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Mongolia Economy
Economy - overview:
Economic activity traditionally has been based on agriculture and breeding of livestock. Mongolia also has extensive mineral deposits; copper, coal, molybdenum, tin, tungsten, and gold account for a large part of industrial production. Soviet assistance, at its height one-third of GDP, disappeared almost overnight in 1990-91 at the time of the dismantlement of the USSR. Mongolia was driven into deep recession, prolonged by the Mongolian People's Revolutionary Party's (MPRP) reluctance to undertake serious economic reform. The Democratic Union Coalition (DUC) government embraced free-market economics, eased price controls, liberalized domestic and international trade, and attempted to restructure the banking system and the energy sector. Major domestic privatization programs were undertaken, as well as the fostering of foreign investment through international tender of the oil distribution company, a leading cashmere company, and banks. Reform was held back by the ex-Communist MPRP opposition and by the political instability brought about through four successive governments under the DUC. Economic growth picked up in 1997-99 after stalling in 1996 due to a series of natural disasters and declines in world prices of copper and cashmere. In August and September 1999, the economy suffered from a temporary Russian ban on exports of oil and oil products, and Mongolia remains vulnerable in this sector. Mongolia joined the World Trade Organization (WTrO) in 1997. The international donor community pledged over $300 million per year at the Consultative Group Meeting, held in Ulaanbaatar in June 1999. The MPRP government, elected in July 2000, was anxious to improve the investment climate; it also had to deal with a heavy burden of external debt. Falling prices for Mongolia's mainly primary sector exports, widespread opposition to privatization, and adverse effects of weather on agriculture in early 2000 and 2001 restrained real GDP growth. Despite drought problems in 2002, GDP rose 4.0%, followed by a solid 5.0% increase in 2003. The first applications under the land privatization law have been marked by a number of disputes over particular sites. Russia claims Mongolia owes it $11 billion from the Soviet period; any settlement could substantially increase Mongolia's foreign debt burden.
GDP:
purchasing power parity - $4.882 billion (2003 est.)
GDP - real growth rate:
5% (2003 est.)
GDP - per capita:
purchasing power parity - $1,800 (2003 est.)
GDP - composition by sector:
agriculture: 20.6%
industry: 21.4%
services: 58% (2002 est.)
Population below poverty line:
33% (2003 est.)
Household income or consumption by percentage share:
lowest 10%: 2.1%
highest 10%: 37% (1995)
Distribution of family income - Gini index:
44 (1998)
Inflation rate (consumer prices):
1.5% (2002 est.)
Labor force:
1.4 million (2001)
Labor force - by occupation:
herding/agriculture 46%, manufacturing 6%, trade 10.3%, public sector 4.7%, other/unemployed 33% (2001)
Unemployment rate:
4.6% (2001)
Budget:
revenues: $387 million
expenditures: $428 million, including capital expenditures of NA (2001 est.)
Industries:
construction materials; mining (coal, copper, molybdenum, fluorspar, and gold); oil; food and beverages; processing of animal products
Industrial production growth rate:
4.1% (2002 est.)
Electricity - production:
2.225 billion kWh (2001)
Electricity - production by source:
fossil fuel: 100%
hydro: 0%
other: 0% (2001)
nuclear: 0%
Electricity - consumption:
2.194 billion kWh (2001)
Electricity - exports:
25 million kWh (2001)
Electricity - imports:
196 million kWh (2001)
Oil - production:
0 bbl/day (2001 est.)
Oil - consumption:
8,750 bbl/day (2001 est.)
Oil - exports:
NA (2001)
Oil - imports:
NA (2001)
Agriculture - products:
wheat, barley, potatoes, forage crops, sheep, goats, cattle, camels, horses
Exports:
$524 million f.o.b. (2002 est.)
Exports - commodities:
copper, livestock, animal products, cashmere, wool, hides, fluorspar, other nonferrous metals
Exports - partners:
China 46.7%, US 32%, Russia 6.5%, South Korea 5.1% (2003 est.)
Imports:
$691 million c.i.f. (2002 est.)
Imports - commodities:
machinery and equipment, fuels, food products, industrial consumer goods, chemicals, building materials, sugar, tea
Imports - partners:
Russia 33.9%, China 19.8%, South Korea 12.1%, Japan 5.7%, Germany 5.2% (2003 est.)
Debt - external:
$885 million (2001 est.)
Economic aid - recipient:
$332 million (2003 est.)
Currency:
togrog/tugrik (MNT)
Currency code:
MNT
Exchange rates:
togrogs/tugriks per US dollar - 1,171 (2003), 1,110.31 (2002), 1,097.7 (2001), 1,076.67 (2000), 1,021.87 (1999)
Fiscal year:
calendar year
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