Mongolia : Sustainable Tourism Development Project

Agriculture, natural resources and rural development / Rural sanitation - Rural solid waste management - Water-based natural resources management

Industry and trade / Trade and services

Tourism is the largest and fastest growing sector of the global economy. Ecotourism is estimated to comprise 7% to 20% of global tourism, and in many countries is a major contributor for the financing of protected areas and income for rural communities. Mongolia has a small but rapidly growing tourism sector. In 2017, tourism comprised 3.1% of Mongolia's gross domestic product (GDP), and generated US$330 million, 2.9% of total employment, and 34,000 jobs. By 2028, tourism is forecast to comprise 11% (US$1.72 billion) of adjusted GDP and to provide 48,000 jobs. International visitor arrivals in 2017 were 471,239, and by 2028 are forecast to increase to 1.02 million. Development of the tourism sector is accorded a high national priority to diversify the economy and create jobs, especially under Mongolia's current economic difficulties. Government plans to expand tourism are focused on the country's large network of protected areas, which encompasses 21% of Mongolia's area and which is targeted to reach 30% by 2030.

Despite these intentions, Mongolia ranks low in the World Travel & Tourism Competitiveness Index. Challenges include low service standards, inadequate infrastructure, and a short tourism season due to harsh winters. Most protected areas are under-funded and located in remote regions of high poverty. Tourism, if unmanaged, may also result in ecological and cultural impacts and provide few local benefits. To address these issues, the government has initiated the National Program on Tourism Development (2016 2030), which aims to establish Mongolia as a global destination for nomadic culture. The program outlines a multi-sector approach for investment in visitor facilities, transport and sanitation infrastructure, and community-based products and services. National tourism service standards are being improved and regional feasibility studies for tourism development are underway. Five protected areas are listed for ecotourism development, of which two are designated the highest priority: Khuvsgul Lake National Park (KLNP) in Khuvsgul aimag and Onon-Balj National Park (OBNP) in Khentii aimag.

The KLNP (1.2 million hectares [ha]) and OBNP (0.42 million ha) are the largest national parks in northern and eastern Mongolia. The KLNP is characterized by Khuvsgul Lake, the largest freshwater resource in Mongolia; the OBNP is the documented birthplace of Chinggis Khaan, a historical leader revered in Mongolia. Both parks support global biodiversity values, are remote, and share transboundary river basins with the Russian Federation. Both support small rural populations with some of the highest poverty rates in Mongolia. Despite these similarities, the parks are in very different stages of tourism development. In 2017, the KLNP received 89,652 visitors and the OBNP received 6,696. The KLNP has experienced large increases in visitor numbers since 2010, due to improved road and air access from the national capital (Ulaanbaatar), and is now the third most visited destination in Mongolia. The OBNP has limited road and no air access and requires long travel times from the capital. At both parks, most (99%) of arrivals occur within a three-month period (June to August; peak summer season). Projections indicate that by 2038, visitor numbers will have increased to about 293,791 per year at the KLNP and 162,390 per year at the OBNP. For the OBNP, a national road to the park will be constructed in 2020 and is expected to result in an increase in visitor numbers of about 30,226 by 2024.

The KLNP and OBNP reflect the challenges faced to achieve sustainable tourism in Mongolia's protected areas. At the KLNP, improved road access has resulted in severe over-crowding and impacts to natural resources, and there is a need to manage tourism. At the OBNP, similar trends are expected following improved access, and there is a need to avoid such impacts, through planning based on the experiences at the KLNP. For both parks, the development of sustainable tourism requires addressing four key areas, through measures tailored to the specific conditions of each park: (i) inclusive planning and benefits for communities; (ii) enabling infrastructure; (iii) improved waste management; and (iv) improved park management.