Ulaanbaatar, September 4, 2024 /MONTSAME/. The main feature of the State Budget of Mongolia for 2025, as highlighted by Minister of Finance of Mongolia Javkhlan Bold in a press conference, is that it marks the beginning of infrastructure recovery, focusing on regional development.

A total of MNT 6.9 trillion has been allocated to finance infrastructure development in the regions including road and energy projects, outlined in the Government Action Program for 2024-2028. Of this, 24 percent (MNT 1.6 trillion) is earmarked for road and transportation projects, 8 percent (MNT 0.6 trillion) for energy development, and 11 percent (MNT 0.7 trillion) for engineering infrastructure, with the remainder allocated to other fields.

While this year’s budget focused on social infrastructure, such as schools and kindergartens, next year’s budget aims at expanding infrastructure, including roads, energy, and heating that foster economic growth while financing unfinished projects of this year.

Minister Javkhlan Bold emphasized the Government’s commitment to supporting producers and private sector production through tax policy. “This includes exempting the equipment of the next stage of processing in all sectors from taxes, supporting private sector investments, and providing tax exemptions for investment costs of private enterprises. We intend to reduce the burden of budgetary investments and make policy investments,” stated the Minister.

Furthermore, 110 state-owned enterprises and over 500 enterprises with local government or state participation will undergo audits by an international accreditation organization. The Government plans to transform large strategic enterprises into joint-stock companies, enhance their economic and social significance, stabilize their operations, and, where necessary, proceed with liquidation.

At the press conference, the Finance Ministry presented over 10 projects such as “Khushig Valley Tunnel’ and “Double-Towered Suspension Bridge-Tunnel-Highway” to be named “Go Mongolia”, which aimed at decentralizing Ulaanbaatar City and reducing traffic congestion.

MNT 210 billion is allocated to finance the construction work for the Government’s one-stop service center, and MNT 202 billion is set aside for the construction of a water purification plant and a wastewater recycling plant in Ulaanbaatar, as part of the Water Supply Project, under the Mongolia Water Compact, financed by the U.S. Millennium Challenge Account. Moreover, MNT 80 billion is earmarked for the construction of the New Central Treatment Plant, with a daily capacity of 250,000 cubic meters.

The funding source for the infrastructure development for the “Khushig Valley- New Zuunmod City” which is planned for resolving urbanization, as well as for planning, feasibility study, and blueprint of the “New Kharkhorum City” project, which is designed to accommodate 500,000 people, was reflected in the 2025 State Budget draft.

To boost regional economic activity, the Government plans to launch the construction work of the “Five Circles for Rural Revival” regional development project, which is planned to interconnect centers of aimags and border ports by auto road. By 2025, a total of 2120.9 kilometers of roads are planned to be built, including 1079.7 kilometers of road connecting aimags, 708.6 kilometers of road connecting aimags to border ports, and 332.6 kilometers for tourism.