Source: The World Bank                   Date: 01 July, 2010

The World Bank approved on Monday a USD12 million credit for the Mongolia Multi-sector Technical Assistance (MSTA) project, which aims, among other things, to help Mongolia improve and manage social protection systems for the poor, and to support the government’s efforts to build its capacity for policy making and regulation in the fiscal, social and financial sectors.

The global financial crisis “highlighted the need for policy reforms – especially in terms of policies to protect the country’s poorest people from the boom and bust cycles typical of economies that depend on mineral exports,” said Mr. Arshad Sayed, World Bank Country Manager for Mongolia “The challenge now is to turn the crisis into opportunity. The MSTA project aims to build the capacity needed to achieve this.”

Policy reforms include adopting an appropriate fiscal framework, improving the budget process and the planning and management of public investments, and implementing a targeted poverty benefit. Other key reforms are to prepare the banking sector for the upturn in economic activity, investment and capital inflows in the years ahead. “The MSTA will assist Mongolia to successfully manage the upcoming mining boom and any bust that may follow,” said Mr. Rogier van den Brink, World Bank Lead Economist and the Task Team Leader for the project.

The money will come from the World Bank’s arm for the world’s poorest countries – the International Development Association. The project, targeting the country’s key budget management and social protection ministries, will run from July, 2010 to December, 2014.