The Gobi Regional Economic Growth Initiative (Phase I and Phase II) is a rural development program financed by USAID to assist the people of the Gobi region to undertake measures to develop and sustain market-led economic growth and development. The USAID strategy for this program is to target constraints of rural economic growth, stemming from information, structures, organizations, and policies. The primary beneficiaries of this program are potential entrepreneurs, business enterprises, local consultants, herder groups, and cooperatives, local governments, non-herder enterprises, business associations and NGOS, and consumers of business information.

Phase I was a five-year (January 1999 – January 2004) program whose objectives were to increase productivity and profitability of businesses, increase market value of selected animal production, the promotion of alternative livestock production, improved maintenance and use of Mongolia’s land and water resources, and improved access to and use of market/business information. Phase II of the Gobi Initiative (January 2004-January 2009) is funded at $2 million per year for a total of $10 million.

The main program objectives of Phase II are to increase the number of new and strengthened productive Gobi businesses, and to increase the availability, access to, and use of business information by Gobi entrepreneurs.

Location

Six Gobi aimags- Govi-Altai, Bayanhongor, Uvurhangai, Umnugovi, Dundgovi and Govisumber

Funding Period

January 2004 - January 2008 (Phase II)

Goal

To develop and strengthen rural business in the Gobi region

Objectives

• An increase in the number of new and strengthened productive Gobi businesses
• An increase in availability, access to and use of business information by Gobi entrepreneurs

Focus

• Supporting herder groups that are expanding and/or diversifying their business activities
• Supporting the development of herder cooperatives
• Supporting businesses that add value to herder products and link those products to markets
• Promoting rural business linkages to the financial services sector
• Improving the quality and accessibility of local business development and support services

Results during the first year support the project's premise that herder business diversification and expansion can work in Mongolia, as evidenced by the majority of project clients who successfully undertook business planning and achieved production and sales targets in 2004:

• Sales revenue of MNT 777 million (US$ 650,000) was generated by 88 herder and non-herder businesses during 2004
• Herder interest in the project resulted in the number of project clients increasing from 73 groups at the beginning of 2004 to 150 by year-end, with most of the informal groups transitioning into legal cooperatives
• Autumn market events in the six Gobi aimags attracted 628 exhibitors and 38,000 visitors and generated MNT 124 million (US$ 104,000) in sales
• Project clients accessed MNT 145 million (US$ 121,000) in new commercial financing with MNT 103 million (US$ 86,000) guaranteed under the complementary "Rural Agribusiness Support Program" funded by the US Department of Agriculture
• Rural Business News (RBN), the project's primary business information dissemination product, began regular television programming, increasing the number of business readers, listeners and viewers to over 300,000.