Saturday, June 30, 2012
International: Counting the Cost - Is Mongolia over-reliant on its resources?
This week on Counting the Cost Al Jazeera's Steve Chao travelled to Mongolia. Despite being surrounded by global powers such as China and Russia, Mongolia is no economic backwater. The vast country is rich in resources with deposits of coal, copper, and gold worth an estimated $1.3 trillion.
On the back of these resources the country saw over 13 per cent growth in 2011 and in the same year spending rose by 56 per cent. However big growth and spending inevitably sparks high inflation and Mongolia is no exception, with 11 per cent inflation in December.
So is it all too much, too fast? And is the Mongolian economy over-reliant on these natural resources? To answer these questions Counting the Cost spoke to Tsakhiagin Elbegdorj, the Mongolian president.
He says: "Most of our growth is actually coming from mining and we would like to make our economy like a rainbow-coloured economy, you know, now Mongolia's economy is mostly one colour and we would like to have more colours. Of course I have a message to foreign investors: Do not see Mongolia as a single mining business country, there are many opportunities... Mongolia can be a great hub between Russia and China in this region - an infrastructural hub, financial hub, high-tech hub, we have the potential."