IMF: IPO of commercial banks should be postponed

On April 29, Prime Minister L.Oyun-Erdene met with representatives of the International Monetary Fund (IMF)’s Working Group. Prime Minister L.Oyun-Erdene thanked the working group for visiting Mongolia and meeting him in person two years later than planned due to the COVID-19 situation. He also expressed his gratitude for IMF’s support to the country during this difficult time amid the pandemic.

IMF noted that Mongolia has successfully overcome the pandemic, returned to normal life and begun the development of the Oyu Tolgoi underground mine as part of the government’s New Revival Policy, which focuses on border crossings, reaching agreements, and intensifying port operations.

“The COVID-19 pandemic and the Russia-Ukraine crisis pose major challenges to developing countries such as Mongolia, with many negative consequences, such as inflation, rising prices, and currency shortages. The government has initiated a law to prevent the rise in prices and shortages of key commodities, which has been discussed and approved by Parliament, and is taking measures in this regard,” the fund said.

During the meeting, the prime minister conveyed that he is supporting Mongol Bank’s measures to protect its foreign exchange reserves and prevent shortages. He also mentioned that the Law on State Austerity has been submitted for parliamentary review.

They believe that in order to protect Mongolia from future risks, it is important for public institutions to focus on austerity and targeting child money and welfare. IMF noted that it supports the idea of commercial banks launching IPO but advised to postpone this work in consideration of the current pandemic situation and the international crisis.

The working group said it was ready to cooperate in tax policy reform.