Ulaanbaatar, May 15, 2015—Mongolia’s current account has improved in the first three months of 2015 due to sharp declines in imports, yet further dampening of FDI continued to strain the balance of payments, according the Mongolia Monthly Economic Brief, released today by the World Bank.
“The improved current account reflects declining global oil prices and weakening import demands amidst a slowing economy. Yet, sharp declines in imports also largely reflect continued declines in foreign direct investment, which in turn adversely affected the balance of payments,” said Taehyun Lee, World Bank Senior Economist. “External accounts would likely stay under pressure should foreign direct investment remain weak in the remainder of the year,” he added.
The Economic Brief also noted that the tighter monetary and fiscal policies helped improve the current account balance in recent months. The report underscored underscored the importance of ensuring credibility of such policy measures with proper implementation in order to bring the Mongolian economy back on a sustainable growth path.
Mongolia Economic Briefs will provide just-in-time analyses of key monthly economic developments, with a monthly focus on newly released economic reports and policies.