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Mongolia: Selected Issues and Statistical Appendix

Author(s):
International Monetary Fund
Published Date:
November 2005
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III. Developments in Trade and Impacts of Eliminating Textile Quotas1

1. With the completion of the phased elimination of import restrictions on textiles and clothing (TC), concerns about impacts on Mongolia’s exports have increased. All remaining quotas under the Multifibre Agreement (MFA) were removed at the beginning of 2005, completing a phased process, which had started in 1995. As the lifting of restrictions under the phased program was backloaded, the consequences for the Mongolian economy are expected to be larger than those at the previous stages of quota elimination.

2. This chapter takes a closer look at how the lifting of MFA restrictions might affect the Mongolian economy. Our analysis mainly focuses on garment exports to the U.S. market, which is the most important destination for Mongolia. Garments have become a major export product over the past several years, accounting for 20 percent of total exports in 2004.2 As Mongolia had quota free access to the market of United States and European Union, Mongolia’s accessibility to these markets remains unchanged after the quota elimination. Relative to other exporters that had been subject to quotas in the major importing countries, however, Mongolia’s competitiveness in garment exporting would tend to be reduced.

3. This chapter concludes that MFA quota elimination is likely to have a significant adverse impact on Mongolian garment exports. In particular, Mongolia’s garment exports to the U.S. market would fall sharply over a relatively short period of time, leaving copper and gold as the only two major export products. Given the large fluctuations of international prices of these two products, promoting other exports would become increasingly important to reduce vulnerability to terms of trade shocks. Section A discusses recent developments in exports, then Section B describes the recent development of the garment sector. Section C discusses the impacts of quota elimination, and Section D lays out the challenges for the external sector. Section E concludes.

A. Background on Mongolia’s Development of Exports

Mongolia: Export growth and copper price change

4. Mongolia relies heavily on international trade, but its export base is narrow and commodity-based. Mongolia’s strong commitment to the WTO agreement3 and its open trade regime, with low uniform level of import tariff and a limited number of export taxes, have laid ground for recent strong economic performance. Total trade (exports plus imports) has reached around 130-140 percent of GDP since 2000, which is among the highest in Asia. However, a large proportion of total exports consist of just a few products. Copper, which was developed with substantial assistance and participation of the former Soviet Union, continues to be the most important export product, making Mongolia’s export performance highly vulnerable to copper price fluctuations. Exploitation of the country’s significant gold deposits largely got underway in the early 1990s. Recently, these two products have accounted for more than half of Mongolia’s total export (60 percent in 2004). In addition, garments (including cashmere) have become a major export product—especially, the share of non-cashmere garments in total export reached 11 percent in 2004.

5. In geographical terms, whereas the Soviet Union was the dominant trade partner before the economic transition of 1990s, China has emerged in recent years as a major trading partner. The shares of export and import to China are 48 percent and 25 percent respectively in 2004. Exports to G7 countries, mainly the United States, are also significant, at more than 30 percent of share in recent years. This partly reflects an increase in non-cashmere garment export to the United States. The Russian Federation remains a key trading partner even during the transitional period because of Mongolia’s continued dependence of energy imports from Russia and the joint Mongolian/Russian ownership of the large Erdenet Copper Mine.

Mongolia: Foreign Exchange Inflows

6. Despite the narrow export base and commodity price fluctuations, Mongolia’s overall balance of payment has been relatively stable. This performance largely reflected a thriving service sector, a sharp increase in unrequited private transfer (i.e. workers’ remittances), and donor support through loans and grants. Service receipts, mainly in the tourism industry, increased at an average annual growth rate of 25 percent from 1995 to 2004. Workers’ remittances from the increasing numbers of Mongolians living in China, Korea, and the United States have also become important sources of foreign cash inflow.4 Donor assistance has averaged around 16 percent of GDP every year, reaching US$216 million in 2004. Loans are mostly provided by the World Bank, the Asian Development Bank, and Japan with concessional terms, while grants are largely from other bilateral donors. As a result, Mongolia’s level of official foreign reserves increased from 9 weeks of imports in 1996 to 17 weeks in 2002, despite large volatility in copper prices. The settlement of pre-1991 Russian debt resulted in a sharp decline of the reserves to 9 weeks again in 2003, but a boom in copper exports helped the government reconstitute its reserves in 2004.

7. Mongolia’s balance of payments has also been strongly influenced by the developments in the garment sector. As the world’s second largest producer of raw cashmere, cashmere garments initially played a key role in the initial development of the garment sector. Cashmere exports, however, fluctuated due to unsatisfactory government policies together with a series of external shocks such as unfavorable economic conditions during the transition in early 1990s, the Asian crisis in late 1990s, and unstable weather conditions.5 On the other hand, foreign direct investment in the non-cashmere garment sector started in late 1990s, and the industry has since developed into a key export sector, overtaking cashmere, with annual sales on the order of US$100 million.

Table III.1.Mongolia: Garment Exports
1992199319941995199619971998199920002001200220032004
(in millions of US dollar)
Total Exports356366367485423569462454536523524627872
Total garment exports583341586085639717211481119176
o/w non-cashmere800002624187344357596
o/w cashmere50334158605939789870464580
(in percent of total export)
Total garment exports16.28.911.211.914.215.013.521.332.021.915.419.020.2
o/w non-cashmere2.20.00.00.00.04.65.14.113.78.46.611.911.1
o/w cashmere13.98.911.211.914.210.48.417.218.413.48.87.19.1
(in percent of GDP)
Total garment exports4.45.84.74.75.18.16.410.718.111.37.29.411.6
o/w non-cashmere0.60.00.00.00.02.52.42.07.74.33.15.96.4
o/w cashmere3.85.84.74.75.15.64.08.610.46.94.13.55.3
Source: The Bank of Mongolia and Fund staff estimates.

B. Developments in the Non-Cashmere Garment Sector

8. The expansion of non-cashmere garment exports was led by foreign direct investment by Chinese textile companies. Chinese exports to the United States and the European Union were restricted by garment quotas under the MFA. Since Mongolia had quota free access of its garment export to the United States and the European Union, foreign exporters who were facing restrictive quotas had incentives to locate their production facilities into Mongolia. In addition, Mongolia was in a favorable position compared to other low income countries in Asia as the U.S. and E.U. also put quota restrictions on the import from those countries under the MFA.6

9. Almost all of the approximately 100 companies in the non-cashmere garment sector have benefited from significant foreign investment. China accounts for the largest number (37 percent), followed by Korea (19 percent), Hong Kong SAR (13 percent), and Taiwan Province of China (8 percent)). These companies are taking advantage of the absence of the U.S. quota restrictions on garment imports. In 2003, 98 percent (US$78 million) of Mongolia’s sewn clothing exports and 37 percent (US$ 13 million) of knitted clothing exports were sent to the U.S. market.

10. Non-cashmere garment exports have declined substantially since 2002 with the third and final phase of quota elimination. The MFA quotas were to be phased out progressively over the 10-year period, starting in 1995.7 The integration under the third phase was only 18 percent of WTO members’ garment imports in 1990. Major affected categories were cotton apparel, silk knitted shirts/blouses, and silk trousers/shorts. The export value of these products from Mongolia was halved to US$ 4.3 million in 2002 from US$ 10 million in the previous year. The remaining integration in the final phase, which started at the beginning of 2005, amounted to a maximum of 49 percent.

11. China’s quota utilization rates were high for the major categories in which Mongolia concentrated its exports to the U.S. market. High quota utilization rates generally mean that China’s exports to the quota imposed markets are competitive but restricted. Therefore, Chinese foreign direct investment is likely motivated primarily by quota restrictions on these products.

Table III.2.Major garment exports from Mongolia and China’s quota utilization rate
20032004share in 2004China’s quota utilization

rate in 2004
(millions of US dollars)(percent)(percent)
338 Knit Shirts, MB12198.392.7
339 W/G Knit Blous394017.492.7
345 Cotton Sweater21114.695.4
348 W/G Slacks, et464419.383.4
445 Wool Sweater, M3115.093.4
446 Wool Sweater, W83013.293.4
other527432.1
Total garment181229100
Sources: US-OTEXA, and chinaquota.com

C. Effects of the Final Quota Elimination

12. In the first half of 2005, Mongolian garment exports to the United States declined by 27 percent in value terms, and 37 percent in volume terms compared with a year earlier. Almost all the categories indicate substantial declined, including one showing complete shutdown. These numbers are consistent with reported observations of Chinese investors suspending operations in Mongolia, either temporally or permanently. Conversely, garment exports from China have grown rapidly since the final phase of the quota elimination. The U.S. garment imports from China increased by over 40 percent in volume terms during the first half of 2005, while imports from Mongolia (and one other Asian exporter—Nepal) fell by more than one third. Contrary to initial expectations, garment exports from a number of other Asian producers have also increased.8 For example, Cambodia, where most of garment producers are foreign owned, increased its export to the United States by 15 percent in the first half of 2005.

Table III.3.Mongolian Garment Exports to the US
unit: in million of dollars20042005valuevolume
Jan-JunJan-Junchangechange
338 Knit Shirts, MB93-69.1-20.4
share in total13.05.5
339 W/G Knit Blouse1210-20.1-2.8
share in total17.018.5
347 Cot.M/B Trouser32-40.0-38.0
share in total4.53.7
348 W/G Slacks, etc2322-4.7-29.6
share in total32.942.6
Sub-total4837-23.4-25.7
share in total67.570.3
Total garment export7152-26.5-37.0
Source: US OTEXANote: The products included in the safeguard are i) cotton knit shirts and blouses (Category 338/339), ii) cotton trousers (Category 347/348), and iii) cotton and manmade fiber underwear (Category 352/652). Mongolia does not export the products in category 352/652.

Figure III.1.Volume and Price Changes of Garment Exports to the United States from Selected Asian Low Income Countries in the First Half of 2005

13. In light of the surging imports from China, in May 2005 the government of the United States announced its decision to impose safeguard limits on the amount of garments imported of three categories from China. These categories were cotton knit shirts and blouses (category 338/339), cotton trousers (category 347/348), and cotton and man-made fiber underwear (category 352/652). Two of these categories (338/339 and 347/348) represented about 70 percent of Mongolian garment export to the United States. This safeguard action allows exports from China in the three categories to increase by only 7.5 percent annually. The question, therefore, is whether Chinese investors will maintain or even expand their Mongolia operations to escape the current or possible future safeguard actions in foreign markets.

14. Government actions have not successfully arrested the declining garment exports. The government has taken decisions to mitigate the impacts of quota elimination. Two major actions have already been taken: i) halving the level of social security contributions by employers for affected firms, from the current 19 percent of the wage bill, and ii) exempting the import tax on raw materials for garment products. The government also plans to establish a textile industrial park in Ulaanbaatar, and intends to take as-yet unspecified measures to promote diversification in the sector. In addition, the government is trying to obtain a favorable bilateral treatment from the European Union.

D. Challenges for Policymakers

15. Because Mongolia’s garment sector relies heavily on imported raw materials, the net impacts of the sector on the balance of payments and GDP are still relatively small. Almost all of Mongolia’s non-cashmere garment exports are made from imported materials, whose share against the export value is estimated to be more than 70 percent. Therefore, the share of GDP is also very small—perhaps less than 2 percent, and the net impact of trade balance would not be substantial. Given this relatively small sized and current favorable international commodity markets, Mongolia would not face a major balance of payment risk from the decline in garment exports.

16. However, the social and employment impacts could be serious. The number of full-time workers (mostly women) in the non-cashmere garment sector declined to 13,800 as of April 2005 from 18,400 as of April last year due to the closure of factories. The government needs to facilitate the transition of these workers so that they could be absorbed in other sectors, where Mongolia is likely to have a more durable comparative advantage, based on its rich endowments with minerals resources and cashmere. Given that different skills are required even in the cashmere sector, the unemployed workers would need to be provided with necessary training.

17. Continuing efforts are therefore needed to ensure that Mongolia is able to benefit from its areas of comparative advantage and to respond flexibly to changes in the international environment. Development of mineral industries with large reserve potentials continues to be a major engine of economic growth in Mongolia. The exploration has just started. In order to attract foreign direct investment for mineral development, it is critically important to maintain a stable and predictable legal and regulatory framework. The potential of cashmere industry is high, but not fully exploited. A recent study by the World Bank identified a series of shortcomings in the cashmere sectors, including supply distortions, inadequate marketing and distribution systems, and weak public and private institutional capacity to guide the industry’s development.9 A current proposal to impose new export tariffs on low cashmere would not be consistent with Mongolia’s open trade strategies and could introduce additional distortions. The government, therefore, needs to promote market-oriented strategies to support efficient cashmere market development.

18. Mongolia’s large territory, its landlocked position, the small size of the domestic market, and often harsh weather conditions all pose particular challenges for policymakers. Over the medium term, therefore, further investment will be needed to upgrade the country’s infrastructure. Given the large scale and very high cost of such investments, it will be crucial for Mongolia to set coherent investment priorities and to obtain advice and financing for such projects from multilateral and bilateral donors on concessional terms.10

E. Conclusions

19. The impacts of MFA quota elimination on Mongolia are likely to be substantial and greater than in most other Asian countries, calling for strong action to offset the decline. While some of the neighboring Asian countries have managed to increase their garment exports even after the quota elimination, Mongolia’s non-cashmere garment exports have suffered a major decline. In the longer term, Mongolia has very limited rationale for a garment industry reliant on imported raw materials, far from the main market, and with high transport costs. Mongolia therefore needs to lay the foundations for the exploitation of its areas of comparative advantage—such as mineral resources, cashmere, and new areas like tourism—through the maintenance of market-oriented policies to enable the private sector to respond flexibly to changes in the international environment, the careful identification of public investment priorities, and a continued reliance on concessional foreign financing, supported by an open environment for foreign direct investment. The windfall of higher international commodity prices provides only temporary breathing room for Mongolia. It is imperative to make good use of this breathing space to improve a business environment that creates opportunities to invite foreign investors in various industries.

STATISTICAL APPENDIX
Table 1.Mongolia: Selected Economic and Financial Indicators, 1999–2004
19992000200120022003 1/2004
Est.
(Percent change)
Real GDP3.21.11.04.05.610.6
Consumer prices (end period)10.08.17.91.74.710.6
(In percent of GDP)
General government revenue27.234.538.538.437.939.4
General government expenditure39.441.543.944.442.141.7
Current balance-0.23.24.84.47.69.2
Primary balance-10.3-5.2-3.9-4.3-3.0-1.0
Overall balance-12.2-7.0-5.4-5.9-4.2-2.2
Net domestic bank credit to government0.0-0.7-1.7-2.29.5-3.2
Total public debt 2/3/104.798.889.191.7113.999.0
NPV of total public debt 2/3/4/74.867.062.862.780.260.2
Domestic debt8.78.74.83.014.98.1
(Percent change)
Net foreign assets96.933.68.940.1-24.922.0
Net domestic assets-23.6-17.996.145.4191.619.5
Domestic credit-11.1-8.041.643.2147.023.0
Broad money31.717.528.041.949.720.3
Reserve money51.819.48.421.714.716.8
Broad money velocity (GDP/BM) 5/4.34.03.42.62.12.1
Annual interest rate on central bank bills (percent) 6/11.48.58.88.015.015.8
(In millions of US dollars; unless otherwise indicated)
Current account balance, including official transfers 7/-60-54-77-108-9918
(In percent of GDP)-6.7-5.7-7.6-9.6-7.71.2
Trade balance-113-140-170-229-199-149
(In percent of GDP)-12.5-14.8-16.7-20.5-15.6-9.8
Exports, fob454536523524627872
(Percent change)-1.818.0-2.43.219.739.0
Of which: Gold967075118157240
Copper119160147140162284
Imports, cif567676-6937538271,021
(Percent change)-2.619.22.58.69.823.5
Financial and capital account balance 7/758892174111
Foreign Direct Investment3440437813293
Gross official international reserves (end-period) 8/157191207271178205
(In months of next year/projected imports c.i.f.)2.83.33.33.92.12.2
Public and publicly guaranteed external debt 2/8288378549781,2371,360
(In percent of GDP)95.990.184.388.799.190.9
NPV of public and publicly guaranteed external debt 2/3/4/571542587658816822
(In percent of GDP)63.057.357.759.765.354.9
(In percent of exports of goods & services)102.885.191.792.997.767.9
Debt service31.924.133.932.0284.091.1
(In percent of exports of goods & services)5.73.85.34.534.07.5
Exchange rate
Togrogs per US dollar (end of period)1,0721,0971,1021,1251,1701,209
Trade prices
Export prices (U.S. dollar, percent change)-7.013.6-11.6-4.76.623.1
Import prices (U.S. dollar, percent change)-2.42.5-2.32.35.415.1
Nominal GDP (billion togrogs)9251,0191,1161,2411,4611,808
Nominal GDP (million U.S. dollars)9069461,0161,1181,2741,516
Sources: Mongolian authorities; and Fund staff estimates and projections.

The outturn for 2003 reflects the impact on fiscal, monetary and external accounts of the $250 million settlement of the TR debt.

Includes IMF loans, guarantees and arrears.

Includes treasury bills outstanding, and gross claims of the BoM on the government.

Calculated based on 5 percent discount rate from 2004 onwards.

Seasonally adjusted figures for broad money velocity.

Annualized yield on end-period auction of 14-day bills.

Includes errors and omissions. From 2004 onwards, revised estimates for remittances in the current account, offset by adjustments mainly in capital account.

Beginning December 2000, includes commercial banks’ foreign exchange deposits with the Bank of Mongolia.

Table 2.Mongolia: Gross Domestic Product, 1999–2004(At current prices)
199920002001200220032004
(In billions of togrogs)
Gross domestic product925.31,018.91,115.61,240.81,461.21,808.0
Industry168.5204.3223.9250.7325.5462.8
Agriculture342.1296.5277.6256.6293.4385.7
Construction23.019.321.929.044.847.0
Transportation62.483.1107.2140.0154.9175.0
Communications22.329.137.742.847.854.0
Trade191.7244.6297.8344.0387.1445.5
Services115.4142.0149.4177.7207.7237.9
Net factor income from abroad-4.0-5.631.766.572.0160.2
Gross national product921.31,013.31,147.41,307.31,533.21,968.2
(In percent of GDP)
GDP100.0100.0100.0100.0100.0100.0
Industry18.220.120.120.222.325.6
Agriculture37.029.124.920.720.121.3
Construction2.51.92.02.33.12.6
Transportation6.78.29.611.310.69.7
Communications2.42.93.43.43.33.0
Trade20.724.026.727.726.524.6
Services12.513.913.414.314.213.2
Sources: National Statistical Office, and Ministry of Finance and Economy.
Table 3.Mongolia: Gross Domestic Product, 1999–2004(At 2000 constant prices)
199920002001200220032004
(In billions of togrogs)
Gross domestic product1,008.21,018.91,029.51,070.71,130.31,250.0
Industry200.3204.3236.5243.0244.9287.6
Agriculture352.6296.5242.1212.0222.3266.4
Construction22.619.321.724.936.036.4
Transportation71.783.195.5113.5126.7141.4
Communication21.029.131.233.336.437.7
Trade196.5244.6265.6299.4320.8333.3
Services143.5142.0137.0144.6143.3147.2
Net factor income from abroad-4.4-5.629.357.455.7110.8
Gross national product1,003.91,013.31,058.81,128.11,186.01,360.7
(Percent change)
GDP growth3.21.11.04.05.610.6
Industry1.62.015.82.70.817.4
Agriculture4.4-15.9-18.3-12.44.919.9
Construction1.6-14.612.414.944.21.3
Transportation-0.915.914.918.911.711.5
Communication11.338.47.16.79.33.7
Trade0.624.58.612.87.13.9
Services8.0-1.1-3.55.5-0.92.8
Net factor income from abroad4,541.528.5-622.496.1-3.098.9
Gross national product2.80.94.56.55.114.7
Sources: National Statistical Office, and Ministry of Finance and Economy.
Table 4.Mongolia: Output of Major Agricultural Products, 1999–2004
199920002001200220032004
(In thousands of metric tons, unless otherwise specified)
Meat599.1639.2468.1413.1318.1424.5
Milk (million tons)467.0375.6290.3276.6292.4328.6
Dairy products (tons)36.524.917.7
Eggs (millions)9.66.77.74.27.116.0
Wool20.921.719.817.015.215.3
Wheet169.5142.0138.7123.1160.4135.6
Cereals169.5142.1142.2125.9165.0138.5
Potatoes6.758.858.351.978.780.2
Other vegetables45.638.944.539.759.649.2
(In millions of head)
Livestock33.530.126.123.925.528.0
Sheep15.213.811.910.610.811.7
Goats11.010.29.69.110.712.2
Cattle3.83.12.11.91.81.8
Horses3.22.62.22.01.92.0
Camels0.30.30.30.30.30.3
(Percent change)
Meat8.16.7-26.8-11.8-23.033.5
Milk8.4-19.6-22.7-4.75.712.4
Diary products-64.9-31.8-28.9
Eggs12.9-30.214.9-45.569.1125.3
Wool-19.63.8-8.8-14.1-10.60.6
Cereals-13.1-16.20.1-11.531.0-16.1
Potatoes-89.7777.6-0.9-10.951.61.9
Other vegetables34.1-14.714.4-10.850.1-17.5
(In percent of total head)
Memorandum item:
Privately owned livestock96.296.797.297.497.998.2
Sources: National Statistical Office, and Ministry of Finance and Economy.
Table 5.Mongolia: Output of Basic Industrial and Mining Products, 1999–2004(In thousands of metric tons, unless otherwise specified)
199920002001200220032004
Electricity (million kilowatt hours)2,8422,9463,0103,1123,1383,304
Coal4,9645,1855,3375,6935,8247,092
Fluorspar597734585514488468
Copper concentrate362358381376372371
Gold concentrate (kilograms)10,24611,80813,70012,09711,11919,418
Bricks (millions)171721132313
Cement104926814816262
Lime503730434230
Sawn timber (thousand of cubic meters)161521101718
Scoured wool112112
Felt (thousand meters)10211411111330368
Woolen fabrics (thousand meters)192138325559
Coats (thousands)000
Suits (thousands)91416
Leather footwear (thousand pairs)76171053
Sheepskin coats (thousands)012
Meat (excluding pork)46127114
Sausages4397557289511,1711,272
Flour674038505458
Bakery goods152023222223
Confectionery887677
Milk and dairy products (liters)221356
Toilet soap71600
Household soap1532204
Carpets (thousands of square meters)629705615534663690
Processed metal131310557
Sources: National Statistical Office, and Ministry of Finance and Economy.
Table 6.Mongolia: Gross Industrial Output at 1995 prices, 1999–2004
199920002001200220032004
(In billions of togrogs)
Food29.228.729.630.231.932.7
Leather and shoes0.40.60.70.40.40.2
Textiles22.619.328.833.627.830.0
Clothing2.02.34.210.313.911.3
Energy 1/45.246.643.845.345.748.6
Coal12.712.813.513.914.617.8
Mining of metal ores97.4102.7109.4101.696.5136.9
Other mining and quarrying14.216.518.715.017.714.0
Non-metallic products4.64.24.86.37.05.1
Wood processing1.11.01.00.81.81.1
Chemicals1.01.01.61.31.11.3
Printing1.01.61.62.04.71.7
Furniture3.13.10.50.90.40.5
Other3.53.23.69.613.111.4
Sources: National Statistical Office, and Ministry of Finance and Economy.

Includes electric and thermal energy.

Table 7.Mongolia: Coal Mining Sector, 1999–2004(In thousands of metric tons)
199920002001200220032004
Production4,9645,1855,3375,6935,8247,092
Imports304310000
Consumption5,0175,2125,3275,6925,8237,092
Intermediate 1/4,1274,4494,5374,7234,3804,479
Final consumption8907637909691,4432,613
Industry and construction34718015215215491
Agriculture3230889
Communal housing and public services202407334436465451
Other3091733043748172,063
Exports4351,560
Memorandum item:
Stock, end of year170186206157227343
Sources: National Statistical Office, and Ministry of Finance and Economy.

Consumption by thermal power stations.

Table 8.Mongolia: Petroleum Imports, 1999–2004(In thousands of metric tons)
199920002001200220032004
(In thousands of metric tons)
Total petroleum imports393.7429.9487.5470.6512.9563.9
Petro193.2233.7247.2243.7259.1270.1
Diesel159.4161.7197.1190.6214.8258.2
Jet fuel15.918.422.820.523.922.8
Mazut22.714.617.59.512.411.1
Lubricants2.51.52.96.32.71.7
(In millions of U.S. dollars)
Memorandum item:
Value of Petroleum Imports71.8109.8124.0110.0142.5210.2
Sources: National Statistical Office.
Table 9.Mongolia: Electricity Sector, 1999–2004
199920002001200220032004
(In millions of kilowatt hours)
Supply3,0453,1273,2123,2793,3093,474
Domestic2,8422,9463,0173,1123,1383,304
Imports203181196167171171
Utilization, total3,0453,1273,2123,2793,3093,474
Industry and construction9591,1821,2031,2601,3611,459
Transport and communications677987859299
Agriculture272117222426
Commercial housing and public services444463476487526568
Other sectors370165164178192207
Loss in transmission and distribution509576603583489480
Power stations’ own use610616644649618629
Exports5925181678
(Togrogs per kilowatt hour, annual average)
Tariff
Industry414145474751
Agriculture414145474751
Households353545474749
(Percent change)
Supply and utilization0.12.72.72.10.95.0
Domestic6.23.72.43.20.85.3
Imports-44.7-10.88.3-14.62.4-0.3
Industry and construction-20.723.31.84.78.07.2
Transport and communications6.317.910.1-2.68.07.7
Agriculture145.5-22.2-19.029.48.27.6
Commercial housing and public services4.24.32.82.38.07.9
Other sectors68.9-55.4-0.68.48.07.5
Loss in transmission and power stations’ own use
in total supply (in percent)36.738.138.837.633.531.9
Sources: Ministry of Fuel and Energy.
Table 10.Mongolia: Employment by Sector, 1999–2004(Number of employees, in thousands at end of year)
199920002001200220032004
Total employment 1/813.6809.0832.3870.8926.5950.5
Agriculture and forestry402.6393.5402.4391.4387.5381.8
Industry98.891.093.399.2109.5114.2
Transport and communications34.934.135.138.839.542.2
Construction27.623.420.425.535.139.2
Education43.254.455.259.355.357.8
Health34.833.533.034.536.839.4
Other171.7179.1192.9222.1262.8275.9
Memorandum items:
Labor force853.4847.6872.6901.7959.8986.1
Unemployed39.838.640.330.933.335.6
Sources: National Statistical Office, and Ministry of Finance and Economy.

Excludes foreign employees.

Table 11.Mongolia: Ulaanbaatar Consumer Prices, 1999-2005 1/(December 2000 = 100)
1999200020012002200320042005
Jan.-July
(Period average)
Overall index90.4100.9109.0110.1113.8123.2138.7
Flour and flour goods94.599.2101.998.498.1121.5123.7
Meat and meat products103.5135.4137.5137.9159.2187.2256.3
Milk and diary products90.493.0100.291.592.791.896.2
Sugar, candy, tea, fruits91.491.1100.3100.896.2103.6106.2
Potato and vegetables94.5127.6113.0123.7116.8104.4140.4
Other food stuffs97.9100.8102.4102.2104.1110.6123.7
Alcohol and tobaccos89.597.1112.4115.9112.5117.3127.8
Men’s clothing95.697.0103.6108.4110.2112.8115.7
Women’s clothing97.698.0102.0100.5100.599.299.9
Children’s clothing97.799.999.5101.8117.4118.3126.4
Footwear95.897.099.898.7106.9108.8108.2
Cloth100.499.998.4100.4118.8124.6139.3
Housing, heating, and electricity74.981.3110.0119.2121.6123.7132.5
Household goods94.198.6100.9101.4101.1102.9106.8
Medical care92.5100.0100.2102.1111.7116.1120.8
Transport and communication83.897.9100.5102.8105.5115.8135.0
Education and recreation88.998.299.397.9108.7117.9121.5
Other goods and services93.7100.1102.1103.9117.8128.0133.6
(End of period)
Overall index92.5100.0108.0109.7114.9127.5145.1
Flour and flour goods97.3100.0103.094.5110.1124.9123.7
Meat and meat products90.3100.0119.5119.1146.5181.9299.3
Milk and diary products96.0100.0106.4107.0102.0101.476.8
Sugar, candy, tea, fruits92.4100.099.895.497.2103.8111.6
Potato and vegetables103.3100.0106.1121.085.5107.1189.4
Other food stuffs100.1100.0104.8102.7105.0116.5121.5
Alcohol and tobaccos90.4100.0116.3115.5112.3119.7128.1
Men’s clothing97.3100.0111.1112.3114.3121.3112.8
Women’s clothing102.0100.0103.6106.0101.9100.999.5
Children’s clothing100.7100.0104.4117.2132.4132.7125.3
Footwear100.1100.0100.9113.3112.2111.3105.1
Cloth100.4100.097.4103.3122.8136.2139.9
Housing, heating, and electricity75.8100.0122.2126.8125.3130.2132.2
Household goods97.3100.0101.4103.8100.8105.9107.9
Medical care100.0100.099.4108.5113.9118.0123.8
Transport and communication96.8100.0101.0105.1107.2130.7137.3
Education ad recreation96.3100.098.4102.7114.3122.9121.5
Other goods and services96.3100.0103.4107.6122.6132.6134.1
(Percent change)
Memorandum items:
Annual average7.611.68.00.35.18.314.5
End of period10.08.18.01.64.711.016.0
Source: National Statistical Office.

The number of commodities comprising the consumer basket increased from 205 to 239 from December 2000.

Table 12.Mongolia: Ulaanbaatar Consumer Price Inflation, 1999-2005(12-month percentage change)
1999200020012002200320042005
Weight1212121212891011121234567
Overall index1.0010.08.18.01.64.712.712.211.310.910.611.012.812.314.415.417.615.8
Food stuffs0.519.15.29.7-1.27.720.220.217.115.014.414.917.015.518.619.724.021.6
Flour and flour goods0.132.72.83.0-8.216.431.526.012.912.913.511.28.47.43.62.81.4-1.4
Meat and meat products0.1613.810.819.5-0.323.429.833.034.930.424.126.028.225.937.239.544.437.9
Milk and dairy products0.05-0.14.26.40.5-5.02.44.08.3-1.8-0.70.13.20.1-4.31.94.311.3
Sugar, candy, tea, and fruits0.059.38.2-0.2-4.42.312.212.39.54.96.82.01.10.10.8-0.15.87.1
Potatoes and vegetables0.0547.0-3.26.114.0-28.74.25.58.217.525.325.029.728.929.825.146.249.5
Other food stuffs0.044.6-0.14.8-2.02.26.97.16.88.011.013.718.018.017.410.110.310.0
Alcohol and tobacco0.046.510.616.3-0.7-2.9-3.3-3.4-3.1-3.2-3.71.312.712.210.59.99.57.2
Clothes and shoes0.135.0-0.34.55.8-0.11.42.70.91.01.32.32.52.02.42.63.22.1
Men’s clothing0.03-2.52.811.11.12.12.35.17.15.06.16.96.53.75.64.25.34.6
Women’s clothing0.044.1-2.03.62.3-3.8-1.6-0.6-0.9-0.7-1.00.61.00.61.12.12.11.8
Children’s clothing0.01-1.0-0.74.412.312.90.81.4-7.51.00.23.35.810.910.411.813.613.2
Footwear0.0510.2-0.10.912.3-0.83.94.2-1.3-0.9-0.8-0.4-0.20.1-0.50.00.6-1.8
Cloth0.00-4.4-0.4-2.66.019.0-1.40.11.35.810.910.810.614.913.614.615.315.7
Housing, heating, and electricity0.115.032.022.23.8-1.73.9-1.42.94.33.93.68.810.112.313.212.813.0
Household goods0.034.72.71.42.4-2.82.82.74.06.75.16.47.45.63.55.45.45.1
Medical care0.0117.80.0-0.69.24.94.94.63.03.03.63.22.93.26.05.87.67.5
Transport and communication0.1027.43.31.04.02.113.517.720.922.521.921.820.821.923.724.225.821.9
Education and recreation0.0715.43.9-1.64.411.47.77.76.86.87.56.46.47.06.27.06.74.2
Other goods and services0.046.03.93.44.113.69.89.47.77.68.28.07.88.07.68.33.43.0
Source: National Statistical Office.
Table 13.Mongolia: Retail Prices, 1999–2005(End of period; in togrogs per kilogram, except where stated)
1999200020012002200320042005
July
Mutton7208019599501,2271,5002,553
Beef7748751,0881,0811,3271,7332,656
Flour325355362297409442402
Bread250250266266288312319
Sugar590684677589557580630
Rice420446476459456685706
Vegetable oil (liter)1,5501,5001,2501,2401,4081,5501,600
Tea bricks (2 kilograms)2,4652,5502,3972,2671,9472,4002,723
Tobacco1,2651,5001,5201,6001,6501,6501,775
Gasoline A-93 (liter)410390410435520673790
Gasoline A-76 (liter)380350375400470600730
Diesel (liter)396470420420462546865
Sources: National Statistical Office; and Neft Import Concern.
Table 14.Mongolia: Privatization of State-Owned Enterprises, 1999–2004 1/
No. of Enterprises

Privatized
Privatization Revenue

(million togrogs)
1999
Total privatization3659,475
Large enterprises167,133
Construction sector3477
Mineral sector2918
Agriculture sector42,741
Other72,997
Small enterprises and assets3492,342
2000
Total privatization195,487
Large enterprises95318
Construction sector31,588
Mineral sector21,364
Agriculture sector1742
Other31,625
Small enterprises and assets10169
2001
Total privatization114,903
Large enterprises14,446
Construction sector00
Mineral sector00
Agriculture sector00
Other14,446
Small enterprises and assets10457
2002
Total privatization2515,912
Large enterprises1014,681
Construction sector3456
Mineral sector00
Agriculture sector1145
Other314,080
Small enterprises and assets151,231
2003
Total privatization1511,174
Large enterprises710,928
Construction sector2106
Mineral sector00
Agriculture sector00
Other510,823
Small enterprises and assets8245
2004
Total privatization2018,429
Large enterprises417,818
Construction sector00
Mineral sector00
Agriculture sector00
Other417,818
Small enterprises and assets16611
Source: State Property Commission.

Excludes privatization receipts of local governments.

Table 15.Mongolia: Government Average Wages, 1999–2004
199920002001200220032004
Employment (thousands)134.0136.4133.7135.6132.2120.5
Wage bill (billions of togrogs)63.586.192.1105.0116.9128.8
Per capita wage (thousands of togrogs)473.9631.2688.6774.3884.31,068.9
Nominal wage index (2000=100)75.1100.0109.1122.7140.1169.3
Percent change14.433.29.163.440.155.2
CPI index (period average, 2000=100)90.4100.9107.2108.2113.8122.8
Percent change7.611.66.30.95.17.9
Real wage index (2000=100)83.099.1101.7113.4123.1137.9
Percent change6.419.42.611.48.612.0
Exchange rate (period average, Togrogs/US$)1,021.91,076.71,097.71,110.31,147.01,192.9
Monthly per capita wage (US$)38.648.952.358.164.274.7
Sources: Ministry of Finance and Economy; National Statistical Office; and Fund staff estimates.
Table 16.Mongolia: Summary Operations of the General Government, 1999-2005
1999200020012002200320042005
ActualActualActualActualActualActualBudget
(In billions of togrogs)
Total revenue and grants251.7351.4429.5477.0553.9713.1738.9
Total expenditure and net lending364.6422.6489.7550.5615.8753.7806.8
Overall balance (incl. grants)-112.9-71.3-60.2-73.4-61.9-40.6-67.8
Financing112.971.360.273.461.940.667.8
Foreign financing105.866.672.881.8-115.868.1134.1
Domestic financing7.04.7-12.6-8.3177.7-27.6-66.2
(In percent of GDP)
Total revenue and grants27.234.538.538.437.939.435.9
Current revenue26.534.037.737.937.339.135.7
Tax revenue and social security contributions19.725.629.428.928.832.329.7
Income taxes4.26.25.85.86.78.06.5
Enterprise income tax2.94.73.93.74.75.54.2
Personal income tax1.41.51.92.12.02.52.3
Social security contributions3.33.94.84.44.54.54.2
Sales tax and VAT6.57.59.39.68.39.08.4
Excise taxes2.94.04.84.14.03.94.5
Customs duties and export taxes1.02.22.42.02.22.52.2
Other taxes1.81.92.33.03.14.43.9
Nontax revenue6.88.48.28.98.56.86.0
Capital revenue and grants0.70.50.80.60.60.40.1
Total expenditure and net lending39.441.543.944.442.141.739.2
Current expenditure26.730.832.933.529.829.928.7
Wages and salaries6.98.58.38.58.07.77.5
Purchase of goods and services10.912.214.614.612.012.010.1
Subsidies to public enterprises0.10.00.50.70.60.60.4
Transfers7.08.38.08.27.98.28.9
Interest payments1.91.81.51.61.21.31.4
Contingency allocation0.4
Capital expenditure and net lending12.710.611.010.912.411.810.5
Capital expenditure4.05.15.35.56.25.84.8
Domestically-financed3.14.34.44.24.64.63.6
Foreign-financed0.90.80.91.31.61.21.2
Net lending8.75.55.75.46.26.05.7
On-lent foreign project loans (net)8.35.35.35.45.85.95.9
Domestic lending minus repayments0.40.20.50.10.40.2-0.1
Current balance (excl. privatization receipts)-0.23.24.84.47.69.27.1
Primary Balance-10.3-5.2-3.9-4.3-3.0-1.0-1.9
Overall balance (incl. grants)-12.2-7.0-5.4-5.9-4.2-2.2-3.3
Financing12.27.05.45.94.22.23.3
Foreign Financing (net)11.46.56.56.6-7.93.86.5
Project loans9.46.26.26.57.37.17.0
Program loans1.81.32.11.31.91.51.0
Short term external debt0.00.00.00.04.0-3.30.0
Amortization1.11.01.81.221.11.51.5
Arrears0.00.00.00.00.00.70.0
Privatization receipts1.30.70.51.41.50.90.7
Domestic Bank Financing (net)0.0-0.7-1.7-2.29.5-3.2-3.9
Domestic Non-Bank Financing (net)-0.50.40.00.21.20.10.0
Memoranda items:
Total public debt (incl. IMF)/GDP104.798.889.191.7113.999.088.3
Foreign debt (incl. IMF)/GDP95.990.184.388.799.190.984.8
Domestic debt/GDP8.78.74.83.014.98.13.5
NPV of total public debt74.867.062.862.780.260.255.6
Nominal GDP925.31,018.91,115.61,240.81,461.21,808.02,059.8
Sources: Ministry of Finance; and Fund staff estimates and projections.
Table 17.Mongolia: General Government Revenue, 1999–2004
199920002001200220032004
(In billions of togrogs)
Total revenue and grants251.7351.4429.5477.0553.9713.1
Current revenue244.8346.5420.1469.7545.2706.3
Tax revenue and social security contributions182.0260.9328.2359.2421.0583.1
Income taxes39.062.864.572.497.6144.1
Enterprise income tax26.548.043.846.368.898.6
of which Erdenet0.015.511.39.529.852.9
Personal income tax12.614.820.726.228.845.5
Social security contributions30.639.354.054.465.282.1
Sales tax and VAT60.476.2104.2118.7121.9163.1
Domestic VAT (Sales tax prior to 1998)28.930.243.840.747.957.4
VAT on imports (Sales tax prior to 1998)31.446.060.478.094.3136.9
Excise taxes26.741.053.351.358.670.3
Excise on alcohol11.215.523.220.619.823.3
Excise on vodka and tobacco3.54.53.13.53.74.2
Excise on imported beer0.20.43.12.93.33.3
Excise on vehicles3.17.27.36.010.514.7
Excise on petroleum8.813.416.618.321.324.8
Customs duties and export taxes9.022.327.024.632.644.7
Customs duties5.917.226.023.831.140.8
Export taxes3.25.21.00.81.63.9
Other taxes16.319.225.237.745.178.8
Petrol and diesel tax4.34.25.54.95.76.1
Vehicle license fee2.52.93.43.74.04.8
Tax on private property0.30.31.73.44.65.7
Other9.211.914.625.830.862.1
Nontax revenue62.785.791.9110.6124.3123.2
Interest and fines3.58.19.19.117.620.5
Own budget revenues29.035.247.248.065.065.2
Dividends5.717.211.66.41.34.1
of which Erdenet1.111.01.62.50.11.9
Other nontax revenue24.525.124.247.240.433.4
Capital revenue and grants6.94.99.37.38.76.8
Capital revenue0.00.10.20.50.00.8
Grants 1/6.94.89.26.88.76.1
(In percent of total revenue)
Current revenue97.298.697.898.598.499.0
Tax revenue and social security contributions72.374.276.475.376.081.8
Enterprise income tax10.513.710.29.712.413.8
Personal income tax5.04.24.85.55.26.4
Social security contributions12.111.212.611.411.811.5
Taxes on goods and services34.633.436.735.632.632.7
Customs duties and import surcharges3.66.36.35.25.96.3
Other taxes6.55.55.97.98.111.1
Nontax revenue24.924.421.423.222.417.3
Capital revenue0.00.00.00.10.00.1
Grants2.71.42.11.41.60.8
(In percent of GDP)
Total revenue27.234.538.538.437.939.4
Current revenue26.534.037.737.937.339.1
Tax revenue and social security contributions19.725.629.428.928.832.3
Enterprise income tax2.94.73.93.74.75.5
Personal income tax1.41.51.92.12.02.5
Social security contributions3.33.94.84.44.54.5
Taxes on goods and services9.411.514.113.712.312.9
Customs duties and import surcharges1.02.22.42.02.22.5
Other taxes1.81.92.33.03.14.4
Nontax revenue6.88.48.28.98.56.8
Capital revenue0.00.00.00.00.00.0
Grants0.70.50.80.60.60.3
Sources: Ministry of Finance and Economy; and Fund staff estimates.

Grants relate to receipt of the budget of counterpart funds from recipient of the grants. This differs from the balance of payments definition which records grants when they are received from abroad.

Table 18.Mongolia: General Government Expenditure, 1999–2004
199920002001200220032004
(In billions of togrogs)
Total expenditure and net lending364.6422.6489.7550.5615.8753.7
Current expenditure246.9314.2366.7415.3434.8539.9
Wages and salaries63.586.192.1105.0116.9138.7
Goods and services100.7124.7162.6180.8174.9217.5
Subsidies and current transfers65.385.295.5109.9125.4160.5
Subsidies 1/0.60.56.18.89.411.4
Transfers64.784.789.4101.1116.0149.1
Social Security Fund42.358.464.373.387.5116.2
Social Assistance Fund11.811.613.717.419.823.0
Other transfers10.614.711.410.58.79.8
Interest payment17.318.216.519.617.623.2
Capital expenditure and net lending117.7108.4123.0135.2180.9213.8
Domestically financed capital expenditure28.943.849.052.367.282.7
Domestic lending minus repayment3.61.85.30.76.12.8
Foreign financed projects85.262.968.882.2107.6128.3
(In percent of total expenditure)
Current expenditure67.774.474.975.470.671.6
Wages and salaries17.420.418.819.119.018.4
Goods and services27.629.533.232.828.428.9
Subsidies and transfers17.920.219.520.020.421.3
Subsidies0.20.11.21.61.51.5
Transfers and other17.720.118.318.418.819.8
Social Security Fund11.613.813.113.314.215.4
Other6.16.25.15.14.64.4
Interest payments4.74.33.43.62.93.1
Capital expenditure and net lending32.325.625.124.629.428.4
Domestically financed capital expenditure7.910.410.09.510.911.0
Domestic lending minus repayment1.00.41.10.11.00.4
Foreign financed projects23.414.914.014.917.517.0
Total expenditure and net lending39.441.543.944.442.141.7
Current expenditure26.730.832.933.529.829.9
Wages and salaries6.98.58.38.58.07.7
Goods and services10.912.214.614.612.012.0
Subsidies and current transfers7.18.48.68.98.68.9
Subsidies0.10.00.50.70.60.6
Transfers7.08.38.08.27.98.2
Social Security Fund4.65.75.85.96.06.4
Social Assistance Fund1.31.11.21.41.41.3
Other transfers1.11.41.00.80.60.5
Interest payment1.91.81.51.61.21.3
Capital expenditure and net lending12.710.611.010.912.411.8
Domestically financed capital expenditure3.14.34.44.24.64.6
Domestic lending minus repayment0.40.20.50.10.40.2
Foreign financed projects9.26.26.26.67.47.1
Sources: Ministry of Finance and Economy; and Fund staff estimates.

Beginning in 2001, this item includes subsidies to state-owned enterprises for quasi-fiscal activities which, previously, had been recorded under purchases of goods and services.

Table 19.Mongolia: General Government Expenditure by Function, 1999–2004
199920002001200220032004
(In billions of togrogs)
Total expenditure364.6422.6489.7550.5615.8753.7
General public services33.042.250.454.053.763.7
Defense18.426.125.428.127.932.9
Public order and safety17.023.928.730.533.444.2
Education64.882.198.7103.7115.4141.0
Health35.746.054.358.058.173.2
Social security and welfare59.976.084.596.9117.6150.6
Housing and community services4.77.07.17.66.39.6
Recreation and culture11.514.315.117.518.221.5
Economic affairs22.433.045.158.973.584.9
Other 1/97.172.180.495.3111.7132.0
(In percent of total expenditure)
General public services9.010.010.39.88.78.4
Defense5.16.25.25.14.54.4
Public order and safety4.75.65.95.55.45.9
Education17.819.420.218.818.718.7
Health9.810.911.110.59.49.7
Social security and welfare16.418.017.317.619.120.0
Housing and community services1.31.71.41.41.01.3
Recreation and culture3.13.43.13.23.02.8
Economic affairs6.17.89.210.711.911.3
Other 1/26.617.116.417.318.117.5
(In percent of GDP)
Total expenditure39.441.543.944.442.141.7
General public services3.64.14.54.43.73.5
Defense2.02.62.32.31.91.8
Public order and safety1.82.32.62.52.32.4
Education7.08.18.88.47.97.8
Health3.94.54.94.74.04.1
Social security and welfare6.57.57.67.88.08.3
Housing and community services0.50.70.60.60.40.5
Recreation and culture1.21.41.31.41.21.2
Economic affairs2.43.24.04.85.04.7
Other 1/10.57.17.27.77.67.3
Sources: Ministry of Finance and Economy; and Fund staff estimates.

Includes capital expenditure and net lending (foreign-financed projects).

Table 20.Mongolia: General Government Social Expenditure, 1999–2004
199920002001200220032004
(In billions of togrogs)
Total expenditure364.6422.6489.7550.5615.8753.7
Social expenditure176.6225.4259.7283.7315.6396.0
Social security and social assistance59.976.084.596.9117.6150.6
Education64.882.198.7103.7115.4141.0
Health35.746.054.358.058.173.2
Housing and community services4.77.07.17.66.39.6
Recreational, cultural affairs and services11.514.315.117.518.221.5
(In percent of total expenditure)
Social expenditure48.453.353.051.551.352.5
Social security and social assistance16.418.017.317.619.120.0
Education17.819.420.218.818.718.7
Health9.810.911.110.59.49.7
Housing and community1.31.71.41.41.01.3
Recreational, cultural affairs and services3.13.43.13.23.02.8
Sources: Minstry of Finance and Economy; and Fund staff estimates.
Table 21.Mongolia: Subsides and Transfers, 1999–2004
199920002001200220032004
(In billions of togrogs)
Total subsidies and transfers65.385.295.5109.9125.4160.5
Total subsidies0.60.56.18.89.411.4
Energy0.10.05.48.67.98.1
Urban transport0.60.50.50.01.53.2
Other0.00.00.10.10.00.0
Total transfers64.784.789.4101.1116.0149.1
Social Security Fund42.358.464.373.387.5116.2
Social Assistance Fund11.811.613.717.419.823.0
Other10.614.711.410.58.79.8
(In percent of GDP)
Total subsidies and transfers7.18.48.68.98.68.9
Total subsidies0.10.00.50.70.60.6
Total transfers7.08.38.08.27.98.2
Sources: Ministry of Finance and Economy; and Fund staff estimates.
Table 22.Mongolia: Social Security and Social Assistance Funds, 1999–2004
199920002001200220032004
(In billions of togrogs)
Social Security Fund
Total revenue47.665.673.983.694.6115.3
Budget transfers13.514.821.024.424.442.0
Social security contributions 1/33.259.267.076.584.9107.2
Civil servants9.819.221.423.425.528.2
Business entities14.419.728.127.836.043.5
Employees9.018.723.825.424.435.5
Other1.00.92.02.24.83.1
Total expenditure43.758.464.373.387.5116.2
Old age pension28.238.441.947.055.373.6
Handicapped persons3.85.56.27.59.514.3
Survivors benefits4.76.36.77.89.012.1
Disability benefits0.60.80.91.11.31.5
Death benefits0.70.81.21.61.81.9
Allowance for accidents1.21.92.22.43.04.0
Serviceman’s pension2.13.63.84.25.36.6
Unemployment benefits0.60.50.50.61.11.0
Administration1.30.00.00.00.00.0
Capital investment0.00.00.00.00.00.0
Other0.50.70.91.01.21.3
Overall balance4.02.98.09.28.812.0
Social Assistance Fund
Total expenditure11.811.613.717.319.823.2
Pregnancy1.82.33.64.34.24.3
Mothers with large families1.60.70.50.70.80.8
Child care0.10.10.10.10.10.2
Twins0.00.00.00.00.00.0
Infant nursing2.82.93.34.34.85.7
social pension2.73.63.84.45.77.1
War veterans1.01.01.62.22.43.0
Other1.81.10.81.41.72.1
(In percent of total government expenditure)
Memorandum items:
Social Security Fund expenditure12.013.713.413.314.215.4
Budget transfers to the Social Security Fund3.73.24.34.44.05.6
Social Assistance Fund expenditure3.22.72.83.23.23.1
(In percent of GDP)
Social Security Fund expenditure4.75.55.85.96.06.4
Budget transfers to the Social Security Fund1.51.31.92.01.72.3
Social Assistance Fund expenditure1.31.11.21.41.41.3
Sources: Ministry of Finance and Economy; and Fund staff estimates.

A part of social security contributions constitutes intergovernmental transfers.

Table 23.Mongolia: Number of Social Security Beneficiaries, 1999–2004(In thousands)
199920002001200220032004
Social security298.9310.5316.5344.1364.0365.5
Old age167.5171.6173.2173.0175.9176.3
Handicapped persons29.432.735.242.741.652.7
Survivors’ benefits33.734.935.636.737.737.8
Disability benefits58.161.462.954.864.358.1
Other benefits10.29.99.637.044.640.5
Social assistance249.1223.9242.2285.1354.1378.7
Pregnancy43.845.950.549.351.554.5
Mothers with large families61.628.753.817.535.733.5
Child care37.631.520.64.65.97.5
Twins0.30.40.30.30.30.3
Infant nursing4.73.53.357.158.459.1
War veterans41.547.956.286.5107.1125.2
Social pension25.430.633.837.339.743.6
Disabled Nursing homes for elderly3.69.310.115.519.327.9
Other30.626.113.616.836.227.1
Source: Ministry of Finance and Economy.
Table 24.Mongolia: Government Employment and Wage Bill, 1999–2004
199920002001200220032004
(Number of positions)
Government employment
General public services15,11415,71815,54316,11414,74413,807
Public order and safety14,38415,02312,65812,18614,5069,569
Education46,49846,35948,86650,92847,92748,444
Health27,04626,52925,34425,77024,64323,023
Social security and welfare1,639489621686643608
Recreation and culture5,8586,4196,2105,9235,7215,174
Agriculture and forestry1,3351,2221,3921,4041,2071,037
Other services22,13722,51122,61522,58222,77418,833
Total134,011134,268133,248135,591132,164120,493
(In billions of togrogs)
Wages and salaries
General public services9.412.313.014.916.218.5
Public order and safety7.510.912.113.514.917.9
Education24.132.536.141.446.445.4
Health10.513.715.016.217.822.9
Social security and welfare0.70.30.30.40.40.5
Recreation and culture2.53.23.44.14.34.9
Agriculture and forestry0.60.40.50.90.80.8
Other services8.212.711.513.616.118.0
Total63.586.192.1105.0116.9128.8
Source: Ministry of Finance and Economy.
Table 25.Mongolia: Expenditure of the Health Sector, 1999–2004(In billions of togrogs)
199920002001200220032004
Total expenditure35.746.054.358.058.173.2
Wages and salaries10.513.915.016.217.822.9
Social security2.64.14.34.44.86.0
Social security payments2.13.43.53.64.05.0
Health insurance0.50.70.80.80.81.0
Other goods and services21.525.833.034.532.240.8
Electricity1.21.51.61.61.71.8
Fuel and heating4.34.65.65.35.35.8
Transport (fuel)1.31.82.02.02.02.6
Food2.02.22.72.72.93.4
Medicines6.07.39.59.110.012.0
Other6.78.511.713.810.315.2
Investment0.71.51.32.02.32.4
Capital repair expenditures0.40.60.70.91.11.1
Sources: Ministry of Finance and Economy.
Table 26.Mongolia: Expenditure of the Education Sector, 1999–2004(In billions of togrogs)
199920002001200220032004
Total expenditure64.882.198.7103.7115.4141.0
Wages and salaries24.132.236.141.446.445.4
Social security5.19.79.810.511.811.8
Social security payments4.28.18.28.79.79.8
Health insurance0.91.61.71.82.12.1
Other goods and services31.936.745.843.947.872.0
Electricity2.02.32.82.62.93.0
Fuel and heating10.912.515.414.215.517.1
Transport (fuel)0.50.60.70.70.70.9
Food3.34.15.45.97.79.5
Medicines0.00.00.00.00.00.0
Other15.217.221.620.421.041.4
Investment2.52.43.13.14.94.5
Capital repair expenditures1.20.60.81.81.21.6
Lending minus repayment0.00.63.13.13.25.7
Sources: Ministry of Finance and Economy.
Table 27.Mongolia: Monetary Survey, 2000-05
200020012002200320042005
Dec.Dec.Dec.Mar.Jun.Sept.Dec.Mar.Jun.Sept.Dec.Mar.Jun.
(In billions of togrogs)
Broad money2593314705045586097047408128278468921,009
Currency101109121115141148131140170163144133177
Deposits158222349389417461572600642664703760832
Demand deposits304767656866817185797881101
Tugrik time deposits5988147176193211240273284287301347371
Forex deposits6987135148156184250257273298324332360
Net foreign assets202220308307322382232242242266283330376
Net international reserves206227322320336399278288294318294342388
Bank of Mongolia154176254243268301151176183185198222252
Commercial banks52516877689812811211013396120136
Other NFA-4-7-13-13-14-17-47-46-52-52-11-12-12
Bank of Mongolia0000000003111
Commercial banks-5-7-13-13-14-18-47-46-52-56-13-13-13
Net domestic assets57111162197236228472498570561564562633
Domestic credit120170243290329331601640681708740747804
Net credit to government513174-4-2815213111498946548
Credit958471828386266225215199190180162
Minus: Deposits44536378861151149410110096115114
Claims on nonbanks69139236286333360449509567610646682756
Claims on public enterprises6101211131616151413131422
Claims on the private sector45115204239283305390442495511552581646
Nonperforming loans16111730333337424976717676
Accrued interest receivable on loan12454679910111112
Other items, net-63-59-82-93-93-104-129-142-111-147-176-185-171
Memorandum items:
(In percent)
12-month percentage change
Broad money 1/17.528.041.945.839.139.449.746.845.535.720.320.624.3
Net foreign assets55.412.137.026.712.326.3-27.7-31.5-36.028.623.326.845.7
Domestic credit-17.57.610.121.238.720.588.892.076.911.89.26.17.7
Claims on public enterprises-26.765.817.16.7-0.716.232.838.413.5-17.2-22.5-12.855.9
Claims on the private sector44.8152.477.487.573.181.091.384.675.167.541.631.730.4
Key ratios:
Currency/total deposits63.949.134.629.533.832.223.023.326.524.520.417.521.2
Demand deposits/total deposits18.921.119.216.716.314.314.211.813.211.911.110.612.1
Tugrik time deposit/total deposits37.439.642.145.246.445.842.045.444.343.242.845.744.6
Forex time deposits/total deposits43.739.338.738.037.339.943.742.742.544.946.143.643.3
Currency/broad money39.032.925.722.825.324.318.718.921.019.717.014.917.5
Demand deposits/broad money11.514.214.212.912.210.811.69.610.49.69.29.010.0
Time deposits/broad money49.552.960.164.362.564.869.771.568.670.773.976.172.5
Ratio (percent): Forex deposits/BM26.726.428.829.427.930.235.634.733.636.038.337.235.7
Sources: Bank of Mongolia; and Fund staff estimates.
Table 28.Mongolia: Balance Sheet of the Bank of Mongolia, 2000-05
200020012002200320042005
Dec.Dec.Dec.Mar.Jun.Sept.Dec.Mar.Jun.Sept.Dec.Mar.Jun.
(In billions of togrogs)
Reserve money133144175181195222201229245255235253296
Currency outside Banks101109121115141148131140170163144133177
DMB reserves3235556654736989759291120119
Cash in vaults6101416191821212020252727
Demand deposits of DMBs26254150355548685572669392
Deposits of business units0000000000000
Net Foreign Assets155177254243268301151176183189199224253
Net international reserves154176254243268301151176183185198222252
Assets209228302289312357238231236237251272300
Minus: Liabilities55524846445687555352544947
Other assets, net0000000003111
Assets0000000003111
Minus: Liabilities0000000000000
Net Domestic Assets-22-32-79-62-73-8050536267363042
Net Credit to Government34356-3-16-33128101100981068487
Credit535240394459219174172171159153151
Government bonds53524039445959575554534947
Treasury IMF account34384039405255535252534947
Reconstruction bonds201400574422000
Treasury bills0000000000000
Other000000160117117117105104104
Minus: Deposits19173442609392737273536963
Domestic currency13133029526873666369432836
Foreign currency6441392419794104027
Claims on deposit money banks5788101113191622222219
Claims on nonbanks1111111000000
Minus: Central bank bills (net)21506143493976607346697082
Other items, net-40-26-33-25-19-19-15-819-6-23-718
Of which: precious metals813751723810311561234
Memorandum items:
Reserve money growth (12 month percent change)19.48.421.726.711.016.814.726.525.615.216.810.520.4
Broad money/reserve money (ratio)1.952.302.682.792.862.753.503.233.313.243.603.533.41
Sources: Bank of Mongolia; and Fund staff estimates.
Table 29.Mongolia: Consolidated Balance Sheet of Commercial Banks, 2000-05
200020012002200320042005
Dec.Dec.Dec.Mar.Jun.Sept.Dec.Mar.Jun.Sept.Dec.Mar.Jun.
(In billions of togrogs)
ASSETS158226354394423469585617658681727781852
Net foreign assets4744546554818165587884107123
Net international reserves52516877689812811211013396120136
Assets5352718272103132122116140138160170
Minus: Liabilities12354551067414034
Other foreign assets, net-5-7-13-13-14-18-47-46-52-56-13-13-13
Assets0000000000000
Minus: Liabilities571313141847465256131313
Net domestic assets110182299330369388504551600604643675729
Reserves3135556652766982708388116116
Cash6101416191821212020252727
Deposits with BOM25254150335748605063648989
Central bank bills21506143483976607245697081
Domestic credit85134236292344364473539581610634663717
Net credit to government17-3171252430141-12-19-39
Claims on Government42323143382747514328312712
Less: Government deposits25363036262223212927434651
Loans to nonbanks68138235285332359449509567610646682756
Public enterprises5101110121516151413131422
Private sector45115204239283305390442495511552581646
Nonperforming loans16111730333337424976717676
Accrued interest receivable on loan12454679910111112
Other assets, net-27-36-52-71-76-90-114-129-124-135-149-174-185
LIABILITIES158226354394423469585617658681727781852
Deposits158222349389417461572600642664703760832
Demand deposits304767656866817185797881101
Time and savings deposits5988147176193211240273284287301347371
Foreign currency deposits6987135148156184250257273298324332360
Deposits of NBFIs0000000111100
Borrowing from BoM04456813161617242219
Memorandum items:
(In millions of U.S. dollars)
Net foreign assets43.339.548.256.647.369.569.255.649.764.569.489.6103.0
Foreign currency deposits63.079.2120.2129.8136.6158.7214.2218.0232.6248.0268.2278.2302.1
Sources: Bank of Mongolia; and Fund staff estimates.
Table 30.Mongolia: Net Credit to Government, 2000-05
200020012002200320042005
Dec.Dec.Dec.Mar.Jun.Sept.Dec.Mar.Jun.Sept.Dec.Mar.Jun.
(In billions of togrogs)
Net claims on government51.331.57.43.6-3.7-28.2151.9131.2114.198.294.065.148.2
Claims95.284.370.581.882.686.5266.4225.4215.0198.7190.0179.8162.1
Minus: Deposits43.952.963.278.286.3114.6114.494.2100.9100.596.0114.7113.9
Bank of Mongolia (net)34.135.06.3-3.0-15.7-33.3127.8101.399.997.6105.884.487.5
Claims on Government53.451.939.839.044.559.4219.5174.2171.9170.8158.8153.0150.6
Loans to the MoF0.00.00.00.00.00.00.00.00.00.00.0103.6103.7
FX financing without tugrik funds0.00.00.00.00.00.0160.2117.0117.0117.0105.30.00.0
Government bonds19.613.60.00.04.67.04.44.32.42.10.10.20.1
Reconstruction bonds19.613.60.00.04.67.04.44.32.42.10.10.20.1
Treasury IMF account33.838.339.839.039.952.454.853.052.551.753.449.246.8
Less: Deposits19.316.933.542.060.292.791.772.972.073.253.068.663.1
Budget deposits13.47.719.041.359.292.691.772.971.973.052.368.462.2
In domestic currency7.03.915.228.450.668.273.065.863.069.142.028.034.8
In foreign currency6.43.93.712.98.624.418.77.18.93.910.240.527.4
Budget reserves4.33.50.00.00.00.00.00.00.00.20.80.10.9
Commercial banks (net)17.2-3.51.16.612.05.124.229.814.10.6-11.8-19.3-39.3
Claims on Government41.832.530.742.838.127.046.951.143.127.831.226.811.5
Advance financing of MoF0.01.80.10.71.00.90.00.41.52.00.20.81.6
Government securities41.830.630.641.736.825.946.850.741.125.331.025.79.8
Inherited and directed credits0.00.00.00.00.00.00.00.00.00.00.00.00.0
Accrued interest receivable0.00.00.10.40.40.20.10.00.50.50.00.30.2
Less: Government deposits24.635.929.736.226.121.922.721.329.027.243.046.150.8
Sources: Bank of Mongolia; and Fund staff estimates.
Table 31.Mongolia: Interest Rates, 2000-05(In percent per annum)
200020012002200320042005
DecDecDecMarchJuneSept.DecMarchJuneSept.DecMarchJune
Deposit rates
Current account
Domestic currency2.4-6.00.0-5.10.0-6.00.0-6.00.0-6.00.0-6.00.0-6.00.3-6.60.0-4.80.0-4.80.0-4.80.0-4.80.0-4.8
Foreign currency1.0-3.60.3-4.20.3-3.00.3-3.00.3-3.00.3-3.00.3-3.00.3-3.00.3-3.00.3-3.00.3-3.00.3-3.00.0-3.0
Demand Deposit1.2-13.21.2-9.62.4-10.22.4-10.26.0-10.23.6-10.21.8-10.06.0-10.06.0-10.06.0-9.66.0-9.66.0-9.96.0-9.9
Time deposit
Domestic currency 1/3.6-24.02.4-24.02.4-10.26.0-22.06.0-22.06.0-22.06.0-22.06.0-22.06.0-20.46.0-24.06.0-20.46.0-20.46.0-20.4
Foreign currency2/1.2-12.01.0-13.21.2-12.01.2-12.01.81-12.02.4-12.02.4-12.02.4-12.01.4-12.01.4-10.21.4-9.61.4-9.81.4-9.8
Loan rates
Bank of Mongolia3/8.68.69.93.915.511.311.59.213.314.615.89.55.5
Commercial banks4/
Domestic currency34.741.433.432.632.432.231.530.330.332.330.032.730.0
Foreign currency25.822.219.820.820.922.619.619.721.818.217.916.317.3
Source: Bank of Mongolia.

Up to 1 year.

1-3 year.

Discount rates on central bank bills with maturity of 14 days.

Loan rates for short-term loans with maturity less than 1 year.

Table 32.Mongolia: Balance of Payments, 1999–2004(In millions of US dollars, unless indicated otherwise)
199920002001200220032004
Trade balance-113.1-140.2-169.9-228.9-199.3-149.0
Exports, f.o.b.454.2535.8523.2523.9627.3872.1
Copper119.2160.3147.1140.2161.7284.3
Noncopper334.9375.5376.1383.7465.6587.7
Imports, c.i.f.-567.3-676.0-693.1-752.8-826.6-1,021.1
Services, net-7.3-8.4-22.2-11.8-49.3-60.1
Receipts100.6104.2113.5184.6207.9338.2
Payments-107.9-112.6-135.7-196.4-257.2-398.3
Income, net-12.8-12.42.9-4.5-11.5-41.4
Official med- and long-term interest payments-7.8-9.3-9.0-10.8-11.9-14.6
Private transfers, net5.98.025.064.474.3146.3
Official grants60.286.272.153.049.486.9
Other grants6.912.415.320.237.835.5
Current account balance, including official transfers-60.3-54.3-76.8-107.6-98.618.1
Financial and capital account62.468.379.0145.4-29.619.3
Direct investment34.240.043.077.8131.592.9
Portfolio investment0.00.00.00.050.0-2.5
Medium- and long-term, net97.280.568.899.0-170.125.5
Disbursements173.7151.0167.2182.0175.6157.2
Amortization-76.6-70.5-98.4-83.0-345.7-131.7
Currency and deposits, net-22.9-13.53.6-8.7-21.0-74.3
Other private, net (includes short-term capital flow)-46.1-38.7-36.3-22.7-20.0-22.3
Errors and omissions12.720.112.528.530.6-8.0
Overall balance14.734.114.766.4-97.629.3
Financing-14.7-34.1-14.7-66.497.6-29.3
Increase in net official reserves (-)-30.5-35.2-19.5-65.696.8-34.7
Use of IMF credit (+)4.21.7-1.7-4.33.0-7.3
Increase in gross official reserves (-)-34.7-36.9-17.8-61.493.8-27.4
Arrears accumulation (+) / payments (-) (net)2.0-15.84.8-0.70.85.4
Exceptional financing / rescheduling13.816.80.00.00.00.0
Memoranda items:
Current account balance (in percent of GDP)-6.7-5.7-7.6-9.6-7.71.2
Net official reserves (end-period)105.4140.6160.1225.8128.9163.6
Gross official reserves (end-period)156.8190.9206.8271.5177.7205.1
(In months of next year/projected imports c.i.f.)2.83.33.33.92.12.2
Outstanding arrears (end-period)1/15.80.04.84.15.410.8
Sources: Mongolian authorities; and Fund staff estimates.

Arrears on post-1991 Russian debt. Pre-1991 transfer ruble debt to Russian Federation (US$11.4 billion), which was settled in 2003, is excluded.

Table 33.Mongolia: Commodity Composition of Exports, 1999–2004(In millions of U.S. dollars, unless otherwise indicated; unit values are denominated in U.S. dollars)
199920002001200220032004
Copper concentrate (value)119.2160.3147.1140.2161.7284.3
Volume (concentrate in ‘000 tons)492.7496.0540.9548.6563.2562.6
Refined copper equivalent138.0138.9146.0153.6157.7157.5
Unit value--refined (per ton)864.21,154.11,007.3912.61,025.61,804.8
Molybdenum concentrate9.06.25.110.115.020.0
Volume (tons)4,164.43,028.23,081.83,469.03,967.32,250.2
Unit value (per ton)2,167.12,032.51,647.92,916.53,790.78,888.1
Fluorite concentrate16.819.319.817.015.011.4
Volume (‘000 tons)164.1197.1215.6192.5187.5140.5
Unit value (per ton)102.798.192.088.180.081.1
Gold95.969.774.7117.6157.3239.9
Volume (kg)10,960.37,839.88,328.712,388.314,220.619,043.6
Unit value (per kg)8,752.18,892.08,966.99,496.511,061.112,597.4
Sawn wood4.90.30.00.00.00.0
Volume (‘000 cubic meters)38.32.50.10.00.00.2
Unit value (per cubic meter)126.7126.7219.3134.0
Cashmere tops2.20.60.30.91.81.1
Volume (tons)41.57.12.815.428.112.7
Unit value (per kg)52.489.9103.059.163.182.7
Cashmere, dehaired45.954.555.030.525.744.1
Volume (tons)1,168.3770.21,006.6632.3563.1831.7
Unit value (per kg)39.370.854.748.345.653.0
Cashmere garments7.813.011.612.815.133.1
Volume (‘000 pieces)314.5428.5325.2483.6645.51,500.1
Unit value (per piece)24.830.435.726.423.422.1
Cashmere, greasy/raw14.421.90.90.91.10.6
Volume (tons)799.5717.250.253.767.143.4
Unit value (per kg)18.030.517.316.817.013.8
Textiles18.473.244.234.674.896.5
Volume (‘000 pieces)4,399.66,696.710,066.811,310.821,648.026,900.6
Unit price4.210.94.43.13.53.6
Camel wool, raw1.71.72.20.70.70.7
Volume (tons)893.3836.8964.0345.0354.8281.8
Unit value (per kg)1.92.02.32.11.92.4
Skin and hides23.934.916.311.36.15.9
Volume (‘000 pieces)2,688.24,395.81,579.01,332.2409.5406.4
Unit price8.98.010.38.514.814.4
Sheepskin coats0.10.20.30.10.20.2
Volume (‘000 pieces)6.11.11.41.21.00.8
Unit value (per piece)17.2218.6222.2111.6233.1205.1
Carpets0.91.40.00.90.00.0
Volume (‘000 square meters)28.968.10.0101.00.00.0
Unit value (per square meter)32.119.99.4
Meat13.215.812.020.515.713.2
Volume (‘000 tons)13.216.713.517.211.052.2
Unit value (per ton)997.7948.2888.01,187.51,434.2252.2
Scrap Metal5.65.24.03.53.78.7
Volume (‘000 tons)17.120.210.78.68.08.7
Unit value (per ton)325.0259.1371.7411.7467.61,002.2
Other74.257.5157.6122.3133.3112.5
Total454.2535.8523.2523.9627.3872.1
Sources: Mongolian authorities; and Fund staff estimates.
Table 34.Mongolia: Commodity Composition of Imports, 1999–2004(In millions of U.S. dollars)
199920002001200220032004
Food60.8101.9113.1129.5112.4157.3
Live animals and animal products1.12.14.95.35.75.7
Vegetable products18.046.451.058.336.469.3
Animal and vegetable oil5.66.16.89.410.29.6
Prepared food36.147.250.456.660.072.7
Energy85.2120.3143.8132.7161.3231.3
Of which: Petroleum products71.8109.8124.0110.0142.5210.2
Equipment Goods231.1200.3180.4209.9250.4305.4
Machinery and equipment176.7133.3112.5134.4165.0201.5
Vehicles and transportation equipment54.467.067.975.585.4103.9
Raw Materials and Spare Parts44.356.473.277.3106.6135.3
Chemical products20.228.133.034.542.146.6
Raw hides and skins0.40.20.70.50.40.6
Building materials4.45.59.810.921.017.1
Metals19.322.729.831.443.071.0
Consumer Goods91.3135.6119.5141.3156.7181.7
Rubber products12.613.315.119.121.625.7
Wood and wood products0.91.72.23.24.34.3
Cellulosic materials6.28.710.314.925.319.1
Textile46.279.963.384.282.0100.9
Footwear and clothes1.21.82.21.91.61.6
Measuring instruments17.221.117.59.09.716.5
Manufactured articles7.09.18.99.012.113.5
Other imports51.361.563.062.039.210.1
Total (c.i.f)567.3676.0693.1752.8826.61,021.1
Memorandum items:
Nonfood imports506.5574.1580.0623.3714.2863.8
Nonenergy imports482.1555.7549.3620.1665.3789.8
Sources: Mongolian authorities; and Fund staff estimates.
Table 35.Mongolia: Direction of Trade, 2000–2004(In percent of total exports or imports)
199920002001200220032004
Exports 1/100.0100.0100.0100.0100.0100.0
Countries of the former CMEA13.710.410.69.27.23.2
Former U.S.S.R.13.610.410.69.17.23.2
Russia13.59.710.38.66.32.4
Kazakhstan0.10.20.20.10.50.0
Other0.00.50.00.40.50.8
Korea, Democratic People’s Republic of0.10.00.00.00.00.0
EU countries10.07.56.56.57.421.4
Belgium0.30.30.30.00.10.1
France0.20.40.00.00.31.8
Germany0.70.40.60.50.81.3
Italy4.13.13.01.71.52.0
Netherlands1.00.70.70.50.40.4
United Kingdom3.82.41.73.54.415.8
Other0.00.10.00.20.00.0
Other76.482.183.084.485.375.3
China57.157.353.741.746.146.8
Hong Kong, China1.01.61.50.60.50.8
Japan3.01.73.31.31.43.8
Korea0.60.60.94.41.21.1
Singapore0.30.00.00.05.82.3
Switzerland0.20.20.10.10.10.2
United States12.919.922.031.623.318.0
Other1.30.81.64.56.92.3
Imports100.0100.0100.0100.0100.0100.0
Countries of the former CMEA33.337.540.938.537.641.0
Former U.S.S.R.30.535.838.736.735.238.8
Russia29.233.636.434.132.633.5
Kazakhstan0.11.10.61.10.62.6
Other1.21.21.71.61.92.7
Bulgaria0.60.00.20.10.20.2
Former Czechoslovakia 2/1.00.61.00.50.70.5
Hungary0.30.30.20.20.50.7
Poland0.90.80.70.81.00.9
EU countries10.311.410.68.311.08.3
Denmark0.60.71.30.40.50.5
France1.71.40.90.71.41.5
Germany4.64.85.14.54.83.3
United Kingdom0.81.00.70.40.50.4
Austria0.10.30.10.10.70.5
Finland1.10.80.60.50.30.2
Other1.51.41.21.62.81.9
Other56.451.18.553.251.450.7
China13.517.819.320.221.822.0
Hong Kong, China1.12.62.54.33.03.2
India0.40.30.20.20.10.1
Japan22.411.99.56.28.07.3
Korea7.19.09.712.28.56.0
Singapore1.81.71.51.71.31.5
Switzerland0.50.50.80.50.60.4
United States6.14.62.53.52.94.6
Other3.63.63.24.75.35.7
Sources: Mongolian authorities; and Fund staff estimates.

Data for exports of copper refer to country of initial purchaser rather than country of destination of final product.

Data after 1993 refer to Czech Republic and Slovak Republic.

Table 36.Mongolia: Services and Income Accounts, 1999–2004(In millions of U.S. dollars)
199920002001200220032004
ReceiptsPaymentsReceiptsPaymentsReceiptsPaymentsReceiptsPaymentsReceiptsPaymentsReceiptsPayments
SERVICES
Passenger fares7.33.57.33.410.14.413.06.011.05.919.613.6
Railway2.21.21.91.13.71.16.01.94.11.514.39.9
Airline5.12.35.42.36.43.37.04.16.94.45.33.7
Port services2.924.53.112.33.123.61.918.25.435.328.731.1
Transit fees18.81.220.91.622.62.423.92.724.13.029.02.2
Travel35.640.935.951.339.355.3130.1119.2143.0107.5185.1147.8
Embassy expenses abroad2.05.53.45.33.95.34.85.64.85.99.25.4
Embassies/international organizations0.50.00.50.00.42.40.42.40.42.70.42.7
Commissions0.00.54.30.80.01.00.00.80.00.82.00.0
Communications7.54.27.74.47.74.46.08.64.87.44.89.1
Technical Assistance0.07.50.013.20.015.30.021.00.038.40.019.9
Other26.120.121.120.326.421.64.511.914.450.359.4166.5
Total100.6108.0104.2112.6113.5135.7184.6196.4207.9257.2338.2398.3
INCOME
Direct investment income0.02.90.05.30.03.40.05.20.06.80.039.5
Interest on bank deposits6.70.011.00.010.80.15.70.85.11.98.50.0
Interest on debt0.015.90.019.40.013.60.010.80.011.90.014.6
Official Medium- and long-term0.07.90.09.30.09.00.010.80.011.90.014.6
Short-term0.00.00.00.00.00.00.00.00.00.00.00.0
Private Sector0.08.00.010.10.04.50.02.50.03.80.01.3
Interest on trade credit0.00.40.00.40.00.40.00.50.00.90.02.6
Other interest0.00.32.00.39.90.38.41.38.83.98.10.0
Total6.719.513.025.420.717.814.118.613.925.416.658.0
Sources: Mongolian authorities; and Fund staff estimates.
Table 37.Mongolia: Medium- and Long-Term Loan Disbursements, 1999–2004(In millions of U.S. dollars)
199920002001200220032004
Official loans101.971.084.283.8101.2128.7
Japan32.520.216.314.017.725.1
Germany4.84.89.98.16.95.8
Korea2.50.00.516.24.60.0
Norway0.40.00.00.00.03.6
Spain0.00.00.00.00.02.8
Kuwait1.01.13.83.93.21.8
World Bank13.013.323.014.427.748.9
Balance of payments support0.00.011.10.05.85.8
Project12.613.111.314.221.439.2
Technical assistance0.40.20.60.20.53.9
Asian Development Bank47.131.330.026.539.539.4
Balance of payments support16.112.210.00.020.15.0
Project31.019.120.026.519.434.4
Technical assistance0.00.00.00.00.00.0
IFAD0.60.30.70.71.61.1
Commercial loans71.980.082.998.274.428.5
Total173.7151.0167.2182.0175.6157.2
Sources: Ministry of Finance and Economy; and Fund staff estimates.
Table 38.Mongolia: Short-Term Capital Flows, 1999-2004((In millions of U.S. dollars)
199920002001200220032004
Import credits-9.5-6.6-11.5-8.5101.2128.7
Inflows3.45.45.01.82.74.8
Erdenet3.05.04.31.51.84.0
Others0.40.40.70.30.90.8
Outflows12.912.016.510.323.0
Erdenet12.99.516.510.323.0
Trade credit extended on exports-0.34.13.36.6-8.7-0.6
Inflows5.26.54.57.70.00.0
Erdenet5.26.54.57.7
Outflows5.52.41.21.18.70.6
Others5.52.41.21.18.70.6
Others-3.1-7.2-7.1
Inflows10.010.911.8
Erdenet3.04.13.7
Others7.06.88.1
Outflows13.118.118.9
Erdenet5.97.77.9
Others7.210.411.0
Total 1/-12.9-9.7-15.3-1.9-29.04.2
Sources: Mongolian authorities; and Fund staff estimates.

As data for others are not available from 2002, total is calculated without others after 2002.

Table 39.Mongolia: Official Reserves of the Bank of Mongolia, 2000-05
200020012002200320042005
Dec.Dec.Dec.Mar.Jun.Sept.Dec.Mar.Jun.Sept.Dec.Mar.Jun.
(in millions of US dollars)
Net international reserves140.6160.0225.7212.9235.1260.0129.0149.7156.1153.9163.5186.4212.3
Assets190.8206.8268.3253.1274.0308.0203.5196.0201.2197.5207.8227.8251.3
Foreign exchange168.3155.6218.5222.7232.9273.7196.9178.9160.5138.4193.7180.0190.4
Cash3.67.312.212.114.614.211.313.47.611.610.16.99.9
SDR holdings0.00.00.00.00.00.00.00.00.00.00.00.00.0
Demand deposits6.52.01.730.150.079.26.392.651.221.01.723.745.1
Foreign government bills43.621.645.433.233.233.266.129.019.48.750.710.021.9
Time deposits114.5124.6159.0147.1134.8146.8113.043.782.296.8131.1139.3113.2
Reserve position in the IMF0.10.10.10.10.10.10.10.20.20.20.20.20.2
Monetary gold22.551.149.830.441.234.36.717.240.859.114.147.761.0
Liabilities (official short-term)50.246.842.640.239.048.074.646.445.143.644.341.439.0
Use of Fund Credit and Loans from the IMF50.246.842.640.239.048.049.646.445.143.644.341.439.0
Borrowing from banks abroad0.00.00.00.00.00.00.00.00.00.00.00.00.0
Nonresident deposits0.00.00.00.00.00.025.00.00.00.00.00.02.6
Other0.00.00.00.00.00.00.00.00.00.00.00.00.0
Sources: BOM, IMF Treasurer’s Department.
Table 40.Mongolia: Selected Indicators of Commercial Bank Foreign Exchange Operations, 2000-05
200020012002200320042005
Jun.
Foreign assets (US$ million)48.647.562.9113.3113.8142.7
Cash4.36.611.215.223.222.5
Demand deposits6.113.217.333.027.234.6
Time deposits38.127.634.465.057.075.6
Other assets0.10.00.00.16.310.0
Foreign liabilities (US$ million)5.38.014.644.044.439.7
Deposits of foreign banks and nonresidents1.01.52.73.934.028.5
Loans from foreign banks0.50.51.52.43.05.7
Other foreign liabilities3.86.010.437.87.35.5
Foreign currency denominated loans (US$ million)25.045.477.4163.0239.2294.6
Summary indicators (in percent)
FC loans/total loans40.336.437.042.444.846.4
Nonperforming loans/total loans (Forex)17.75.97.59.910.911.6
Nonperforming loans/total loans (tugrik)28.19.36.97.111.38.9
Foreign currency deposits (US$ million)63.079.2120.2214.2268.2302.1
Summary indicators (in percent)
FC deposits/total deposits43.739.338.743.846.143.3
Forex current accounts/total current accounts54.246.248.961.058.258.4
FC demand deposits/total demand deposits47.251.648.649.356.948.9
FC time and savings deposits/total time and savings d31.729.627.629.737.833.6
Source: Bank of Mongolia; and Fund staff estimates.
Table 41.Mongolia: External Debt and Debt Service, 1999–2004
199920002001200220032004
(In millions of US dollars)
External debt827.8837.0853.5978.11,237.01,360.1
Medium- and long-term776.4786.7806.7936.11,138.11,315.9
IMF51.450.346.842.048.944.2
Short-term 1/0.00.00.00.050.00.0
Debt service31.924.133.932.0284.091.1
Amortization24.114.824.820.9272.375.2
Interest7.89.39.011.111.615.9
Medium- and long-term27.917.526.824.2275.232.3
Amortization20.38.518.013.2263.817.9
Interest7.69.08.811.011.414.4
IMF4.06.67.17.88.77.5
Repurchase/Repayments3.86.36.87.78.57.3
Charges0.20.30.20.10.20.2
Short-term 1/0.00.00.00.00.051.3
(In percent)
External debt/GDP91.490.184.388.799.190.9
Medium- and long-term85.784.779.784.991.188.0
IMF5.75.44.63.83.93.0
Short-term 1/0.00.00.00.04.00.0
External debt/exports of goods & services149.2130.8134.1138.1148.1112.4
Medium- and long-term139.9122.9126.7132.1136.3108.7
IMF9.37.97.45.95.93.7
Short-term 1/0.00.00.00.06.00.0
Debt-service ratio 2/5.73.85.34.534.07.5
Amortization4.32.33.92.932.66.2
Interest1.41.51.41.61.41.3
Medium- and long-term5.02.74.23.433.02.7
Amortization3.71.32.81.931.61.5
Interest1.41.41.41.61.41.2
IMF0.71.01.11.11.00.6
Repurchase/repayments0.71.01.11.11.00.6
Charges0.00.00.00.00.00.0
Short-term 1/0.00.00.00.00.04.2
Sources: Mongolian authorities; and Fund staff estimates.

Includes treasury bill in US$ to nonresident issued in relation to pre-1991 Russian debt settlement.

In percent of goods and services.

Table 42.Mongolia: External Debt Stock by Creditor, 1999–2004(In millions of U.S. dollars, end of period)
199920002001200220032004
External Debt827.8837.0853.5978.11,237.01,360.1
Medium and long-term official (excluding IMF)776.4786.7806.6936.11,138.11,315.9
Multilateral (excluding IMF)412.5437.1476.5548.0668.8796.1
Asian Development Bank281.6298.8319.3366.1439.1502.6
World Bank129.6136.9155.1179.0225.0287.3
IFAD1.31.52.12.94.76.2
Bilateral official350.9336.5317.1375.1456.3506.8
Paris Club322.3306.6283.5322.2395.7444.1
Japan214.8208.4193.6219.3261.8293.4
Russia51.543.226.424.522.116.7
Germany37.637.546.559.977.990.3
Finland6.26.16.05.97.98.8
Norway12.111.511.112.517.121.9
Spain0.00.00.00.08.812.9
Non-Paris Club28.629.933.552.960.662.8
China15.515.515.515.015.015.0
Korea8.78.17.924.530.231.7
India1.21.00.90.70.60.4
Kuwait3.35.39.212.714.815.6
Treasury bill in US$ to nonresidents0.00.00.00.050.00.0
IMF51.450.346.842.048.944.2
Commercial13.013.013.013.013.013.0
Short-term0.00.00.00.00.00.0
Sources: Ministry of Finance and Economy; and Fund staff estimates.
Table 43.Monthly Exchange Rates, 2001–05(In togrogs per U.S. dollar, period average)
Official rate 1/Interbank rate2/Street rate
2001
January1,097.81,098.71,101.5
February1,099.01,099.21,099.8
March1,098.01,098.11,098.3
April1,093.01,092.71,092.3
May1,092.51,092.71,094.1
June1,096.01,096.11,097.5
July1,096.71,096.91,098.1
August1,098.41,098.61,100.2
September1,099.51,099.21,099.4
October1,099.61,099.71,100.2
November1,100.01,100.21,101.1
December1,101.31,101.41,102.1
2002
January1,102.01,102.21,103.0
February1,103.41,103.41,103.5
March1,104.01,103.91,103.5
April1,104.01,103.71,103.2
May1,103.41,103.11,103.1
June1,104.01,104.11,104.9
July1,108.41,109.31,110.0
August1,113.21,115.21,115.4
September1,116.11,116.51,117.0
October1,119.01,119.81,120.0
November1,122.21,122.81,123.1
December1,124.11,124.51,125.0
2003
January1,129.41,130.01,130.0
February1,134.11,134.71,135.0
March1,139.71,139.81,140.0
April1,136.21,135.91,136.9
May1,130.01,129.81,130.8
June1,133.71,134.61,135.0
July1,146.61,148.61,148.9
August1,152.21,153.21,154.0
September1,156.61,158.01,158.0
October1,161.41,162.71,163.0
November1,168.31,169.91,170.0
December1,170.31,170.61,171.0
2004
January1,170.21,170.91,171.0
February1,173.21,173.91,174.0
March1,177.51,177.91,178.0
April1,173.01,173.21,174.0
May1,163.21,163.51,164.0
June1,166.61,167.31,168.0
July1,181.81,184.31,185.0
August1,191.61,194.31,195.0
September1,198.91,200.41,200.5
October1,204.41,206.71,207.2
November1,210.21,212.41,215.0
December1,211.81,215.51,216.6
2005
January1,210.91,213.21,215.4
February1,208.51,210.91,212.7
March1,202.71,202.21,201.7
April1,186.91,187.41,189.1
May1,188.01,188.61,189.6
June1,190.51,191.81,193.1
Source: Bank of Mongolia.

Midpoint rate announced by the Bank of Mongolia.

Midpoint rate established in the interbank foreign exchange market.

References

    IMF (2005), “The Ending of Global Textile Trade Quotas”, World Economic Outlook, Box 1.3, Washington D.C., April.

    Mlachila, Montfort andYongzhengYang (2004), “The end of textiles quotas: A case study of the impact on Bangladesh”. IMF Working Paper, WP/04/108.

    World Bank (2003), “From Goats to Coats: Institutional Reform in Mongolia’s Cashmere Sector”, Report No. 26240-MNG, Washington D.C., December19.

    World Trade Organization (2005), “Trade Policy Review: Mongolia, Report by the Secretariat (Geneva: World Trade Organization).

This chapter was prepared by Yo Kikuchi.

Net exports were significantly smaller, given the use of imported raw materials.

Mongolia became a member of the WTO in 1997.

The data compiled by the Bank of Mongolia reflect transactions through formal banking systems. The actual foreign cash inflows in Mongolia would be much larger as there are active suitcase transactions crossing borders.

Those countries included Bangladesh, Cambodia, Vietnam, and Sri Lanka.

Only a handful countries such as China, India, and Pakistan were expected to end up reaping the benefit of quota elimination (For example, see IMF (2005)).

Mongolia is trying to replace historical bilateral cross-boarder agreements with China and Russia with new transit transport framework agreements that cover all road transport (WTO (2005)).

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