Economic Policy Reform and Competitiveness Project (EPRC)

Chemonics
www.eprc–chemonics.biz

Economic Policy Support

• Improving IT systems at the General Agency for Specialized Inspection (GASI): Implementing the MoU signed 20 February 2009 the project provided training to fifty-five inspection officers of the GASI office in Zamyn Uud. The training focused on IT systems, networking, security, and computer maintenance.  In preparation for connecting GASI to the Customs offices in Zamyn Uud and Ulaanbaatar, the project also assisted the GASI Zamyn Uud office with the installation of their local area network (LAN) which will eventually enable inspection officers to access the Customs GAMAS database.
• Market analysis of cement, glass-making, and iron bar manufacturing: The project completed and delivered a preliminary market analysis of these products for the implementation of the “Master Plan on Construction Material Production Development 2007-2015” to leaders of the Government working group on “Industrialization Policy and Coordination.” Current schedule is for the project to make the presentation of initial findings to an extended working group meeting in April. 
• Legal and regulatory framework for Public-Private Partnerships (PPPs) and Concessions: With assistance from an international expert, the project initiated assistance to the Ad-hoc Parliament Committee on PPP tasked to develop a draft Concession Law and core members of the working group for developing a draft PPP umbrella law at the National Development & Innovation Committee.

Financial Markets Support

• Mongolia Corporate Governance Development Center: On 9 April and with project assistance, the Financial Regulatory Commission (FRC) and the Institute of Finance and Economics (IFE) organized the second Mongolian Corporate Governance Forum to launch the Mongolian Corporate Governance Development Center with a public presentation of its concept and business plan. The formation of the Mongolian Corporate Governance Development Center is the culmination of efforts that began with the project’s corporate governance diagnostic assessment of Mongolian companies in September 2008, the results of which were presented at the first Mongolian Corporate Governance Forum on 9 October, 2008, where the leading participants signed a joint resolution to establish a Mongolian Corporate Governance Development Center. FRC and IFE signed a MoU on 6 March to establish the center as a NGO. The MCGDC will have three key activities: directors training, research and standards setting, advocacy, and public outreach.  EPRC will continue to support the MCGDC through its organizational period and to expand its training curriculum and membership base.  
• Credit Information Center (CIC): The CIC, with project assistance, the IFC and the Mongolia Bankers Association held a day-long workshop on 6 April with the primary goal of educating parliamentarians and regulators on the operation of credit bureaus and the enabling legislation which will be presented for consideration in the spring session of parliament. The workshop, with attendance of fifty-four potential CIC stakeholders and members of the media, featured presentations by representatives of leading private sector credit information providers from Asia, Eastern Europe, South Africa and the Americas as well as the Bank of Mongolia and CIC stakeholders and supporters.
• Banking sector restructuring. On 28 April and with assistance from an international expert, the project began a four-week technical assistance assignment to help the Bank of Mongolia review the banking sector and recommend potential opportunities and methodologies for consolidation and restructuring.

Energy Sector Support  

• Energy sector financial status: The ERA has completed the review of requests for electricity and heat tariff increases and issued a proposed schedule of increases. The proposal stimulated much discussion within the GoM, labor unions, the public, and the media. The current Tariff Reform Plan contemplates these increases effective July 2009. The project will continue to assist the ERA in implementing the remaining tasks in the approved Tariff Reform Plan according to schedule.
• Competitive electricity market design and implementation: The project completed and distributed a second revised draft of the market rules following a workshop-style meeting with the New Market Working Group. The ERA will finalize the draft Market Rules by the end of May in accordance with the agreed schedule. The goal is to have the new market ready for implementation in 2010. 
• Update of ERA Assessment: Project will deliver the November 2006 assessment of the ERA by the end of April. The assessment shows the ERA made significant gains in the past two years and makes recommendations for further improvement.
• Energy Working Group and GoM/external partners meetings: The next EWG meeting will be held on 30 April.
• Action plan with MMRE: responding to a request from the MMRE, the project completed and submitted a proposed action plan to provide technical assistance in selected energy tasks and issues.
• Project presentation at MMRE: On Saturday, 4 April, per request of the Minister, the project made a presentation on the new market design and current status of activities in the energy sector.
• MMRE forms Working Group to revise Energy Law: Pursuant to the meeting held on Saturday, 4 April, MMRE issued Ordinance #83 to establish a working group to revise the Energy Law. The first meeting took place on 22 April and discussed the draft Concept Paper and a work schedule. The plan is to submit the draft Concept Paper on amending (or re-writing) the Energy Law to the Ministry of Justice and Home Affairs on 7 May and the draft law along with approved Concept Paper to the Cabinet on 25 June. The EPRC energy specialist is a member of the working group.
• MMRE initiates a review of ERA’s activities: In concert with Note #9 of the Cabinet’s meeting dated Feb. 11, 2009, which approved the ERA’s budget for a half year (until Jul.1, 2009) and obliged Minister D. Zorigt to review regulatory activities of the ERA and propose draft amendment to the Energy Law, MMRE established a group tasked to make the assessment of ERA’s activities and provide conclusions to the Minister. The group is scheduled to initiate the review on 28 April.

Consensus Building, Public Education, and National Dialogue Support

• Tax issues workshop for journalists. On 8 April 2009 in collaboration with the Press Institute and the General Department of Taxation (GDT), ERPC co-sponsored an all-day workshop for journalists on “Tax Reform Issues and the Impact of Recession on Tax Collection.” Twenty-seven journalists from eleven newspapers, nine TV stations, two radio stations, three magazines and the Montsame News Agency attended the event. Presentations covered the impetus for tax reform and the current tax environment in Mongolia, the impact of specific tax reforms including Personal Income Tax (PIT), Corporate Income Tax (CIT) and Value-Added Tax (VAT), the contribution of Windfall Profits Tax and CIT to overall tax revenues and the difficulties of tax law enforcement. The workshop included exercises and discussion of journalist techniques to promote effective and accurate coverage of tax issues.
• Journalists visit to Erdenet. As a follow up to the 8 April 2009 workshop, the project co-sponsored a two-day workshop with the Press Institute and GDT in Erdenet town on 17-19 April 2009. Twenty-two journalists from ten newspapers and six TV stations attended. The trip to Erdenet was designed to provide journalists with first-hand information on how the global recession and falling commodity prices are affecting Erdenet’s revenues, profit margins, and corporate tax payments—Erdenet is the largest corporate tax contributor. Journalists interviewed the Deputy Director D.Boldbaatar of Erdenet Mine and other officials from the Finance Department. Director of Orkhon Aimag Taxation Department, H. Erdenebilig, Head of GDT’s newly established Department of Taxpayer Relations, D. Bayaraa, Head of GDT Tax Collection Department, O. Enkhsaikhan and GDT Public Affairs Officer, Ts. Tsendsuren conducted a one-day training course at Orkhon Aimag’s Taxation Department where journalists had the opportunity to ask questions and discuss issues directly with tax officials. The Press Institute continues to work with journalists as they draft articles and is monitoring the media for resulting coverage of tax issues.
• Production of second TV program on Ulaanbaatar heating completed: As part of the “Hot Topix” TV series, the project completed production of a TV program focused on household energy conservation, scheduled to be broadcast next month.