D. Enkhjargal, Vice President of the MongolBank, made a startling disclosure when testifying before the Standing Committee on Economics on Tuesday when it was discussing the monetary policy for 2009.

Answering the concern of G.Batkhuu (DP) about the illegal export of gold and aluminum, the bank official said according to a contract with Boroo Gold Company the Government was entitled to receive 15 tons of gold annually. However, only the Mongolian version of the contract has this provision. The agreement in English makes no mention of this and since that version is taken to be the authentic one, the State has been losing 15 tons of gold every year.
Mongolia produces about 30 tons of gold a year and the MongolBank gets to buy 10 of this. But it received only 6-7 tons this year. There is also no record of where10 tons of gold has gone after extraction.
The meeting was centered mainly on inflation. Some members blamed the Central Bank for not following the right policy and thus allowing inflation to rise to 34 percent while the government’s target had been to keep it under six percent.
Others wondered if inflation would rise to 70-80 percent next year. The Government aims at restricting inflation to 12 percent in 2009
Testifying before the committee, the President of the Mongol Bank, A.Batsukh, pleaded for less public revelation of inflation figures as this causes panic and uncertainty and “might bring negative effects”. He also asked MPs not to demand changes in the monetary policy and instead to have faith that it would work.
D.Terbishdagva (MPRP) said, “Blaming the high inflation only on oil and food price increase is wrong. There are other factors also, such as the global financial crisis, and the Central Bank’s strict monetary policy.”
Asked why the inflation figure was not decreasing even when the oil price has fallen, Batsukh said this takes time and inflation will be steady around 12 percent in 2009.

 

Source: en.news.mn