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Today’s Highlights:

• 🌍 Saudi-Mongolia Energy

• ⚖️ Gobi Privatization Halt

• 🚬 Tobacco Tax Hike 

No Time to Waste. Let’s Get Started! 🦘

MARKET

MNG: Government establishes a virtual zone to promote IT production, offering support via subsidies and tax incentives.

GOV: Saudi Arabia’s Aqua Power has expressed interest in partnering with Mongolia to develop the renewable energy sector.

BOM: The Central Bank has kept the policy interest rate unchanged at 12%.

⚖️ FRC Steps In on Gobi’s Privatization Plan

The Financial Regulatory Commission (FRC) has intervened in Gobi JSC’s (GOV) attempt to delist and convert into a limited liability company, escalating tensions with shareholders. The regulator said it has yet to receive the formal paperwork required for such a change and is now reviewing whether the process complies with market rules and protects minority investors.

📄 Regulator Presses for Transparency

To that end, the FRC instructed the Mongolian Stock Exchange (MSE) to examine shareholder meetings, board decisions, valuation reports, and buyback pricing. By doing so, the regulator aims to ensure that the conversion process is both transparent and aligned with legal requirements before any structural change can move forward.

• ⏸️ Buyback on Hold: As part of its intervention, the FRC ordered Gobi to suspend its previously announced share buyback. Nevertheless, Gobi’s stock remains actively traded on the exchange, maintaining liquidity in the short term even as governance concerns linger.

🏢 Gobi Pushes Back

Yet, Gobi punches back right away, saying the company filed an official notice on September 10 and maintains that privatization does not require prior regulatory approval. The move puts the company on a collision course with the regulator, pitting corporate autonomy against market oversight.

📉 Investor Risks in Focus

The dispute highlights 3 key risks for investors in Mongolia’s capital market:

1. Governance Risk: Lack of transparency in Gobi’s privatization could sideline minority shareholders.

2. Regulatory Risk: Prolonged disputes or legal challenges may stall corporate actions, limiting liquidity and delaying returns.

3. Reputational Risk: A public clash between a flagship listed company and the regulator could undermine both local and foreign investor confidence.

Ultimately, this case tests Mongolia’s capital market governance. A firm FRC stance could strengthen minority investor protections but may slow future privatizations, while leniency could raise concerns about enforcement consistency. Transparency in the privatization process and clear communication with retail investors is critical, especially as 3 companies, including $GOV, have gone private this year, leaving small shareholders largely in the dark.

⭐ Selected for you

ECONOMY & BUSINESS

• Mongolia's 31M Ton Rare Earth Paradox: World's #2 Reserve. (RobertRitz)

• Mongolian Tournament Organiser MESA Allegedly Owe $200,000 to Unpaid Teams and Talent. (eSportNews) 

• China August Coal Imports from Mongolia Hit Highest Since at Least 2022. (Aawsat)

• CNN's Blueprint Spotlights the Innovators Propelling Mongolia into a Digital Future. (PRNewswire)

• MMC Completes First Gold Pour at Bayan Khundii Mine in Mongolia. (Yahoo!Finance)

POLITICS

• Gyeongnam and Ulaanbaatar Launch First Official Exchange. (AsiaBusinessDaily) 

• Chinese Defence Minister Meets Mongolian Counterpart. (TheStar)

• Azerbaijan, Mongolia Explore Prospects for Expanding Collaboration. (Report)

• India Plans Strategic Rare Earths Reserve. (Aawsat)

CULTURE & LIFESTYLE

• Fighting Hunger In Mongolia. (TheBorgenProject)

• Oldest ‘Head-Butting’ Dinosaur Fossil Found in Mongolia. (JapanNews)

• Mongolian athletes debut on Netflix’s Physical Asia!. (InsideMongolia)

• Mongolia Elected to Universal Postal Union’s Postal Operations Council for First Time. (Montsame)

🔥 Smoking Will Be Expensive 

Parliament is moving to sharply raise excise taxes on tobacco products over the next 5 years, aiming to curb smoking and tackle mounting public health and economic costs. A draft bill, submitted by 76 lawmakers, also seeks to bring electronic cigarettes, rapidly gaining popularity among young people, under the same restrictions as traditional tobacco.

🚬 Tobacco Control in Mongolia: Long Road, Weak Enforcement

Mongolia introduced its first tobacco control law in 1993 and has revised it 8 times. Yet, enforcement remains weak. Regulators cite poor coordination and a surge in illicit trade as reasons why smoking rates, particularly among adolescents, have not fallen. Electronic cigarettes have emerged largely unregulated, fueling a new generation of nicotine users.

📈 A Serious Push This Time?

Under the proposed legislation, excise taxes on all tobacco products would rise in stages between 2025 and 2030. Lawmakers say the extra revenue will fund public health programs, from school nutrition and youth leisure activities to strengthened tobacco prevention and cessation services.

• Tobacco use is a serious problem: it accounts for roughly 17% of annual deaths in Mongolia, around 4,300 lives each year, and costs the economy ₮801 billion annually, about 2.1% of GDP. Officials argue that higher taxes could reduce consumption, lower healthcare costs, and boost long-term productivity.

“This reform is about safeguarding the health of our next generation,” lawmakers said, framing the tax hikes as both a public health measure and a fiscal tool to reduce the economic drag of tobacco use. If passed, the bill could become one of Mongolia’s most ambitious anti-tobacco initiatives yet.

Lastly… Mongolia’s tobacco control efforts highlight a common challenge in public health policy, as laws exist, but enforcement is the weak link. Loopholes, poor coordination, and illicit trade have undermined past efforts. The rise of electronic cigarettes shows that even when old laws work for traditional products, new trends can outpace regulation. The proposed tax hikes and tighter oversight could finally make enforcement more meaningful, but success will depend on rigorous implementation and public awareness campaigns.

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Publisher: Ts.Ankhbayar
Writer: M.Khulan
Graphics by: Ts.Tselmeg

Disclaimer: The information Inside Mongolia provides is for educational and informational purposes only. It is not intended to be or constitute financial advice, trading advice, or any other advice. The decision whether to consider the information we provide is solely our readers' independent decision.