Mongolia’s economy is on the mend after the slump in global commodity prices and economic mismanagement pushed the economy to the brink of crisis in 2017. But an admission to an IMF program, commitment to structural reform and rebound in global commodity prices have supported the economic recovery. Though ongoing political uncertainty could derail much needed investment and poses a risk to the outlook. Long term, Mongolia’s favourable demographic profile and mineral wealth will support growth. Yet the economy must widen its production base if it is to ensure sustainable and inclusive growth.
Mongolia is a lower-middle-income economy, with incomes per capita forecast to reach US$6000 by 2023─which is equivalent to Iraq, Fiji and Namibia currently. The number of people living in poverty rose to 30% of the population in 2016 from 21% in 2014. This is positively correlated with the fall in average incomes over the same period. But the poverty rate is still below the 39% recorded in 2010.