Legislative delays expected to bring down Mongolia's credit rating


2018-04-10 17:34 GMT+8

Moody’s has reported that the postponement of legislative reforms driven by Mongolia's enrollment in the International Monetary Fund's extended fund facility (EFF) program will negatively affect the nation's credit rating.

The IMF’s Board of Directors has praised the program’s implementation. According to Moody’s, the further delay or cancellation of structural economic changes will pose a risk to Mongolia in terms of receiving assistance from donor countries. As Mongolia faces remaining highly susceptible to periodic mining fluctuations, Moody’s analysts say that this process will eventually have a negative impact on the country’s credit rating.

Bills and amendments for the recapitalization of banks and the establishment of a budget council, which would work to tighten and administer state budget spending, have been delayed. Moody’s also noted that the pace of Mongolia's economic growth will be related to how Oyu Tolgoi and Tavan Tolgoi’s further development proceed.

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