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    8 February 2011

    Re-issued as received

    UNIDO Study Outlines Strategic Directions for Industrial Policy in Mongolia

    VIENNA, 8 February (UN Information Service) - Proposing a policy that would help the Government of Mongolia turn its industrial development goals and projects into reality is the aim of a new report by the United Nations Industrial Development Organization (UNIDO) presented in Vienna today.

    The paper, Strategic Directions on Industrial Policy in Mongolia, is based on rigorous research assessing the performance of Mongolia's most important sectors: minerals, natural fibres and meat processing, as well as suggesting new areas of comparative advantage. It looks at the current characteristics of the manufacturing sector, its contribution to the overall economy, the prevailing macroeconomic and institutional circumstances of the country, and its performance relative to other countries at the same stage of development.

    "Mongolia is currently at a crucial juncture in its development process and key strategic decisions are being taken to ensure long-term sustained growth," said UNIDO Director-General, Kandeh K. Yumkella.

    "The Government of Mongolia is giving high priority to developing an industrial programme which would feature ambitious goals and involve developing a range of new industrial activities. To reach those goals and realize such ambitious projects, many obstacles will have to be overcome. Industrialization will play a leading role and UNIDO is pleased to accompany the country in this major endeavour. I am confident that this study will contribute to Mongolia's industrial policy-making process."

    Ambassador Jargalsaikhan Enkhsaikhan of Mongolia expressed gratitude to the Director-General and the UNIDO team for responding positively to the request of the Government of Mongolia for a substantial study.

    He said that UNIDO, in close consultation with Mongolian experts, has prepared this thorough report that assessed the overall situation in the industrial sector of Mongolia and has put forward some concrete practical recommendations that would help achieve the country's industrialization objectives. The Ambassador underlined that these recommendations would be highly useful when the country is blessed with a new opportunity to develop a diversified, dynamic and value-adding manufacturing industry by exploiting its rich mineral and livestock resources.

    The report points out that the diversification of Mongolia's manufacturing capacity is essential if it is to weather the shocks associated with the volatile minerals markets. Historical and current empirical evidence show that countries which produce and export manufactured products have experienced a more stable economic performance, especially if their products are in demand in high-income countries.

    The study combines analysis of long-term structural change with the role of an active industrial policy. It takes into account the contributions of policy-makers, entrepreneurs, academics, non-governmental and international organizations, and other stakeholders.

    The study suggests a strategy and a set of policies which aim to stimulate structural change into and within the manufacturing sector. Because of the importance of the mining sector for Mongolia's economy, the study also examines the options for moving from resource-based industries into higher value-added manufacturing activities.

    Ambassador Enkhsaikhan expressed satisfaction with the commitment of UNIDO in working together with Mongolia to create an economy based on diversified and value added industry.

    "If the findings of this report are used strategically, in 20 years Mongolia will have a much more diversified economy. The manufacturing industry will be a major driver of economic activity, with production taking place in modern, environmentally friendly and resource-efficient plants. This will mean high-quality employment opportunities and higher incomes," added Yumkella.

    The full report is available here:

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