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THE MOF PLANS TO PRESENT THE DRAFT AMENDMENT TO THE FINANCIAL LEASING LAW TO THE PARLIAMENT FOR RATIFICATION

5/11/2022

Within the framework of the "Strengthening Fiscal and Financial Stability Project," jointly implemented by the Ministry of Finance of Mongolia and the World Bank, one of the key objectives is to enhance the stability of the financial sector of Mongolia.

In this context, the Financial markets and insurance division of the Financial Policy Department of the Ministry of Finance cooperated with a national consultant (i) to review the current state of implementation of the Financial leasing law; (ii) to conduct a comparison study of Financial leasing law of Mongolia with international best practice; and (iii) prepare the draft document to amend the Financial leasing law. 

The draft amendments to the Financial leasing law include fundamental reforms, which include the following:

  1. The current law stipulates that a lessor and lessee in a financial lease relationship would have the same rights and obligations as a lessor and a lessee in a regular property lease relationship. However, this contradicted the specifics and basic principles of the tri-partite nature of the financial leasing arrangement. Thus, the draft amendment removed references to the Civil Code provisions related to regular property lease arrangements. Moreover, the draft amendment focused on balancing lessor and lessees' rights and obligations, wherein some fundamental rights and obligations of the parties were not reflected before. 
  2. Financial leasing in Mongolia is not a licensed activity, while it is in most other developed and developing countries. Therefore, it meant any entity could offer financial leasing services in Mongolia, leading to a higher risk of money laundering and terrorism financing. Moreover, the lack of supervision of the financial leasing market limits the effective implementation of laws and regulations and hinders the sector's overall development. Thus, according to the draft amendment, the Financial Regulatory Commission of Mongolia is the designated authority to oversee and supervise the financial leasing market. In this way, the development of the sector and further compliance with the anti-money laundering and terrorism financing law will be ensured. 
  3. Some of the provisions relating to the specifics of financial leasing arrangement, such as provisions on accounting and re-possession of leased items, are now obsolete and need to be updated in line with the stakeholders' practical needs and the most current international standards and regulations. Therefore, the draft amendment changed relevant provisions following the above. 

The successful adoption of the proposed draft amendment will increase the availability of flexible financing instruments that do not require additional collateral and will solve the financing issues being faced by most small and medium enterprises. Also, it will improve the legal environment, ensure the sustainable development of the financial leasing market and increase the number of participating professional organizations, customers, and investments. The law is expected to be submitted to the autumn session.

NEWS
WORLD BANK WORKING GROUP MET WITH PIU AND IMPLEMENTING ORGANIZATIONS REGARDING THE COMPLETION REPORT OF THE STRENGTHENING GOVERNANCE IN MONGOLIA PROJECT

4/3/2023

Concerning the Strengthening Governance in Mongolia project, which was completed on February 28, 2023, the World Bank working group to develop the project completion report had an official meeting with Project Implementation Unit (PIU) and implementing organizations on March 30, 2023. The purpose of the working group meeting is to review the implementation of the project, the results achieved, and the fulfillment of the project indicators.

PERFORMANCE BASED FINANCING: INSPIRING NEW APPROACHES TO PUBLIC FINANCIAL MANAGEMENT IN HEALTH AND EDUCATION

3/23/2023

Performance based financing (PBF) links funds or payments to service providers to results achieved and gives them considerable autonomy in the use of these funds. The strategic approach is appealing to many individuals and organizations as it motivates them to perform better and channels resources directly to the frontlines. This in turn fosters greater accountability. Using this approach has been popular in different sectors with some promising results emerging. 
AN INTEGRATED SYSTEM FOR RESULTS-BASED MEDIUM-TERM BUDGET PLANNING: IN ACHIEVING THE GOALS OF IMPROVING BUDGET PLANNING, BUDGET EFFICIENCY AND PROGRAM OUTCOME.

3/7/2023

    Under the scope of improving public financial management, Mongolia is aiming to introduce result-oriented medium-term budgeting, transitioning from the traditional input-based budgeting. This goal is aligned with development policy of Mongolia to shift from medium-term fiscal framework (MTFF) to medium-term expenditure framework (MTEF).

The MOF is entering the new phase of PFM Reform Action Plan

2/28/2023

Within the framework of the European Union financed, World Bank managed “Strengthening Governance in Mongolia” project, the Ministry of Finance, in compliance with the “Sustainable Development Vision 2030” and the “Action Program of the Government of Mongolia for 2016-2020”, has approved and implemented the Public Financial Management (PFM) Reform Strategy and the Action Plan for 2018-2022. The overarching objective of the strategy was to improve governance and achieve effective resource allocation and efficient public service delivery. The implementation status of the PFM Action Plan is indicated as “Certain results have been achieved” at the rate of 85 percent.
LAUNCHED BETA VERSION OF THE REDEVELOPED GLASS ACCOUNT PORTAL

1/20/2023

The Ministry of Finance Mongolia has developed and successfully launched the new version of the Glass Account Portal in 2023 within the framework of the Strengthening Governance in Mongolia Project jointly implemented by the EU and the World bank.

New systems and services are added in the Intermediate service platform for fiscal and financial systems

1/11/2023

The Ministry of Finance Mongolia has developed and successfully launched the Intermediate Service Platform (ISP) in 2022 within the framework of the Strengthening Governance in Mongolia Project. The main purpose of the system is to provide a possibility of information /web services/ exchange between the independent systems of the Ministry of Finance and other organizations in a easy and flexible way. In addition, it is solving the issues of overlapping connections and development between many information systems and organizations, transferring them to a unified standard, making it has no complexity, and more secure.

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