L. Purevsuren, Minister for Foreign Affairs: Interview

L. Purevsuren, Minister for Foreign Affairs

Interview: L. Purevsuren

How do you expect Mongolia’s role in the regional economy to develop going forward?

L. PUREVSUREN: Foreign trade plays an important part in Mongolia’s economy. Since it began its transition to a market economy, Mongolia has adopted open trade and investment policies. After joining the WTO in 1997, we bound all our tariffs under the General Agreement on Tariffs and Trade and began granting most-favourednation status to all WTO members. We also have bilateral trade agreements with 23 countries and bilateral investment agreements with 44 countries.

There are two main priorities for Mongolia’s regional economic policy. First, we aspire to gain access to sea ports to create favourable transit conditions for our exports (the main factor affecting export competitiveness is Mongolia’s landlocked position and resulting high transit costs). Second, we aim to join economic integration and infrastructure networks – both international and regional. Mongolia is a transit hub for 1.5bn people in China and Russia, two markets every investor wants to enter. So we are not landlocked, but a market-linking country. I am also pleased to note that Mongolia is the seventh member of the Asia-Pacific Trade Agreement, the only operational regional trade agreement linking China and India.

What is the importance of the recent visits by the presidents of Russia and China?

PUREVSUREN: During Russian President Vladimir Putin’s visit, our two sides affirmed the importance of deepening our strategic partnership and agreed to resolve issues pertaining to bilateral economic cooperation in a speedy manner. For instance, both nations agreed to instruct their foreign ministries to draft a roadmap for the work ahead, focusing on developing business activities, encouraging trade and investment, and expanding people-to-people relations. To this end, the two governments signed a package of deals, including intergovernmental agreements on reciprocal conditions for travel and forest fire protection. Various ministries and agencies signed memoranda on construction, transport, finance, judicial matters, information cooperation and training in Russia for Mongolian specialists.

During the state visit by Chinese President Xi Jinping, we upgraded our strategic partnership to the level of comprehensive strategic partnership. Both sides signed 26 agreements in trade, infrastructure, energy and financial cooperation, and pledged to increase bilateral trade to $10bn by 2020. Political relations between the two countries are also being strengthened with meetings of top leaders. Significant achievements have been made in the infrastructure and financial sectors. In particular, China will provide tariff concessions of at least 40% to Mongolia’s freight as it transports through its territory. The two sides also agreed to open four new railway ports and China is set to increase its number of sea ports for Mongolian use and will transport at least a third of Mongolian transit freight from Asia to Europe.

How does the “third neighbour” policy affect economic and foreign policymaking?

PUREVSUREN: It is not only about politics, as it helps us diversify our foreign trade and investment. This year Mongolia signed its first Economic Partnership Agreement with Japan, an important third-neighbour country. This will expand trade, investment, services and people-to-people exchange, and connect Mongolia to regional economic integration and industrial networks of global value-added products. Over the next decade, both sides will remove tariffs on about 96% of the total value of bilateral trade. This new phase of cooperation will also help to build up our strategic partnership with Japan. Our economic links with the “third” countries are growing. Canada is our largest export partner after China, while the US, Japan, South Korea and Germany are our largest import partners after Russia and China; and Singapore, Canada, South Korea and the US are some of our top-12 investment partners. We also ratified an Agreement on Transparency in Matters Related to International Trade and Investment with the US.

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The Report: Mongolia 2015

Trade & Investment chapter from The Report: Mongolia 2015

Cover of The Report: Mongolia 2015

The Report

This article is from the Trade & Investment chapter of The Report: Mongolia 2015. Explore other chapters from this report.

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