Will Mongolia catch up with Chile in 2030?
In line with a resolution from the 70th General Assembly of the United Nations in 2015, 193 member states have been implementing their own 2030 Agenda for Sustainable Development. Mongolia is one of them, and our parliament ratified the agenda for sustainable development on 2 February 2016.
The 2030 sustainable development goals include ending poverty, ending hunger, promoting health and well-being, supporting quality education, achieving gender equality, ensuring availability of drinking water and sanitation for all, introducing renewable energy, promoting economic growth and employment, building infrastructure, fostering innovation, reducing inequality, making cities and settlements inclusive, ensuring responsible consumption, mitigating climate change impacts, conserving marine resources, protecting terrestrial ecosystems, promoting peace and justice, and strengthening partnerships for development.
A total of 169 targets were set to achieve these goals, and every member state has been implementing their own programs to meet those targets. Last week journalists and civil society representatives gathered in the United Nations building in Ulaanbaatar, and discussed how Mongolia was tracking against its sustainable development targets. It was not a coincidence that this discussion took place on 28 September – the International Day for the Universal Access to Information. The reason is that sustainable development cannot be achieved without informed involvement from people.
During the discussion, Mongolia’s performance against each target was reviewed by one speaker, and I was offered to present my views on Target 8 – Economic growth.
If all goals and targets are achieved, Mongolia is envisioned to be among the leading middle-income countries based on per capita income by 2030, be a multi-sector stable economy, and a society dominated by middle and upper-middle income classes, preserve ecological balance, and have stable and democratic governance.
More specific goals include 1) Increase Gross National Income (GNI) per capita to 17,500 USD, 2) Ensure average annual economic growth of no less than 6.6 per cent through 2016-2030, 3) End poverty in all forms, 4) Reduce income inequality and have 80 per cent of the population in the middle and upper-middle income classes, 5) Increase the enrollment rate in primary and vocational education to 100 per cent, and establish a lifelong learning system, 6) Improve the living environment of the Mongolian people to lead a healthy and long life, and increase life expectancy to 78 years, 7) Be placed among the top 70 countries by the human development index, 8) Preserve ecological balance and be placed among the top 30 countries by the green economy index, 9) Be placed among the top 40 countries by the ease of doing business index, and among the top 70 countries by global competitiveness index, and 10) build professional, stable, and participative governance, free of corruption and adept at implementing development policies at all levels.
Everyone will enjoy a good livelihood if these targets are met. However, in order to do this, every one of us has to work hard and collaborate with each other effectively over the next 12 years. I have elaborated here on our macroeconomic reality and what we need to do. This is only one of the sustainable development targets, which are designed to address economic, societal, and environmental issues.
Are our aspirations realistic?
Let us look at two macroeconomic targets only. Is it realistic that our annual economic growth does not go below 6.6 per cent through 2030, and become an upper middle-income country by increasing our GNI per capita? Our Gross Domestic Product (GDP) is the total value of all goods and services produced in Mongolia. If you add to GDP the money transferred into the country by Mongolians abroad, we get our GNI.
Mongolia is aspiring to increase its 2014 GNI per capita of 4,166 USD to 17,500 USD by 2030. For comparison, Chile, which has a similar economy to Mongolia, had GDP per capita of 14,000 USD in 2016, while Korea and China’s GDP per capita were 27,000 USD and 8,000 USD respectively. According to the National Statistical Office, Mongolia’s population is projected to reach 4 million in 2031, which means the economy should grow to 70 billion USD. In other words, our 12.4-billion-USD economy in 2014 would grow by 500 per cent over the next 15 years. This aspiration might be realistic given Mongolia’s economy grew 10 times bigger in the 25 years after the 1990 revolution.
The realization of our aspirations is dependent on whether we can stop and get rid of corruption, which is a negative factor that has grown significantly following the dawn of the new millennium. Corruption is causing the loss of public property, misuse of the public budget, and suppression of free economic competition. Therefore it has to be stopped. Given that the government cannot provide oversight on itself, we – the people – need to take the lead in this fight against corruption.
Beate Trankmann, a United Nations representative in Mongolia, has recently said that the government needs to work with the private sector and should offer loan collateral to mitigate risks.
In order to ensure higher economic growth, Mongolia needs to dramatically improve public governance, bring stability into the government structure, and strengthen it as an institution. Furthermore, we have no choice but to support free economic competition by converting state-owned companies into public companies, freeing up prices, and removing monopolies.
We are facing the challenges to capitalize on information and technological advances, to prepare our youth for globally competitive industries, and to create a brand new economy by developing our brainpower.
Our economy will achieve diversity and gain competitiveness in a specific industry only when free economic competition is enabled in the right sectors. This is how Mongolia can become a leading middle-income country by 2030.
Translated by Amar.B