Among those bidding to be chosen to manage and coordinate
the work of the proposed Mongolian Stock Exchange joint venture is a
partnership enterprise between Mosdaq of Mongolia and NASDAQ OMX, the world’s
largest exchange company. The Government expects the JV to substantially
increase both the volume and worth of stocks traded at the exchange, to raise
total market capitalization to 46% of GDP, and to ensure that at least 10% of
all capital investment in Mongolia is channeled through the stock exchange.

Two representatives of the partnership – Ulf Carlsson,
General Manager, NASDAQ OMX North Asia & Japan, and J. Erdenebat of Mosdaq
– recently spoke to media.  Asked if it
is reasonable to expect the joint venture to perform as an international
exchange without corresponding changes in the country’s economic scene and
legal environment, Carlsson conceded that big investors usually do not favor
financial markets in developing countries with a small economy, but he was
confident that use of state-of-the-art technology will change that mindset, as
long as Mongolia followed international norms in implementing laws, setting up
a stable tax network, and conducting corporate business in a transparent way.

The Government wants the selected company to provide the
funds for the entire program and has not specified how it will be allowed to
recoup its investment. Erdenebat declined to go into details, but indicated
they would be interested in shares of the Mongolian Stock Exchange when it
becomes a joint venture.