Mongolia Economic Update, November 2013

In 2013, the Mongolian economy is expected to maintain double digit growth due to the start of copper production of the Oyu Tolgoi (OT) mine and expansionary economic policies. Yet, the economy is facing a significant challenge from growing balance of payments pressures as the foreign direct investment (FDI) inflow declines and the mineral exports remain weak. A substantial balance of payments imbalance stems from a weakening minerals market but also largely reflects the consequences of pro-cyclical economic management over the last two years. Mongolia may also face a downside risk from an uncertain global economic environment and further dampening of minerals market. Macro-economic and financial vulnerabilities are growing due to continuous expansionary fiscal and monetary policies reflected in significant off-budget spending and rapid credit growth. The government took a series of positive measures in recent months to address the challenges including the adoption of the new investment law, announcement of a fiscal consolidation plan, and subsequent amendment of the 2013 budget to tighten budget spending. Yet, further efforts are needed to shift the growth-oriented economic policies toward economic stability and rebuilding macro-economic policy buffers, in light of uncertain prospects in the external environment and the balance of payments situation.

Bibliographic Details

Main Authors:	Shiilegmaa, Altantsetseg, Gombosuren, Khandtsooj, Batsuuri, Davaadalai
Language:	English en_US
Published:	World Bank, Washington, DC 2013-11
Subjects:	ACCOUNTING, ADVANCED ECONOMIES, AGGREGATE DEMAND, ASSET PRICES, BALANCE OF PAYMENTS, BALANCE SHEET, BALANCE SHEETS, BANK ACCOUNT, BANK CREDITS, BANK DEPOSIT, BANK DEPOSITS, BANK LOAN, BANK LOANS, BANKING SECTOR, BANKING SYSTEM, BENEFICIARIES, BLACK MARKET, BOND INVESTMENT, BOND ISSUANCE, BOND STOCK, BOND YIELDS, BONDS, BORROWERS, BORROWING COSTS, BUDGET, BUDGET DEFICIT, BUFFERS, CAPITAL ADEQUACY, CAPITAL FLOWS, CAPITAL FORMATION, CAPITAL INFLOW, CAPITAL INFLOWS, CAPITAL OUTFLOWS, CENTRAL BANK, CENTRAL BANK BILLS, CHECK, COMMERCIAL BANKS, COMMERCIAL LOANS, COMMERCIAL TERMS, COMMODITY MARKETS, COMMODITY PRICES, CONSOLIDATION, CONSUMER PRICE INDEX, CONTRACTS, CORE INFLATION, CREDIT EXPANSIONS, CREDIT GROWTH, CREDIT RATING, CREDIT RISK, CREDIT RISKS, CREDITORS, CURRENCIES, CURRENCY COMPOSITION, CURRENCY DEPRECIATION, CURRENT ACCOUNT, CURRENT ACCOUNT DEFICIT, CURRENT ACCOUNT DEFICITS, DEBT FINANCING, DEBT ISSUANCE, DEBT LEVEL, DEBT MANAGEMENT, DEFICIT FINANCING, DEPOSIT, DEPOSIT INSURANCE, DEPOSITS, DEVELOPING COUNTRIES, DEVELOPING COUNTRY, DEVELOPMENT BANK, DISBURSEMENT, DISBURSEMENTS, DOMESTIC BOND, DOMESTIC CONSUMPTION, DOMESTIC CREDIT, DOMESTIC DEBT, DOMESTIC GOVERNMENT BONDS, ECONOMIC DEVELOPMENTS, ECONOMIC ENVIRONMENT, ECONOMIC GROWTH, ECONOMIC POLICIES, ECONOMIC POLICY, ECONOMIC STABILITY, EMERGING ECONOMIES, EMERGING MARKETS, EXCESS LIQUIDITY, EXCHANGE, EXCHANGE RATE, EXCHANGE RATE MOVEMENT, EXPENDITURE, EXPENDITURES, EXPORT GROWTH, EXPORT VOLUME, EXPORTERS, EXTERNAL BORROWING, EXTERNAL DEBT, FEDERAL RESERVE, FINANCE, FINANCIAL CRISIS, FINANCIAL MARKET, FINANCIAL MARKETS, FINANCIAL RISKS, FINANCIAL STABILITY, FINANCIAL SUPPORT, FINANCIAL VULNERABILITIES, FISCAL BURDEN, FISCAL DEFICIT, FISCAL DEFICITS, FISCAL DISCIPLINE, FISCAL POLICIES, FISCAL POLICY, FIXED INVESTMENT, FOOD PRICES, FOREIGN CAPITAL, FOREIGN CURRENCY, FOREIGN DIRECT INVESTMENT, FOREIGN EXCHANGE, FOREIGN EXCHANGE MARKET, FOREIGN INVESTMENT, FOREIGN LOAN, FOREIGN LOANS, FOREIGN PORTFOLIO INVESTMENT, FUTURE, GLOBAL ECONOMY, GLOBAL TRADE, GOOD, GOODS, GOVERNMENT BOND, GOVERNMENT EXPENDITURE, GOVERNMENT EXPENDITURES, GOVERNMENT REVENUE, GOVERNMENT SPENDING, GROSS DOMESTIC PRODUCT, GUARANTEE, HOUSEHOLD INCOME, HUMAN DEVELOPMENT, IMBALANCE, IMBALANCES, IMPORT, IMPORT DEMAND, INCOME LEVEL, INFLATION, INFLATION RATE, INFLATIONARY PRESSURE, INFLATIONARY PRESSURES, INSURANCE CORPORATION, INTEREST, INTEREST PAYMENTS, INTEREST RATE, INTEREST RATES, INTERNATIONAL BORROWING, INTERNATIONAL RESERVE, INTERNATIONAL STANDARD, INVESTMENT, INVESTMENT CAPITAL, INVESTMENT CLIMATE, INVESTMENT PROJECTS, INVESTMENT REGIME, INVESTMENTS, INVESTORS, LABOR FORCE, LABOR MARKET, LENDING, LIABILITIES, LIABILITY, LIQUIDITY, LIVING STANDARDS, LOAN, LOANS, LOCAL CURRENCIES, LOCAL CURRENCY, LOOSE MONETARY POLICY, MACRO-ECONOMIC POLICIES, MACRO-ECONOMIC POLICY, MARKET CONDITION, MARKETS, MONETARY AUTHORITIES, MONETARY POLICIES, MONETARY POLICY, MORAL HAZARD, MORTGAGE, MORTGAGES, NON-PERFORMING LOAN, NPL, OPEN MARKET, PORTFOLIO, PORTFOLIO FLOWS, POTENTIAL INVESTORS, POVERTY, PRICE CHANGES, PRIVATE CREDIT, PRIVATE CREDIT GROWTH, PRIVATE INVESTMENT, PRIVATE LOAN, PRIVATE SECTOR CREDIT, PRIVATE SECTOR DEBT, PROPERTY, PRUDENTIAL REGULATIONS, PUBLIC DEBT, PUBLIC DEBT MANAGEMENT, PUBLIC INVESTMENT, PUBLIC INVESTMENTS, PUBLIC SPENDING, REGULATORY FORBEARANCE, REPAYMENT, RESERVE, RESERVE MONEY, RESERVES, RETURN, REVENUE, REVENUES, RISK FACTORS, RISK PROFILE, SAVINGS BANK, SHARE, SHARE OF INVESTMENT, SHORT-TERM BORROWING, SHORT-TERM CAPITAL, SHORT-TERM DEPOSITS, SHORTFALL, SLOWDOWN, SOVEREIGN BOND, SOVEREIGN BONDS, STATE BANK, STOCK, STOCK MARKET, SUPPLY, SUPPLY CAPACITY, SUPPLY SIDE, TAX, TAXES, TIME DEPOSIT, TIME DEPOSITS, TRADE DEFICIT, TRANSACTION, TRANSACTIONS, TRANSPARENCY, WITHDRAWAL, WITHDRAWALS,
Online Access:	http://documents.worldbank.org/curated/en/2013/11/18485265/mongolia-economic-update https://hdl.handle.net/10986/16643
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