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Mongolia’s foreign economic relations at the current stage of development

Author

Listed:
  • Aleksandr Valerievich Makarov

    (Baikal Institute of Nature Using Management of the Siberian branch of RAS, Ulan-Ude, Russia)

  • Elena Vladislavovna Makarova

    (East Siberia State University of Technology and Management, Ulan-Ude, Russia)

  • Aleksandr Borisovich Andreev

    (Baikal Institute of Nature Using Management of the Siberian branch of RAS, Ulan-Ude, Russia)

Abstract

The article discusses the current foreign economic relations of Mongolia. The importance of foreign trade, foreign investment and foreign borrowing as key factors of Mongolia’s growth is revealed. It is shown that involvement of western companies in the development of the largest mineral deposits has become the basis of two-digit indicators of the country’s economic growth. However, the flip side of resource-oriented development was the critical level of Mongolia’s dependence on exports of raw materials to China. The government of Mongolia limiting foreign companies’ role in the economy resulted in FDI plunge, which with lower raw material prices has become one of the main causes of the 2015 economic crisis. Moreover, the lack of foreign investment had to be replenished by external borrowing leading to soaring external debt. All these events have confirmed the urgent need for Mongolia to adhere to a multi-vector cooperation policy providing for rich world companies priority investment role, and China as the key market for raw materials exports. Despite the fact that Mongolia seeks to eliminate dependence on Russian energy resources, expansion of trade and investment cooperation with it also remains important to maintain a balance between the major foreign economic partners and ensure the economic security.

Suggested Citation

  • Aleksandr Valerievich Makarov & Elena Vladislavovna Makarova & Aleksandr Borisovich Andreev, 2020. "Mongolia’s foreign economic relations at the current stage of development," Russian Foreign Economic Journal, Russian Foreign Trade Academy Ministry of economic development of the Russian Federation, issue 7, pages 79-92, July.
    • Handle: RePEc:alq:rufejo:rfej_2020_07_79-92
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    References listed on IDEAS

    as
    1. Li, Bin Grace & Gupta, Pranav & Yu, Jiangyan, 2017. "From natural resource boom to sustainable economic growth: Lessons from Mongolia," International Economics, Elsevier, vol. 151(C), pages 7-25.
    2. Christopher MacDougall, 2015. "Foreign Direct Investment into Mongolia," The Northeast Asian Economic Review, ERINA - Economic Research Institute for Northeast Asia, vol. 3(2), pages 43-53, October.
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