2013-09-24 17:26:09 - New Materials research report from Business Monitor International is now available from Fast Market Research
Mongolia is on the cusp of a mining boom. The start of production at the Oyu Tolgoi copper and gold mine in 2013 is set to transform the entire landscape of the country's mining industry.
Mongolia is on the cusp of a mining boom. The commencement of production at the Oyu Tolgoi (OT) copper and gold mine in 2013 is set to transform the entire landscape of the country's mining industry. Situated in the South Gobi Desert, OT is Mongolia's main mining site and hosts rich deposits of copper, molybdenum, silver and gold. The OT project is the biggest economic undertaking in Mongolia's history and will account for one-third of the economy once it becomes fully operational in 2019.
We believe Mongolia
will experience one of the fastest economic growth rates in the world over the next decade, a development that will have huge social and economic consequences, and therefore pose key challenges for policymakers. The deluge of foreign investment, attracted by the country's vast mineral wealth, will transform the country from a largely rural (and often nomadic) society, with a large section of the population employed in agriculture, to an increasingly urban and industrialised one. Moreover, the growth of the mining sector will dwarf other areas of the economy, leading to an increasing concentration of labour and wealth in this industry.
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Despite the bouts of resource nationalism over the past year, we believe the Mongolian government will eventually tone down its rhetoric against foreign miners. Crucially, the re-election of incumbent President Tsakhiagiin Elbegdorj has strengthened the Democratic Party (DP)-led coalition government's position, which should make it easier to formulate and implement policies.
We expect the government's policy priorities to shift away from the populist tones outlined during the election campaign, back to a more market-friendly platform. Campaigning for the presidential elections earlier in the year was aggressive and populist in nature, with resource nationalism a hotly-debated topic.
Anti-foreign investor sentiment amongst the public was a major reason why the government took a more pronounced hardline stance towards key foreign investors in the country, most notably global mining major Rio Tinto. However, with elections now out of the way, the government can turn its attention to putting the economy back onto an even keel. To be sure, Mongolia is planning to scrap a controversial law designed to curb foreign ownership in what it considers to be strategic sectors, including mining, banking & finance and telecommunications. The new measure, if passed, will replace the 2012 Strategic Entities Foreign Investment Law (SEFIL), which had been responsible for a slump of 43% in overseas investment in H113.
Report Table of Contents:
BMI Industry View
- On The Cusp Of Mining Boom
- Mongolia - Q4 2013
- Coal: Tavan Tolgoi In Driving Seat
- Table: Mongolia - Select Coal Projects
- Table: Mongolia - Coal Production Forecast
- Copper: Oyu Tolgoi To Slowly Take Charge
- Table: Mongolia - Largest Copper Projects
- Table: Mongolia - Copper Production Forecast
- Gold: Oyu Tolgoi Set To Dazzle
- Table: Mongolia - Select Gold Projects
- Table: Mongolia - Gold Production Forecast
Industry Risk Reward Ratings
- Risk Reward Ratings
- Table: Asia Mining Risk/Reward Ratings
- Heading Towards A Golden Future
- Table: Mongolia - Mining Industry Value & Production Forecasts
- Economic Nationalism On The Retreat
- Table: Table: Mongolia Political Overview
- Commodity Strategy
- Non-Ferrous Metals
- Aluminium: Weakness Ahead After Recent Surge
- Copper: Bounce To Give Way
- Nickel: Underperformance To Continue
- Zinc: Weak Steel Sector To Weigh On Zinc
- Table: Select Commodities - Performance & BMI Forecasts
- Table: BMI Commodities Strategy
- Brightening Landscape For Foreign Miners
- Table: Mongolia - Financial Data Of Key Listed Companies
- Centerra Gold - Q4 2013
- Table: Centerra Gold - Key Financial Data
- Turquoise Hill Resources - Q4 2013
- Table: Turquoise Hill - Key Financial Data
- Table: South East Asia - Select Mining Projects
Global Industry Overview
- Table: Select Countries - Recent And Planned Tax Increases And Other Government Plans
- Table: Mining Business Environment Indicators
- Table: Weighting Of Components
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