Whether it was curiosity about a new venue or eagerness to network after a month’s gap, the monthly meeting on August 23 at Kempinski Hotel Khan Palace brought together a record number of 99 members. They heard Executive Director Jim Dwyer make the happy announcement that membership had reached 160. The 11 of them inducted since the last meeting are:

· AMC Consultants, a mining consultancy, providing services exclusively to the minerals sector;

· Baker & McKenzie, as of 2009, the fifth largest law firm in the world by revenue;

· Connect Resources Services, an Australia-based privately owned investment and investment consulting firm managing engineering and mining service entities;

· CPS International, the Mongolian marketing arm of CPS Securities, an Australia-based financial services company;

· Europharma, one of the largest pharmaceutical companies in Mongolia;

· M.A.D Mongolia, offering assessment of business growth opportunities and a plan to realize those opportunities;

· PricewaterhouseCoopers, one of the world’s “Big 4” assurance, tax and consulting firms that has just established a full-service Mongolian office (a ‘renewal’ deserving special recognition);

· Rodman & Renshaw, a full-service investment bank based in New York City and the leader in the PIPE (private investment in public equity) and RD (registered direct offering) transaction markets;

· Runge LLC, providing consulting, training, and software for mining and related services industries;

· Snowy Mountains Engineering Corporation (SMEC) Mongolia, an Australia-based engineering and development consultancy in 25 countries with more than 4,000 permanent and contract staff; and

· Supply & Allied Services, the major shareholder in SAS-SGT in Mongolia, owning and operating an industrial supplies wholesale/retail warehouse in the country.

The first presentation of the evening was by Ms. E.Sodontogos, General Manager, Discover Mongolia 2010 Organizing Committee. She gave details on what to expect at this much-awaited annual investors' forum this year, to be held on September 8-10. There will be two keynote speakers and, apart from the favorite Government Hour, there will be a Parliament Hour, affording participants a chance to pick the brains of Mongolian lawmakers.

Mr. James Polson, Executive Director, Australasian Independent Diamond Drilling (A.I.D.D), discussed the state of the Mongolian mining service sector. Exploration to feasibility study to mine development to actual mining is usually a 5-year cycle and Mongolia is yet to enter the fourth and final stage. The sector is “in its infancy” and will not grow until the Government shifts its “focus from short-term gains from mining investments”, and offers tax incentives and easier access to credit. With such support, the sector can fulfill its potential and move beyond meeting domestic demand to exporting its services.

Dr. Ch.Khashchuluun, Chairman, National Development and Innovation Committee (NDIC), spoke on the Development Bank of Mongolia and on the proposed Sainshand Industrial Complex, detailing the developments in the Government’s ambitious and long-term policy of industrialization since he last spoke at a BCM meeting in January.

The bidding for the Tavan Tolgoi project will be announced this year and that for the industrial complex next month. Project management companies will be chosen and their views on the viability of specific projects will be decisive. A small copper smelter will be set up at Erdenet. This and other processing units are likely to be owned by foreign investors. The complex will depend mainly on locally available raw material and due care would be taken of environmental concerns.

The Sainshand project is a concentration of industries at one place, but the strategy is to encourage regional development. Indeed, western Mongolia is more resource-rich than even the Gobi. The most recent confirmation of this was the discovery of large molybdenum deposits there. The Shivee Ovoo coal-based power plant will cost USD4.5 billion to develop. On the other hand, Mongolia is ahead of most developed countries in deriving as much as 1% of its energy needs from sustainable sources. Interestingly, the ICT sector accounts for 9% of the country’s GDP.

USD14 million has been allocated to the establishment of the Development Bank. Its main job will be to provide long-term capital to finance strategically important projects. To ensure transparency in its operations, management will be in the hands of an international team of professionals and, even more, Mongolian members of the governing board will include people “usually most critical of whatever the Government does”.

The last presentation was by Mr. Larry Marchese, e-Signature Consultant, USAID Economic Policy Reform and Competitiveness (EPRC). His topic was a digital signature law that would be Mongolia’s gateway to the global digital economy. The Government had prepared the draft of such a law and EPRC has revised it to make it compliant with global standards and practices.