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Mongolia
Abundance of resources offers potential
Mongolia is more than four times the size of Germany, but has a population of only 3.1 million. Mining is very important for the country, due to its abundance of raw materials. The industrial sector represents about 44% of GDP, the bulk of which is accounted for by the mining industry. Coal, copper and gold are mined in the interior of the country, which is marked by extreme seasonal temperature fluctuations. It is said that 30,000 Mongolians speak German, about 1% of the total population. While the former East Germany was a valued partner country of Mongolia until the collapse of the Soviet Union, the reunified country of Germany assumed this role starting in the early 1990s. Since 1992 KfW has been active in Mongolia as part of Financial Cooperation on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).
Well-trained specialists are needed to harness Mongolia's wealth of resources. The German Federal Government (BMZ) is thus supporting the country in its efforts to achieve sustainable, widespread economic growth based on raw materials by further expanding the German-Mongolian Institute for Resources and Technology (GMIT), which was founded in 2013. Under a new FC project, a multi-functional building with teaching and laboratory rooms, a library and a second dormitory building (Mongolia's own funds) is to be added to the GMIT campus at the Nalaikh location. The assumption is that GMIT can make an important contribution to providing highly qualified personnel for the development of the raw materials industry in Mongolia.
Mongolia's continental climate is characterised by very long and cold winters. Around 93% of the electricity and heat supply is generated by seven Soviet-design thermal (heat and) power stations built between 1961 and 1986. Nearly 7% of this is supplemented by production capacities from renewable energy sources (wind, water, photovoltaics), which have been successively commissioned in recent years. The thermal power plants have a low level of operating efficiency and, like large parts of the transmission and distribution network, are antiquated and susceptible to malfunctions. This is already putting the security of supply at risk today. This is exactly where KfW's projects come into play, investing in the energy efficiency and safety of the existing transmission and distribution networks. The central power supply grid can be made more environmentally friendly and more efficient through relatively inexpensive modernisation measures. In addition, new projects in the energy sector will promote air pollution control in the yurt districts of Ulan Bator. Germany contributes with all of its projects to energy security and to the country's socio-economic development and to climate change mitigation.
Mongolia is a unique refuge for flora and fauna in the Central and East Asia region, Since the political changes in 1990, however, the pressure on ecosystems has increased considerably. Most of the land is used intensively, but not sustainably, which is largely due to the rapid growth in livestock farming and the large coal and copper mines in the south of the country. This is compounded by the impacts of climate change. As a result, according to the United Nations, up to 70% of the country's land area is at risk of desertification. In recent years, environmental policy reforms have significantly improved the conditions for protecting Mongolian biodiversity. The government has declared nearly 30% of the country's territory as protected areas. Mongolia has thus demonstrated its commitment to nature conservation and its willingness to implement the UN Convention on Biological Diversity. Despite annual increases in public budget allocations, the financial resources are not adequate for effective management of the designated protected areas. KfW is therefore improving the management of protected areas on behalf of the German Federal Government (BMZ) so that Mongolia can also implement the UN Convention effectively.
project information biodiversity (PDF, 101 KB, non-accessible)
Further information
Local office
KfW Office Ulan Bator
Director KfW Office: Michael Sumser-Hellstern
Seoul Street 21, 5th floor
Naiman Zovkhis Building
14251 Ulan Bator
Mongolia
Phone: +976-7011-5951
Fax: +976-11-315 950