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EAEU, Mongolia Trade Can Grow 25%

Maxim Vasiliev, Russia’s Trade Representative with Mongolia has suggested that the Mongolian government has linked its future economic growth to the successful signing of a Free Trade Agreement with the Eurasian Economic Union (EAEU). He was speaking at the economic conference “Prospects for the development of trade, economic and investment cooperation between Mongolia and the EAEU countries” being held in Moscow.

Vasiliev said that “In 2023, Mongolia’s economy grew by 7%, and in the next two years, the country’s government forecasts growth of 6.5%. The Mongolian government associates the sustainable growth of the country’s economy with trade agreements with partner countries, primarily with the EAEU.”

The EAEU includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia. It fills the geographic space between Eastern Europe and Western Russia.

Vasiliev added that Mongolia’s trade turnover with Russia and the EAEU could grow by almost a quarter. This forecast is based on such large system-forming projects as the Power of Siberia 2 gas pipeline, the design work of which has now been fully completed, and the upgrading of the Trans-Mongolian Railway, the main transport artery of Mongolia.

The conference also discussed industrial cooperation between Russia and Mongolia, highlighted energy, including the modernisation of the Ulaanbaatar thermal power plant, built in Soviet times. Another promising area for Russian-Mongolian cooperation is infrastructure. This includes construction of an underground metro system in Ulaanbaatar, a circular railway and the development of free trade zones.

Vasiliev also stated that “In the agricultural sector, we expect supplies of agricultural machinery, primarily from Rosselkhozmash. Mongolia’s proposal to create a spinning production jointly with Russia and Kyrgyzstan deserves attention. This can be discussed at the agricultural forum in early August in Ulaanbaatar.”

He recalled that within the framework of Russia-Mongolia-China economic corridor program, 44 projects are at the discussion stage. The decision on a temporary trade agreement, within the framework of which duties in mutual trade will be eliminated or reduced on a limited range of goods, was made following a meeting of the Supreme Eurasian Economic Council. That deal is expected to be completed before year end when tariff reductions will kick in and spur proposed new investments. 

Further Reading

Russia-Mongolia 2024 Trade & Development

Russia’s trade and development with Mongolia is extensively covered in our 2024 Russia’s Pivot To Asia Guide, which is a complimentary download and can be accessed in English here and Russian here.

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