The office of the President of Mongolia, Public Relations & Communications Division

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2012-02-04

The President of Mongolia Was Familiarized With the Progress of the “Shine Dornogobi” Project To Establish an Industrial Park

President of Mongolia Ts. Elbegdorj finished his working trip in Zamiin Uud and arrived in Sainshand, Dornogobi aimag, where he was met respectfully by the aimag authorities and a ceremonial guard.
Authorities of the Dornogobi aimag and organizations and entities that participate in the soum’s development met the President and other officials accompanying the President and provided them with updates on developments of the soum.

First, L.Ganhuyag, the aimags Governer, gave a speech about the aimag: “I am delighted to express a gratitude on behalf of Dornogobi Aimag for the visit by the President of Mongolia and representatives from the ministries who are in charge of the developments in our aimag. Dornogobi Aimag is implementing a big development project. Our aimag is located 456 km aways from Ulaanbaatar, has 14 soums, over 60000 residents, two border ports -- Zamiin Uud and Hang -- and 421 km of railroad that pass through the aimag’s territory. There are 460 km of paved road, 134 km of which was laid last year. The groundwork to build a 1100 km railroad has started, and the project to build 400 km railroad from Tavantolgoi to Sainshand is also moving ahead.




“Our aimag has a considerable amount of natural resources and is seeking to improve energy resources. The “New Dornogob” project is giving good results. The number of tax payers increased from 12000 in 2009 to 32000 in last year. Income has doubled compared to 2001. The domestic budget investment reached 5.1 billion tugriks in 2011. The number of animals is increasing. Job opportunities have increased as a result of the promotion of small and medium enterprises. There were 700 special licensees in 2008. In 2010-2011, the number of licenses reduced. Land reclamation in mining sites have reached 63%.”


From many project proposals, the government approved projects that were carried out. An Industrial Park will be built in Sainshand. A survey and soil work for the development of the railroad have started. The Aimag has allocated 3512 hectares of land to build the industrial park. Nature-friendly technologies are preferred for this big project.





The President mentioned: “I assume that Parliament has tackled issues such as mining product, the exchange of goods, and a 49% investment rate from foreign and domestic investors. The government should take care of the tax issue. We have a common conception for these undertakings.”



Ch. Khashchuluun , director of the National Development and Innovation Committee, informed the visitors on the implementation status of the “Sainshand Industrial Park” project.


He stated that “This is the second biggest national industrial park project after Erdenet. The budget for this project was allocated from the 2011 national budget. A partnership agreement was made with the American company Bechtel, a well-established international consulting company. The project is in the implementation stage. The landscape drafting was carried out in 6 months. The master plan was prepared in different versions by the chief consultant.”
“A Koks plant, a direct reduction iron plant, a coal gasification plant, a copper smelter, and a construction material factory are projected to be built for the industrial park. If the project is implemented successfully, the last plant will be put into operation in 2019.”

“When the industrial plant starts operating, it will create 12000 jobs. The number of mining workers will increase to 68000. A request to train additional engineers and technicians was sent to the Ministry of Education. Ten billion USD will be invested to establish the industrial park. To increase an ability to compete, we should a apply tax exemption.”
“The successful implementation of the industrial park project will bring many benefits, such as the transfer of new progressive technologies, an increased ability to compete, economic classification, the production of value-added end products to meet domestic demands and export of these products, resulting in a positive social and economic impact, the realization of prospective macroeconomic goals, economic growth acceleration, structural improvement in the economy, increase in employment opportunities, decentralization, an increase in the population’s income, and poverty reduction. We are seeking the support from the government to enact supporting law proposals.”



The President asked, “As the prior exploitation management, who is going to handle attracting investors for this project. Will NDIC manage this project in the future? What structure will be needed?”

The Director of the NDIC replied, “We assume that well-established domestic companies will be involved.”

“Local people might be thinking that they are lucky to be born in Dornogobi Aimag. Residents here should have a shared attitude that this project will be sustainable. Even big projects tend to stop because of subjective things. In order to avoid that, politics and private interests should not be involved. Exporting iron ore should be taxed. There is a water issue. 95% of the used water is recycled in Tavan Tolgoi. They are even planning to recycle 98% of the used water in the future. This is a good water-saving way that you should think about. It is also possible to haul UB’s used gray water to here.”


“Extracting and processing shouldn’t be handled by one entity. Erdenet is a big copper industry. But the Industrial Park in Dornogobi is the first and biggest industrial park in Mongolia that includes many various plants. There is an exit to foreign markets just 230 km away from here. We believe this exit to foreign markets to be the exit to the sea. The distance to Choir from here is 230 km, while the distance from Choir to UB is 240 km. I believe that this is the best location, and we all assume that this is the most important resolution made by the joint government.”

“I want to emphasize that Mongolia has to become a port for the mainland. Passenger and freight flights via Mongolia save five to six hours. Japanese scientists made the calculation that it is possible to fulfill 100% of human energy needs using renewable resources such as solar energy and harvesting the Gobi wind. We believe in our future generation and that they can successfully carry on accomplishments we make. I was working in Zamiin Uud today. Zamiin Uud is going to be a main exit that leads to our gigantic southern market.”


“As the President of Mongolia I am supportive of the idea of building the Industrial Park. We also should support people who are working here.”

Afterwards, the administrator of the vocational training Center in Dornogobi Aimag made a presentation on their business. This vocational training center has existed for 26 years and has 840 students, 40 teachers and staff, and offers 14 different majors. With the investment of one billion Tugrigs from the “Education Development Project 3,” the center had a full renovation. Five different majors were added with funding from Millennium Challenge Account.


In preparation of the turning Dornogobi Aimag to the Industrial Park, the vocational training center has been equipped with the modern equipment and other required educational resources.

At the end of the meeting, the President mentioned that “building a complex industry sounds just right. For instance: There is a workshop in Khanbogd soum that makes uniforms for Oyu Tolgoi workers. There is a private entrepreneur who made a contract worth three billion tugrigs with OT to make wooden furniture and supply it to Oyu Tolgoi. People’s needs are increasing so it is good to anticipate these business and opportunities and adapt accordingly to these needs. It is encouraging that construction companies are forming a consortium. With land granted for free by the government, without bribery, and established infrastructure, people can build buildings and set up hotel and restaurant businesses.
During the implementation of this Industrial Park project, the land management aspect needs to be handled thoroughly and immediately. When construction starts, all kinds of authorities will try to be involved. You should be vigilant about adverse and harmful effects in all occasions.

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http://www.president.mn/zamiinuud2012-02-3.zip