💸 GDP GROWTH | MONGOLIA'S REAL ESTATE GIANT | RISING SAVINGS

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Tsagaan Sar is just around the corner! If you haven't already prepared for it, now is the time to start. 👀

🤔 DID YOU KNOW?

The HU plans to host a virtual concert in the Metaverse on March 30.

Early bird tickets are already available.

🏠 REAL ESTATE: RE/MAX

In the third quarter of last year, real estate agencies in Mongolia generated a total sales revenue of ₮927.5 billion. Out of this, RE/MAX, the largest real estate agency in the country, accounted for a significant portion of ₮923 billion.

How?

In 2022, RE/MAX completed a total of 14,500 deals, with 39% of these being rental sales and 61% commercial sales. This resulted in a 6% increase in their revenue. Furthermore,

• The MVP: With a current real estate listing of 183 thousand, RE/MAX currently holds the largest database of properties in Mongolia. In the previous year, they added a total of 38 thousand new properties to their listing, which averages to approximately 104 new properties added per day.

• Agents: As of the third quarter of 2022, Mongolia has a total of 309 registered real estate brokers and 1,413 agents. According to the available data for the same period, RE/MAX owns 75 of these broker offices and employs more than 1,000 agents.

• It's worth noting that RE/MAX sells an average of 40 listings per day, or approximately 1.6 properties are sold by their agents every hour.

• Clients: In 2022, the company provided their services to 18 thousand customers and successfully assisted 1 out of every 2 people to purchase their desired property, accounting for 73% of the total deals in the industry.

As a final point

In the past year, real estate prices saw an 11% increase, with the average cost reaching ₮3.75 million per square meter. As the number of agents in the market continues to rise, it's becoming an increasingly competitive and dynamic industry. To succeed in such an environment, it will take even more talent and expertise. Let’s see what happens.

📈 DATA STORY

Term deposit savings continue to be the primary savings option, accounting for 83.5% or ₮12.9 trillion of total savings, reflecting a 1.5% increase from the previous month. As for demand deposits, they experienced a resurgence in popularity following the reintroduction of non-zero interest rates. Last month, demand deposits grew to ₮2.6 trillion, which marks a MoM increase of 5.8%.

💸 GDP GROWTH

Mongolia's GDP grew by 4.8% last year, reaching ₮28.4 trillion at the nominal price of 2015.

Behind the growth…

The agricultural sector accounted for 1.7% of the overall GDP growth, while the industry and construction sector contributed 0.8%. The service sector played a significant role in the country's economic growth, contributing 2.6%. Net tax on products also had a 1.4% increase, adding to the overall GDP growth.

• Growth booster: The service sector made a significant contribution to GDP growth, with a total production increase of 5.5% to ₮13.3 trillion. This was driven by an 8% production rise in the wholesale and retail trade sector and a 6.9% output growth in the information and communication sector.

• A hiccup: However, the production of the mining and quarrying industry decreased by 11.9% to ₮3.3 trillion in 2022, which took away 1.6 percentage points from the GDP growth. This was mainly caused by a drop in the sector's exports due to China's Covid restrictions.

Expectations & reality

Moving on, let's see how far the 2022 economic growth of 4.8% falls short of projections.

• Bank of Mongolia: Estimate 3% (difference +1.8%)

• Analysts: Their forecast for Q3 2022 stood at 2.5% (difference +2.3%)

• Asian Development Bank: Forecast 1.7% (difference +3.1%)

• IMF: Forecast 2.5% (difference +2.3%)

• World Bank: Estimate 2.5% (difference +2.3%)

This year…

This year, the IMF, World Bank, and Asian Development Bank have projected different growth rates for Mongolia's GDP. The IMF forecasts a 4% growth, the World Bank predicts a 6% growth, and the Asian Development Bank estimates a growth rate of 4.9%. These projections are primarily based on the expectation that Oyu Tolgoi underground mining will commence and exports will recover.

📅 MNG SUMMIT 2023

MNG Summit is a non-profit organization that supports the growth of the next generation of Mongolians around the world, with a focus on career development, networking, and all that goes along with that.

During the upcoming MNG Summit in 2023, you'll have the chance to listen to keynote speakers, take part in panel discussions, engage in interactive workshops, and network with individuals who share similar interests.

Visit their website for more information.

🏃 QUICK STORIES

📌 Moody's affirms Mongolia's B3 rating, keeping outlook stable. The B3 rating of Mongolia considers the risks posed by its liquidity and external factors, but also acknowledges its potential for robust growth and more manageable levels of debt repayment compared to the past.

📌 21 companies announce dividends since the beginning of the year. APU JSC (APU), for instance, has declared a dividend payout of ₮44 per share. This is a return of 3.1% based on the current share price of ₮1,397. Other notable companies include Golomt Bank (GLMT), Bogd Bank (BOGD), InvesCore (INV) and many more.

📌 Gobi (GOV) reduces losses 4.7 times to ₮8.1 billion. This improvement is mainly attributed to the 34% increase in sales revenue to ₮193.4 billion, which was driven by the subsiding impact of the pandemic and the price increase of some of their products.

📌 Revenue of Material Impex (MIE) increases by 27% to reach ₮77 billion. As a result, the company’s net profit amounted to ₮8.7 billion, a YoY increase of 69%. Last year, the company's total assets grew by 26% to ₮64 billion as well.

⭐ TOP NEWS

• Senior diplomat calls for closer China-Mongolia coordination (China Daily)

• Mongolian PM sees South Korea as customer and gateway for rare metals trade (Reuters)

• TMK Energy secures rig for CBM drilling in Mongolia (Natural Gas World)

• Mongolia: Petro Matad announces operational update (energy-pedia)

• MIAT Mongolian Airlines to conduct direct flights to Doha (MONTSAME)

💭 WATCH & LEARN

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Editor: E.Zolbayar
Writer: Ch.Anuun

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