Diversification and Engagement Key to Mongolian Development, Report Finds
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- Mongolia’s future dependent on successful development of mineral sector, diversification and engagement with neighbours
- Country has the potential to play central role in regional renaissance but also faces threat of over-exposure to mining sector
- Sustained economic growth must be underscored by efforts to diversify the economy and build further trade and investment relationships
- More information about the Scenarios is available here
Davos-Klosters, Switzerland, 23 January 2014 – Mongolia, the hub of one of the world’s fastest-growing economic regions, is the focus of a World Economic Forum report that is published today.
The report, Scenarios for Mongolia, has been produced to map out potential long-term economic outcomes of the country’s recent period of double-digit growth, which to date has been generated largely on the back of rapid development of its resources sector. The three scenarios identified for the country’s future are:
Regional Renaissance: Where Mongolia finds itself at the heart of a dynamic economic area comprising Northern China and Eastern Russia, combined with an integrated, open North Korea. In this scenario, Vladivostok is a thriving seaport benefitting from an opening of Arctic sea lanes, and the free movement of goods and people across borders is commonplace.
China Greening: Envisages a future where China has become a world leader in green technology and the circular economy. This precipitates diversification in Mongolia towards solar and wind-power generation and high-end organic food products.
Resource Tensions: An opposite outcome to Regional Renaissance, where nationalist sentiments lead to territorial disputes, and natural resources are used for political leverage. This makes it difficult for Mongolia to sell its main minerals and to diversify
The aim of these scenarios is to help the Mongolian Government take the strategic decisions that will guide the country towards long-term sustainable and diversified growth. The urgency to address this has been underscored by discoveries that bring the country’s natural resource endowment to an estimated US$ 3 trillion. In a country the size of Europe and a population of just 3 million, this has brought significant development challenges.
“Mongolia’s long-term economic success depends significantly on how well it is able to develop its mining industry and manage its revenues, but also on its ability to diversify and build trade and investment relationships with its neighbours,” said Kristel van der Elst, Senior Director, Head of Strategic Foresight, World Economic Forum.
Common policy responses identified in the scenarios include:
- Improving the investment and business climate for both minerals and other sectors
- Designing a sovereign wealth fund able to operate as an investment or development fund
- Forging strong political and economic relationships with its neighbours
Scenarios for Mongolia, which was produced in collaboration with the Mongolian Government, will form the basis of dialogue in a number of sessions during the World Economic Forum’s Annual Meeting, in which a high-level government delegation from the country, including the president, Tsakhiagiin Elbegdorj, will be participating.
The 44th World Economic Forum Annual Meeting is taking place from 22 to 25 January 2014 under the theme The Reshaping of the World: Consequences for Society, Politics and Business. More than 2,500 participants from 100 countries are taking part in the Meeting. Participants include more than 30 heads of state or government and 1,500 business leaders from the Forum’s 1,000 member companies, as well as Social Entrepreneurs, Global Shapers, Young Global Leaders and representatives from civil society, media, academia and the arts.
The Co-Chairs of the Annual Meeting 2014 are: Aliko Dangote, President and Chief Executive Officer, Dangote Group, Nigeria; Kris Gopalakrishnan, President, Confederation of Indian Industry (CII); Vice-Chairman, Infosys, India; Jiang Jianqing, Chairman of the Board, Industrial and Commercial Bank of China, People’s Republic of China; Joseph Jimenez, Chief Executive Officer, Novartis, Switzerland; Christophe de Margerie, Chairman and Chief Executive Officer, Total, France; Marissa Mayer, Chief Executive Officer, Yahoo, USA; and Judith Rodin, President, Rockefeller Foundation, USA.
Notes to Editors
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