Mongolia spends 753 billion MNT in debt repayment in June

Finance Minister Ch.Khurelbaatar reported that his ministry has paid 753 billion MNT in June in debt repayment out of 3.8 trillion MNT owed this year. The minister was speaking at a press conference regarding the fourth review of the extended fund facility program and the repayment of the Dim Sum Bond.

This month, the ministry completed the 370 billion MNT repayment of the Dim Sum Bond, 61.8 billion MNT interest payment of Chinggis Bond, and 27.6 billion MNT repayment of foreign concessional loans. Foreign debt made up 459 billion MNT of the 753 billion MNT. Meanwhile, domestic debt of 293 billion MNT included fiscal deficits, Sain Malchin program, and repayment of government bonds.

The Dim Sum Bond was a three-year bond with an interest rate of 7.5 percent. Domestic government bonds ranged from 9.6 percent interest rate to 15.5 percent interest rate. As of the first half of 2018, the debt of Cabinet decreased to 21 trillion MNT. Ch.Khurelbaatar said that Cabinet will carefully consider issuing domestic and foreign bonds so as not to increase repayment pressure.

Of the 3.8 trillion MNT owed in 2018, 2.6 trillion MNT is principal payments while 1.2 trillion MNT are interest payments.

Minister Ch.Khurelbaatar reported that Cabinet will not be amending the budget this year. “This will help fiscal discipline. In the past, ministers planned large expenditures ahead of previous budget amendments, which increased the deficit,” said Ch.Khurelbaatar.