S.Narantsogt,  Executive Director of Erdenes Mongolia LLC:  Implementing large-scale mineral and industrial projects in cooperation with Germany

The Mongolian Mining Journal /Jun.2023/

A.Khaliun

The 9th meeting of the Mongolian-German Economic Committee was held in Ulaanbaatar on June 5, 2023. It  was chaired by S. Narantsogt, executive director of Erdenes Mongolia LLC. The head of the German side of the committee was Hans-Christoph Brumberg, director of the Asia region and CEO of WPD LLC which works in the field of design, financing and development of renewable energy projects.
Representatives of the private sector of the two countries exchanged their views on opportunities for business cooperation.
S. Narantsogt, Executive Director of Erdenes Mongolia LLC, spoke about the issues discussed and outcomes from the meeting.

What is the role of the Mongolian-German Economic Committee?
Representatives of the Mongolian-German Economic Committee meeting have a goal to strengthen  cooperation between the two countries. The Agreement between the Government of Mongolia and the Government of the Federal Republic of Germany “On Cooperation in Minerals, Industry and Technology Sectors” was first signed in October 2011.
The Economic Committee plays an important role in implementing the bilateral agreement by connecting Mongolian-German business people, opening doors to joint projects and programs, presenting the policies of the two governments to business people, strengthening the economy and relations between citizens of the two countries.

What is the level of economic cooperation between the two countries?
Mongolia established diplomatic relations with Germany in 1974 and next will mark its 50th anniversary. 
After the COVID pandemic, trade, and economic cooperation between the two countries was restored and, by 2022, trade reached $208 million. Of these, exports reached $26.0 million and imports reached $182.8 million. Mongolia mainly exported food and agricultural products, and imported technical equipment, food, and oil products from Germany.
Cooperation between the two countries is rapidly developing in many sectors such as defense, education, culture, environment, and in the humanitarian sphere.

What issues were discussed at this 9th meeting?
More than 80 participants representing 40 entities from the mineral, renewable energy, transportation, logistics, and education sectors attended and exchanged views on developing mutual cooperation. Private businesses and entities from both countries also gave detailed information about their planned projects and programs, and state and government organizations made presentations on policy and legal reforms.

In which areas of the economy has Mongolia expressed interest in cooperating with Germany?
Mongolia made concrete proposals for cooperation in the minerals, renewable energy, education, transportation and logistics sectors. It was stressed that supporting German investments in the exploration, extraction and processing of important metals and rare earth elements and creating a stable supply from Mongolia is a priority for cooperation between the two countries.

The two countries have ample opportunities for the joint implementation of large-scale projects in the mineral and industrial sectors. For example, iron ore processing and the development of high-quality steel production are possible. In addition, they discussed the possibility of increasing the investment of German companies in the introduction of a conveyor system for earth excavation and extraction of minerals in open pits. They expressed interest in cooperation on a detailed strategic plan for joint research, exploration, mining, and enrichment of certain important metals and rare earth elements. 

How are you going to cooperate in the field of renewable energy?
As a part of cooperation in the renewable energy sector, we believe it is appropriate to submit the following proposal to the intergovernmental working group to remove obstacles to the wind farm project, which has been under discussion for many years.
On one hand, it is necessary that the parties have a good understanding of the provisions of the wind farm contract.

In addition, conditions will be created for wind power plants with German private sector investment to generate electricity without fluctuations. Also, during discussion of the results of this meeting, it was mentioned that the government will pay for the introduction of high technology.

How is the state going to resolve the problems of costly renewable energy production?
The government needs to concentrate the payments collected from consumers in a special account or fund and use the accumulated funds only to solve the problems of renewable energy production, improve the system and support the use of renewable energy. In the future, if a new renewable energy plant is built, it is advisable to adopt technological standards and requirements for the construction of a power plant with energy storage using both solar and wind energy and ensure the implementation of these standards.

What are the possibilities of cooperation with Germany in the education sector?
As part of a support for companies investing in and operating in the mining and renewable energy sectors, it is possible to improve the facilities of training and research laboratories at Mongolian universities and colleges and to support the creation of specialized training programs. In particular, the two sides agreed to diversify and develop the activities of the joint German-Mongolian Institute for Resources and Technology located in the Nalaikh district in the direction of vocational training.

In addition, the respective institutions of both sides will cooperate to create opportunities for students studying in Germany and students of the joint German-Mongolian Institute for Resources and Technology to work and practice in enterprises and organizations with German investment operating in Mongolia.

Germany proposed to cooperate in the aviation sector of our country. What was the proposal?
Mongolia has a vast territory, and the German side suggested the possibility of developing general civil aviation and providing low-cost flight services with small planes. Since this is important for the development of mining and tourism, the two sides agreed during the talks that the civil aviation authorities of the two countries should work together and develop concrete proposals in a short time.

Finally, I would like to conclude that the 9th session of the Mongolian-German Economic Committee was very productive, with the enterprises and private sector organizations of the two countries presenting  new proposals and initiatives for cooperation, and  participants working  to find solutions to existing difficulties.