MONGOLIA, IMF CLOSE TO AGREEING LOAN DEAL

With inflation hitting record highs and the budget deficit worsening, top-level Mongolian officials say they will seek assistance from the International Monetary Fund, according to Bloomberg.

Foreign Minister Munkh-Orgil Tsend (pictured) said he was confident an agreement with the international lender would be in place by February. Khayankhyarvaa Damdin, chairman of the ruling party’s parliamentary caucus, agreed that Mongolia should enter the lending program as soon as possible, Bloomberg reports.

The IMF “held very productive discussions with the Mongolian authorities” on policies that could become part of an IMF-supported economic and financial program, the fund said last week after a two-week trip to Mongolia.

Mongolia, a country so rich in copper, gold, coal, iron and other mineral resources that some dub it the Kuwait of Asia, is now facing a financial crisis spurred by slumping commodity prices and mounting debt. Since coming to power in June, the Mongolian People’s Party has announced an economic reform plan containing spending cuts, and requested the IMF’s help.

IMF aid could ease financial concerns moving forward, as Mongolia will have to repay $1 billion in debt by 2018. Signaling the poor state of its export-driven economy, the national currency fell to an all-time low against the dollar yesterday, Bloomberg says.

• Russian state-controlled news agency Sputnik reports Mongolia expressed “high interest” in working with the Eurasian Economic Union, a Russia-led regional economic bloc. If Mongolia joins, it will be the first member from outside the former Soviet Union.

• The IMF has also approved $180 million in loans for Moldova, a country plagued by financial scandal and political corruption, RFE/RL reports. The three-year loan package was approved as Moldova showed signs of carrying out economic reforms.

Source:http://www.tol.org/client/article/26467-mongolia-economy-imf-loan-commodities-debt.html