With the economic development community stuck at home, fDi is reaching out to professionals on the FDI frontline as they grapple with the biggest global challenge in recent history.
Despite Mongolia’s close proximity to China, its low population density has helped it limit the spread of Covid-19 and it adopted preventive measures early in the crisis. Nonetheless, the slump in demand for key commodities has serious implications for the mineral-rich country. Undrakh Bold from InvestMongolia outlines her team’s survival strategy.
Q: How have the past few weeks been for you and your team?
A: During these challenging times, our investment team has been working remotely and switched to digital communication with investors.
Q. How vital is communication with internal and external stakeholders during the crisis?
A: InvestMongolia will need to further adopt technology to remain competitive and to optimise our performance. We have been creating digital aftercare services for existing investors. Aftercare is one of the most important roles of our agency, especially during the current pandemic. We are providing information via email and our website on the new Covid-19 related measures enacted by our government.
Q: Mongolia is reliant on mineral exports, but commodity prices have collapsed. How has this affected the country’s investment proposition?
A: The economic slowdown will reduce demand for raw materials and hit our exports of coal, copper, iron ore, zinc and crude oil, thus slowing down Mongolia’s growth further. The risks to our domestic economy are clear. The revenues of mining companies will decline, dragging down the fiscal revenues they generate for the budget.
Therefore, necessary monetary and macroprudential policy measures are being implemented to address the difficulties triggered by the disease and support economic activities. The country’s Monetary Policy Committee decided on lowering the policy interest rates to stimulate economic growth and extending the maturity on consumer loans of up to 12 months for borrowers experiencing difficulties.
Q: Is the government and InvestMongolia considering economic diversification? What might that look like?
A: In contrast to the virus’s debilitating impact on personal services, the pandemic has handed a windfall opportunity to services powered by information and communication technology (ICT), triggering the rapid growth of services that do not require face-to-face interaction such as, data-based, e-payment services, teleworking, video streaming, gaming and e-commerce platforms.
Q. What do you see in the mid-to-long-term?
It is hard to say how long this is likely to last. We are seeing a significant decrease in new investors’ inquiries during these challenging times. We are being proactive in finding ways to continue to service them. Like with any other crises, this one will eventually end, but the outbreak of Covid-19 will inevitably have a deep impact on our world and trigger shifts in political and economic power. We need to look forward and prepare for the post-Covid-19 period.
Undrakh Bold works at InvestMongolia, the country's national investment promotion agency.
You can find the full archive of the fDi’s Virus Diaries series at the following link. If you work in economic development or investment promotion and want to share your experience in dealing with the coronavirus, get in touch at fDi@ft.com.