ULAANBAATAR, MONGOLIA – The Asian Development Bank (ADB) and the Government today signed an agreement to help Mongolia address rising inequality among its people.
“Mongolia’s economic outlook is bright, with 12.3% GDP growth in 2012 and projected growth of around 15 % in 2013-214. But there is a risk that too much focus on mining sector development will lead to neglect of other parts of the economy, resulting in greater disparities in income and access to basic services,” said Claude Bodart, Principal Health Specialist at ADB’s Mongolian Resident Mission.
Mongolia’s mining sector is expected to boom but has benefited few Mongolians, as the sector creates relatively few jobs and high global mineral prices have led to increased inflationary pressures. Protecting people with low skills and income from the impact of high inflation and enabling their full participation in economic growth through greater employment and access to core public services are key issues that the Government of Mongolia is keen to challenge.
Under the agreement, ADB will provide $1 million through a grant from the Japan Fund for Poverty Reduction, which is administered by ADB, to help the government identify main causes of inequality and the constraints to reversing that.
Over the coming 27 months, the government will engage a wide range of public, private and civil society stakeholders in a participatory process to identify key constraints to inclusiveness of growth in Mongolia. Policy and program recommendations to address inclusive growth will feed into the Government’s socioeconomic development plans and assist the development of investment programs and strategies in priority sectors such as health, social security, vocational training, transportation and ger areas development to support inclusive growth.
To help formulate its policies to address inequality, the government will assess the international policies and practices that other resource rich countries used to promote inclusive growth. It will also study corporate social responsibility practices and implement a pilot project to match jobless welfare recipients in urban and rural areas with potential employers.