How we are helping
2014/15 Budget Estimate:
A stable and prosperous Mongolia is in Australia’s national interest, and our aid program promotes a well-governed, economically-resilient and equitable Mongolia. Our areas of investment are where Australia has a comparative advantage and are aligned with the development objectives identified by the Government of Mongolia. Mongolia is a major destination for Australian foreign investment, particularly in its fledgling mining sector. Australia has significant commercial interests with over 50 Australian companies operating in Mongolia. Australia’s investments draw on our strengths as a mining nation and the strong people-to-people links built over time through our scholarships and volunteers programs. Australia is one of the largest grant aid donors to Mongolia.
Mongolia has experienced relatively strong economic growth for the past decade due to high-level foreign investment in its mining industry. However, growth is now slowing and occurring in a climate of high inflation and where governance and accountability is weak. Heavy reliance on the mining sector makes the economy vulnerable to global resource-price fluctuations and financial shocks. There are concerns about the environmental and social impacts of mining. Social and economic inequality is a risk to long-term growth and stability. Approximately one-third of the population lives below the national poverty line, with rural poverty much higher than urban poverty. Access to water, sanitation, and quality education are serious problems, particularly in rural areas and for the approximately 500,000 people living in the urban slums (‘ger’ districts) that surround the capital Ulaanbaatar. As a landlocked nation with a small, dispersed population, Mongolia is also disadvantaged by its severe weather conditions and an increasingly degraded natural environment.
The current Mongolia Country Strategy has three pillars: Human Resource Development; Extractives; and Supporting Vulnerable Communities. In 2013–14, the bilateral program supported these pillars through three main programs: the long-standing Australia Awards Mongolia scholarships program; the World-Bank-led Groundwater Management project; and the UNICEF-led Water, Sanitation and Hygiene (WASH) project. From 2015, the new Aid Investment Plan for Mongolia will focus on the sectors where Australia has a strong track record, while ensuring alignment with the priorities of the new Australian aid policy.
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
- Improving the access of school children to clean water and sanitation facilities in partnership with UNICEF.
Read more about our education assistance to Mongolia
The mining sector has propelled Mongolia to lower-middle income country status. A well-governed, environmentally and socially responsible mining sector can reduce poverty and promote equitable economic growth. Australia’s significant expertise and experience is helping promote a more stable regulatory environment in the mining sector.
Read more about our governance assistance to Mongolia
- The bilateral relationship with Mongolia has strengthened. March 2014 saw the first visit to Australia by a Mongolia Foreign Minister in over 20 years. Foreign Minister Luvsanvandan Bold announced with Foreign Minister Bishop the Australia-Mongolia Extractives Program (AMEP) and an increase in the annual Australia Awards Mongolia (AAM) scholarships from 38 to 43.
- Implementation of the redesigned Australia Awards Mongolia program since July 2013 is showing promising results from the new features of the program—such as new priority study areas, new activities to support alumni and women’s professional development, and a focus on targeting provincial candidates.
- The most significant development in 2013–14 is the finalisation of the Australia Mongolia Extractives Program (AMEP) design and tender selection. AMEP represents a concrete escalation in Australia’s engagement with Mongolia. It will help Mongolia progress towards equitable and sustainable economic growth of its extractives sector.