Principal Deputy Assistant Secretary of Commerce For
Market Access and Compliance
15th Annual NAMBC Investors Conference
Kempinski Khan Palance Hotel
October 16, 2012
As prepared for delivery.
Good evening ladies and gentlemen!
It is an honor and great pleasure to speak at the opening of the North America-Mongolia Business Council’s 15th Annual Investors Conference. On behalf of the U.S. Department of Commerce, I would like to thank Mr. Saunders and the North America-Mongolia Business Council for organizing this important event every year, which has been extremely valuable in strengthening commercial ties between the United States and Mongolia. I applaud your contribution in helping to build a stronger bridge between our two countries and express my sincere appreciation to you for having me here today.
As Ambassador Campbell noted, this year’s Annual Conference coincides with the 25th Anniversary of diplomatic relations between the United States and Mongolia. During this quarter of a century, our relationship has developed steadily on all fronts – political, economic, military, educational, and cultural.
25 years ago, trade between the United States and Mongolia was virtually non-existent. Today, our bilateral trade exceeds half a billion dollars, with U.S. exports to Mongolia amounting to over $525 million as of August of this year. This is not a small achievement in 25 years.
25 years of U.S.-Mongolia bilateral relations closely parallels with Mongolia’s journey from dramatic transition from a communist era economy to a market based economy. It has been a difficult transition, especially in economic terms, as Soviet aid disappeared almost in an instant, pushing the country into an unprecedented economic crisis. It took years for the country to recover from this crisis and transform itself. Mongolia proved that by embracing the road to democratic reforms and market economy, the country can overcome any obstacles.
During the early years of the transition, Mongolia heavily relied on foreign aid. The U.S. Agency for International Development (USAID)’s grant, amounting to over $220 million since 1991, was vital to bolstering democracy and economic growth in Mongolia, especially during the early years.
Today foreign investment and trade have superseded foreign aid in underpinning Mongolia’s economic development. For example, foreign direct investment that Mongolia received in 2000 amounted to less than $54 million, but within a decade, in 2010, that figure reached almost $1.5 billion. Most of this investment is inevitably tied to Mongolia’s mining sector, currently the most attractive sector for foreign investments and most important sector for Mongolia’s economic prosperity. Expansion of the mining industry is having a huge impact on the development of other sectors, including construction, tourism, information technology, and agriculture.
As the wealth of Mongolia’s mineral resources turned Mongolia into the fastest growing economy in the world, with an unprecedented 17.3 percent growth last year, our commercial ties have paralleled this impressive growth and have become deeper and stronger as more U.S. companies explore Mongolia for business opportunities. These companies bring world-class expertise, knowledge, products and technology to Mongolia.
We believe that Mongolia’s mineral riches can become bases for sustainable development and can put Mongolia on the road to economic prosperity if managed properly. Our goal is to see Mongolia achieve these goals by creating a transparent and predictable business environment, strengthening the rule of law, reducing corruption, and utilizing best international commercial practices.
As many of you know, the Commerce Department, the Department of State, and the U.S. Embassy in Ulaanbaatar have collectively been at the forefront of promoting and deepening our bilateral trade and economic relationship with Mongolia. We strive to build robust and sustainable commercial relations with Mongolia by helping strengthen Mongolia’s economy with sound business practices, while helping American companies compete on an equal playing field in this emerging market.
Since 2006 we have been organizing U.S.-Mongolia Business Forums to promote partnerships between U.S. and Mongolian businesses. These forums become an important tool to deepening our commercial ties. In 2008 with the support of the NAMBC, the Commerce Department and the U.S. Embassy in Ulaanbaatar organized the first ever U.S. trade mission to Mongolia. The signing of MOU on Trade and Economic Cooperation between the Commerce Department and the Ministry of Foreign Affairs and Trade of Mongolia in 2011 was an important milestone in reinforcing our commercial economic ties.
Again, it is an honor to represent the U.S. Department of Commerce at this event and share with you the U.S. views on our bilateral trade relationship, which the United States regards as a very important one.
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