Trade and Economic Relations

The two countries signed the Intergovernmental Trade Agreement in 1994 in Ottawa. Trade turnover between the two countries as of now is shown as follows:
                                                                               (in USD million)
Year
1995
1996
2000
2001
2002
2003
2004
2005
2006
2007
Total turnover
0.1
2.3
1.7
2.0
3.0
4.4
20.9
139.3
181.3
188.6
Export
0.1
0.1
0.8
1.0
0.5
0.7
14.7
122.0
171.2
178.5
Import
0.03
2.2
0.9
1.0
2.5
3.7
 6.2
 17.3
 10.1
10.1
 
Canada’s share in our foreign trade turnover was about 5.0 percent in 2007. Mongolia’s export to Canada surged in last 2 years due to the gold exploration. Last year gold export accounted for 99.6 percent of total export to Canada. Mongolia’s import from Canada mainly consists of agricultural products, mining machinery, loading and uploading equipment, spare parts and telecommunication facilities.
 
The inclusion of Mongolia to the Canada’s list of Countries eligible for General Preferential Tariffs /GPT/ enables the former to enjoy preferential tariffs in exporting gold, hides and skins, leather products, carpets and other animal originated products including combed cashmere to Canada. 
 
In terms of investment made to Mongolia Canada goes second following the People’s Republic of China. Since 1996 Canada has made investment worth nearly USD250 million, most of it was absorbed by mining sector. Currently, about 70 Canadian companies operate in Mongolia.
 
The two countries signed the “Convention on Avoidance of double taxation and Prevention from fiscal evasion with respect to taxes on income and on capital” in 2002, in Ottawa.
 
Canadian International Trade Minister David Emerson paid an official visit to Mongolia in January 2008. Two sides has agreed on further strengthening the trade and investment ties, including the eventual establishment of a Foreign Investment Promotion and Protection Agreement /FIPA/ between the two countries.
 
Two countries are actively cooperating in the mining field. Mongolia attends the Prospectors and Developers Association of Canada /PDAC/ Convention in Toronto every year since 2002. In 2006 Mongolia became a member of the Intergovernmental Forum for Mining, Minerals, Metals and Sustainable Development. The two parties are active in the North America-Mongolia Business Council /NAMBC/.
                                      
Canadian investment in Mongolia (in USD million)
 
Sector           
Total        
1996-2004       
2005   
2006   
 2007    
1.Mining
244.1    
173.0
0.83
70.0
0.3
2. Trade and Service  1.6 0.8 0.7 0.05 0.1
3. Banking and Finance   0.4 0.4      
4.Construction               0.07 0.07      
5. Processing of animal originated raw materials  0.04 0.04      
6. Agriculture 0.03 0.03      
7. Other 2.1 - - 2.2 -
Total 243.3 174.2 1.5 72.2 0.4
Source: FIFTA statistics
 
Mongolian side is keen to learn Canadian experiences and further promote our cooperation in agriculture, energy and urban development. Some agreements were signed including the programs and projects in agricultural sector and program of “Sustainable Cities Initiative” implemented by the Government of Canada in foreign countries.
 
The Government of Canada has provided development assistance to Mongolia through the Canadian International Development Agency /CIDA/ and Canada Fund, as well as through multilateral cooperation channels. The bilateral assistance has been mostly spent to implement small-scale projects for poverty alleviation, health, education, improvement of social status of women and environment protection. The two countries signed “Exchange of Letters on Canada-Mongolia Development Cooperation” in 1998.
 
          Official assistance of Canada to Mongolia (in mln Canadian dollars)
 

Year
To the Govern
ment
Partner
ship program
Human-itarian aid
Food aid
International develop-ment research center
Multi-lateral program
Total
1998
0.18
 
 
 
0.08
 
(0.26)*
1999
0.17
 
 
0.06
0.31
3.61
4.15
2000
0.22
0.27
0.05
0.01
0.02
3.32
3.89
2001
0.29
0.78
0.11
 
0.13
2.76
4.09
2002
0.56
1.13
 
 
0.23
4.09
6.01
2003
0.58
0.79
0.20
 
0.37
2.05
3.99
2004
0.80
0.79
 
 
0.18
1.14
2.91
2005
 
0,80
0,56
 
0,21
3,86
5,43
Total
2.8
4.56
0.92
0.07
1.53
20.83*
30,71*

Source: Statistical Report on ODA, 1998-2005
Note: * Incomplete datas