Deputy
Prime Minister N.Altankhuyag and Arshad Sayed, resident representative of the World
Bank in Mongolia, exchanged views about the economic situation and the banking
sector. The annual International Monetary Fund review of the budget policy of
Mongolia has not been issued this year, and this may make it difficult for the
Asian Development Bank, the Government of Japan and the World Bank to meet its
commitments.

The
proposed budget revision will place a significant amount of money into people’s
hand, and could trigger inflation. If the present 8-9 percent inflation
threatens to rise to 20-30 percent by the end of the year, people will prefer to
save in foreign currencies, which brings huge risks to the economy. The World
Bank representative suggested putting all additional revenue in central bank
reserves.