Recent data shows that the economy recorded 7.0% growth in Q4, up from Q3’s 6.9% reading. Booming exports underpinned the expansion, thanks to a tourism recovery and improved trade links with China, amid the opening of two new railway lines in the quarter. In addition, private and government consumption grew at strong rates, although fixed investment saw a small contraction. Turning to 2023, the seemingly rapid economic recovery in China bodes well for Mongolia’s external sector; China consumes over three quarters of Mongolia’s goods exports, and before the pandemic was the main source of tourist arrivals. However, the 2023 budget’s cautious fiscal stance could be constraining domestic demand. In other news, the government recently announced it would switch to selling coal via auction rather than by long-term contracts, in a bid to reduce corruption and boost revenue.
Mongolia International Reserves (months of imports) Data
| 2017 | 2018 | 2019 | 2020 | 2021 | |
|---|---|---|---|---|---|
| International Reserves (months of imports) | 8.3 | 7.2 | 8.7 | 10.4 | 7.7 |