Last week, the Cabinet held an irregular meeting to discuss the implementation and financing of the Good Shares program, a plan to buy back a portion of public shares of Erdenes Tavan Tolgoi.
Head of the General Authority for Social Allowance and Services Ts.Tuvaan reported that a total of 650,000 citizens out of 1.6 million people holding shares of Erdenes Tavan Tolgoi have submitted requests to commercial banks to sell a portion of their shares to the government. Ts.Tuvaan said that citizens who submitted their requests on June 13 will receive the first payment of 100,000 MNT for their 323 shares this week.
In order to finance the Good Shares program, the Cabinet released long-term (15 year) government bonds in the domestic market through several stages, and will repay the bond with dividends from state-owned shares of Erdenes Tavan Tolgoi .
The Cabinet says the government will purchase additional publicly owned shares when they are made available on the Mongolian Stock Exchange.
Some critics of the program have said in local media that the Cabinet is putting a burden on the state budget through the purchase of shares and that the Good Shares program is illegal.
Responding to the negative press, Minister of Finance B.Bolor addressed the public and said, “The media reports are inaccurate. They also report that the Cabinet is not able to finance its current expenses and will face difficulties in issuing salaries and pensions. I officially state that these media reports have no basis. Salaries, pensions, and other expenses are all being distributed in accordance with plans. There won’t be any difficulties in the future.”