In regards to the discussion over the draft law of 2016 main guidelines towards state monetary policy, we deliver the short interview with Director of Mongol Bank’s Monetary Policy and Research Department D.Boldbaatar.
In scope of the monetary policy, there has been a talk of macroeconomic balance. How should we perceive it?
First of all, we should understand that economic conditions have been changed drastically. We are now obligated to transform current economic structure which was formed solely on mining sectors and reliant on prices of commodities. During the period of mining boom, we set big goals such as mega infrastructure projects and also directed the state budget policies mainly towards social welfare.
But we are currently facing challenges to create an economic growth in new environment of macro economy. Then it is called as new balance of macro economy, referring to implementation of macroeconomic policies in order to shift the economy into new balance.
What steps should be taken in order to shift into new balance of economy?
That what has changed so far is crucial. Firstly, we must now amend the state budget initially designed based on the mining boom. It is necessary to approve the state budget which must be reduced and deficit free. We do not have an option to take such approaches because we are facing difficulties of external debt.
Secondly, the country’s economic conditions just follow changes in mining sector due to its high dependency. Such ups and downs in mining sectors force us to make right adjustments swiftly in major polices and implement them efficiently.
Thirdly, all countries highly dependent on mining sector have been struggling lately and witnessing downturn in export sector. We have same situation and struggles as they do, so that we might develop a value chain in agricultural sector and create new products in order to recover the export. It would be fundamental to reach our goal of reform.
Lastly, another issue we currently encounter is that revenues coming from foreign markets have been decreased. Then, we must accumulate money to invest into expanding local economy and should focus on domestic manufacturing.
When is the new balance of economy expected to be fulfilled, according to Mongol Bank?
There is no certain timetable, which is impossible to be set. Economy itself is driven towards new balance. But the result is crucial. If we adjust our policies efficiently, we can reach our goal within a short amount of time.
What are expectations over new balance of economy?
We expect to create the diversified economy which is less dependent on external factors such as world economic transitions. But we had set such objectives previously, so that now we should be more aggressive and specific to make it reality.
B.Khongor
In regards to the discussion over the draft law of 2016 main guidelines towards state monetary policy, we deliver the short interview with Director of Mongol Bank’s Monetary Policy and Research Department D.Boldbaatar.
In scope of the monetary policy, there has been a talk of macroeconomic balance. How should we perceive it?
First of all, we should understand that economic conditions have been changed drastically. We are now obligated to transform current economic structure which was formed solely on mining sectors and reliant on prices of commodities. During the period of mining boom, we set big goals such as mega infrastructure projects and also directed the state budget policies mainly towards social welfare.
But we are currently facing challenges to create an economic growth in new environment of macro economy. Then it is called as new balance of macro economy, referring to implementation of macroeconomic policies in order to shift the economy into new balance.
What steps should be taken in order to shift into new balance of economy?
That what has changed so far is crucial. Firstly, we must now amend the state budget initially designed based on the mining boom. It is necessary to approve the state budget which must be reduced and deficit free. We do not have an option to take such approaches because we are facing difficulties of external debt.
Secondly, the country’s economic conditions just follow changes in mining sector due to its high dependency. Such ups and downs in mining sectors force us to make right adjustments swiftly in major polices and implement them efficiently.
Thirdly, all countries highly dependent on mining sector have been struggling lately and witnessing downturn in export sector. We have same situation and struggles as they do, so that we might develop a value chain in agricultural sector and create new products in order to recover the export. It would be fundamental to reach our goal of reform.
Lastly, another issue we currently encounter is that revenues coming from foreign markets have been decreased. Then, we must accumulate money to invest into expanding local economy and should focus on domestic manufacturing.
When is the new balance of economy expected to be fulfilled, according to Mongol Bank?
There is no certain timetable, which is impossible to be set. Economy itself is driven towards new balance. But the result is crucial. If we adjust our policies efficiently, we can reach our goal within a short amount of time.
What are expectations over new balance of economy?
We expect to create the diversified economy which is less dependent on external factors such as world economic transitions. But we had set such objectives previously, so that now we should be more aggressive and specific to make it reality.
B.Khongor