It is time to start some serious thinking on how Mongolia is going to manage the flow of mining revenues so that most people benefit in the best way. That these revenues must be used to boost the national economy is obvious, but The Mongolian Mining Journal asks how exactly the bags of money labeled “from copper”, “from coal”, “from gold” will be utilized to generate a regular, long-term and steady flow of revenue from other sources.

Several resource-rich countries appear to have found more productive uses for their wealth than just distributing it among the people. Mongolia still does not have any clearly defined list of purposes for which money from the Human Development Fund can be used. Public discussion has not gone beyond whether the distribution of the allowance would start before or after the Lunar New Year and beyond which sections of the population would get it first. The whole thing has been like giving away prizes after a noisy and crowded festival. A major, if unspoken, consideration was certainly how much would, could, or should be distributed before the next general election. Quite funny how the Human Development Fund is being used for nothing to do with development, individual or national!

Economic growth can come only if stringent regulations are enforced on how the money can be spent. Funds are not trees that flower automatically. Nor are they magical barrels of honey that never empty. We must quickly disabuse the public mind of its perception that the Human Development Fund is a cash vending machine, a kind of ATM, so to say.

Some areas of priority spending suggest themselves automatically. The infrastructure in our country is not well developed, undermining our competitive advantage and stifling economic growth. We need to decide how much to spend on infrastructure development and how much on human development. The two are not mutually exclusive and we shall have enough for both, with prudent management.