Mongolia Economy Growing, but Vulnerable

Mongolia Economy Growing, but Vulnerable


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According to a review at East Asia Forum the Mongolian economy is growing steadily, but remains vulnerable to external economic pressures.

Mongolia has now entered the third year of the three-year Extended Fund Facility arrangement offered by the IMF in 2017. During this period the Mongolian government has targeted reduction of the budget deficit, overall debt, increase in foreign exchange reserves, and promote sustainable economic growth in an effort to stabilize the countries economy to enable long term development.

Under this program, the Mongolian economy has been strengthening good prices for exports such as copper, and significant investments into the second phase of the Oyu Togoi mining copper and gold mine.

Domestic economic confidence has increased along with a significant uptick in foreign currency reserves.

The Bank of Mongolia undertook a comprehensive review of assets and reserves for major Mongolian commercial banks, and formulated a plan for risk supervision and mitigation.

Overall, the prospects for continued growth in the Mongolian economy are strong, if not exponential. The economy continues to be highly exposed to external stimuli, with 90% of exports in the minerals sector, and over 50% of total FDI coming from the single largest investment project in Mongolian history, the Oyu Tolgoi mine.

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