Transcript MONGOLIA is OPEN for BUSINESS

MONGOLIA is OPEN for BUSINESS
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MONGOLIA is OPEN for BUSINESS
Content
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History of mining sector in Mongolia
Assessment of the current situation
Business opportunities
State policy of the mineral sector
Conclusion
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MONGOLIA is OPEN for BUSINESS
Mongolian mining
industry has history of
101 years
1990-
1923 - 1990
1913 - 1921
Large-scale state-run
mining and infrastructure
projects
Free marketoriented legal
environment
and favorable
investment
environment
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MONGOLIA is OPEN for BUSINESS
Mongolia is one of the fastest growing
economies
16
14
17%
GDP, billion USD
12
15%
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GDP growth by percent
12.9%
12.4%
13%
11.7%
8
11%
6
9%
4
6.4%
2
0
7%
3.9
3.9
3.5
6.9
8.8
10.6
11.7
14.7
2007
2008
2009
2010
2011
2012
2013
2014
5%
Ministry of Finance forecasts Mongolia to continue enjoying double digit growth in the coming years.
GDP growth by percent
GDP, billion USD
19%
17.5%
MONGOLIA is OPEN for BUSINESS
Economic development and mining sector
CONTRIBUTION OF THE MINING SECTOR (%)
Export
GDP
17%
Budget
81%
FDI
23%
73%
%
20
21
17
89
91
2011
2012
2013
2011
2012
81
2013
20
21
23
78
81
2011
2012
2013
2011
2012
73
2013
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Production, billion MNT
Investment, million USD
Investment and production
The production of the mining industry is rapidly growing in the last years due to the investment. Therefore,
the Ministry of Mining supports a policy to promote and encourage investors.
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MONGOLIA is OPEN for BUSINESS
OPPORTUNITIES: Why invest in Mongolia? (1)
1950 deposits and 8150 discoveries are registered in the State inventory of
mineral resources, and 300 of them are under utilization.
Main Minerals
U
Resources (2013)
Gold (tons)
2,493
Zinc (thousand tons)
1,740
Iron ore (mln tons)
1,166
Crude oil (mln barrel)
2,438
World Rank
Top 10
Copper (thousand tons)
117,000
Top 10
Coal (mln tons)
175,500
Top 10
Shale oil (bln tons)
788
Uranium (ths tons)
170
The Central and Eastern parts of Mongolia relatively well studied. While western part
of country is untapped, which has a great potential for discovery of new deposits.
MONGOLIA is OPEN for BUSINESS
OPPORTUNITIES: Why invest in Mongolia? (2)
RUSSIA
GDP $2.118 Trillion
Economy 8th Largest
Population 143.500.000
KOREA
CHINA
GDP
Economy
Population
$8.939 Trillion
2nd Largest
1.344.130.000
GDP
$1.198 Trillion
Economy 15th Largest
Population 50.129.669
JAPAN
GDP
$5.007 Trillion
Economy
3rd Largest
Population 126.659.683
Source: World Bank, 2013
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MONGOLIA is OPEN for BUSINESS
OPPORTUNITIES: Why invest in Mongolia? (3)
Coal to Gas
$30.0 bln
Iron Ore
processing
$1.0 bln
Railways
$16.0 bln
Coal to Liquids
$2.5 bln
Copper
Smelter
$2.0 bln
Oil production
$0.8 bln
Coal washing
$0.8 bln
Power plant
on Tavantolgoi
coal mine
$ 1.0 Bln
Highways
$0.46 bln
Oil refinery
$1.20 bln
Power plant V
$1.2 bln
Total investment: $ 56.96 Billion
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MONGOLIA is OPEN for BUSINESS
Legal reform:
State Policy on the Mineral
sector (2014/01/16)
Investment law (2013/10/03)
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Improve the competitiveness and development of the mining sector, encourage
the transparent and responsible mining industry based on private sectors.
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Provide sustainable investment environments (stabilize the investment)
Non- discrimination between foreign and domestic investors.
Amendment in Minerals law (1)
(2014/01/24)
Law of Mongolian on common –
occurrence mineral resource
(2014/01/09)
Law on border ports (2013/12/26)
Petroleum Law
(2014/07/01)
Regulation for long named law *
Royalty fee is 2.5%, when gold sells to the Central Bank or commercial banks.
Current royalty rate will apply when export the Gold.
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The rights of an issuance of the special license transferred to the province and
local authority;
The area will be allocated without competitive tender;
Royalty rate is 2.5%.
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Law of Mongolia on exemptions
from custom and VAT
taxes,(2013/06/07)
Amendment in Minerals law (2)
(2014/07/01)
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No VAT and customs until 2018 for the equipment of oil, shale and coal
processing projects.
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Improved border point management
Better port regulation allows to accelerate trade and reduce bureaucracy
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Main principles are not to restrict the investors’ right and basic principles of the
Law dated on 2006.
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Intensify the explorations of shale oil and crude oil.
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Activities of special licenses, which issued before the law, shall be continued
under the contract.
* Prohibit mineral exploration and mining operations at headwaters of rivers, protected zones of water reservoirs
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MONGOLIA is OPEN for BUSINESS
CONCLUSION
1. Democratic country with open market economy.
2. Stable political environment.
3. Great potential of minerals.
4. Neighboring with two giant markets.
5. Created a long-term, easy to understand and stable legal environment in
the mining sector.
6. Favorable tax environment.
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MONGOLIA is OPEN for BUSINESS
We are warmly welcoming you
to MONGOLIA