Overview of Australia's aid program to Mongolia

How we are helping

2016-17 Total Australian ODA Estimated Outcome
$10.5 million

2017-18 Bilateral Budget Estimate
$5.9 million

2017-18 Total Australian ODA Estimate
$10.9 million

The Australian Government will provide an estimated $10.9 million in total ODA to Mongolia in 2017-18. This will include an estimated $5.9 million in bilateral funding to Mongolia.

Resource rich, strategically located and outward-looking, Mongolia is the world’s most sparsely populated country, with 3 million people spread over 1.5 million km2. The economy is driven by mineral resources, including copper, gold and coal, with mining providing about 17 per cent of GDP and the majority of exports.  Recent dampening of the global minerals market and moderating economic growth in China has reduced government revenue and affected growth in recent years.  As mining output increases and commodity prices improve, the mining sector, if managed well, is central to the country’s goals to increase economic growth and reduce poverty.

Australia’s development cooperation program aims to promote well-governed, efficient public and private sectors that support Mongolian communities to benefit from resource-driven growth. Our areas of investment are where Australia has a comparative advantage and are aligned with the development objectives identified by the Government of Mongolia.

The rapid development of Mongolia’s mining sector places demands on human resources in the public and private sectors. Attracting and retaining skilled workers is a top priority for businesses, but Mongolia’s education system is not meeting the needs of a competitive economy.

For these reasons, the bilateral program provides assistance to two sectors—human resource development and the extractives sector. Focussing the aid program on governance and the investment climate can help improve the speed and attention of large commercial decisions that are worth many times the aid input. Transparent and predictable regulation benefits Australian business investments and is relevant to the objective of both governments to support prosperity by catalysing private investment.

Australia has two development cooperation objectives for Mongolia:

Objective 1: Mongolia’s government, civil society and private sector personnel have the skills and qualifications to deliver better services

Australia is promoting education opportunities for Mongolians by:

  • strengthening the capabilities of the Mongolian government and the private sector by providing postgraduate scholarship opportunities in Australia
  • strengthening the technical skills of young Mongolians in construction and mechanical engineering to provide skills relevant to industry needs.

Read more about our education assistance to Mongolia

Objective 2: Mongolians are benefitting from a well governed mining industry

The mining sector has propelled Mongolia to lower-middle income country status through the jobs and revenues that flow from large scale foreign direct investment. A well-governed, environmentally and socially responsible mining sector can reduce poverty and promote sustainable economic growth. Australia’s significant expertise and experience is helping promote a more stable and equitable regulatory environment in the mining sector, encouraging new activity and helping Mongolia to benefit.

Read more about our governance assistance to Mongolia

Our results

  1. Australia’s bilateral relationship with Mongolia continues to grow. In September 2017 we will mark the 45th anniversary of diplomatic relations.
  2. The Australia Awards Mongolia program supports approximately 66 Mongolians studying in Australia, a Women's Leadership Program, and the activities of alumni, through the Mongolia Australia Society (affectionately known as the ‘Mozzies Association’ in honour of its core group of members, the Mongolian Aussies).
  3. The Australia Mongolia Extractives Program (AMEP) is helping Mongolia progress towards equitable and sustainable economic growth of its mining industry by supporting improved governance and regulation by mining-related government agencies, in areas such as geoscience, gold industry regulation, safety regulations for open pit and other mines, mineral valuation and communications. Work has commenced on the establishment of a Geological Survey Agency. AMEP is helping Mongolia progress towards equitable and sustainable economic growth of its mining industry.
  4. A twinning arrangement to improve Technical and Vocational Education and Training between Melbourne Polytechnic and Dalanzadgad technical school in the South Gobi is piloting new competency-based training curricula, and assisting the Mongolian Ministry of Labour.
  5. Australian Volunteers for International Development in Mongolia are placed in sectors which align with both Australian and Mongolian Government development priorities, including human resource development, extractive industries, water and sanitation, and disaster risk reduction. Host organisations can be government agencies, local NGOs or INGOs and multilateral agencies.
  6. The Australian Centre for International Agricultural Research project on grassland management in Mongolia and China is working to improve livelihoods for herders.

Our forward program

The education and extractives sectors will continue to be the focus for Australia’s assistance. Within the extractives sector our focus is improving the management and regulation of the sector through governance reforms which in turn will lead to improved conditions for business and increased investment flows.

The Scholarships program will offer approximately 25 scholarships in 2017-18 for Mongolians to start post-graduate study in Australia.  Women now make-up approximately 70 per cent of Australia Awards graduates.

The Mongolia program will continue to integrate Australia’s aid, trade and foreign policy interests in Mongolia. Australia’s strengths as a mining nation and the strong people-to-people links through our scholarships and volunteers programs will help maintain the excellent cooperative relationship that we have built with Mongolia.

Last Updated: 9 May 2017