Industry & Retail
From The Report: Mongolia 2014
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Mongolia faces significant challenges in manufacturing, as neighbouring China has a prominent edge in production of many goods. The northern country can also be an expensive country for manufacturers, with high transportation and labour costs. In May 2013, the minimum wage was raised from $87.75 per month to $120 per month. Government investment in textiles manufacturing in 2012 saw $68.8m directed to cashmere production, $45m to wool goods output and $13.5m to sewing operations. Still the potential for industry in Mongolia is under-appreciated. The prospects for the sector are positive, but the country must be careful. Mongolia has the right mix of wealth and income growth that will promote strong consumer demand in the medium and long term. Despite concerns about the future of high-end retail, Mongolia remains one of the most promising retail markets globally.
This chapter contains an interview with S. Demberel, President, Mongolian National Chamber of Commerce and Industry.

Articles from this Chapter

Overview

Countering the cycle: Spending mineral revenues to build up local manufacturing capacity
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While Mongolia may seem an unlikely place for export-focused manufacturing, it is becoming less so. The country is remote, it has a small labour pool and it cannot be described as inexpensive. The local market is small and it has little in the way of an industrial tradition. However, the economics of manufacturing work for a rather wide range of goods. Mongolians need and can now afford many products, and in many cases – especially when it comes to foods and beverages – it makes sense to manufacture…

Interview

OBG talks to Sambuu Demberel, President, Mongolian National Chamber of Commerce & Industry
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Interview: Sambuu Demberel How is the government supporting cooperation with the private sector? What else can be done? SAMBUU DEMBEREL: Public-private dialogue, collaboration or cooperation is a long and tireless process. Without regular and meaningful consultation with the private sector it is not possible to make successful and effective policies, regardless of the industry. Such consultations should be done not only at the national level, but also at every soum (district) and aimag (province)…

Analysis

Coming back for thirds: Light manufacturing offers stability when commodity prices fluctuate
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The rise and return of light manufacturing is often overlooked in Mongolia, given that mining is so large and the potential in the resources sector so great. In recent years, small manufacturers have made a significant contribution to the country, in terms of supporting domestic consumption and exports. Cashmere has been a particularly strong contributor to the economy for a number of years, suggesting that the investments made in the sector were justified. The Growth Of Manufacturing The growth…

Overview

Home made: The focus shifts to serving the local market with domestic products
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While the world has focused on high-profile retail openings in Mongolia – especially Louis Vuitton in 2009 and KFC in 2013 – and the notable absence of shoppers at some of the country’s high-end malls in recent months, much has been going on in the broader market. Retail has been developing steadily below the super-high end and big brands. Malls have been opening, major local players have been expanding and people are, indeed, shopping. Many legitimate questions have been raised about the retail…