WT/TPR/M/297
3 November 2014
(14-6362)  Page: 1/28
Trade Policy Review Body 
24 and 26 September 2014 
 
  TRADE POLICY REVIEW 
MONGOLIA  
MINUTES OF THE MEETING 
Chairperson: H.E. Mrs Mariam MD Salleh 
CONTENTS 
 
1  INTRODUCTORY REMARKS BY THE CHAI RPERSON ....................................................... 2  
2  OPENING STATEMENT BY THE REPRESENTATIVE OF MONGOLIA .................................. 3  
3  STATEMENT BY THE DISCUSSANT ................................................................................ 6  
4  STATEMENTS BY MEMBERS .......................................................................................... 9  
5  REPLIES BY THE REPRESENTATIVE OF MONGOLIA AND ADDITIONAL 
COMMENTS ..................................................................................................................... 23  
6  CONCLUDING REMARKS BY THE CHAI RPERSON ......................................................... 27  
 
 
Note: Advance written questions and additional questions by WTO Members, and the replies 
provided by Mongolia are reproduced in document WT/TPR/M/297/Add.1 and will be available 
online at http://www.wto.org/englis h/tratop_e/tpr_e/tp_rep_e.htm. WT/TPR/M/297 • Mongolia 
 
- 2 - 
 
  1  INTRODUCTORY REMARKS BY THE CHAIRPERSON 
1.1.  The second Trade Policy Review of Mongolia was held on 24 and 26 September 2014. The 
Chairperson H.E. Mrs Mariam MD Salleh (Malaysia)  welcomed the delegation of Mongolia headed 
by Mr Ochirbat Chuluunbat, Deputy Minister for Economic Development; the rest of the delegation 
from Ulaanbaatar; H.E. Mr. Vaanchig Purevdorj, Pe rmanent Representative of Mongolia to the WTO 
and his colleagues from the mission in Geneva; and the discussant, H.E. Mr Francisco Pirez Gordillo (Uruguay). 
1.2.  The Chairperson recalled the purpose of the Tr ade Policy Reviews and the main elements of 
the procedures for the meeting. The report by Mongolia was contained in document WT/TPR/G/297 and that of the WTO Secretariat in WT/TPR/S/297. 
1.3.  Mongolia adopted the alternative timeframe for its TPRB meeting. Questions by the following 
delegations had been submitted in writing at least four weeks in advance and had been 
transmitted to the delegation of Mongolia: China; Canada; the EU; Australia; Colombia; the United States; Turkey; Chinese Taipei; Brazil; Thailand; Japan; and Korea. The following delegation 
submitted written questions after the four -week deadline: the Russian Federation. 
1.4.  The last review of Mongolia took place in  2005 and much had happened since then. That 
Review had noted relatively modest economic growth of around 4% in the early 2000s based on 
agriculture and services. However, this review no ted that, in the past few years, Mongolia had 
been one of the fastest growing economies in th e world. Driven by increased production and 
exports of minerals, growth in GDP had been over 10% for the past three years as the economy quickly recovered from a recession in 2009 that re quired an IMF supported stand-by arrangement. 
Mongolia successfully exited that stand-by arrangement in October 2010.   
1.5.  Growth was likely to continue, although at a slower rate. While existing mines increased 
production and new ones come on stream brought many benefits, rapid growth also posed 
problems. Bringing the mineral deposits into production required a lot of investment and the 2012 
law on foreign investments in strategic sectors had caused some uncertainty and had contributed to a decline in investment. A new law on investment had been introduced in 2013 which was 
intended to address concerns relating to the 2012 law, as well as concerns about earlier 
legislation. However, the Chairperson had noted that many questions had been raised about the new and related laws and about investment generally. Hopefully, these questions were indicative of the interest of many countries to invest in Mongolia. 
1.6.  Investment in mining also depended on investment in transport infrastructure as well as in 
the mines themselves. With a low population density and harsh climate such investment was expensive for Mongolia. However, it already had a good telecommunications system and there 
were ambitious plans for rail and road developmen t. The realization of these plans could benefit 
from foreign investment and could help development in mining and other sectors. But getting value for money for the cost investment in infrastructure required an efficient and open 
Government system. 
1.7.  The reports and several delegations' questions had noted that, in general, Mongolia had low 
applied tariffs but import duties on some products were higher than the bound rates. Although this 
affected relatively few tariff lines, Members were interested to know the plans by Mongolia in 
addressing this discrepancy between applied and bo und tariffs as well as its import prohibitions. 
Members would also like to hear from Mongolia about its import and export regimes and the steps taken to improve their efficiency and reduce tradin g costs, as well as about any duties and charges 
applied to exports and imports. 
1.8.  The reports and questions from Members and the replies from Mongolia covered many issues. 
The Chairperson was sure that these would be touched upon in greater detail at their deliberations 
on the first and second day of the meeting. WT/TPR/M/297 • Mongolia 
 
- 3 - 
 
  2  OPENING STATEMENT BY THE REPRESENTATIVE OF MONGOLIA (MR OCHIRBAT 
CHULUUNBAT) 
2.1.  At the outset, let me put on record my appreciation to all the delegates present here for 
showing an interest in Mongolia's trade policy th rough the questions submitted and we hope for a 
constructive exchange of views. 
2.2.  I would like to thank you, Madam Chair, for your kind words of welcome and introduction to 
Mongolia's second Trade Policy Review. Special thanks to H.E. Mr. Fransisco Pirez Gordillo, 
Ambassador of Uruguay for accepting to be the discussant for our review. I would also like to 
thank the WTO Secretariat's team for their hard work in producing the report which provides a basis for our discussion. 
2.3.  I must mention that our government officials worked hard to prepare the responses to all the 
questions posed by the Members. The responses we re circulated to Members. Like other Members 
going through the Trade Policy Review, we were engaged in a lot of coordination work as questions cut across Ministries and agencies, despite the many constraints, not least of which is of course, 
time. We assure you that we put the necessary  effort in providing the written answers.  
Mongolia and the multilateral trading system 2.4.  Mongolia strongly believes in the principles and benefits of rules-based multilateral trading 
system in which the World Trade Organization plays a central role in ensuring transparency, 
inclusiveness and predictability. Mongolia remains fully committed to the goals and mission of the WTO. 
2.5.  Mongolia looks forward to the successful conclusion of the Doha Round and considers that it 
is important to move forward to achieve successful implementation of the issues that were agreed 
during the 9th Ministerial Conference in Bali. Th e implementation of the Bali Package would make 
a contribution to consolidating the multilateral  trade regime thus supporting the expansion of 
global economy. 
2.6.  As a landlocked developing country, Mongolia continues to be committed to freer trade and 
trade liberalization and, as such, she strives to find the right balance while improving the 
necessary legal basis.  
2.7.  As a Member of the WTO, Mongolia shares the view that the Trade Policy Review is an 
important process in promoting greater awarenes s and understanding of each Member's trade 
policies and practices, and the legitimate reason s behind them. These reviews provide a platform 
for Member to share policy initiatives and measures that are being taken to meet obligations under 
the Agreements.  
2.8.  For the second Trade Policy Review, Mongolia received close to 200 questions from 
12 Members. The queries covered investment policy and its reform, competition policy, domestic 
legal changes, government procurement, services liberalization, and tariff-related issues.  
Current economic overview 
2.9.  In 2013, the economy grew by 11.7% over the pr evious year; the inflation rate accounted for 
12.5%, the unemployment rate was 7.6%.  
2.10.  GDP per capita, as of last year, has seen a five-fold increase compared to the year of our 
first trade policy review (2005). Foreign trade turnover has substantially increased compared to 
2005 by about five times and accounted for US$11 billion; however, trade deficit has also 
increased reaching US$2.1 billion. Our exports make around 40% of GDP and imports around 60%. The trade sector absorbs 12% of total workforce and is considered as high workforce 
absorbing sector playing a significant role in employment.  
2.11.  The Government of Mongolia is attributing great importance to intensifying the economic 
development, including through increasing public investment in major projects with government 
bonds and the Development Bank. It is expected to  support economic growth in the coming years. WT/TPR/M/297 • Mongolia 
 
- 4 - 
 
  2.12.  Promoting development of the private sector has been one of the key objectives of the 
Government of Mongolia. In order to improve the legal environment, to direct public and private 
partnerships for economic development, the Concession Law was adopted in 2010. The Government implemented actions such as promoting private investment in infrastructure projects, 
transfer some of the government functions to non-governmental organizations and professional 
associations. A particular attention was paid to privatization of state-owned enterprises and privatization plans are adopted for four years. 
2.13.  In 2013, Mongolia traded with 135 countries. The PR of China, the Russian Federation, the 
United States, Canada, the EU, Japan, and the Re public of Korea are our main trading partners, 
accounting for 90% of total trade.  
2.14.  Some of the Mongolian export items enjoy pref erential tariffs under the GSP schemes of the 
U.S, the EU, Canada, Japan and the Russian Federation. From 2014, Mongolia is eligible to "GSP 
Plus" of European Commission on sustainable development and good governance. These enhance the possibilities to improve the access to these markets.  
2.15.  Most of the questions we received were re garding our investment environment and a New 
Investment Law, which was approved in 2013. This law replaced the controversial Law on the Regulation of Foreign Investment in Business Entities Operating in Sectors of Strategic 
Importance. The Government has made its best efforts to improve the investment environment.  
2.16.  Mining is one of the major sectors that plays an important role in the economy of the 
country. As of 2013, the share of the sector in the GDP accounted for 28%. To develop private sector driven, transparent, responsible mining sector and in order to create balanced and 
diversified economy in short and medium term, the policy in the mining sector was adopted by the 
Parliament this year until 2025.  
2.17.  The main foundation of Mongolia's economy is livestock husbandry; it plays an important 
role in the economy, in the employment and expo rt revenues of Mongolia. As of the end of 2013, 
close to 28% of GDP were produced by the ag ricultural sector, of which 77.5% account for 
livestock husbandry. As well, 35% of the total labour force is engaged in the agricultural sector 
and 7% of export income is contributed by the ag ricultural sector. In 2013, we counted the total of 
45 million heads of livestock.  
2.18.  The Government of Mongolia continues to believe that trade liberalization plays and should 
play a vital role in improving the living standards of all people. From this point of view, the 
Government is working to make the necessary contribution to successful completion of the Doha 
Round in the near future.  
2.19.  The Government of Mongolia is of the view that all Members, large and small, should make 
a contribution to move the negotiations forward. Mongolia shares the view of and actively 
participates in the groups such as G-33, Small and Vulnerable Economies (SVEs), Recently Acceded Members (RAMs), and Net Food Importing Developing Countries.  
2.20.  Trade facilitation is an issue that has a particular importance in increasing trade, especially 
for landlocked developing countries with small economies. The Government of Mongolia is pleased that an agreement is underway, waiting for a consensus. Mongolia is of the position to conclude the agreement at the earliest.  
2.21.  Taking this opportunity let me inform the Members that an International Think-Tank of 
LLDCs was established in Mongolia and high-level events took place recently.  
2.22.  Mongolia is also working hard to integrate into the regional economy. Until now, it remained 
the only country that did not belong to any of the regional trade arrangements. We see regional 
trade agreements as useful complements to the multilateral trading system. Our first free trade agreement is being negotiated with Japan, and we are also working to accede to the Asia-Pacific 
Trade Agreement. The Government attentively foll ows the activities of the ASEAN, the APEC, the 
PECC, as well as the economic cooperation in the North-East and Central Asia. In the future, it is intended to ensure a more active particip ation in APEC through acceding to it.  WT/TPR/M/297 • Mongolia 
 
- 5 - 
 
  2.23.  In summary, during the period under the review, Mongolia had continued to pursue a 
generally liberal trade and economic policy through consolidating the accomplishments and promoting fair competition and creating a new structure of the economy, which rests on the pillars of competitive industries. The economic policies  of the country and its WTO compliance efforts 
were complementary. Mongolia continues to hope that its legitimate interests are heard and 
treated with due consideration and understanding. WT/TPR/M/297 • Mongolia 
 
- 6 - 
 
  3  STATEMENT BY THE DISCUSSANT 
3.1.  On this important occasion, I should first of all like to welcome the delegation of Mongolia, led 
by His Excellency Mr Ochirbat Chuluunbat, Vice-Minister of Economic Development. 
3.2.  I also wish to thank Mongolia and the Secretariat for the high-quality reports that are before 
us, which will serve as a valuable basis for our exchanges of views during this two-day review. 
3.3.  It is an honour and a privilege to be the discussant for this second review of Mongolia's trade 
policy. I shall divide my comments into two parts - the first relating to the economic environment 
and the second focusing on the trade policy framework and an analysis of a number of sectoral 
policies in particular. My intention is to make a constructive contribution to our discussions in this high-level meeting. 
3.4.  I should emphasize that preparing this statemen t proved most enriching, as I was able to 
take a closer look at the progress Mongolia has made on several counts, which also gave me 
a better sense of some of the past and future challenges faced by this interesting country with its population of about 2,800,000. 
Economic environment 
3.5.  As regards the economic environment and as the Secretariat report points out, Mongolia has 
refrained from applying protectionist measures while maintaining a generally open trade and 
investment regime. 
3.6.  The country's GDP has grown by more than 10%  over the past three years, driven by 
increased production and the export of minerals. Mo ngolia's rapid development is likely to continue 
as mining production expands and new mines enter into operation. On this particular point, 
the Secretariat report re-emphasizes the problems that may arise from dependence on a narrow 
economic base relying on minerals. 
3.7.  Major investment is, of course, necessary to exploit mineral deposits. The Law of 2012 on 
foreign investment in sectors of strategic importance caused a certain amount of uncertainty and 
contributed to a decline in investment. However,  a new investment law was introduced in 2013 
in order to address concerns relating to the 2012 Law and prior legislation. 
3.8.  The reports highlight a series of changes being made by the Government with a view to 
significantly improving competitiveness in Mongolia's various economic sectors. Foreign direct investment has largely contributed to the country's growth, which is why it is a very positive sign that the authorities are continuing to make ever y effort to improve the country's economic and 
trade regimes. Investment will lead to greater benefits as well as technology transfer, thus 
contributing to Mongolia's endeavours to further improve the quality of life of its inhabitants. Foreign investment has played a key role in furt hering economic openness. It would therefore be 
interesting to know what measures Mongolia is considering to attract more foreign investment. 
3.9.  As to the need to diversify the economic base, some Members had already submitted 
comments and questions during the first review of Mongolia's trade policy in 2005, and 
several delegations reiterated their questions on the subject in this second review. It is important 
to emphasize that the authorities are aware of the difficulties that may arise, and Mongolia's government report points out that export diversification will help the country improve its economic performance. 
3.10.  In this connection, it would be interesting to hear the authorities report on the results 
achieved in implementing the comprehensive na tional development strategy established by 
Mongolia in 2008. 
3.11.  Another matter of relevance to the economic environment is that the country has been 
adopting a series of laws in order to strengthen the fiscal policy framework and promote fiscal consolidation. It would be interesting to know whether these measures have achieved the 
expected results. WT/TPR/M/297 • Mongolia 
 
- 7 - 
 
  3.12.  According to the Secretariat report, Mongolia has bound most of its tariff lines at 20%. 
The average bound MFN rate is 17.7% compared with an average applied MFN rate of 5%. The report also notes that Mongolia applies an ad valorem  tariff rate of 5% to almost all imported 
goods. For most tariff lines, the applied rate is low. Import duties on some products are greater 
than the bound rate, which affects a small number of tariff lines. 
3.13.  Although the economy is essentially market-driven and has been privatized, there were 
about 100 fully or partially state-owned enterprises in Mongolia. Between 2005 and 2011, about 
90 entities were privatized while several, including the national airline (MIAT) and some 
power plants, had their privatization postponed. 
3.14.  It is very important to mention the significance that Mongolia attaches to the multilateral 
system as a key element of its position regarding international trade, on which a large part of its 
economy depends. Mongolia actively participates in the group of landlocked countries and is 
a member of other groups as well, such as the group of small, vulnerable economies, the G-33 coalition on agriculture, the group of Asian developing countries, and the group of recently 
acceded Members (RAMs). It was one of the 40 Members that notified their Category A 
commitments under the Agreement on Trade Facilitation. 
3.15.  Mongolia is an observer to the WTO Plurilat eral Agreement on Government Procurement. 
3.16.  Lastly, we concur with Mongolia that it is essential to reach a successful conclusion to the 
Doha Round, and that this can generate positive outcomes for WTO Members in their endeavours to improve people's living standards. The reforms to global agriculture are a prime example. 
Trade policy regime – sectoral policies 
3.17.  Turning to the second part of my statement concerning the trade policy framework and the 
analysis of some sectors of Mongolia's economy, I should point out that mining, information and technology, agricultural production, and tourism have been identified by the Government as 
priority areas for development and attracting foreign direct investment. Mongolia's report 
describes a series of laws to promote and develop these areas. 
3.18.  Agriculture accounts for one third of employment and around 15% of Mongolia's GDP. 
The main agricultural exports are cashmere, combed goat down and hides and skins of sheep and 
goats. According to the Secretariat report, Mongolia has a trade deficit for agricultural products. 
3.19.  It should be mentioned that Mongolia has land suitable for growing crops, but its harsh and 
difficult climate prevents it from taking better advantage of arable land for the time being. It is 
therefore encouraging to note the various measur es that are being implemented to reduce the 
adverse impact of the country's severe climate on agriculture. Any technical assistance that Mongolia may receive in this regard will undoubtedly contribute to the sustainable improvement of 
productivity and help overcome the obstacle s currently posed by the country's climate. 
3.20.  Given the importance of agriculture and the si ze of the country's population, it would be 
interesting to hear a few comments from the authorities on Mongolia's objectives to improve food 
security and develop rural areas, which are set out in the Agriculture Sector Development Strategy 
(2006-2015), the National Programme for Food Security (2009-2016), the Third Crop Campaign (2008-2010), and the Livestock Programme (2010-2021). 
3.21.  As regards the mining and energy sectors, th e Secretariat report indicates that mining 
represented over 18% of GDP in 2012, while export s of minerals accounted for some 89% of total 
goods exports that same year. Mongolia is a major producer of various minerals including coal, copper, metal ores and fluorspar, and it hopes that the mining sector will continue to expand as 
new mineral deposits are exploited. 
3.22.  According to the Secretariat report, illegal mining, which avoids payment of royalties and 
compliance with environmental laws, has increased. It would be interesting to hear what measures 
have been taken or are being envisaged by the au thorities to reduce this practice, which affects 
the country's economy. WT/TPR/M/297 • Mongolia 
 
- 8 - 
 
  3.23.  There are other sectors, such as energy and industry, as well as the development of free 
zones and the services sector, in particular tourism and transport, which Members would like to address in greater detail. 
3.24.  It is important to highlight the progress that Mongolia is making in the field of intellectual 
property. The Global Innovation Index 2014 ranks the country 56
th out of 143 countries. It would 
be interesting to hear about Mongolia's experience regarding the development and protection of intellectual property. 
Conclusions 
3.25.  Turning to the last part of my statement on this first day, I would like to highlight a few 
points that the authorities might wish to consider for future analysis. 
3.26.  The conclusion that can be drawn from examining the body of documents for this TPR is that 
Mongolia has made huge strides since the previous review of its trade policy in 2005. As with 
everything in life, and achievements notwithstanding, there are also challenges to be met and overcome in the future so as to maintain and increase the country's annual rate of growth, 
improve the competitiveness of its business sectors and achieve more inclusive development for 
society as a whole. It is encouraging to note the various reforms on which Mongolia has embarked since 2005 in order to address and strengthen those areas which, today, might be described 
as weaker. 
3.27.  These areas include economic diversification, the problems arising from lack of 
infrastructure, the need to reduce high transport costs (agreements with neighbouring countries would be helpful), and attracting more investment so as that Mongolia can benefit from the 
transfer of technology and other advantages to the country. 
3.28.  It has been a great privilege to share my comments as the discussant on this first day 
of Mongolia's second trade policy review. 
3.29.  Unfortunately we do not have enough time to take a closer look at the process 
of liberalization, integration and participation in international trade in which Mongolia has been engaged for some time now. 
3.30.  I am convinced that this two-day exercise will prove extremely valuable in giving us an even 
deeper insight into the dynamics of this incredible country. I also believe that this meeting will be very useful to the Mongolian authorities as they advance with internal reforms. 
3.31.  Once again, I appreciate the opportunity that  h a s  b e e n  g i v e n  t o  m e  a n d  w i s h  M o n g o l i a  
a successful review. WT/TPR/M/297 • Mongolia 
 
- 9 - 
 
  4  STATEMENTS BY MEMBERS 
CHINA 4.1.  China is glad to see that Mongolia, as our important neighbour, has achieved remarkable 
economic and social development since its last review in 2005. We are even more pleased to 
witness that the economic growth has benefitted the people of Mongolia, by raising their living 
standards and reducing the unemployment rate . We commend Mongolia for taking its WTO 
commitments seriously and its continuous effort to liberalize its trade and investment 
environment. For example, Mongolia has kept most of the applied tariff rates lower than the bond 
rates, and has upgraded the customs information system which has greatly enhanced trade facilitation during the period under review. We en courage the Government of Mongolia to continue 
in this direction. 
4.2.  Turning to the bilateral front, Mongolia and China, with geographical proximity, cultural 
affinity and economic complementarity, always enjoy close relationships in all aspects including trade and investment. We are currently the largest trading partner and investor of Mongolia, and 
notably, our investment outflow to Mongolia is accelerating. Looking ahead, we are willing to 
deepen and extend our cooperation in boarder areas,  and actively engage in Mongolia's efforts to 
diverse from its resource-dependent economy. Just last month, H.E. President Xi Jinping of China 
visited Mongolia. During his visit, both sides decided to upgrade the China-Mongolia relations to a 
comprehensive strategic partnership which surely will bring our bilateral relations to a new level. 
4.3.  At this occasion, China would encourage Mongolia to further facilitate foreign investment in 
areas of agriculture, mining, transportation, elec tric power, and renewable energy. In particular, 
we look forward to working closely with the Mongolian Government on their infrastructure to 
improve connectivity and facilitate trade. We also believe that it would be in the interests of the Government of Mongolia to simplify approval procedures for foreign investment and further 
improve transparency of its investment regime so as to protect the legitimate rights and interests 
of foreign investors.  
CANADA 
4.4.  Allow me to begin by saying a few words about Canada and Mongolia's bilateral relationship, 
before moving on to the broader trade and economic environment. 
4.5.  Canada and Mongolia have built a strong and dynamic partnership based on shared values, 
including mutual recognition of the importance of open and fair trade to economic growth and 
prosperity. This understanding underscores our important bilateral relationship and extends to the 
WTO. 
4.6.  Our bilateral relationship has its roots in trade and investment. Canada was one of the first 
"Third Neighbour" countries to participate in exploration of Mongolia's mineral resources and today 
we are one of the top foreign investors in the country. Canada accounted for the third highest FDI inflows by a single country to Mongolia betw een 1990 and 2012, increasing by 22% over the 
previous year to reach US$1.9 billion in 2012. 
4.7.  I would like to commend the efforts of Mongolia in transitioning to a market-oriented 
democracy in a peaceful fashion in just over 20 years. This is particularly remarkable given Mongolia's geographic challenges such as a lack of access to open seas, vast distances and a harsh 
climate, the latter a challenge Canada can certainly relate to. 
4.8.  The Canada-Mongolia bilateral relationship could move to a new level with the successful 
conclusion of a bilateral Foreign Investment Promotion and Protection Agreement. Our negotiating 
teams have re-engaged recently and we thank Mo ngolia for their latest communication on the 
outstanding issues regarding the Agreement. We ho pe to bring negotiations to conclusion in the 
near future. 
4.9.  Canada is committed to the growth of our relationship with Mongolia and we welcome the 
constructive dialogue in which our Governments have engaged over the years. It is in the spirit of WT/TPR/M/297 • Mongolia 
 
- 10 - 
 
  this dialogue that I would like to highlight three broad themes, addressing issues which I believe 
could foster greater economic participation by Mongolia in the global economy. 
4.10.  First, I would like to commend the efforts of Mongolia to liberalize the foreign investment 
approval regime by repealing the "Strategic Entities Foreign Investment Law 2012" and replacing it 
with "Investment Law 2013". This should ease the approval process for foreign investments in 
Mongolia in two key respects. First, the law provides for a consistent application of rules across industry sectors and outlines a consistent role for Government in the decision-making process. 
Second, the law includes a supermajority clause as a prerequisite for any amendment or repeal, 
which provides considerable and much sought after stability in Mongolia's legislative framework governing investment. However, th e new Law, which has also repealed the previous "Investment 
Law 1993", has significantly narrowed the number and range of stabilized and domestic investors 
through minimum paid-in capital requirements. More over, other pieces of legislation provide for a 
margin of preference for domestic suppliers of goods and services. In light of slumping economic growth and a drop in foreign investment, increased stability for private investment, both foreign 
and domestic, will help Mongolia to return to a robust growth path. 
4.11.  Second, Canada recognizes and supports the n eed for Mongolia to diversify its economy to 
promote sustainable growth. One way to do so would be to further open areas of the economy to 
private sector participation by reducing Government participation, including with respect to mineral 
exploration and production, power generation, and railway transportation. In the last 18 months, 
there has been notable increase in State's role in the economy of Mongolia with 14 new state-owned enterprises created since 2012. A ccording to some estimates, the assets of 
state-owned enterprises reached 33% of GDP at the end of 2012, while their combined profitability 
is reported to be near zero. Canadian market participants report that Mongolian legislation and regulations governing trade and investment often lack clear definitions, allowing for subjective and 
inconsistent interpretation by the authorities. Diminishing the State's role in the economy through 
reduction of the State ownership of assets, as well as increasing clarity and transparency in legislation and regulation, will help reverse the outflow of foreign investment as well as free up the 
important macroeconomic levers in order for the Government to advance its "Action Plan 
2012-2016". 
4.12.  Third, as Mongolia seeks to modernize its hard infrastructure, particularly in rail transport, 
Canadian companies have reported a rather unorthodox treatment in regards to participation in 
public tenders. I cannot underscore enough the im portance of predictability, transparency and 
fairness in government procurement procedures. These help ensure best value for Government resources, increase the confidence of suppliers and underline the importance of the rule of law. 
Further, a fair and transparent process is likely to attract better and more technologically 
advanced suppliers to Mongolia, thereby contributing to the effective development of the country's infrastructure. 
4.13.  Canada has submitted written questions that reflect our concerns regarding a number of 
trade-policy related measures that may impede market access or otherwise constrain mutually beneficial growth in trade and investment between our two countries. We look forward to Mongolia's responses, and more generally to a co nstructive exchange of views on all aspects of 
Mongolia's trade policy.  
EUROPEAN
 UNION 
4.14.  This is the second review for Mongolia. Du ring the years under review, Mongolia has 
continued its progress towards free market, free trade and diversification of its economy. Certainly 
there is still room for improvement and we have seen some difficulties in the investment environment particularly in the last two years but, considered in perspective, we should commend 
Mongolia for its efforts. 
4.15.  While the Russian Federation and the People's Republic of China are the main trade partners 
for Mongolia accounting for more than 70% of Mongolian total foreign trade, the EU represents, nevertheless, an important trading partner accounting for about 9.3% of Mongolia total trade. 
4.16.  A word on the EU's bilateral relationship with  Mongolia. Formal relations between the EU and 
Mongolia are overall positive and, in 2013, we si gned the EU-Mongolia Partnership Agreement that WT/TPR/M/297 • Mongolia 
 
- 11 - 
 
  provides a comprehensive framework for enhancing relations in political, economic and sectoral 
areas such as agriculture people-to-people, research and innovation, environment, culture and education. In the field of trade, the EU and Mongolia have agreed to cooperate in the following priority areas: (1) diversification of the economy and of its export base; (2) stable and predictable 
business and investment environment; and (3) raw materials. 
4.17.  Regarding the diversification of its economy, Mongolia became eligible to GSP+ in 2006 
already. The EU congratulates Mongolia on qual ifying for the GSP+ also under the reformed 
EU-GSP as from 1 January 2014 and invites the count ry to ensure effective implementation of the 
relevant international conventions in order to keep  those preferences. Part of the EU development 
assistance (€65 million for 2014-2020) is in support of SMEs and approximation of EU standards which, in the end, should help strengthen Mongolia's production and export capabilities. 
4.18.  At a multilateral level, the EU praises the positive recognitions that Mongolia attributes to 
the Trade Facilitation Agreement reached in Bali and congratulates Mongolia for having notified its Category A commitments in July. 
4.19.  Turning now to Mongolia's request to receive additional technical assistance to ensure the 
full implementation of the agreements, the EU wo uld like to underline that it stands ready to 
support the Government in trade-related capacity areas and considers it as a priority of our 
relations. However, we are concerned by the fact that the existing organizational structure of the 
Ministry of Economic Development makes it very difficult to "absorb" additional technical assistance programmes. We understand that the trade portfolio is managed by the department of economic cooperation, loan and aid policy which seems to be understaffed. Therefore, we would 
invite Mongolia to indicate whether it intends to "strengthen" the operational resources allocated to 
trade in the Ministry of Economic Development and to clarify its overarching trade policy strategy so that the EU and other donors could more easily earmark funds in this area. 
4.20.  Coming now to our second priority with Mongolia, that is to reach a stable and predictable 
business and investment environment, I would like to  underline first of all the need of an increased 
transparency of the import procedures put in place. This is an issue that the EU has been trying to 
clarify for a long time but unfortunately we ha ve not yet received the necessary answers. We 
would recall Mongolia that replies are an important aspect of any TPR and that, more broadly, it is in the interest of Mongolia to set up a business environment that is transparent and stable enough. 
In some areas, it seems that the environment still raises questions from companies and we would 
encourage Mongolia to work with us in the coming months to provide more detailed and reassuring 
answers, for instant on issues like import licensing or water services. 
4.21.  The EU welcomes the improvement brought to the investment framework in 2013; it should 
contribute to reassure and bring back investors. The EU believes that the steps taken to approve 
the largest public-private partnership globally in  the energy sector, the so-called combined heat 
and power plant CHP5, represent a visible and positive decision that will help Mongolia restore the 
confidence of the international investors. 
4.22.  Regarding our third priority with Mongolia, we are interested in receiving more clarity on the 
new Mineral Law and we stand ready to exchange expertise on environment and safety regulations 
in the mining sector. 
4.23.  Concluding, the EU is confident that this TPR will help Mongolia in reviewing its policies so as 
to ensure that they are most favourable for attaining its economic objectives while respecting their international commitments in this forum. 
AUSTRALIA 
4.24.  We have been pleased to witness Mongolia's rapid development of recent years, powered by 
strong economic growth which we hope to see co ntinue for the benefit of all Mongolia's people. 
4.25.  Australia's bilateral relationship with Mongolia is strong, particularly in the area of mining 
investment, development cooperation, education, and people-to-people links. WT/TPR/M/297 • Mongolia 
 
- 12 - 
 
  4.26.  Education has been an important part of our development assistance programme in 
Mongolia, it is important in promoting and sustaining economic growth and reducing poverty. Since 1995, the Australian Government has supported over 350 Mongolians and their families to study in 
Australia on postgraduate scholarships, with many graduates going on to achieve success in 
government and business in Mongolia. In recognition of the success of this programme, Australia 
announced in March that, from this year, it would be increasing the number of postgraduate scholarships it provided to Mongolians each year from 38 to 43. 
4.27.  Like Mongolia, Australia is a resource-rich country whose mining industry has undergone 
rapid expansion in recent years. Australia is a ssisting the Mongolian Government to help ensure 
that the benefits of the timing sector are realized for the entire population. 
4.28.  If any country wants to make the most out of its resources, good governance and a stable 
regulatory and investment climate are crucial. Australia was pleased to announce earlier this year 
the Australia-Mongolia Extractives Program, which will help the Mongolian Government to strengthen governance and transparency in the mining sector, level the playing field for both 
domestic and foreign investors, and improve access for Mongolians to technical and vocational 
education, training and jobs. 
4.29.  Foreign investment has played an important role in Australia's own economic growth, 
particularly in the mining industry. Australia welcomes recent efforts by the Mongolian Government 
to improve Mongolia's foreign investment climate, particularly the repeal of the Strategic Entities Foreign Investment Law and the passing of the new investment law and minerals policy at the end of 2013. Noting the importance of maintaining tr ansparent and predictable rules, we encourage 
Mongolia to take further steps to support fore ign investment and promote investor confidence. 
This could include improving the speed and transp arency of decision-making as well as enhanced 
consultation with investors on draft legislation. In this regard, we welcome the establishment of 
Invest Mongolia as a separate agen cy to promote foreign investment. 
4.30.  Australian investors have a significant stake, alongside the Government of Mongolia, in the 
US$6.5 billion Oyu Tolgoi copper and gold mine, the largest single investment in Mongolia's 
history. A joint venture between Rio Tinto and the Mongolian Government, Oyu Tolgoi is expected 
t o  a c c o u n t  f o r  b e t w e e n  2 0 %  a n d  3 0 %  o f  M o n g o l i a ' s  G D P  o n c e  i t  s t a r t s  f u l l  c o m m e r c i a l  o r e  production. Australia encourages the Mongolian Government to exercise every effort to reach an agreement on financing of Stage 2 of Oyu Tolgoi. 
4.31.  Australia thanks Mongolia for its notification of Category A commitments under the 
Agreement on Trade Facilitation. Achieving progress on the WTO Agreement on Trade Facilitation and development of a post-Bali work programme in these areas is of utmost importance to the 
ongoing success of the multilateral trading system. We also encourage the Mongolian Government 
to address the concerns of foreign businesses around restrictions on freedom of movement of foreign nationals, and the use of the criminal justice system to resolve commercial disputes. 
4.32.  Australia notes that high levels of inflation can diminish investment returns and negatively 
affect investor confidence. Australia recognizes the step taken by the Bank of Mongolia to raise interest rates in 2012, which brought down inflat ion. Noting the continued persistence of high 
levels of inflation in the economy, we encourage the Bank of Mongolia and the Mongolian 
Government to work together to bring inflation down further, including by undertaking further 
regulatory reform to free up markets and increase the capacity of the Mongolian economy. 
COLOMBIA 
4.33.  Mongolia's second trade policy review shows th e country's positive economic performance, 
with a high rate of economic growth, substantial increases in per capita GDP, a low rate of unemployment, and improvements in standards of living, all of which are bolstered by investment, 
trade in minerals, wide ranging structural reforms and an open trade regime. 
4.34.  The sustainability of these favourable results will largely depend on how Mongolia handles 
major structural challenges such as the diversification of its economy, which is highly dependent on mining, and the diversification of its trading partners. In 2012, 84% of its exports came from a 
single sector, namely mining, and went to a si ngle market, China, which accounted for 92% of WT/TPR/M/297 • Mongolia 
 
- 13 - 
 
  these exports. Mongolia will also have to improve its infrastructure, particularly as regards road 
and rail transport. The comprehensive national  development strategy of 2008 and the wide 
ranging reform process undertaken during the review period are important initiatives in addressing these challenges. 
4.35.  Mongolia adopted trade facilitation measures during the period under review. We welcome 
the introduction of the Customs Automated Information System (CAIS) and the online payment system for customs duties, which has reduced clearance times from 3 hours and 6 minutes to 23 
minutes. These measures, along with the implementation of the Trade Facilitation Agreement in 
future, will have a positive impact for Mongolia, which is a landlocked country with very high business costs. 
4.36.  Notwithstanding the progress made since the prev ious trade policy review in 2005, Mongolia 
still applies some trade restrictive measures which we consider appropriate to mention in this 
review: 
• There are still 60 tariff lines with applied rates exceeding the bound rates. 
• Import bans on several products such as ethyl alcohol, and non-automatic licences for a 
 variety of products, such as breeding animals. 
• The large number of mandatory technical standards (around 3,000) that are not aligned with 
 international standards. 
4.37.  We are also struck by the fact that Mongolia is the only WTO Member that is not party to 
any regional trade agreement with other countries. This was already mentioned in the WTO's World Trade Report 2011, stating that Mongolia wa s the exception, amidst an ever growing trend 
to negotiate bilateral, regional and plurilateral trade agreements. We wonder whether Mongolia 
might explore these areas of trade policy, because FTAs could help it integrate more effectively in the global economy. We also note that, in the WT O, Mongolia has not been a party or third party 
in any dispute under the dispute settlement mechanism, nor has it taken any antidumping actions 
or applied any safeguard measures; moreover, it has not established any investigating authority to apply trade defence measures. 
4.38.  To conclude, we wish Mongolia every success with the review of its trade policy and 
encourage it to pursue its efforts to reduce depe ndency on the mining sector, achieve long term 
sustainable development and create a competit ive and diversified economy. The government 
programmes aimed at creating infrastructure, increasing the number of export products and 
establishing an environment conducive to foreign direct investment will be instrumental in 
achieving these objectives. 
UNITED
 STATES 
4.39.  In the 17 years since it acceded to the WTO, Mongolia has recognized the importance of 
market-oriented economic development, as eviden ced by its focused efforts to promote economic 
growth, as well as its recognition of the need for increased transparency. Open and transparent 
trade and investment regimes will further enha nce the business environment in Mongolia and 
improve Mongolia's attractiveness to its trading partners and foreign investors. We recognize the particular challenges that landlocked developing countries (LLDCs) face in participating in international trade and note that the United States is committed to close cooperation with LLDCs 
to address such challenges and, specifically, to continuing to work hard to advance trade and 
economic ties with Mongolia. 
4.40.  We took particular note of Mongolia's discussion of the importance of trade facilitation to 
landlocked developing countries. We hope that the actions of a few will not continue to block the 
benefits of the Trade Facilitation Agreement to the many, including many developing countries. With regard to the Trade Facilitation Agreement, we also thank Mongolia for its hard work and 
commitment in submitting its Category A notification. 
4.41.  Trade between Mongolia and the United States has grown in recent years. In 2005, when 
Mongolia's first Trade Policy Review took place, total two-way trade in goods stood at WT/TPR/M/297 • Mongolia 
 
- 14 - 
 
  US$166 million. By 2012, this figure had increased to a high of US$707 million before declining in 
2013. In the coming years, further growth in trade with Mongolia will likely be affected significantly by how well Mongolia handles its economic engine and its biggest economic challenge – the mining sector. We encourage Mongolia to figure out how to manage the development of its mineral 
resources in a manner that will ensure steady growth. It is well-known that the mining sector is 
the key driver of Mongolia's economy. It is Mongolia's major source of exports and foreign direct investment, and many of Mongolia's imports also feed the mining sector. Since 2010, Mongolia has 
experienced double-digit GDP grow th, led by higher commodity prices for copper, gold, zinc, coal 
and other minerals and by large capital inflows su pporting Mongolia's pursuit of world-class mining 
development projects.   
4.42.  Mongolia's economy has achieved this growth despite a number of problematic challenges 
that impede economic development. These includ e inadequate transparency in regulatory and 
legislative processes, weak rule of law, corruption and frequent abuse of inspection, and permitting and licensing regimes to protect existing state and private sector interests. The Mongolian 
government's economic policymaking has often been unpredictable, and almost always, it has 
lacked the transparency that foreign investors and traders need and expect in today's global 
trading system. 
4.43.  For example, in May 2012, Mongolia's Parliament hastily passed the Strategic Entities 
Foreign Investment Law, apparently in reaction to  an attempt by a foreign state-owned enterprise 
to gain a majority interest in a coal company. Unfortunately, this law created a great deal of uncertainty about Mongolia's investment climate. In the aftermath, implementing regulations were 
delayed, companies reported that they could neithe r register nor complete permitting actions, and 
investors openly questioned whether or not Mongolia was serious about attracting foreign direct investment (FDI). Following a significant downturn  in FDI in 2012 and 2013, Mongolia's Parliament 
passed a new investment law in October 2013, which has started to win back investor confidence. 
While it is hoped that some vague language in the new investment law will soon be clarified, key provisions in this law include its equal treatment of domestic and foreign investors and its 
provisions regarding tax stability. 
4.44.  Another example involves the ongoing amendment process to Mongolia's 2006 Minerals 
Law, which, among other things, sets forth the regime for issuing exploration and mining licenses. In 2010, after the President of Mongolia criticized the existing minerals licensing regime, Mongolia 
embarked on a process to amend the entire law.  This process has produced numerous proposed 
amendments. While changes to important laws often take time, in this case the lengthy amendment process has adversely affected the mi ning sector. Even though the Minerals Law 
remains in force, officials at all levels of Government now delay or even refuse to process normal 
requests for extending or issuing exploration and mining licenses, ostensibly out of concern that actions taken under the current law might eventually become invalid or require alteration under 
the new law being considered. The effect has been to generate long and costly bureaucratic delays 
in several commercial sectors, which has increase d investment risk. Many investors are hopeful 
that Parliament's January 2014 adoption of a new Stat e Minerals Policy will lead to greater stability 
in the mining sector and sound amendments to the Minerals Law. 
4.45.  Another problematic area involves the tendering process under Mongolia's Public 
Procurement Law. Recently, companies from a number of countries, including the United States, have expressed serious concerns about inadequate  transparency and lack of fairness in this 
process.   
4.46.  We are encouraged that the Mongolian Government took an important step toward 
addressing transparency and corruption concerns in September 2013 when it signed an agreement 
with the United States promoting legislative and regulatory transparency in matters affecting trade 
and investment and calling for adherence to anti-b ribery and anti-corruption principles. While the 
Mongolian Parliament still must ratify this agreement, once it is in effect and has been implemented, it should enhance not only trade and investment but also create an even more 
attractive business environment in Mongolia. 
4.47.  In conclusion, we look forward to continuing our work with Mongolia to expand the 
U.S.-Mongolia trade and investment relationship. WT/TPR/M/297 • Mongolia 
 
- 15 - 
 
  TURKEY 
4.48.  We observe that since its last trade review, Mongolia has achieved successful GDP and trade 
growth as well as macroeconomic performance. Acco rding to the data of 2013, its capita per GDP 
has more than doubled in the last five years. Unemployment also fell from 11.6% in 2009 to 7.6% 
in 2013. Despite the sluggish performance of it s trade volume in 2013, exports of Mongolia 
reached US$4.27 billion, representing 37.1% of its GDP, while its imports reached US$6.36 billion. Furthermore, trade deficit decreased by 13% in 2013 compared to 2012. 
4.49.  In this context, although its economic grow th is highly dependent on the exports of 
minerals, and it is subject to the fluctuations in the global mineral markets, Mongolia recently managed to minimize the negative outcomes of global economic crisis and put into place a rapid recovery and continued substantial economic growth since 2010. 
4.50.  Although being a small economy, Mongolia is a country in favour of an open trade and 
i n v e s t m e n t  r e g i m e  w i t h  a  t r a d e  v o l u m e  m o r e  t h a n  9 0 %  o f  i t s  G D P .  T h e  c o u n t r y  h a s  a  r a t h e r  simple tariff regime having no tariff escalation or tariff peak, and for most of the lines the applied 
rates are lower than the bound rates. To diversify its economy and to minimize the effects of 
fluctuations of the price and export volume of the minerals, Mongolia is also well aware of the importance of a private sector-led, high-tech manufacturing and services sector. 
4.51.  In this regard, the Comprehensive National Development Strategy of Mongolia aims at 
increasing exports of processed products rather than minerals and raw materials of animal origin. Establishment of the Development Bank of Mongolia in 2011 will also be helpful in diversifying its exports. 
4.52.  We are also of the view that the Government's recent legislative steps such as the new 
Foreign Investment Law, the newly introduced Fiscal Stability Law, the Integrated Budget Law, the Social Welfare Law are also important instruments in improving its overall trade and economic 
performance and in restoring confidence to its investment environment.  
4.53.  We are also happy to see that Mongolia is also dedicated to review its business 
environment, to reduce red tape, to simplify its customs procedures such as the post clearance 
customs control and the submission of electron ic documents and electronic payments system. 
4.54.  Mongolia's recent regional trade initiatives su ch as the Asia-Pacific Trade Agreement and the 
negotiation of an economic partnership agreement with Japan are important steps in further liberalizing its overall trade regime. 
4.55.  That being said, we wish to mention that, as for all Members, there is still room for 
improvement in its trade and economic policy framew ork. In this respect, the Secretariat report 
underlines the high dependency on minerals of exports to a single market and its application of 
non-aligned standards such as mandatory technical requirements and the diminishing number of 
inspections conducted in recent years regarding intellectual property rights and the unnecessary licences applied in foreign trade. 
4.56.  As also stated in the Government report, Mongolia can also improve its institutional trade 
policy making capacity and enhance its transparency  by publishing the necessary legislation of the 
WTO Agreements. 
4.57.  When it comes to bilateral relations, Turkey  has been one of the strong supporters of 
Mongolia since the collapse of the planning syst em more than two decades ago and Turkey is 
helping its transition from planning to the market system. We currently enjoy excellent political and economic relations with Mongolia although our economic relations are under our potential.  
4.58.  Turkish technical cooperation and development of agencies is quite active in Mongolia and is 
actively cooperating with the Mongolian Government in several social and economic sectors. WT/TPR/M/297 • Mongolia 
 
- 16 - 
 
  CHINESE  TAPEI 
4.59.  Looking back at Mongolia's economic performance over the last few years, we see that it 
recovered well after the 2008 global financial crisis, and it has enjoyed a high level of economic growth at an average of 14% annually since 2011. Furthermore, several new laws have been 
introduced in 2013 in the areas of investment, fiscal stability, integrated budget, social welfare and 
customs reform, which could produce greater transparency in law enforcement and help to attract more foreign investment in the future. 
4.60.  Mongolia's main exports are products of natural resources such as mining, which account for 
28% of its GDP. The second largest exporting sector is livestock agriculture, with a similar share of 
GDP. We also note that the main destination for these exports is its closest neighbour, China. We would suggest, therefore, that Mongolia might like to encourage its industries to widen the scope 
of their export product lines and reach out to new export markets in order to increase the potential 
for expansion. 
4.61.  It would appear that the main challenges facing Mongolia's economy today are the external 
imbalances caused by a rapid decline in the amount of inward foreign direct investment and the 
weakening of some of its mineral exports. And, as  I mentioned before, Mongolia's export market is 
very concentrated and reliant at present on just one particular country. Aside from these concerns, 
the latest forecasts are for economic growth to moderate in 2014 and remain broadly stable in 
2015, for inflation to decline, and for the current account balance to improve over the next two years, assuming appropriate policies are applied. This all suggests that Mongolia's main policy priorities should be to address pressures on its balance of payments and foreign exchange 
reserves, and to generally tighten fiscal and moneta ry policies towards gaining economic stability. 
4.62.  Regarding bilateral relationship between Mongolia and the Separate Customs Territory of 
Taiwan, Penghu, Kinmen and Matsu, the total value of two-way trade between us amounted to 
around US$23 million in 2013. The total amount of investment from our private sectors into 
Mongolia stands cumulatively at about US$20 million. We have a trade and economic representative office in Ulaanbaatar and Mongolia has the same in Taipei. All-in-all, a good 
relationship exists between us in terms of trade and economic affairs. 
4.63.  My delegation has already submitted several written questions to Mongolia in advance, on 
such topics as the economic environment, FD I, regional and bilateral trade agreements, 
government procurement, and rail transport. We  are grateful to Mongolia for preparing the 
answers to these questions. We would also like to encourage it to continue to maintain an open 
trade regime and to further tighten fiscal and monetary policies in its Action Plan for 2012-2016. And, last but not least, we look forward to Mongolia joining the GPA as it promised at the time of 
its WTO accession. 
BRAZIL 4.64.  It is a matter of great satisfaction for Brazil to participate in this Trade Policy Review of 
Mongolia. Brazil's commitment to Mongolia may be observed by the number of cooperation 
instruments, comprising different fields, which have been negotiated by the countries over the last years. 
4.65.  Since Mongolian first Trade Policy Review in 2005, its economy has grown substantially, 
despite some growth fluctuation during this period. There was also a considerable progress 
towards improving living standards. 
4.66.  According to the Secretariat report, Mongolia has resisted protectionist pressures and 
continued to maintain a generally open trade and investment regime. We see it as a clear 
commitment of Mongolia to the multilateral trading system. 
4.67.  Trade flows between Brazil and Mongolia have also intensified since Mongolia's first Trade 
Policy Review in 2005. Despite this, it remains at relatively unstable and modest levels. In this 
sense, we believe that bilateral trade is well below its potential and could be further expanded, both in terms of value and diversification. WT/TPR/M/297 • Mongolia 
 
- 17 - 
 
  4.68.  In what concerns direct investment between our countries, it is still a field to be strongly 
developed, and we hope that Mongolia's new Investment Law of 2013 will help our countries achieve this goal. 
4.69.  As regards non-tariff measures, although Mongolia has the objective of increasing the 
number of national standards that are identical to international standards, we note that currently 
only 14.6% of its agricultural standards are aligned with international standards. In this sense, we recall that domestic standards shall only be applied when in conformity with WTO rules. 
4.70.  Brazil has submitted a few questions to Mongolia in connection with its investment and 
mining policies and agricultural standards, to  which we expect to receive the corresponding 
answers during this exercise. 
4.71.  Let me conclude by reiterating that Brazil stands ready to further enhance its cooperation 
and trade with Mongolia. 
JAPAN 4.72.  Recently, Mongolia has recorded its economic growth by more than 10% a year. In addition, 
the Mongolian Government is promoting diversification of its economy, recognizing that fluctuation 
of commodity prices are likely to affect the Mongolian economic growth rate due to the economic structure depending on the commodity. Japan, which has continuously supported Mongolian 
economic growth since Mongolia began its transition to democracy and a market economy, 
welcomes efforts of the Government of Mongolia for its economic diversification.  
4.73.  Now let me move to trade policies. We have two points here: the WTO and RTAs. 
4.74.  As for the WTO, Mongolia has reformed its domestic regulations in order to implement the 
WTO Agreement since its accession in 1997. Japan encourages Mongolia to continue its endeavour 
for reforming the regulations in consistency with the WTO Agreement. 
4.75.  Concerning RTAs, Mongolia does not have any RTAs with other countries. However, it has 
finished negotiation of the Asia-Pacific Trade Agreement and reached an agreement in principle on 
the Japan-Mongolia EPA this July. Japan expects that these efforts will be complementary to the multilateral trading system as long as they  are implemented consistently with the WTO 
Agreements.  
4.76.  Let me turn to specific points. We have four points here: investment and business 
environment, procedures for licenses and perm issions, telecommunications, and excise tax. 
4.77.  To begin with, Japan welcomes Mongolian measures to reform its legislation to realize a 
better environment for investment and business. In particular, Japan commends that the new 
Investment Law of 2013 improved its foreign investment and business environment removing discrimination on foreign investment. Japan also stresses that the transparency is the key element 
in the implementation of the laws on investment and business environment. 
4.78.  On the other hand, we think Mongolia still has some issues to address with respect to the 
investment and business environment. First, the minimum threshold of investment required to 
foreigners, which is an obstacle to attract a small amount of investment, is at US$100,000. This 
could interrupt the activity of foreign investors. Second, Mongolia does not permit acquisition of land by foreigners thus far. Third, there is a complicated license system in the construction services sector subject to types of construction. Japan requests Mongolian efforts to tackle these 
obstacles in order to improve the investment and business environment. 
4.79.  Next, procedures for licenses or permissions, such as renewal of licenses of 
telecommunication services. They often take a long time because of a lack of legal provisions on 
the clear deadline for administrative decisions. Even in the case that there is a legal provision on 
the deadline, some procedures are delayed without any reasonable backgrounds. We would like to 
know whether domestic enterprises in Mongolia are struggling with this problem as well and how 
the Mongolian Government addresses, for example, reforming laws and improving its operation. WT/TPR/M/297 • Mongolia 
 
- 18 - 
 
  We emphasizes that discriminatory treatment to foreigner is very harmful for Mongolian 
investment and business environment. 
4.80.  On telecommunications, we understand that resale related to telecommunications service 
suppliers providing MVNOs, ISPs, and so on are actively implemented in many countries in order to 
expand the market. We would like to know whether Mongolia has some regulations on such resale 
and hopes that the Mongolian Government will promote it in a proper manner, including relaxing the regulations. 
4.81.  Finally, excise tax. Considering the answer about excise tax on alcohol to our written 
question, Japan requests Mongolian efforts to improve the current situation by an appropriate measure. We emphasize that imposing the excise tax in a discriminatory manner would not be consistent with the WTO Agreement, in particular GATT.  
4.82.  Mongolia also mentioned in the written answer that "there is no intention to differentiate 
domestic and imported goods" on the excise tax on passenger vehicles and so forth. However, according to the Mongolian domestic law on the excise tax, the provision can be considered as the 
excise tax is imposed only on imported automobiles. Japan requests Mongolian efforts to make the 
provision consistent with the WTO Agreements. 
REPUBLIC
 OF KOREA 
4.83.  As the Secretariat report noted, the Mongolian economy has grown substantially thanks to 
its large mineral exports and inflow of FDI during  the period under review. But Mongolia has faced 
fluctuations of growth rates caused by its high depe ndence on mineral exports. In this regard, it is 
worthwhile to note that the Mongolia has actively pursued economic diversification under the 
Comprehensive National Development Strategy of 2008, and along similar lines, has improved its 
investment climate by introducing the Investment Law of 2013.  
4.84.  As for trade policy, it is quite pleased to note that Mongolia maintains an open trade regime 
with its bound tariffs of around 20%, although the applied rate is, in most cases, much lower. It 
has also taken measures to improve customs procedures, including a revision of Customs Law and the Law on Customs Duties and Tariffs of 2008, as well as the introduction of the Customs 
Automated Information System. We also welcome the notification of Mongolia to the WTO with its 
Category A commitments under the Agreement on Trade Facilitation 
4.85.  We certainly recognize that the mining industry has been the driving force of Mongolian 
economic growth. The FDI inflow has turned Mongolian mining into a competitive modern industry 
and has created the possibility to expand into re lated up and down stream industries, including 
heavy manufacturing such as copper, iron, and steel production. 
4.86.  Taking into account such positive aspects, we would like to put forward suggestions as 
follows. 
4.87.  First, Mongolia is encouraged to continue to diversify its export products and mitigate its 
dependence on the mining industry. In this regard, we would like to say that as mineral resources 
are hidden and invisible ones, Mongolia is encouraged to cultivate invisible capacity of determined 
Mongolian people which can lead to development of various industries including high-tech industry. 
4.88.  Second, while doing so, Mongolia should make further efforts in improving its infrastructure 
in the areas of railroads, electricity and transpor tation systems, and draw FDI into these areas to 
make economic growth more sustainable. In this regard, Korea wishes to express its willingness to 
be consulted when needed, and participate in Mong olia's ongoing endeavours as well as share our 
expertise. 
4.89.  Third, while we note that Mongolia has maintained quite an open trade regime, and has 
diligently introduced relevant law and related customs procedures, the lack of WTO notifications needs to be improved. As the Secretariat noted, applied tariff rates that are above WTO bound 
rates would need to be solved in a prompt manner. WT/TPR/M/297 • Mongolia 
 
- 19 - 
 
  4.90.  Last but not least, as the Secretariat report pointed out, Mongolia applies higher excise tax 
rates on certain imported goods than like domestic products, particularly on alcoholic beverages as well as passenger vehicles, gasoline and diesel fuel. We believe that applying higher excise tax rates on certain imported goods is not consistent with Article III:2 of the GATT. 
4.91.  On the bilateral front, Korea and Mongolia have maintained close economic ties. The 
bilateral trade volume has grown 75 times since the establishment of diplomatic relations between the two countries in 1990, reaching US$426 million in 2013 and Korea's total stock of investment 
in Mongolia amounted to US$719 million in 2013, making Korea the 4th largest trader as well as 
investor. Taking this opportunity, Korea would like to express its sincere hope to further expand our already strong bilateral relations on all fronts. 
4.92.  My delegation submitted some written questions to Mongolia on certain aspects of its trade 
and trade-related policies and measures. We would like to thank Mongolia for providing us with 
written answers. We will look into them ca refully and come back later, if necessary. 
4.93.  In closing, we very much hope that today's TPR will provide a good opportunity for both 
Mongolia and its trading partners, including Korea, to assess the progress as well as to help 
identify further ways forward.  
THE
 RUSSIAN  FEDERATION 
4.94.  The Russian Federation and Mongolia have a long history of friendly relations and develop 
broad, deep and robust bilateral cooperation spanning vast economic, trade and investment areas. Russia for long has been keeping the status of one of the major trade partner of Mongolia in terms 
of Mongolia's import. It is noteworthy that during the recent official visit of the President of the 
Russian Federation to Mongolia, both sides ha ve arranged to further expand and intensify 
economic and commercial ties. During the visit,  a number of documents were signed enhancing 
cooperation in such spheres as transport infrastructure modernization, energy supply, power 
generation, border-crossing facilitation. All these enable us to affirm that Mongolian-Russian 
relationship does enjoy a promotion to a new level. 
4.95.  We highly appreciate current economic reforms ongoing in Mongolia aiming at promoting 
exports and imports, fiscal stabilization as well as trade in minerals. Moreover, we are pleased to 
note recent considerable improvements in the country's investment climate, taxation policy, 
banking regulations, infrastructural development, all this despite restrained economic base, unfavourable geographic location and other given constraints. 
4.96.  Nevertheless, we would like to highlight some  of trade and investment measures that, we 
believe, need more attention. Russia has submi tted some questions for this review concerning 
certain TBT aspects in national food safety regulations as well as foreign access to open tendering, 
which are of particular commercial interest to us. We would appreciate any clarifications from the 
Mongolian side on the above matters. 
PARAGUAY
  
4.97.  We welcome Mongolia's participation in this exercise, at a time when the country is enjoying 
sound economic performance and its trade is expanding. 
4.98.  The Mongolian economy has recovered significantly after the global financial and economic 
crisis of 2009, as evidenced by a rate of economic  growth of 11.7% in 2013, one of the highest in 
the world. That same year, Mongolia's trade ba lance recorded a deficit of US$2,082 million, 13% 
below that of 2012. The business sector accounted for 17.4% of total GDP and 12.4% of the employed labour force, meaning that it is regarded as a highly labour intensive and fast growing 
sector. 
4.99.  Mongolia's most notable success in this connection has been the introduction of reforms to 
the concessions regime in order to boost the ec onomy through alliances between the public and 
private sectors. WT/TPR/M/297 • Mongolia 
 
- 20 - 
 
  4.100.  I would also like to point out that Mongolia and Paraguay share similar features in that 
both countries are situated on booming continents, between two large countries, and have no direct access to the sea. Mongolia is one of Paragu ay's strategic allies, which is also the case in the 
Group of Landlocked Developing Countries in the WTO and UNCTAD. This was reflected in the 
Group's active participation in the Trade Facilitation Agreement negotiations. 
4.101.  Special mention should be made of the fact that, thanks to support from the Mongolian 
Government, Ulaanbaatar is home to the International Think Tank for Landlocked Developing 
Countries, which over time will become an import ant tool in providing support for our countries. 
4.102.  During the period under review, trade flows between Paraguay and Mongolia remained well 
below potential, and we therefore see this as a matter on which our governments should place greater emphasis. 
4.103.  To conclude, it should be pointed out that Paraguay and Mongolia share the same vision of 
the future of the multilateral trading system. Both countries are in favour of swift implementation of the Trade Facilitation Agreement an d a future Development Work Programme. 
ARGENTINA 
4.104.  Argentina welcomes Mongolia's economic performance in recent years. It wishes to 
underscore that a delegation of parliamentarians from Mongolia visited Argentina in March of this 
year, expressing interest in the characteristics of livestock husbandry in Argentina's Patagonia 
region and in vaccine production and disease control. 
4.105.  Argentina's Ministry of Agriculture, Livestock and Fisheries said that it was in a position to 
offer Mongolia cooperation in the development of technology, animal health, disease control, 
animal genetics, direct sowing and storage. 
4.106.  Argentina remains willing to provide such cooperation and believes that this will be a major 
step in establishing closer relations between Argentina and Mongolia. 
INDIA 
4.107.  As brought out in the reports by the Secretariat and Mongolian Government, after a 
negative growth rate in 2009 due to fall in commodity prices, Mongolia has achieved an 
unprecedented economic growth during the period  2010-13. In 2013, Mongolia's GDP growth rate 
was 11.7% and the total trade was over US$10.6 billion which has grown more than four fold in comparison to trade in 2005. Mongolia's achievem ents are commendable despite challenges facing 
their economy (landlocked country). 
4.108.  Since its accession to the WTO, the Mongolian Government has undertaken a number of 
measures directed towards making trade laws and regulations in line with the WTO disciplines. Since its first TPR, we note that a number of laws and regulations have been introduced by 
Mongolia which, amongst other things, are intended to improve the investment and business 
climate and promote fiscal stabilization. As a result of these measures, Mongolia has achieved steady economic growth and its trade engagement with Members has expanded. 
4.109.  While Mongolia has registered positive growth, it continues to face several challenges. 
Recognizing challenges that can arise from depe ndence on a narrow basket of export items, 
fluctuations in commodity prices, vulnerability to external environment and for broadening economic base, we note that Mongolian authorities are pursuing the Millennium Development 
Goals-Based Comprehensive National Development Strategy of 2008. 
4.110.  We have noted that Mongolia has successfully concluded the negotiations with all 
participating States for its accession to the Asia-Pacific Trade Agreement (APTA) and started the 
negotiation for an Economic Partnership Agreement with Japan. We welcome Mongolia's 
participation and commitment to the multilateral trading system. We fully appreciate Mongolia's continued need for technical assistance to ensure the full implementation of the WTO agreements 
and to participate in the DDA negotiations. WT/TPR/M/297 • Mongolia 
 
- 21 - 
 
  4.111.  On the bilateral front, India and Mongolia enjoy very close and cordial relations. Our 
bilateral trade grew five-fold during the period  2009-12. We look forward to working with the 
Mongolian authorities in further expanding our trade and investment ties for mutual benefit. India has been extending developmental assistance as part of South-South cooperation to Mongolia in 
varied sectors, including training and capacity building activities under Technical and Economic 
Cooperation Programme. 
NIGERIA 
4.112.  Nigeria appreciates the impressive progress in Mongolia's transition from a centrally 
planned economy to a market economy, particularly, the steps taken by the authority in pursuing the policy liberalization, deregulation, privatization and macroeconomic stabilization. We are happy to note that through its persistent pursue of liberal policies, Mongolia remains one of the most 
open trading regimes in the world with low import tariffs and limited non-tariff barriers. It is 
worthy of note that the discovery of huge mineral resources paved the way to rapid economic and social development which further re-integrates Mongolia into the global economy. The real growth 
was estimated at 1.3% in 2009 and 17.5% in 2011. Mongolia's GDP per capita was around 
US$3,480 in 2012 to US$4,069 in 2013. The real growth of the economy is attributed to mining exports that accounted for 18% in 2012 against the 17% in 2004. 
4.113.  Nigeria believes that open markets, non-discrimination and global competition in 
international trade are conducive to global and national welfare. My delegation commends Mongolia for its economic development and reducing poverty as we note the medium term outlook remains favourable underpinned by developments in  mining sector. We also welcome the recent 
steps taken by the Government, particularly in the areas of fiscal and exchange rate policies 
towards addressing rising domestic demand and balance of payments pressures. However, my delegation calls for further decisive recalibration of policies to address vulnerabilities and to build 
buffers against external shocks and to ensure sustainable strong growth. 
4.114.  As indicated in the Secretariat report, Mongolia has made considerable progress towards 
improving living standards and investment, and tr ade in minerals have contributed considerably. 
However, managing the resource based boom along with legislative and institutional challenges it 
presents, and the investment in infrastructure it requires, constitute the biggest challenge facing the Government. At the same time, the geographical and climatic situation of Mongolia makes these tasks more difficult than in some other countries. 
4.115.  A s  a  M e m b e r  o f  t h e  W T O ,  M o n g o l i a  h a s  c o ntinued to create an enabling investment 
environment for investors by increasing transparency of its trade policies with regard to the principles of the multilateral trading system. Mongolia has also contributed to the multilateral 
trading system and is active in advancing the WTO and strengthening its role in sustaining trade 
liberalization as key to driving international trade and economic development, in particular, for the developing and least developed countries. Nigeria also wishes to express its appreciation for the 
role Mongolia is playing in the WTO and how it has used market openings and foreign investment 
as instruments for economic growth and development. 
4.116.  As a landlocked country with very specific and peculiar challenges, we are not surprised 
that Mongolia's priority is trade facilitation as far as the DDA is concerned. Therefore, it is our 
expectation that the Trade Facilitation Agreement, particularly with respect to the need for uniform 
procedures for clearing transit goods which ensure s transparency and predictability will benefit 
Mongolia tremendously. 
4.117.  In conclusion, Nigeria looks forward to collaborating with Mongolia in the ongoing Doha 
Development Agenda (DDA) negotiations to ensure its successful conclusion based on its development mandate.  
URUGUAY 
4.118.  Uruguay commends Mongolia for the efforts and changes it has made since its entry into 
the WTO, despite all the challenges that this involved. WT/TPR/M/297 • Mongolia 
 
- 22 - 
 
  4.119.  It is important to recall that our two countries have had diplomatic relations since October 
1997 and that they intend to improve relations in a number of areas. 
4.120.  Since the figures for trade between Urugua y and Mongolia have been relatively 
insignificant in recent years, the two countries are planning to seek areas of complementarity in 
order to expand their bilateral trade. 
4.121.  It should be noted that a delegation from Mongolia visited Uruguay in March of this year. 
The two countries signed a Memorandum of Understanding to step up their bilateral cooperation in 
the agriculture and food sectors. 
4.122.  The Memorandum establishes a Sanitary and Phytosanitary Advisory Committee, which will 
operate as a high level forum to facilitate negotiation, cooperation and coordination in matters relating to animal and plant health, including a fforestation, aquaculture, and food safety and 
quality in both countries. The forum will deal with the following issues, among others: (1) market 
access; (2) cooperation on food safety legislation and regulations; (3) cooperation on the livestock identification and traceability system; (4) animal  and plant health and food safety research and 
development, including technical and technologica l exchanges; (5) establishment and revision of 
international standards pertaining to sanitary and phytosanitary issues and to food safety and quality. 
4.123.  Uruguay fully concurs with Mongolia's report when it emphasizes the importance of and 
commitment to a successful outcome and implementation of the Doha Development Round. 
MR
 OCHIRBAT  CHULUUNBAT 
4.124.  Let me first thank you, Madam Chair, for your leadership for today's discussions. I would 
like to thank H.E. Mr Francisco Pirez Gordillo for his positive comments and assessment to 
Mongolian trade and policy. I especially would like to thank all delegates and particularly 
distinguished Ambassadors who have made very valuable contributions to today's discussions. 
4.125.  We very highly appreciate the positive comments on the Mongolian trade policies. We have 
made progress since the first Trade Policy Review but we still have challenges and difficulties. Some of them have been mentioned in the speeches like issues related to corruption, handling of 
foreign investment in Mongolia and transparency.  
4.126.  We have tried to do our best to provide all possible comprehensive answers to your 
questions. We think that there will still be some questions and issues for clarification and we will 
do that on the second day of the meeting. Thank you again for your very active participation and 
we look forward to see more interesting exchange of views and discussions. WT/TPR/M/297 • Mongolia 
 
- 23 - 
 
  5  REPLIES BY THE REPRESENTATIVE OF MONGOLIA AND ADDITIONAL COMMENTS 
5.1.  The delegation of Mongolia appreciates the comments and questions raised by the Members 
during the first session of our TP R. We find them of much relevance and use to our trade policy. 
5.2.  Let me briefly respond to Members' questions.  
5.3.  Our investment regime and the future plans in  the area of promoting investment were of 
much concern to Members. Taking the opportunity, I would like to inform Members that our investment policy was reviewed by UNCTAD in April this year, where the Governments and the 
international businesses expressed great interest in the developments in this area and where they 
positively received the recent improvements. 
5.4.  Through the comments and questions, WTO Members also gave us some insightful guidelines 
as to where our policy should be directed. Some negative impacts to investors were caused by the 
Law on Foreign Investment in Entities Operating in Strategic Sectors adopted in 2012. However, 
we are glad to hear positive reactions and welcoming comments that Mongolia has repealed this law quickly and adopted a new Investment Law which is more liberal and friendly for foreign 
investors. We are fully aware of the fact that we have to pay more attention to the effective 
enforcement of the law and take much more active actions to improve our business and investment environment based on the principles of transparency, credibility, accountability and 
predictability. The comments made by the WTO Members as well as the recommendations drawn 
in the Investment Policy Review Report by UNCTAD  will be given due consideration in our future 
measures and decisions in this area. 
5.5.  As for trade policy, it was mentioned earlier that Mongolia keeps maintaining a relatively 
open trade regime: tariff average is still one of the lowest in the world at 5%; very few restrictions 
and technical barriers on trade compared to other countries. 
5.6.  Due to the recent developments in the mining sector, a lot of debates continue to rise 
regarding our trade-related policies. This, we contend, is natural and inevitable for a country like 
Mongolia which is trying to overcome the legacy of the transition period and of the centrally-planned economy and still paving the way for the prospective future. Despite, the 
Government continues to believe that a more open trade regime contributes to the overall 
sustainable development of the economy. It is tr ue that, as the Members rightly noted, there are 
issues that we have to solve. Members are concerned about the differentiated application of excise taxes on certain goods and the administration of licensing procedures. We are working on these: 
the draft amendments to the Law on Excise Tax w ill be submitted to the Parliament during the 
upcoming autumn session to open on the first of October. Food security has become a serious issue in Mongolia, especially as regards food safety, nutrition and self-sufficiency. As for all the 
Members, human health protection is a fundamenta l policy objective. The Law on Food Security 
and related Regulation on the Exportation and Importation of Strategic Food was adopted last year. The National Food Security Program until 2 016 is being implemented. It aims at ensuring 
food supply, quality and safety. As said, the Government shall continue working to improve the 
enforcement of the Law on Food Security and the administration of related regulations, including 
licensing. 
5.7.  The Members raised concerns on our tariffs.  There are items on which applied rates are 
higher than the bound ones. The Government has reviewed the tariffs and an amendment is being 
submitted to the Parliament this autumn.  
5.8.  With regard to taxation, a significant reform was carried out in 2006. The General Taxation 
Law was renewed to cut the taxes to a single rate of 10% instead of progressive rates of 10%, 
20% and 30%. Annual tax credits for individuals we re increased, including such as for housing, 
education, etc. The VAT was cut from 15% to 10%. In this regard, the Government of Mongolia is 
taking measures to create a more tax-friendly and favourable environment for the businesses.  
5.9.  Pertaining to specific trade-related measures , Members questions focused on privatization 
and intellectual property. WT/TPR/M/297 • Mongolia 
 
- 24 - 
 
  5.10.  The private sector shares around 80% in GDP today. This is a significant share in the 
economy. However, the Government of Mongolia co ntinues to undertake privatization measures of 
state-owned enterprises. It has planned to priv atize 22 state-owned large enterprises between 
2013 and 2016; 13 of them should be privatized fully, and state ownership should be reduced in 
nine. This concerns large entities including the Mongolian Stock Exchange, Telecom Mongolia, the 
Mongolian Airlines, Information and Communication Network, Crop Promotion Fund, the Mongolian Agricultural Commodity Exchange, the Mongol Post, and two coal mines (Shivee-Ovoo and 
Baganuur). 
5.11.  The Government is continuing to ensure a high er-level protection of IP. As such, it has 
formulated a Draft National IP strategy, which main ly aims at strengthening the IP protection and 
its enforcement. The Draft is ready to be submitte d to the Cabinet. Also, Mongolia is joining the 
Beijing Treaty on Audiovisual Performance and the Marrakesh Treaty to Facilitate Access to 
Published Works by Visually Impaired Persons an d Persons with Print Disabilities. Accordingly, 
amendments are being made to the respective laws such as the Patent and Copyright Laws. 
Mongolia fully complies with the TRIPS Agreement. 
5.12.  Members raised considerable concern regarding transparency. In this regard, I would like to 
inform Members that the Law on Information Transparency and the Access to Information is in 
force since 2011 and was amended in July 2014. According to the amendments, the governmental 
bodies have an obligation to make information related to their operation, human resource, budgeting and finance, and procurement publicly a ccessible. Also, issues related to tendering are 
now regulated by the Law on Cristal Account which was adopted two months ago. Other laws 
related to transparency are being initiated such as the Draft Law on Public Hearing. These 
measures show that the Government of Mongolia is taking seriously the concerns of businesses. 
5.13.  As for specific sectors, Members were more  interested in mining and agriculture.  
5.14.  Mining has been the driving force of the country's economy in recent years. The boom of 
extractive business has also had side effects by pr ovoking illicit practices. According to statistics, 
100 thousand people are engaged in illegal mining. These practices bear a range of issues that the 
Government needs to solve, including environment and safety. Mongolia is planning to join Safety 
and Health in Mines Convention. Various safety regulations have been formulated and some of them have been introduced. Additionally, the State Policy on Mining sets to improve the regulatory framework for fighting illegal practices. Additional ly, the Draft Law on Transparency in Mining has 
been approved by the Cabinet and is being submitted to the Parliament this autumn.  
5.15.  In agriculture, the Government of Mongolia has been implementing several policies and 
programs. The State Policy on Food and Agriculture until 2015, the Food Security Program, and 
the Crop Campaign III have succeeded in their objectives to reach self-sufficiency in wheat and 
potato. The Government of Mongolia is working to maintain the achievements and attract investment in agriculture to promote integrated agriculture.  
5.16.  The Government continues to direct its trade and investment policy to creating a more 
favourable environment for traders and investors. In the aftermath of the painful transition period and a sudden explosion of extractive industry, some erroneous measures may have been taken. 
However, we contend that the timely correction of  such measures is important and we were able 
to do that. We will keep working in this direction in the future.  
5.17.  Please allow me to take this opportunity to bring to the attention of the Members the 
importance of the Trade Facilitation Agreement for a landlocked country like Mongolia. Reaching a 
consensus on the adoption of the Agreement sha ll greatly contribute to easing the constraints 
faced by the traders and reducing the cost of trade. 
5.18.  Taking the opportunity, I wish to thank the Secretariat team for arranging a meeting with 
Director-General Azevêdo which took place yester day. We had a very interesting meeting and a 
productive exchange of views on how to upgrade our cooperation in the years to come. We also 
thank the WTO for the assistance it has been providing to Mongolia in recent years.  WT/TPR/M/297 • Mongolia 
 
- 25 - 
 
  DISCUSSANT 
5.19.  The second Trade Policy Review of Mongolia allowed us to better understand the evolution of 
its trade policies and practices and has helped us to understand the past and future challenges facing this interesting country. 
5.20.  Progress on the level of economic openness through its various reforms and the growth of 
10% observed during the last three years that Mongolia has achieved deserve a special appreciation as most Members have expressed. 
5.21.  It is also important to note that many Members highlighted Mongolia's low tariffs and, in 
particular, that despite the different financial and economic worldwide crises, it has largely refrained from taking protectionist measures. 
5.22.  I have noted that Members encouraged Mongolia  to continue the reform process in several 
areas, for instance: in the investment framework, in the diversification of the economy, in the 
infrastructure front, in the minerals policy, in the adjustment of some institutional issues to improve the efficiency and transparency and in th e area of state-owned enterprises among others. 
5.23.  There is no question that the transformation process of one country does not happen 
overnight, so it is important to consider not only what needs to be done but also what Mongolia has achieved so far during this short period of time. 
5.24.  I am confident as I have noticed in the dialogue held with the authorities of Mongolia, after 
the first day of examination, that this exercise w ill be useful to continue the process of internal 
reforms that the country has started even before the accession to the WTO in 1997. 
5.25.  The gradual and progressive opening of the economy of a country means adopting a hard 
road to travel that it is not an easy one for any Member, so I congratulate again Mongolia with the 
progress made so far and also for the constructive attitude adopted during its second trade policy review. This attitude gives me the confidence that in the next TPR many of the comments we have 
made will be collected in the different future policies that the country will implement. 
5.26.  Finally, I want to express once again the honour and privilege of having participated as a 
Discussant in the second TPR of Mongolia and I wish the country every success in the future. 
EUROPEAN
 UNION 
5.27.  The EU has learned a lot from the interventions of the delegation of Mongolia, the discussant 
and questions and statements from WTO Members and Mongolia's replies. 
5.28.  The EU is grateful to Mongolia  for their efforts demonstrated in replying to our questions 
although we feel that some areas need to be further clarified known to be with reference to import 
licensing or water services. 
5.29.  For this reason, I would like to reiterate our en couragement to Mongolia to work with us in 
the coming months to provide more detail and reassuring answers on those issues. I also take this 
opportunity to underline the EU availability to support the Government in creating a friendly business and investment environment in Mongolia. 
5.30.  Let me reiterate the appreciation of the EU for this TPR which we hope will be useful to 
Mongolia in their further efforts. 
JAPAN 5.31.  Japan would like to express its sincere apprec iation for the hard work by the Mongolian 
delegation to provide us with a comprehensive and informative presentation. 
5.32.  Japan did not submit any follow-up question in written format before this meeting. I share 
Mongolia's oral explanation, in particular concerning its efforts to our concerns. WT/TPR/M/297 • Mongolia 
 
- 26 - 
 
  5.33.  Japan hopes that the views and opinions given by Members during this TPR will help 
Mongolia to further its reforms. I wish the delegation a safe trip back to Ulaanbaatar. 
CANADA 5.34.  I would like to join my colleagues in thanking the delegation from Mongolia for their hard 
work during this Trade Policy Review, particularly the responses to the written questions that 
Canada submitted prior to the review. 
5.35.  My colleagues and I have reviewed Mongolia's responses and very much do appreciate the 
information that was provided. We do have a couple of follow-up questions which we will be 
submitting in writing to the Secretariat. WT/TPR/M/297 • Mongolia 
 
- 27 - 
 
  6  CONCLUDING REMARKS BY THE CHAIRPERSON 
6.1.  This second Trade Policy Review of Mongolia has provided us an excellent opportunity to 
improve our understanding of the trade and investment policies of Mongolia. Thirteen Members submitted about two hundred questions before th e meeting and 17 delegations took the floor to 
make statements. Our discussion was greatly helped by the comprehensive comments of the 
discussant, Ambassador Pirez Gordillo of Uruguay, and the statement made by the head of the 
delegation for Mongolia, Deputy Minister for Economic Development, Mr. Ochirbat Chuluunbat. 
6.2.  This review has taken place at an interesting time for Mongolia. After several years of rapid 
economic growth, rising incomes, and greater pr osperity, some bottlenecks and barriers to trade 
and investment have been identified as hinderin g  r e a l  p r o g r e s s .  T h i s  r e v i e w  t h u s  i s  a  g o o d  
opportunity to reflect on what could be done to address these issues so that growth can be 
sustained into the future.  
6.3.  The economic expansion of the past few years has been based on investments in mining and 
exports of minerals and, as we heard from the Deputy Minister, the discussant, and delegations as 
well as from the Government and Secretariat reports, more investment is expected in this sector 
and growth should continue. 
6.4.  However, while exploitation of minerals is an opportunity for Mongolia it also poses risks, 
particularly the narrow economic base and dependence on a small range of products exported to a 
few markets which make the economy vulnerable to sudden swings in prices and demand. The Mongolian delegation recognized these risks and, along with several Members, stressed the importance of diversification and suggested areas like agriculture, tourism and high technology 
products as possible sectors for development. However, with the mining sector attracting human 
and financial resources it is no easy task to create an environment that encourages investment in alternative areas.  
6.5.  Despite the growth of the minerals sector, agriculture, especially livestock, is still important 
and employs more people than any other sector of the economy. Although  the cold winters and 
dry conditions make farming difficult, the Government has implemented several programmes to 
improve productivity and I noted the statements by  some delegations about bilateral contacts with 
other countries on agriculture practices, animal and plant health, and food safety and security. 
6.6.  Mongolia does not have any regional trade agreements - although it does qualify under a 
number of Members' GSP schemes. However, it is no t just in agriculture that Mongolia has started 
to increase its level of bilateral contacts. It is also negotiating with Japan on an Economic 
Partnership Agreement and intends to accede to the Asia-Pacific Trade Agreement. Furthermore, 
several delegations insisted they have had high-level meetings and concluded agreements related 
to trade and investment with Mongolia. In the WT O, Mongolia is a Member of several negotiating 
groups and the importance it attaches to the mu ltilateral trading system was highlighted by its 
notification of its Category A commitments on trade facilitation in July of this year. And we also 
welcome the statement by Deputy Minister on th e need to conclude and implement the TFA on 
Trade Facilitation Agreement.  
6.7.  Members noted Mongolia's challenge that it is a large landlocked country with a harsh climate 
making development of infrastructure difficult and expensive. And underdeveloped infrastructure 
adds to the cost of transport, and therefore to tr ade. Improving Mongolia's road and rail links with 
other countries as noted is a priority by the Government and there are ambitious plans for improvements. 
6.8.  Some delegations noted in their intervention s that, while needed improvements should 
continue, during the review period Mongolia ha s shown that it continuous to make progress 
towards allowing more competition, reducing trade barriers, and introducing measures to 
encourage diversification of its economy.  
6.9.  However, several issues were also raised which delegations believe could impede trade and 
investment. Among the issues that I noted which Mongolia might consider for further improvement are the following: WT/TPR/M/297 • Mongolia 
 
- 28 - 
 
  • Investment:  it was widely recognized that the new Investment Law of 2013 and the 
simplified investment procedures have improved the investment climate but there were some concerns about the new legislation and its implementation. These concerns included the differentiation between foreign and domestic investors through minimum 
paid-in capital requirements and the narrowing of the range of stabilized fees and taxes; 
• Government procurement and in vestment in infrastructure:  in noting the 
importance of improving infrastructure, particularly in road, rail, and electricity, several 
delegations suggested the Government could improve the tendering procedures and 
transparency in selection process. It was suggested that Mongolia would benefit from acceding to the Government Procurement Agreement in the WTO and exploring greater participation by the private sector in infrastructure projects; 
• Minerals policy:  the new law on investment has improved the climate for investment 
generally, but Members had raised the issue that the development of a new minerals law has led to delays in issuing exploration and mining licences. We also heard from the 
Deputy Minister that better things are to come when the new law will be put in place to 
ease investment in the sector; 
• Bound versus applied tariffs:  in general, Mongolia applies tariffs well below their 
bound rates but there are some products which have bound tariffs of zero but applied 
tariffs of 5%. Furthermore, excise duties on  some domestically produced products are 
lower than on imports and import prohibitions apply to some products; 
• Standards:  many of the technical regulations, standards, and SPS measures in place in 
Mongolia are not aligned with international standards. Although the official objective is to 
increase the number of standards they subscribe to international ones more progress could be made in this area; and 
• Institutional issues:  it was noted by some delegations that, in many areas, including 
import licensing, investment approval, and even technical assistance, a lot of time and cost was involved while waiting for approval. Of course, every country can improve its 
bureaucratic efficiency but steps should therefore be taken to improve institutional 
capacity and transparency in these areas. 
6.10.  In conclusion, as a large landlocked developing country with a relatively low population, 
Mongolia faces many challenges to its development. Nevertheless, Mongolia has made 
considerable progress to improve its trade and investment regimes and it has recognized the need 
to improve efficiency and transparency in the publ ic sector and to deal with corruption and related 
issues.  
6.11.  I would like to thank Mongolia for its participation in this Review, the Deputy Minister and 
the discussant for their statements and I note the interest of a wide number of WTO Members through their questions and contributions. I hope  that this exercise has given Mongolia the 
opportunity to review its trade and investment polici es and, in six years' time at the next review, 
to hear how the economy has continued to grow and benefit the people of Mongolia. 
__________