- The business environment and its possible change or sustainability is always a topic of interest, concern and conversation for businesspeople and entrepreneurs. The Mongolian National Chamber of Commerce and Industry (MNCCI) announced 2018 as the year of supporting a sustainable environment for business. This includes several matters such as trade facilitation, mitigation of tax and border barriers and supporting business through improved access to credit. As you serve as the Deputy Prime Minister Mr. Enkhtuvshin, what issues are you mainly focused on within your duties?
- My duties include oversight of four agencies. These agencies are responsible for emergencies, special inspections, standardisation and measurement and fair competition. My duties also include oversight of three economic free zones.
When I took my duties, I said that the prime goals of the governmental services are not punishing and fining someone or banning them, but instead assisting and advocating on behalf of businesspeople and providing them with precious advice. At least, we must not bother them if we cannot help them. This is a principle I will follow all the time.
- Is there any achievement in the standardisation sector, for example?
- Parliament adopted last year the government-proposed law on standardisation, technical coordination and accreditation for conformity assessment. This law aims to harmonise the Mongolian standardisation sector with international principles and to reduce and abolish trade barriers through decentralisation. In order to introduce progressive technologies and techniques in industry and to increase the responsibilities of both producers and suppliers, the law provides enterprisers and individuals with an opportunity to consume international, regional, foreign and national standards. The law also regulates the independent operation of an accreditation body that approves conformity certificates for goods with the aim of facilitating trade.
In connection with this, the Mongolian government has been implementing measures for trade facilitation and support. For example, the Mongolian Agency for Standardization and Metrology established a memorandum with the Eurasian Economic Union (EEU) last year to cooperate on technical coordination and accreditation. The memorandum’s main objective is to eliminate non-tariff barriers which make up the majority of problems in the commercial ties with EEU members Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia. The parties to the document will also collaborate in standardisation, veterinary and hygiene issues.
- Almost two years passed since Mongolia and Japan established an Economic Partnership Agreement (EPA), but it seems that the bilateral trade turnover has not seen an increase yet, especially Mongolian exports to Japan have not increased yet. In your view, what is reason for this? Could you give us some information about the current implementation of Free Trade Agreements that Mongolia agreed with some countries?
- The Mongolia-Japan EPA came into force on 7 June 2016 and we have already seen an increase in the trade turnover. As at the end of 2017, the Mongolia-Japan trade turnover increased by eight percent, which was mainly due to an increase in imports from Japan. Most of the goods imported from Japan were automobiles and advanced industrial products, whereas Mongolia mainly exported agricultural products and knitted goods. Now it is vital to augment the range of goods to be exported to the country. To enable this, the government is cooperating with the Japan International Cooperation Agency (JICA) in holding training for owners and staff of small and medium-sized enterprises and given them advice on learning about the Japanese market and manufacturing products according to Japanese standards.
- Let’s talk about Russia. In 2017, our country made trade of USD 1.3 billion with Russia, but only 3 percent of the turnover was accounted for by Mongolian exports. In your view, is there any possibility to increase it, as you once served as Chair of the Mongolia-Russia intergovernmental commission?
- That’s right. So, we need to maximise the kinds of exported goods after working out a master policy on supplying products to the Russian Federation. Meat, meat products, leather, wool and cashmere could be exported to Russia in the first instance. The most important thing is we focus attention on improving the quality and standards for meat and sanitation for livestock. We are discussing this matter with the Russian side. We are also collaborating with the Eastern Economic Forum (EEF) within a cooperation memorandum signed in 2015. The Russian Federation is one of the five members of the EEF that regulates cooperation in trade and economic sectors among the members.
- Intergovernmental actions ought to play a role in exporting not only meat and meat products, but also other agricultural goods to neighbouring countries. Could you please give us the latest information about discounts and allowances in the Customs and border services?
- An official proposal, formulated by the State Professional Inspection Agency (SPIA), has been delivered to Russia and China on supplying milk and dairy products. When evaluation bodies of the respective countries give permission, Mongolia will become able to export the product to these countries. As of present, 35 factories have been certified to export their goods to Russia, following evaluation conducted in meat processing and land farming areas.
- The Economic Free Zone is a big issue within the duties of the Deputy Prime Minister. But in reality, Mongolia has not developed yet its economic and commercial free zones. This has caused difficulties including a double imposition of customs tax and the false determination of imported goods. What specific actions are being taken to address these issues?
- When I took office, I promptly got familiar with the current status of the Economic Free Zones. I admit that there is no concrete progress on the Economic Free Zone (EFZ) although it has been discussed for a long time. For the time being, Mongolia has three EFZs, but only one of them has opened for full operation in Altanbulag, Selenge. In addition to Altanbulag EFZ, the Zamyn-Uud EFZ has had an investment of almost USD 60 million to construct a thermal power station, sewage plant, put in infrastructure for electricity, lighting and paved-roads. We are learning from the experiences of other countries about how to operate a cross-border EFZ, and we have chosen the Zamyn-Uud EFZ to connect with the Erenhot free zone in China.
During an official visit of Mongolian Prime Minister U.Khurelsukh to China, the two countries signed a Memorandum of Understanding on establishing an intergovernmental agreement between the Mongolian Ministry of Foreign Affairs and China’s Ministry of Commerce about boosting major construction projects for economic cooperation along the Mongolia-China borders.
Source: Invest Pro Mongolia #2 (2018)