This year, international prices for these commodities have steadily decreased, making a sizable drop in GDP growth a distinct possibility. Thus, the stabilization of the economy is far from complete. An argument can also be made that exchange stability is due mainly to the inflow of aid money and not to the trade surplus. In short, people's confidence in the government's macroeconomic policies and in exchange has not been firmly established. The increase of imports in 1995 and the distinct possibility that they will exceed exports in 1996 may threaten Mongolia's current trade surplus.
Most Mongolian banks are in very unstable positions, and are saddled with bad loans.
In 1993 the country had 15 banks. Two went bankrupt in 1994, one in 1995, and one in 1996. All but two or three are unhealthy and, as a result, more and more depositors are withdrawing their funds. The Asian Development Bank and the World Bank are currently planning several restructuring projects of the financial sector to alleviate the pain. A high dependence on foreign aid is not desirable, and the tax-collection rate is apparently quite low.