August 28, 2008

German Delegation Discusses Minerals Cooperation With Mongolia

Text of report in English by Mongolian newspaper The UB Post website on 28 August

Thursday, 28 August: A German delegation of business officials and government representatives landed in Ulaanbaatar last week for a 10-day visit, from 14-24 August. The delegation met with officials and experts, including the Mongolian Business Council, and visited mines and mining representatives.

From a Mongolian perspective, the goal of the visit was to encourage German businesses and Germany's government to invest in Mongolia's mining sector.

Prior to the visit, a business meeting co-hosted by the Asia- Pacific Business Association, the Mongolian Foreign Investments and Foreign Trade Agency and the Mineral and Oils Authority discussed the German and Mongolian mining relationship. Representatives of Mongolia's mining sector, including Erdenet, Mongol Alt and Ivanhoe Mines, discussed the industry's current situation with more than 30 German business officials from the banking, mining, and business sector.

According to Montsame Press, the meeting was deemed a success, and "was important in fostering Mongolian-German cooperation and increasing investments".

On the afternoon of 21 August the German business group and the Mongolian Minerals Industry met at the Monnis Showroom in Ulaanbaatar. The aim of the meeting was to introduce the delegates to one of Mongolia's most prominent business groups, the Monnis Company, a business group which already represents a number of large international firms including Nissan, Liebherr and Goodyear.

The German ambassador, the Hon P. Fisher, opened the meeting, while D. Ganbold, president of the Mongolian National Mining Association, H. Schneider, head of the German delegation, and B. Chuluunbaatar, president and CEO of Monnis International, also made statements.

While focusing on investing in Mongolia, or investing in Mongolian resources, E. Sodontogos, legal adviser to the president of the Mongolian National Mining Association, gave an open and frank presentation on the problems that face foreign investors in the Mongolian mining sector. She outlined the history of mining laws from the fall of socialism up to the recently introduced windfall tax controversy.

While the Mineral Law of 1997 made it, according to Sodontogos, one of the most liberal in Asia, more recent taxes and laws have made it increasingly difficult, not only for investors, but for the nation as a whole. Gold smuggling for example, she stated, has risen rapidly due to the windfall tax.

The German delegation, which included members from the Reichstag and a number of prominent residents, such as the recently appointed director of the International School of Ulaanbaatar, G. Rayl, and head of the Asia Foundation, William Infante, spent the rest of the evening at a social dinner discussing the presentation and the prospect of further German investment.

The following morning, the group flew to the Gobi to view mining sites and continue the business tour.

Originally published by The UB Post website, Ulaanbaatar, in English 28 Aug 08.

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