on the measures implemented during the year after the introduction of a special operating regime at Erdenes Tavantolgoi Joint Stock Company and their results.

In light of this report, the Cabinet tasked the Minister of Mongolia and Chief Cabinet Secretary D. Amarbayasgalan to study the issue of reintroducing a special operating regime at Erdenes Tavantolgoi JSC within the framework of the objectives of supporting coal exports and economic growth, increasing the flow of foreign currency, and increasing extraction, transportation, and export of coal at the Tavantolgoi deposit. He is to develop and submit a corresponding proposal to the Cabinet meeting.

The establishment of a special operating regime at Erdenes Tavantolgoi Joint Stock Company has achieved real and positive results, such as an increase in the volume of transportation, export of coal, and flow of foreign currency; a sharp increase in income from the sale of coal; a tangible improvement in average monthly economic indicators of production compared to the previous period; and an increase in net income.

In particular, within one year of the establishment of the special operating regime, Erdenes Tavantolgoi JSC sold 32.8 million tons of coal worth USD 3.3 billion, generating MNT 2.7 trillion in state budget revenues in the form of taxes and fees. Sales revenues reached a record high of USD 1.1 billion in 2022, exceeding government targets and instructions. The company received USD 588 million in income and deposited USD 416.6 million in Mongolbank.

Therefore, it was decided to reintroduce a special operating regime at Erdenes Tavantolgoi Joint Stock Company to support coal exports and economic growth, increase the inflow of foreign currency, and boost coal production at the Tavantolgoi deposit.

Revised Family Law Draft to be Submitted to State Great Khural

The revised draft of the Family Law and other bills will be submitted to the State Great Khural. The current Family Law does not fully comply with the basic principles of civil law, and eight amendments have been made to it since it came into force. However, these amendments have been more aligned with other legal reforms than aimed at solving problems in family relationships. Since 1999, there has been an increase in the number of marriages, divorces, violations of children's rights, and violations of rights and legitimate interests, and the restoration of legal rights has not been sufficiently regulated. The consequences of these legal norms are not adequately regulated. In other countries, family property rights (i.e., the shared property between spouses), amendments to property rights in joint ownership, and new reproductive technologies such as surrogacy and artificial insemination are all regulated by law. The bill aims to bring family relations into compliance with international standards, regulate new relationships, and eliminate omissions and abuses. At the same time, it adheres to the principle of protecting the rights and legitimate interests of children, pregnant and lactating women, single parents with young children, citizens with disabilities, the elderly, and disabled family members.

Process Reengineering in the Labor and Social Protection Sector

The Ministry of Labour and Social Protection of Mongolia (MLSP), in cooperation with some of its affiliated agencies, conducted a study and analysis of process reengineering in the labor and social protection sector. The results of the study were presented to members of the Cabinet of Ministers, who recommended the incremental implementation of process reengineering in the MLSP, the General Agency for Labor Welfare Services, the General Agency for Social Insurance, and related subsidiaries and divisions. Minister of Labor and Social Protection Kh. Bulgantuya was tasked with reporting on the results.

Benefits of process reengineering:

-Reduced the number of processes that citizens go through to receive government services,

-Implemented the principle of one public employee per one public service,

-Balanced and simplified the workload of public service employees,

-Optimized organizational activities,

-Improved civil service productivity, enhanced civil servants' competence, and increased citizens' satisfaction with public services,

-Implemented modern public service approaches, management, and good practices, such as shared services across the public sector.

News in Brief

In light of the urgency to develop draft legislation on the separation of Future Heritage Fund (FHF) funds from the Consolidated Treasury Fund account by January 1, 2024, Minister of Finance B. Javkhlan was tasked with reporting on the implementation to the Cabinet of Ministers. The FHF has accumulated MNT 2.8 trillion.