Mongolia was included in the FATF’s list of jurisdictions with strategic AML/CFT deficiencies or the so-called “Grey list” with only 6 action items in 2019. However, Mongolia was able to get off the “Grey List” in 2020 within 1 year with 37 out of 40 FATF Recommendations rated as compliant.
FATF Recommendation 1 requires countries to assess their risk of money laundering and terrorist financing, and Recommendation 2 requires countries to adopt national policies and measures based on the results of the risk assessment. In this regard, Mongolia's mutual evaluation report recommended that our country approve and implement national policies and strategies to combat money laundering and terrorist financing. In addition, according to the Law on Combating Money Laundering and Financing of Terrorism, it is prescribed to develop and approve national policies and programs based on the results of national risk assessment, and take measures to ensure their implementation.
Therefore, under the leadership of the Ministry of Finance, 11 sub-working groups were formed to assess the risk of money laundering and terrorism financing in each sector. 128 employees of 52 organizations participated in the National Risk Assessment and developed a National Program that defined the necessary measures to be taken to improve weak and weak points in each financial sector.
In the development of the national program, the government of Mongolia hired an external consultant within the framework of the Bank of Mongolia with the help of a highly discounted loan from the "Strengthening Budget and Financial Stability Project" to carry out the following tasks. It includes:
As a result of these efforts and the cooperation of the National Council for Combating Money Laundering and Terrorist Financing, the Government of Mongolia's National Program for Combating Money Laundering and Terrorist Financing was approved on July 5, 2022.
By implementing the anti-money laundering and terrorist financing program, it is possible to develop a stable and accessible financial system connected to the international market by strengthening the anti-money laundering and anti-terrorist financing system of Mongolia in accordance with international technical implementation and efficiency standards. In addition, internal and external cooperation in combating money laundering, financing of terrorism, and the financing proliferation of weapons of mass destruction will expand, coordination of work between the government and the private sector will be improved, and regulatory agencies will be able to allocate resources appropriately and concentrate resources in risky areas.
In addition, this program has an important significance to ensure the implementation of "Vision-2050", the five-year development direction of Mongolia from 2021-2025, and the government's action program for 2020-2024.
WORLD BANK WORKING GROUP MET WITH PIU AND IMPLEMENTING ORGANIZATIONS REGARDING THE COMPLETION REPORT OF THE STRENGTHENING GOVERNANCE IN MONGOLIA PROJECT
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
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.
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
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
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
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.