Ulaanbaatar, December 25, 2023 /MONTSAME/. Today, Prime Minister of Mongolia Oyun-Erdene Luvsannamsrai made remarks to the people of Mongolia, foreign and domestic investors, and international cooperation partners. We present the full transcript of his speech. 

Dear Mongolians,  

Honored investors and international cooperation partners, 

I would like to announce that Mongolia has entirely paid off its "Samurai" bond, amounting to JPY 30 billion (approximately USD 200 million), solely from its own sources, marking complete freedom from external debt on the eve of the New Year.  On October 23, 2023, we also fully repaid the USD 500 million debt of the "Euro" bond of the Development Bank from our own sources. These are a testament to Mongolia's commitment to financial responsibility and its capability to fulfill obligations to the international community and investors. 

The recent Cabinet meeting discussed a proposal for comprehensive legal reform to transform the Development Bank into a classic Exim bank to elevate the Bank's governance and proficiency to international standards. The proposal was submitted to the State Great Khural of Mongolia,” highlighted the Prime Minister. 

There is a saying in Mongolia that “Out of debt, out of danger.” Our government faced a series of historic challenges, including overcoming the COVID-19 pandemic, managing the economic strain during wartime, combating corruption, and timely paying off foreign debt to safeguard the nation from the danger of bankruptcy. 

We had only two choices: to accept external default and enter the International Monetary Fund program or mobilize our own sources through drastic reform measures. Thanks to the anti-corruption measures implemented at the Development Bank and Erdenes Tavantolgoi JSC, we, Mongolians, have succeeded in extricating from a protracted debt cycle that lasted for 12 years. The irresponsible practice of taking loans in the name of the country, dividing them among specific groups, and passing amnesty laws for themselves, with the belief that "our children will pay one day", will not be repeated in Mongolia. These debts were a painful lesson that must never be forgotten: 12 years of missed opportunities that hindered the country's development, stole the income of every household, and pushed the nation to the brink of bankruptcy. 

In the past, the Government of Mongolia has spent MNT 13.3 trillion to repay USD 1.5 billion for "The Chinggis" bond, USD 500 million for the "Mazaalai" bond, USD 800 million for "Gerege" bond, USD 430 million of "Khuraldai" bond, USD 500 million of "Euro" bond, USD 200 million of "Samurai" bond, and other debts. At the peak of the pandemic, Mongolia's economic growth was minus 4.7 percent. However, in 2023, the economy is predicted to have growth of  6.8 percent, and the gross domestic product rise from MNT 36.7 trillion to MNT 63.3 trillion, pushing the GDP per capita to USD 5,220. Notably, for the first time, both the state budget and balance of payments are expected to be in surplus. 

Mongolia's foreign exchange reserves have reached USD 4.5 billion today, compared to USD 2.7 billion in June 2022. This positive growth sustains at the targeted level despite the bond repayment. Importantly, if the government continues its policy to make the economy open and transparent, foreign exchange reserves can reach USD 10 billion. 

In the past, the economic growth was used for paying off the debts. However, as of today, the fundamental condition has been established to ensure that every household and citizen benefits from the growth.