FDI Falls By 36% In Mongolia Y-O-Y
This May, foreign direct investment (FDI) totaling 231.3 million USD was invested in Mongolia an increase from the previous month's FDI.
However, FDI in 2013 is still lagging behind last year's numbers. According to preliminary performance in May, FDI fell by 36 percent compared to May, 2012. As of May, 2012, FDI of 1.8 billion USD was invested in Mongolia, while this year, FDI in Mongolia only reached 1.2 billion MNT since January 1.
Analysts believe the increase occurred as an amendment on the Regulation of Foreign Investment in Business Entities Operating in Sectors of Strategic Importance was made into law. Though FDI slowed, economists say that according to statistical indicators, it will recover in the near future.
Mongolia's investment in foreign countries was equal to 4.9 million USD as of the first half of this year.
Now that the Presidential election is over and shipments have begun from OT I expect things to pick up rather quicly. In fact that is what the largest broker in Mongolia is seeing already.
We've consistently held that economic activity in 1H'13 was being deferred until after the election, which is being confirmed by businesses we talk to who are now being bombarded with potential business inquiries. Investor inquiries at BDSec have also increased meaningfully as of late and clients have begun to wire additional funds into their trading accounts. One real estate broker we know said his phone has been ringing off the hook since Elbegdorj won the presidential election, most of which are foreign inquiries.
Disclosure: I am long TRQ.
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