IMF ex­ec­u­tive board post­pones dis­cus­sion of Mon­go­lia’s ex­tended fund fa­cil­ity


Due to Par­lia­ment’s re­cent move to dis­miss Cab­i­net, the IMF ex­ec­u­tive board has said that it will be post­pon­ing the re­view for Mon­go­lia’s ex­tended fund fa­cil­ity.

“The IMF ex­ec­u­tive board has post­poned its dis­cus­sion of Mon­go­lia’s ex­tended fund fa­cil­ity in­def­i­nitely. We will hold dis­cus­sions with the new Cab­i­net about eco­nomic pol­icy af­ter it has been as­sem­bled,” IMF coun­try rep­re­sen­ta­tive Neil Saker told Bloomberg.

An IMF team led by Koshy Mathai vis­ited Ulaan­baatar from July 19 to Au­gust 2 to con­duct dis­cus­sions on the first re­view of the three-year ex­tended fund fa­cil­ity ar­range­ment ap­proved on May 24, 2017, which pro­vided a 434.3 mil­lion USD soft loan to Mon­go­lia to ad­dress present eco­nomic chal­lenges.

“Per­for­mance un­der the pro­gram has been good, with all quan­ti­ta­tive tar­gets on track. Fis­cal re­sults have been bet­ter than ex­pected, sup­ported by strong rev­enues and tight ex­pen­di­ture con­trol,” Mathai un­der­lined.

Due to a sat­is­fac­tory con­clu­sion of the first re­view by the IMF team, trans­fer­ring of the over­all 5.5 bil­lion USD fi­nan­cial pack­age has be­gun and will be com­pleted in stages.

The au­thor­i­ties and the team had reached a staff-level agree­ment on the com­ple­tion of the first re­view un­der the ex­tended fund fa­cil­ity ar­range­ment, which is sub­ject to re­view by the man­age­ment and ex­ec­u­tive board of IMF. The board was ex­pected to con­sider the first re­view in late Sep­tem­ber but the un­fore­seen po­lit­i­cal shakeup in Mon­go­lia has caused the re­view to be put on hold.

The ex­ec­u­tive board was to de­cide whether or not Mon­go­lia would re­ceive the next stage of IMF fi­nanc­ing.

News of the post­pone­ment has not in­ter­fered with the im­ple­men­ta­tion of the pro­gram, namely the asset qual­ity re­view that is cur­rently tak­ing place. Mon­gol Bank has stated that the re­view is on sched­ule and be­ing con­ducted by the Price­wa­ter­house­Coop­ers branch in the Czech Re­pub­lic.

Mon­gol Bank re­ceived an ini­tial fund­ing of 38.6 mil­lion USD from IMF un­der an en­hanced fi­nanc­ing pro­gram as part of its ex­tended fund fa­cil­ity on May 25, 2017. The cen­tral bank also re­ported that it had re­ceived the ini­tial trans­fer of 100 mil­lion USD from the Asian De­vel­op­ment Bank for the fund­ing of the pro­gram on Au­gust 4, help­ing to in­crease the for­eign cur­rency re­serve of the na­tion.

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