Country Profile

Located between two economic giants in China and Russia, Mongolia is an underdeveloped, resource rich country on the brink of transformation.  Recent political and economic developments have set Mongolia for impressive growth and it has caught the world’s attention.  In 2009 Ivanhoe Mines and Rio Tinto signed a long-term comprehensive Investment Agreement with the Government of Mongolia for the construction and operation of the world’s largest undeveloped copper-gold project, Oyu Tolgoi, which has an estimated after-tax net asset value of about $20 billion.

Mongolia’s Location 


Following the withdrawal of economic support from the former Soviet Union in 1989, Mongolia moved to a free-market democracy in 1990, with the first multi-party elections taking place in 1992.  In line with the 1992 Constitution, Mongolia is a parliamentary democracy with a President as a directly elected head of state.  Since 1990, Mongolia has had seven parliamentary elections and six presidential elections.  The 2016 parliamentary elections resulted in a massive 85% majority win by the Mongolian People’s Party.


The Mongolian population is approximately 3 million, with nearly half of the population living in the capital, Ulaanbaatar.  According to the UNESCO Institute for Statistics, Mongolia has a literacy rate of 98.4%, one of the highest levels in the world.  68% of the population are under the age of 35, one of the lowest age rankings in Asia.


Mongolia is a member of the United Nations and its troops have been a participating in peacekeeping activities in Sierra Leone, Kosovo, Afghanistan and Iraq.  Mongolia has signed a tariff-free goods export agreement with the European Union and received aid under the Millennium Development Goal Foundation from the United States of America.  It has been a member of the World Trade Organization since 1997. Mongolia successfully hosted the 2016 Asia-Europe Meeting (ASEM) and raised its profile in the international spotlight. During the 2 day event, many bilateral meetings with leaders of the ASEM partner countries were held that would strengthen its cooperation and relations with many countries.


After the signing of the Oyu Tolgoi Agreement in 2009, the International Monetary Fund’s (IMF) World Economic Outlook 2010 predicted that Mongolia would be the highest growing economy in the world for the coming decade, forecasting the real GDP growth to be over 25%.  In 2012, Mongolia’s real GDP growth was almost 17%, demonstrating that the IMF forecast was realistic at that time. However, commencing in 2013, commodity prices fell substantially which caused a significant slowing of the economy.  Recently, with increases in commodity prices and a return of confidence amongst investors, the outlook has improved again. Underpinning Mongolia’s status as a mineral rich resource area is the fact that it is home to world-class deposits such as the Oyu Tolgoi copper-gold and the huge state-owned Tavan Tolgoi coal deposit, estimated at 6.4 billion tonnes. In May 2016, Rio Tinto and its partners, the Government of Mongolia and Turquoise Hill Resources, have approved the next stage in the development of Oyu Tolgoi copper and gold mine in Mongolia.  When the Oyu Tolgoi mine becomes operational by 2019, as is now planned, it will account for more than 30 per cent of Mongolia’s GDP.


Mongolia clearly benefits from its geographic location and significant pool of natural resources. Russia, Mongolia and China are bound by strategic agreements to promote cross-border trade and jointly develop transport infrastructure.


Mongolia presents an exciting opportunity for investors interested in frontier markets and can provide diversification into emerging markets.