PM ABOUT ECONOMICS FOR 2012 AND 2013

Ulaanbaatar /MONTSAME/ By a preliminary execution of 2012, the economic growth was 12.3 per cent, and the national Gross Domestic Product (GDP) reached MNT 13.9 trillion, increasing by 1.2 per cent or MNT 4.8 million in terms of per capita. The PM N.Altankhuyag said at a plenary meeting of the parliamentary session held Friday. The inflationary annual difference was 14 per cent in the year 2012, moreover, the inflation rate increased rapidly, reaching 16 per cent by April of 2012, and it seemed to reach 18-19 per cent by end of 2012, "but the cabinet and the Bank of Mongolia co-realized a programme with four directions and managed to stop the inflation,", for exampe, when the diesel's external price grew by 26 percent, here its retail price went up by six percent only. In order to reduce imported consumer products' cost, all products from the Zamyn-Uud border checkpoint were transported to Ulaanbaatar within 24 hours by additional trains, he added. The mortgage loan will be increased this year, it is needed to keep apartment price at one million togrog per square meter, he said. A balance of the state master budget had a deficit of MNT one billion in 2012 due to coal and iron ore prices drop at the international market. In addition, the deficit of the Human Development Fund (HDF) reached 400 billion togrog, the external trade also had a deficit, its products and service deficit went up 30 per cent, he said. The financial and banking sector worked at normal level in 2012, and its risk decreased. The money supply of 2012 reached MNT 7.6 trillion, increasing 19 percent; the savings reached 4.9 trillion, increasing 27 percent, moreover, the foreign currency reserve reached USD 4.1 billion by the end of 2012. The cabinet issued bonds of USD 1.5 billion at the international financial market, and it has positively affected the macro and financial stability. The government established a financial mediation contract with the Bank of Mongolia thanks to which the rate of Mongolian togrog (MNT) is stable against foreign currencies, for example, against the US dollar reached MNT 1,392.1 by December 31 of 2012 increasing by 4.3 togrog only against beginning of 2012. After this, the PM briefed on a project of the macroeconomic of Mongolia for this year. The GDP will increase, a coal extraction is expected to rise, the iron ore extraction went up 20 percent and the oil extraction by 0.6 per cent from 2012, contributing to real augment of the mining sector, he said. The real growth of the land farming and agricultural sector will increase 4.5 percent, the manufacturing production--by 12.3 per cent, and transport, trade and other service sectors--by 10.5 per cent. The real size of the GDP is projected to increase 18.5 per cent, and the nominal GDP size is expected to reach 17.6 trillion togrog. The Premier also said his cabinet aims to keep the inflation rate in one-digit this year by running a policy on stabilizing prices of fuels and consumer goods. B.Khuder