BCM MONTHLY MEETING RECAP - FEBRUARY 22, 2010

With membership now standing at 126 entities, some 35% more than the number last year, it was no surprise that attendance at the monthly meeting on February 22 was an almost record 90. After BCM Chairman Laurenz Melchers had welcomed them, Executive Director Jim Dwyer introduced the two newest members – B Television, and Master Properties. He also gave a brief report on the work of BCM’s 6 Working Groups which include approximately 70 individual volunteers. An Environmental Working Group has been formed comprising mining company environmental experts and environmental NGOs. Another on Entrepreneurship was being put in place.

An update on the work of BCM’s Legislative Working Group was provided by its Chairman, Mr. Bayar Budragchaa. The WG’s efforts led by B. Enkhbat of Eznis Airways presented recommendations for the Concession Law to the Parliamentary Working Group headed by Mr Ts. Munkh-Orgil. The Law was recently adopted by Parliament to take effect on March 1 and does reflect BCM’s comments and is mostly if not 100% reflective of best international practice.

The evening featured two presentations. In the first, Mr. Ya. Sodbaatar, Director of the State Specialized Inspection Agency (SSIA), detailed the reforms introduced and planned in the agency. The goal is to make its work business-friendly and not obstructive. Parliament will soon consider amendments to the law and regulations that govern the way the agency and its staff work. Reaching the targeted international standards will require “a total u-turn in the mindset of many who are stuck in the 1930s”, he said, adding that this is not going to be easy for the 3,000 workers at the agency, 1,700 of them employed as inspectors. However, he was confident that “positive and tangible results” will be achieved by the steps being taken. He called for cooperation from BCM members and urged them for suggestions based on their international expertise and Mongolian experience.

The proposed overhaul, with assistance from the UN and the World Bank, will streamline and expedite procedures. Revealing that the present system in Mongolia calls for inspections at more levels than in most other countries in Central Asia, Mr. Sodbaatar said, “Inspection without results is ridiculous.” Inspectors with the agency are often seen as flexing their muscles and throwing their weight around, “and they do at times abuse their rights and privileges, but they also have to follow a system which has 327 norms”. There will now be transparency, better accessibility, more decentralization, drastic cuts in the number of stages, rationalization and simplification of procedures, and, most important, there will be “human reform”.

The agency does not see its work as insisting on finding fault, and will focus on helping the business environment. “Clear boundaries will be established”, more and more work will be done online, one-stop windows will minimize delays, and there will be fast-track resolution of disputes. “These are coming late, but they are finally coming,” he said, and assured the audience that mistrust will be replaced by collaboration. The civil society will be given a role, and inspectors’ performance will be monitored and evaluated. From next year, the agency will pay for all samples collected for testing.

South Gobi sands Executive Director David Bartel gave an overview of the company, mining coal at Ovoot Tolgoi and other deposits. Asserting that they are a “good corporate citizen”, Mr. Bartel talked about the jobs the company has created and about the expected multiplier effects of its expansion plans. Expressing his appreciation of and admiration for the Mongolian work force, Mr. Bartel said their thirst for learning seems insatiable.

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