Mongolia

Mongolia has grown enormously with one of the higher GDP growth rates in the world. Growth was 10.6% in 2004, 5.5% in 2005, 8.6% in 2006, and 9% in 2007 largely because of high copper prices and new gold production (GDP growth courtesy of the IMF).

With the government signing of the Oyu Tolgoi agreement, an agreement that governed the extraction of the largest untapped copper and gold reserve in the world, it is likely that this growth will continue. FDI is pouring in from companies Ivanhoe and Rio Tinto to extract the minerals. These investments, coupled with the revenues, are expected to greatly bolster the local economy.

But gold and copper are only the beginning of the mining story. Mongolia is estimated to have potential coal reserves of 125 billion metric tons with a significant portion located at the Tavan Tolgoi mine in the southern Gobi. With China purchasing up to 22 million tons of coal per month, Mongolia will likely have a long-term customer to the south. Foreign Direct Investment has grown at an explosive rate from US$25m in 1997 to US$344m in 2006. A large proportion of FDI has been channeled into the construction and mining industries, which are currently experiencing rapid growth.