## Mongolia: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Mongolia

_IMF Staff Country Reports, September 17, 2019_

## Source details

**Canonical URL:** [Mongolia: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Mongolia](https://www.imf.org/en/publications/cr/issues/2019/09/17/mongolia-2019-article-iv-consultation-press-release-staff-report-and-statement-by-the-48680)

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## Bibliographic details
- Published: September 17, 2019
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513514161.002

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### Economic performance and recent developments
- Economy growth accelerated to 8.6 percent in the first quarter of 2019.
- Overall fiscal balance turned into surplus in 2018.
- Gross international reserves have increased by $2 1/2 billion since 2016.
- The recovery stems from a stronger policy framework, significant official financing and a rebound in external demand.

### Structural reforms and governance
- Structural reforms progressed in several key areas:
  - The budget process is more resilient to political pressure.
  - Quasi-fiscal activities were curtailed.
- To achieve sustainable and inclusive growth, it is necessary to advance reform efforts by:
  - Strengthening the rule-based fiscal policy framework.
  - Ensuring financial sector soundness.
  - Improving governance.

### Vulnerabilities and financial sector concerns
- Mongolia remains vulnerable to external shocks given:
  - High debt levels.
  - The economy’s dependence on mineral exports.
- Financial sector risks include:
  - Still inadequate capital buffers at some banks.
  - Overindebted households that could amplify a slowdown into financial instability.

### Risks and downside scenarios
- Risks are tilted toward the downside in the near term.
- Specific shock scenarios noted:
  - Shocks to mineral demand can lead to sharp fall in exports, weakening growth outlook and fiscal accounts.
  - A slowdown in growth could trigger financial instability given the identified banking and household vulnerabilities.

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_Source: https://www.imf.org/en/publications/cr/issues/2019/09/17/mongolia-2019-article-iv-consultation-press-release-staff-report-and-statement-by-the-48680_