Mongolia : Agriculture and Rural Development Project

Sovereign Project | 39229-022

The Project will develop value chains to deliver unique premium value products to niche markets. The Project will deliver these outputs through three components: (i) value-chain development under which it will establish a deposit account to guarantee 50% of the total amount of loans made by private commercial banks to agribusiness enterprises for value-chain development investment plans (selected by the bank from among a group of prequalified plans with high public goods elements), (ii) a local grant and infrastructure development facility to develop rural infrastructure and services, and (iii) project management. In a break with traditional approaches, the Project will provide private enterprises with resources to undertake value-chain investments that have typically been undertaken by public agencies.

Flickr photos from the 39229-022: Agriculture and Rural Development Project in Mongolia album.

Project Details

  • Project Officer
    Hinrichs, Jan F.
    East Asia Department
    Request for information
  • Country/Economy
    Mongolia
  • Sector
    • Agriculture, natural resources and rural development

Related Projects

Project Name
Agriculture and Rural Development Project
Project Number
39229-022
Country / Economy
  • Mongolia
Project Status
Closed
Project Type / Modality of Assistance
  • Grant
  • Loan
  • Technical Assistance
Source of Funding / Amount
Grant 0115-MON: Agriculture and Rural Development Project
Source Amount
Asian Development Fund US$ 14.72 million
TA 7139-MON: Agricultural Marketing and Brand Development
Source Amount
Japan Special Fund US$ 2.00 million
Loan 3287-MON: Agriculture and Rural Development Project - Additional Financing
Source Amount
Ordinary capital resources US$ 35.00 million
Loan 3288-MON: Agriculture and Rural Development Project - Additional Financing
Source Amount
Asian Development Fund US$ 15.00 million
TA 8960-MON: Supporting Agriculture Value Chain
Source Amount
Japan Fund for Prosperous and Resilient Asia and the Pacific US$ 2.00 million
Strategic Agendas
  • Inclusive economic growth
Drivers of Change
  • Gender Equity and Mainstreaming
  • Private sector development
Sector / Subsector
  • Agriculture, natural resources and rural development / Agricultural production - Agro-industry, marketing, and trade - Livestock

Gender
Effective gender mainstreaming
Description
The Project will develop value chains to deliver unique premium value products to niche markets. The Project will deliver these outputs through three components: (i) value-chain development under which it will establish a deposit account to guarantee 50% of the total amount of loans made by private commercial banks to agribusiness enterprises for value-chain development investment plans (selected by the bank from among a group of prequalified plans with high public goods elements), (ii) a local grant and infrastructure development facility to develop rural infrastructure and services, and (iii) project management. In a break with traditional approaches, the Project will provide private enterprises with resources to undertake value-chain investments that have typically been undertaken by public agencies.
Project Rationale and Linkage to Country/Regional Strategy
Agribusiness development is essential for developing agriculture and improving rural incomes in Mongolia. While Mongolian agribusiness enterprises have little quality- or price-based comparative advantage in international markets, they do have a comparative advantage derived from the distinctive qualities of Mongolian agricultural products. This provides the basis for developing a brand that could command a premium in niche markets. However, realizing niche market potential will require comprehensive coordinated value-chain development. The Project will achieve this development by providing private enterprises with the resources to undertake investments in the value chain coordinated with investments in their own processing facilities.
Impact

Competitiveness of agriculture processing industry enhanced

Private sector-led employment generated

Small and medium-sized enterprises developed

Project Outcome

Description of Outcome

Value addition on Mongolian agricultural resources increased by PPEs

Progress Toward Outcome

Implementation Progress

Description of Project Outputs

VCIs financed

Production capacity of herders and farmers improved

(new; defined as a separate output from output 1 of the current project)

Enterprises' marketing and technical capacity improved

(new; defined as a separate output from output 2 of the current project)

Mongolian product brand(s) developed (redefined output 2 of the current project)

Status of Implementation Progress (Outputs, Activities, and Issues)

953 PPB staff (including Credit Guarantee Fund staff) are trained on finance, safeguards, gender, and monitoring by Q1 2020.

For PPEs' employees with a total of 3,668 person-times trainings, where female participants share is 48.9% provided. (Based on EA's project completion report)

As of 30 April 2021, a total of 58 VCIs have been financed. (Based on EA's project completion report)

As of 30 April 2021, due diligence of 66 VCI subprojects has been completed. (Based on EA's project completion report)

Completed

Completed

Completed

Completed

Completed. Potential PPEs were selected which are suitable for meeting and maintaining MNF levels of performance. Required technical trainings are in progress. Currently three PPEs were awarded MNF certification for final products and de-haired fibre. One of the above-mentioned PPEs signed a memorandum of understanding with their international partner during the MNF international forum.

Geographical Location
Nation-wide, Bayanhongor Aymag, Hovd Aymag, Selenge Aymag, Suhbaatar Aymag

Safeguard Categories

Environment
B
Involuntary Resettlement
C
Indigenous Peoples
B

Summary of Environmental and Social Aspects

Environmental Aspects
"Environmental impact assessment and monitoring and mitigation planning have not become yet regular practice in private business enterprises of Mongolia, although the country has relevant laws and legislations. The project management unit has been carrying out environmental due diligence of all value chain development subprojects of participating enterprises. The unit also provide capacity building to participating enterprises.
Involuntary Resettlement
Indigenous Peoples
"Indigenous people's imapct assessment, monitoring and mitigation planning have not become yet regular practice in Mongolia, although the country has relevant laws and legislations. The project management unit has been carrying out relevant due diligence of all value chain development subprojects of participating enterprises. The unit also provide capacity building to participating enterprises.

Stakeholder Communication, Participation, and Consultation

During Project Design
A participatory process was adopted during project design to understand the needs and constraints of stakeholders. Five stakeholder groups were identified and consulted during project preparation. Primary stakeholders include herders and changers; secondary stakeholders include staff from the local governor's office, representatives of nongovernment organizations, and local residents. Consultation consisted of an extensive participatory rural appraisal conducted in Bayankhongor, Hovd, Selenge, and Sukhbaatar aimags. During each of the field trips, participatory workshops were organized to identify stakeholders' interests, understand linkages between the major project participants, and develop a participation strategy during project preparation and implementation.
During Project Implementation
During project implementation, a participatory approach has been adopted to enable different stakeholders to be represented at the project steering committee and other project structures. To increase the exposure of the rural poor and vulnerable groups such as women and remote herders to the benefits of the Project, special care has been given to enhance their participation through intense dissemination activities and a focused awareness campaign by the project management units (PMUs).

Business Opportunities

Consulting Services
The Project will require 436 person-months of consulting services: 42 person-months international and 394 person-months national. All consultants will be selected and engaged in accordance with ADB's Guidelines on the Use of Consultants (2007, as amended from time to time). Technical experts will be recruited individually by the value-chain development PMU as requested by project enterprises to support enterprises in the implementation of their investment plans. Recruitment will be through a cost-sharing arrangement whereby enterprises requesting experts will bear 60% of the costs of engagement. The project manager, both project directors, and staff of both PMUs will be engaged individually. The remaining consultants will be recruited through firms under two packages (one package each for the value-chain development, and for the rural infrastructure and services development components) following quality- and cost-based selection procedures using an 80:20 quality:cost ratio.
Procurement
With the assistance of the value-chain development PMU, where applicable, project enterprises will be encouraged to follow ADB's Procurement Guidelines, Section 3.12 (2007, as amended from time to time), and undertake procurement in accordance with established commercial practices acceptable to the Government and ADB. To be acceptable, the enterprises will (i) demonstrate that procedures are appropriate in the circumstances; (ii) ensure that goods and services financed using project funds are purchased with consideration to economy and efficiency at a reasonable price, given time of delivery, quality, and efficiency; and (iii) ensure that goods and services to be financed by project funds are procured from ADB member countries. Enterprises will be encouraged to procure goods through international competitive bidding and shopping when applicable in the interest of economy and efficiency. The Government has agreed to use ADB procurement procedures with regard to economy and efficiency. The PMU will oversee procurement by enterprises to ensure that ADB guidelines are followed. In case of noncompliance, the Government will have the right to recall the loan to the violating enterprise. For all other procurement, contracts for goods and works estimated to cost $1.0 million or more will be procured using international competitive bidding. Contracts for goods and works estimated to cost less than $1.0 million but more than $100,000 will be procured through national competitive bidding in accordance with standard government procedures subject to modifications agreed with ADB. Contracts for goods and works estimated to cost $100,000 or less will be procured using shopping. Any necessary modifications or clarifications to the recipient procurement procedures will be documented in the procurement plan. The relevant sections of ADB's Anticorruption Policy (1998, as amended to date) will be included in all procurement documents and contracts.

Contact

Responsible ADB Officer
Hinrichs, Jan F.
Responsible ADB Department
East Asia Department
Responsible ADB Division
Environment, Natural Resources & Agriculture Division, EARD
Executing Agencies
Ministry of Finance (formerly Ministry of Finance and Economy)

Timetable

Concept Clearance
27 Oct 2005
Fact Finding
02 Jul 2007 to 06 Jul 2007
MRM
21 Sep 2007
Approval
29 Sep 2008
Last Review Mission
-
PDS Creation Date
01 Mar 2006
Last PDS Update
29 Apr 2022

Funding

Grant 0115-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
29 Sep 2008 24 Oct 2008 07 Jan 2009 31 Dec 2012 29 Feb 2016 13 Apr 2016
Financing Plan
  Total (Amount in US$ million)
Project Cost 24.72
ADB 14.72
Counterpart 10.00
Cofinancing 0.00
Grant Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 18 Aug 2023 14.72 0.00 100%
Cumulative Disbursements 18 Aug 2023 14.72 0.00 100%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory Satisfactory Satisfactory Satisfactory Satisfactory

Loan 3287-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
23 Sep 2015 28 Oct 2015 11 Jan 2016 30 Jun 2021 - 10 Jan 2022
Financing Plan
  Total (Amount in US$ million)
Project Cost 36.00
ADB 35.00
Counterpart 1.00
Cofinancing 0.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 18 Aug 2023 0.00 0.00 0%
Cumulative Disbursements 18 Aug 2023 0.00 0.00 0%

Loan 3288-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
23 Sep 2015 28 Oct 2015 11 Jan 2016 30 Jun 2021 - 10 Jan 2022
Financing Plan
  Total (Amount in US$ million)
Project Cost 15.00
ADB 15.00
Counterpart 0.00
Cofinancing 0.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 18 Aug 2023 0.00 0.00 0%
Cumulative Disbursements 18 Aug 2023 0.00 0.00 0%

TA 7139-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
29 Sep 2008 24 Oct 2008 24 Oct 2008 31 Dec 2010 31 Jul 2013 27 Dec 2013
Financing Plan/TA Utilization
ADB Cofinancing Counterpart Total
Gov Beneficiaries Project Sponsor Others
2,000,000.00 0.00 1,410,000.00 0.00 0.00 0.00 3,410,000.00
Cumulative Disbursements
Date Amount
18 Aug 2023 1,928,742.34
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory Satisfactory Satisfactory Satisfactory Satisfactory

TA 8960-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
23 Sep 2015 20 Oct 2015 20 Oct 2015 31 Mar 2019 30 Jun 2021 09 Sep 2021
Financing Plan/TA Utilization
ADB Cofinancing Counterpart Total
Gov Beneficiaries Project Sponsor Others
0.00 2,000,000.00 0.00 0.00 0.00 0.00 2,000,000.00
Cumulative Disbursements
Date Amount
18 Aug 2023 1,695,427.55
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory Satisfactory Satisfactory Satisfactory Satisfactory

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Title Document Type Document Date
Agriculture and Rural Development Project: Completion Report Project/Program Completion Reports Nov 2022
Agriculture and Rural Development Project - Additional Financing: Audited Project Financial Statements (January-December 2021) Audited Project Financial Statements Mar 2022
Agriculture and Rural Development Project - Additional Financing: Audited Project Financial Statements (January-December 2020) Audited Project Financial Statements Jul 2021
Agriculture and Rural Development Project - Additional Financing: Audited Project Financial Statements (January-December 2019) Audited Project Financial Statements Jun 2020
Amendment to the Loan Agreement (Special Operations) for Loan 3288)-MON: Agriculture and Rural Development Project (Additional Financing) Loan Agreement (Special Operations) Jan 2020
Agriculture and Rural Development Project - Additional Financing: Audited Project Financial Statements (January-December 2018) Audited Project Financial Statements Aug 2019
Agriculture and Rural Development Project - Additional Financing: Audited Project Financial Statements (January-December 2017) Audited Project Financial Statements Jun 2018
Agriculture and Rural Development Project - Additional Financing: Audited Project Financial Statements (January-December 2016) Audited Project Financial Statements Jun 2017
Loan Agreement (Ordinary Operations) for Loan 3287-MON: Agriculture and Rural Development Project - Additional Financing Loan Agreement (Ordinary Resources) Oct 2015
Loan Agreement (Special Operations) for Loan 3288-MON: Agriculture and Rural Development Project - Additional Financing Loan Agreement (Special Operations) Oct 2015
Agriculture and Rural Development Project (Additional Financing): Gender Action Plan Gender Action Plans Aug 2015
Agriculture and Rural Development Project (Additional Financing): Project Administration Manual Project/Program Administration Manual Aug 2015
Agriculture and Rural Development Project (Additional Financing): Report and Recommendation of the President Reports and Recommendations of the President Aug 2015
Хөдөө аж ахуй, хөдөөгийн хөгжлийн төсөл – Нэмэлт санхүүжилт : Төслийн Мэдээллийн Тайлан Translated PDS Jan 2015
Agricultural Marketing and Brand Development TA Completion Reports Jun 2014
Agriculture and Rural Development Project Procurement Plans Sep 2013
Agricultural Marketing and Brand Development: SOFRECO Completion Report Consultants' Reports Jul 2013
Agricultural Marketing and Brand Development: SOFRECO Completion Report Consultants' Reports Jul 2013
Agriculture and Rural Development Project Project/Program Administration Manual Mar 2009
Grant Agreement for Agriculture and Rural Development Project between Mongolia and ADB dated 24 October 2008 Grant Agreement Oct 2008
Proposed Asian Development Fund Grant and Technical Assistance Grant Mongolia: Agriculture and Rural Development Project Procurement Plans Aug 2008
Proposed Asian Development Fund Grant and Technical Assistance Grant Mongolia: Agriculture and Rural Development Project Reports and Recommendations of the President Aug 2008

Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Title Document Type Document Date
Agriculture and Rural Development Project – Additional Financing: Social Monitoring Report (January-December 2020) Social Monitoring Reports Jun 2021
Agriculture and Rural Development Project - Additional Financing: Environmental Monitoring Report (January-December 2020) Environmental Monitoring Reports May 2021
Agriculture and Rural Development Project -Additional Financing: Environmental Monitoring Report (January-December 2019) Environmental Monitoring Reports Jun 2020
Agriculture and Rural Development Project – Additional Financing: Social Monitoring Report (January-December 2019) Social Monitoring Reports Jun 2020
Agriculture and Rural Development Project – Additional Financing: Environmental Monitoring Report (July-December 2018) Environmental Monitoring Reports Jun 2019
Agriculture and Rural Development Project – Additional Financing: Social Monitoring Report (January-December 2017) Social Monitoring Reports Jan 2019
Agriculture and Rural Development Project -Additional Financing: Environment Monitoring Report (January-December 2017) Environmental Monitoring Reports Dec 2018
Agriculture and Rural Development Project: Environmental Assessment and Review Framework (2018) Environmental Assessment and Review Framework Aug 2018
Agriculture and Rural Development Project - Additional Financing: Environmental Monitoring Report (January-December 2016) Environmental Monitoring Reports Jul 2018
Agriculture and Rural Development Project: Environmental Monitoring Report (January 2014-October 2015) Environmental Monitoring Reports Dec 2015
Agriculture and Rural Development Project: Environmental Assessment and Review Framework (2015) Environmental Assessment and Review Framework Aug 2015
Agriculture and Rural Development Project: Environmental Monitoring Report (January-December 2013) Environmental Monitoring Reports Feb 2014
Agriculture and Rural Development Project: Environmental Monitoring Report (January-December 2012) Environmental Monitoring Reports Feb 2013
Additional Financing of Agriculture and Rural Development Project: Environmental Assessment and Review Framework Environmental Assessment and Review Framework Sep 2012
Additional Financing of Agriculture and Rural Development Project: Indigenous Peoples Planning Framework Indigenous Peoples Planning Frameworks/Indigenous Peoples Development Frameworks Sep 2012
Agriculture and Rural Development Project: Environmental Monitoring Report (August 2010-December 2011) Environmental Monitoring Reports Feb 2012
Agriculture and Rural Development Project: Summary Initial Environmental Examination Initial Environmental Examination Nov 2007

Evaluation Documents See also: Independent Evaluation

Title Document Type Document Date
Mongolia: Agriculture and Rural Development Project Validations of Project Completion Reports Dec 2023

Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

No tenders for this project were found.

Contracts Awarded

No contracts awarded for this project were found

Procurement Plan