Economic gloom.
In its November 2009 half-yearly update, the World Bank reports that as one of the world's low-income countries Mongolia has suffered worse than others of its kind where they are dependent on mining copper and gold due to the collapse of prices for these commodities.
Earlier GDP growth (2008) stood at 9%, falling drastically to 0.5% in 2009, with only a modest increase expected in 2010. The Report states that Mongolia has been one of the countries hardest hit in the whole of East Asia, due to its fiscal reliance on mining during the boom-years. High inflation - in 2008 the highest in East Asia - stood at 33.7% year-on-year, and interest rates leapt to almost 18% in some banks. Central Banks change of policies have to some extent remedied these extremes, but Mongolia has a similar situation to elsewhere in the world where loans to the private sector have come to a virtual standstill.
Unemployment rose steadily during 2009, and real effective incomes fell by as much as 60% for some due to continuing high inflation eroding the value of wages.
Its Report further states "Employment conditions are also becoming less favorable for informal workers in the rural regions, and herders and informal mining workers are barely able to cope with the decreasing job availability, falling wages and increasing living expenses."
The hardships facing herding communities is further revealed in a news article from the Mongolian Red Cross, reporting on the severe floods experienced in the capital Ulaanbaatar in July. UB's population growth is expanding at an alarming rate, largely due to poverty among rural communities forcing them to abandon herding. Half of Mongolia's population of 2.6 million are now living in UB, many in shanty ger-encampments on the city's outskirts and in often dire circumstances.
The Future
The World Bank Report on Mongolia concludes by saying "Protecting the poor during this downturn is a challenge, but can be achieved by starting to target the currently untargeted social grants (in particular, the Child Money Program). In the financial sector, the authorities should ensure stability by intensifying supervision and taking decisive action"
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In its November 2009 half-yearly update, the World Bank reports that as one of the world's low-income countries Mongolia has suffered worse than others of its kind where they are dependent on mining copper and gold due to the collapse of prices for these commodities.
Earlier GDP growth (2008) stood at 9%, falling drastically to 0.5% in 2009, with only a modest increase expected in 2010. The Report states that Mongolia has been one of the countries hardest hit in the whole of East Asia, due to its fiscal reliance on mining during the boom-years. High inflation - in 2008 the highest in East Asia - stood at 33.7% year-on-year, and interest rates leapt to almost 18% in some banks. Central Banks change of policies have to some extent remedied these extremes, but Mongolia has a similar situation to elsewhere in the world where loans to the private sector have come to a virtual standstill.
Unemployment rose steadily during 2009, and real effective incomes fell by as much as 60% for some due to continuing high inflation eroding the value of wages.
Its Report further states "Employment conditions are also becoming less favorable for informal workers in the rural regions, and herders and informal mining workers are barely able to cope with the decreasing job availability, falling wages and increasing living expenses."
The hardships facing herding communities is further revealed in a news article from the Mongolian Red Cross, reporting on the severe floods experienced in the capital Ulaanbaatar in July. UB's population growth is expanding at an alarming rate, largely due to poverty among rural communities forcing them to abandon herding. Half of Mongolia's population of 2.6 million are now living in UB, many in shanty ger-encampments on the city's outskirts and in often dire circumstances.
The Future
The World Bank Report on Mongolia concludes by saying "Protecting the poor during this downturn is a challenge, but can be achieved by starting to target the currently untargeted social grants (in particular, the Child Money Program). In the financial sector, the authorities should ensure stability by intensifying supervision and taking decisive action"
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