May 1, 2006｜Russia & Mongolia
Director General, Trade and Economic Cooperation Policy and Coordination Department, Ministry of Industry and Trade of Mongolia
In 2005, trade with Russia accounted for 19.3% of total trade turnover in Mongolia, representing a decrease of 3.9% from the 2000 level of 23.2%. Mongolia imported 127 types of product in 2005, at a value of $400 million. Oil products accounted for 75% of imports, machinery for 9.9%, food products for 7.2%, chemicals for 2.5%, electricity for 1.6%, and construction materials, shoes, clothes and other industrial products accounted for the remaining 3%.
In 2005, Mongolian imports from Russia increased by 16.9% on the previous year and by 93.9% compared with 2000. In 2005, Mongolia exported 34 types of product to Russia, at a total value of $26.4 million. 77.4% of these exports was accounted for by mining products, with meat accounting for 18.7% and raw materials of animal origin for 3.9%.
According to statistics for the last five years, Mongolia has had a trade deficit with Russia. The gap in the trade balance grew to $374 million in 2005, 2.3 times higher than in 2000; this was caused by a fall in the quantity of exports and an increase in the price of imports from Russia on the world market.
Russia invested $33.7 million in 18 Mongolian sectors between 1991 and 2005. 27.2% was invested in geological research, 15.5% in construction, 12.3% in the financial sector, 9.7% in the food industrial sector, 6.5% in transport, and 6.3% in the industrial and public food sectors. Of the 376 Russian-invested companies in Mongolia, 86 are active in the trade and public food sectors, 52 in the processing sector, 46 in the geology sector, 33 in the food industrial sector, and 20 in the transport sector.
Some of the tariff and non-tariff barriers existing in trade between the two countries are as follows:
Both sides place great importance on tariff negotiations concerning Russia’s accession to the WTO, an agreement on which was signed in October 2005, and consider that this would be effective in promoting trade and economic relations between the two countries on a new level. It is in the interests of both sides that this is achieved and we are making an effort to implement a medium-term program for developing cooperation between the two countries in the area of trade and the economy. The objective of this medium-term program is to increase Mongolian trade with Russia to $1 billion by 2010; accordingly, the two sides are discussing the following measures to realize this goal:
The two sides will work on achieving these measures step by step and aim to settle the medium-term program for developing trade and economic cooperation between Mongolia and Russia by the end of 2006.
[Translated by ERINA]