Mountainous Mongolia eyes e-commerce to diversify its economy

Mongolia is looking to e-commerce to aid overcome geographical troubles and diversify its financial state, which depends heavily on mining – mainly of copper, coal, iron ores and gold.

The mountainous, landlocked country is one of the world’s most sparsely populated. Mongolia’s remoteness, put together with its rugged terrain can make standard trade and financial actions hard.

“The electronic way opens up a whole new side for all facets of economic diversification and in particular trade,” reported Tapan Mishra, the UN Resident Coordinator in Mongolia.

“It is very critical for Mongolia to leverage its trade probable by getting eTrade completely ready,” Mr. Tapan explained.

UNCTAD has labored closely with the governing administration on an eTrade Readiness Evaluation of the country.

Published on 8 June, it presents insight on the development that the Eastern Asian country has designed in laying the groundwork for a solid e-commerce ecosystem and gives a street map of action to overcome remaining worries.

“The evaluation tends to make a series of policy suggestions, which, if efficiently carried out, will help Mongolia shift absent from its commodity-based financial system and speed up its digital transformation,” Shamika N. Sirimanne, director of UNCTAD’s know-how and logistics division, said at the assessment’s launch in Ulaanbaatar.

A lot more related and tech-savvy

Mongolia has made progress in spots that bode nicely for its e-commerce ambitions. The nation has strengthened its ICT infrastructure, particularly in urban areas, and greater internet connectivity.

According to facts from the International Telecommunication Union, mobile broadband subscriptions in the region rose from 80 to 116 for each 100 folks between 2017 and 2021. And over 70% of subscribers have accessibility to 4G/LTE networks.

For the duration of the similar interval, the share of Mongolians aged 15 yrs or more mature buying on-line grew from 7% to 42% – the greatest advancement amongst landlocked building nations around the world and one particular of the best in the globe, according to Earth Financial institution data.

 

 

The nation has also noticed electronic literacy enhance amongst its youth. 50 % of its younger adult males and gals now have basic ICT expertise, according to the UN Children’s Fund (UNICEF).

The evaluation also highlights that domestic digital payments, this sort of as e-banking, cellular banking, electronic wallets and QR code payments, are now broadly employed for domestic purchases.

Urban-rural divides and logistics problems

Even though Mongolia has created progress in quite a few crucial regions, issues continue to be, in particular the city-rural divides – both physical and electronic.

Individuals in rural regions in the place even now have constrained obtain to dependable ICT infrastructure and to an world wide web link. And accessibility to affordable economic solutions continues to be restricted for some segments of the populace.

Mongolia’s broad and sparsely populated landscape also provides logistical challenges for e-commerce.

Several of the country’s streets are unpaved and there is no unified technique for addresses. These elements, merged with minimal transportation networks and severe climate problems, make deliveries challenging and costly.

Minimal finance and cross-border payments

When the COVID-19 pandemic accelerated the use of digital payments for domestic buys in Mongolia, cross-border electronic payment options are several and service fees continue to be superior.

A further obstacle is constrained accessibility to funding for digital and technological startups. They depend mainly on self-funding, individual loans and federal government assist in the kind of grants and tax aid.

Other financing solutions, this sort of as crowdfunding and enterprise cash, are sparse and not nonetheless controlled.

Even though Mongolia has numerous guidelines associated to e-commerce, the evaluation highlights the have to have to fortify its authorized framework to secure consumers on the net and deal with concerns associated to on-line fraud and data privacy.

A vital milestone

UNCTAD’s eTrade Readiness Evaluation marks a important milestone in Mongolia´s electronic journey and lays the foundation for a national e-commerce technique.

“By presenting an investigation of Mongolia’s e-commerce ecosystem and charting a roadmap for its further expansion, the eTrade Readiness Evaluation is a person of the catalytic forces for Mongolia to promptly create e-commerce,” the country’s overseas affairs minister, Battsetseg Batmunkh, mentioned at the report’s start.

Also talking at the celebration, Mendbayar Tseveen, the co-founder of Shoppy.mn, one of Mongolia’s greatest on the web marketplaces, highlighted the power of e-commerce to open up new doorways for Mongolian firms.

“E-commerce connects Mongolian and intercontinental businesses and empowers domestic retail companies to harness their comprehensive opportunity,” Mr. Tseveen mentioned.

The evaluation phone calls on federal government ministries and businesses, e-commerce providers, academia and improvement companions to be part of forces in implementing the recommendations. They slash throughout sectors and demand concerted initiatives from the community and personal sectors.

UNCTAD will assist the nation in implementing the recommendations.

The corporation is committed to mobilizing additional support from eTrade for all and growth companions to leverage the electric power of the country’s growing digital financial state and create a vibrant digital long run for all Mongolians.

The eTrade Readiness Evaluation of Mongolia was formulated with the guidance of the Republic of Korea, the European Bank for Reconstruction and Improvement and Switzerland.