Overview of Australia's aid program to Mongolia

How we are helping

2015-16 Total Australian ODA Estimated Outcome
$10.5 million

2016-17 Bilateral Budget Estimate
$5.9 million

2016-17 Total Australian ODA Estimate
$10.0 million

The Australian Government will provide an estimated $10.0 million in total ODA to Mongolia in 2016-17. This will include an estimated $5.9 million in bilateral funding to Mongolia managed by DFAT.

Mongolia’s economic growth has followed the commodity cycle, driven by the rise and fall of mineral prices and private sector led investment in the mining sector. The mining sector now accounts for almost 20% of GDP and the majority of exports and, if managed well, is central to the country’s goals to reduce poverty. Australia’s aid 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 has consolidated to assist two sectors—human resource development and the extractives sector. The aid program engagement on governance and the investment climate can improve the speed and focus of large commercial decisions that are worth many times the aid input. Transparent and predictable regulation benefits Australian business investments and is relevant to both Governments’ focus on aid for trade to deliver prosperity by catalysing private investment.

Australia has two aid 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

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 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 stronger, as evidenced by the opening of Australia’s new embassy in Ulaanbaatar in December 2015.
  2. In a reduced budget environment the Australia Awards Mongolia program continues to support approximately 57 Mongolians studying in Australia, a Women's Leadership Program, and the activities of alumni, through the ‘Mozzies’ association.
  3. The Australia Mongolia Extractives Program (AMEP) commenced in 2015 and is 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. 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. In partnership with the World Bank, we are piloting new institutional structures for groundwater management in three provincial capitals and strengthening the Mongolian Water Authority’s ability to monitor groundwater.
  6. 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.
  7. The Australian Centre for International Agricultural Research project on grassland management in Mongolia and China is working to improve livelihoods for herders.

Our changing program

The development cooperation program has consolidated assistance to the education and extractives sectors. Within the extractives sector the focus of our assistance is improving the management and regulation of the sector through governance reforms which in turn will lead to improved business and investment climates.

The Scholarships program will offer approximately 27 scholarships in 2016-17 for Mongolians to start post-graduate study in Australia, and will aim to gradually increase the number of new scholarships over the next few years.

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: 17 October 2016