Mongolia Report

Huge FDI inflows began to cool in 2012 with the introduction of a controversial foreign investment law. The drop-off in FDI was exacerbated by poor commodities prices, a general retreat of capital from emerging markets, and the winding down of expenditures at Oyu Tolgoi. However, the newly appointed Prime Minister worked closely with Rio Tinto on the on-going disputes over Oyu Tolgoi. In May 2015, both sides agreed to move forward on the second phase of the underground mine and in December 2015, the financing package was finalised. Rio Tinto will invest $6 billion in developing the underground mine over the next couple years.