Mongolia put on its Sunday best to woo investors at the high-profile Mongolia Economic Forum held on July 9-11, 2023 - but it will take more than a flashy event to overcome lingering challenges to doing business in the country.
The big picture: The government is hungry for foreign investment to fund economic development and reduce dependence on mining. But regulatory uncertainty and inconsistent rule of law have long stifled investors' appetite.
Driving the news: Officials pulled out all the stops at the July forum to highlight Mongolia's potential. They trumpeted forecasts of 6% GDP growth in 2023 and announced new agencies to attract investment.
International executives were promised a more welcoming business environment, with the new Mongolia Investment and Trade Agency acting as a "one-stop shop."
Between the lines: The government's sales pitch only goes so far without meaningful improvement of the on-the-ground realities investors face.
Frequent changes to investment laws and opaque approval processes continue to deter capital inflows.
The Heritage Foundation's 2023 Index of Economic Freedom ranked Mongolia at only 120th worldwide for investment freedom, citing "weak institutional capacity."
Mongolia's global standing in the World Bank's Ease of Doing Business rankings stagnated over the past decade while Asian competitors zoomed ahead.
Yes, but: It's not all talk. Mongolia has notched some incremental wins that could pay dividends.
New initiatives like streamlined business registration and investment promotion agencies are steps in the right direction.
Compliance with international anti-money laundering standards helps boost investor confidence on regulatory quality.
Bottom line: The government's slick packaging shows savvy in courting capital. But to truly unlock Mongolia's potential, officials must go beyond PR and enact deeper reforms.
Lip service to welcoming business rings hollow without stable laws, incentives and institutions that align with global best practices.
For the Economic Forum fanfare to translate into real investment, Mongolia needs sustained commitment to improving its climate for outside capital.
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