The first discussion of the bill on overcoming economic hardships and a plan for stabilization was held by Parliament on November 25.
Minister of Finance B.Choijilsuren, Chair of the Financial Regulatory Commission (FRC) S.Davaasuren, and working groups from the Ministry of Finance and Mongol Bank participated in the discussion.
Members of Parliament asked if the country’s credit rating will improve, if unemployment rates will decrease, and if investment will increase if the bill is passed.
During the session, Finance Minister B.Choijilsuren pushed for a “national cost cutting agenda”, which he said could raise the current Moody’s rating of Caa1 by two ratings if implemented. Reporting that the unemployment rate was at 10.4 percent as of June 2016, the Minister said that the agenda would cut unemployment by three percent, to make the rate seven percent.
MPs and parliamentary working groups submitted proposals during the discussion. Head of the Economic Standing Committee D.Terbishdavga proposed a short-term action plan to create part-time jobs and offer training courses to people who have registered as unemployed. There was also a proposal to facilitate short-term employment abroad.
Of the proposals submitted by MPs and working group members, 38 of them were voted down. A proposal to change the name of the bill to “Agenda for Reviving the Economy” was largely supported. A proposal to regulate the implementation of the bill by holding officials accountable and requiring that they report their progress to Parliament every six months was supported by the majority, and the responsibility for reporting was delegated to the government, Mongol Bank, and the FRC. Proposals to improve budgetary discipline, diversify the state’s sources of revenue, and to shift towards a cost cutting standard were also supported by the majority.
The participants voted on a wide variety of proposals addressing different topics and sectors. These included supporting SMEs with tax breaks and loans; improving legislation regarding the banking sector, specifically regarding the operations of foreign banks; supporting domestic manufacturing; supporting agricultural businesses; improving livestock health; and improving the export of animal products. All of these proposals were supported by the majority.
Near the end of the session, proposals rejected by the Economic Standing Committee were voted on. Proposals to continue Tavan Tolgoi mining operations, to build the 450 megawatt Tavan Tolgoi power station, to expand Thermal Power Plant III by 250 megawatts, and to expand Choibalsan Thermal Power Plant by 50 megawatts were all passed. The expansion of development around the new Khushig Valley International Airport was also supported.
The bill was transferred to the Economic Standing Committee to be prepared for a final discussion by Parliament.