Article 4, paragraph 4, of the Constitution of Mongolia stipulates that economic security is  “the Government regulates the economy in line with the national economical security, fulfill the social development of the population and economic entities”. Also, economic security is referred as the National Security component as defined in paragraph 3 of Article 3 of the National Security Law.

Our organization executes functions specified in Article 10, paragraph 10.10.4 of the Law on Intelligence organization “introduce information on issues related to ensuring the national security to relevant authorities and officials”, article 11 paragraph 11.1.3 of the same Law “prevent, detect and eliminate potential activities that might do serious damage to the economic security of the State”.  Mongolia's traditional threats to political and military policies are relatively weak and threats of non-traditional nature such as oil, gas, energy shortages, finance, capital markets crisis, religion and cultural influences.

Even though, to prevent the risks mentionned above, multipillar foreign policy is being pursued in the economic sector, domination of one country in investment sector, as well as dependance from two neighboring countries on issues such as import of food and oil and remains. The ongoing challenges of this sector are:

  • no full estimation of mineral resources, concentrate reserves and its contents,
  • taxes and commissions are not fully collected,
  • license permit, lack of government control over the use of toxic chemicals,
  • restrictions on illegal mining, lack of creation of jobs in other sectors,
  • damage to the environment.

Due to lack of State control over exports of minerals, absence of assessment of volume of goods, basic and accompanying elements, State budget faces deficit. The main reason of major damage to human health and environment are due to lack of control on illegal mining which use non technological methods. The use of toxic chemicals in the mining sector must be used according to technological standarts. 


In modern times, new centers of force are created in the international system, activating regional coalition associations and countering resource depletion and scarcity of raw materials. Developed countries, in addition to its growing demand for natural resources and mineral imports, have been pursuing a policy of investing and exploring mining, natural resources in developing countries. Our country, which is rich in natural resources, is capable of providing raw material not only to neighboring countries, but to others as well. It has the geographical advantage of accessing foreign markets by being in the middle of two big markets, Russia and China. This has created the interests of major global and multinational corporations in Mongolia.  

In Mongolia, the mining sector is one of the strategically important sectors and should contribute to the creation of capital resources needed for the development of other sectors of the economy. Today, the role of Mongolia's mining sector is growing constantly, which accounts for about 20 percent of GDP, 60 percent of industry sector and about 90 percent of total exports. About 20-30 percent of our country's total budget revenues come from copper and coal, which is highly risky due to its dependence of the world market. Therefore, the state budget should focus on raising revenue from the mining sector, allocating it efficiently, thereby increasing production and infrastructure, expanding the intellectual, financial and material basis.  

Experience from other countries shows that by developing the mining industry intensly there are many examples of economic downturn, poverty and ecological disasters, while others on the other hand reach high economic and standard of living for the people.


POSTED: 2019-10-24