Today, the Minister of Finance Ch.Khurelbaatar reported about new bond of the Government. The Government has raised USD 600 million Nomad bond with interest of 5.125% from the international stock market in cooperation with the Bank of Mongolia. The bond period is 5.5 years and will be repaid in 2026.
As of August 2020, State budget has loss of MNT 2.7 trillion. And the central bank's supply of fixed currency to the market to stabilize the USD has led to an official foreign exchange reserve of USD 3.5 billion. This is an official resource. There is a risk that the actual reserves will be less than this. The government also decided to issue bonds due to the decline in direct investment other than Oyu Tolgoi. The introduction of the bond to investors began online last week. Interest rate and term of the bond were not clear.
As of August 2020, State budget has loss of MNT 2.7 trillion. And the central bank's supply of fixed currency to the market to stabilize the USD has led to an official foreign exchange reserve of USD 3.5 billion
In the first half of this year, our economy tightens by -9.7 percent. Export in mining sector decreased by 50% and it is -10 last month which tends to recover. Mining, manufacture, construction, transportation, warehouse service, trade and service sectors are still in difficult situation.
Furthermore, Economists estimated that 27,000 people lost their jobs this year as a result of COVID-19.
As of August 20, 22,191 people have returned home. Assuming that half of them are adults, this means that the number of unemployed has increased by 10,000 people. On the other hand, transactions from abroad have decreased significantly. Prior to COVID-19 pandemic, an NGO that only transfers money from the Republic of Turkey to Mongolia used to send USD 100,000 to Mongolia every week.
In this situation, the government bonds will have a significant impact on recovering the state budget deficit by stabilizing the exchange rate and financing investment projects. The new bond is rated B/B by Standard & Poor's and Fitch.
Today, the Minister of Finance Ch.Khurelbaatar reported about new bond of the Government. The Government has raised USD 600 million Nomad bond with interest of 5.125% from the international stock market in cooperation with the Bank of Mongolia. The bond period is 5.5 years and will be repaid in 2026.
As of August 2020, State budget has loss of MNT 2.7 trillion. And the central bank's supply of fixed currency to the market to stabilize the USD has led to an official foreign exchange reserve of USD 3.5 billion. This is an official resource. There is a risk that the actual reserves will be less than this. The government also decided to issue bonds due to the decline in direct investment other than Oyu Tolgoi. The introduction of the bond to investors began online last week. Interest rate and term of the bond were not clear.
As of August 2020, State budget has loss of MNT 2.7 trillion. And the central bank's supply of fixed currency to the market to stabilize the USD has led to an official foreign exchange reserve of USD 3.5 billion
In the first half of this year, our economy tightens by -9.7 percent. Export in mining sector decreased by 50% and it is -10 last month which tends to recover. Mining, manufacture, construction, transportation, warehouse service, trade and service sectors are still in difficult situation.
Furthermore, Economists estimated that 27,000 people lost their jobs this year as a result of COVID-19.
As of August 20, 22,191 people have returned home. Assuming that half of them are adults, this means that the number of unemployed has increased by 10,000 people. On the other hand, transactions from abroad have decreased significantly. Prior to COVID-19 pandemic, an NGO that only transfers money from the Republic of Turkey to Mongolia used to send USD 100,000 to Mongolia every week.
In this situation, the government bonds will have a significant impact on recovering the state budget deficit by stabilizing the exchange rate and financing investment projects. The new bond is rated B/B by Standard & Poor's and Fitch.