Budget Shortfall Tests Mongolia's Political Stability Ahead of 2026

Mongolia ends 2025 with respectable headline growth but mounting strain beneath the surface. The Zandanshatar government faces two linked vulnerabilities: a widening fiscal gap and a fragile political base. Together, they turn favorable macro signals into rising political risk.

Downtown Ulaanbaatar

The budget numbers are stark. Revenue is running about ₮2.2 trillion ($621 million) below plan. The Social Insurance Fund faces a shortfall near ₮2 trillion ($565 million). Tax arrears have climbed to ₮6.1 trillion ($1.72 billion) across more than 70,000 entities. Parliament approved spending assumptions that now look optimistic, leaving the budget able to cover little beyond wages, pensions, and welfare.

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