THE BENEFICIARY PREPARES AND DELIVERS A QUARTERLY MACROECONOMIC DIAGNOSTICS REPORT FOR THE BUDGET POLICY MAKERS

9/1/2021

The Strengthening Fiscal and Financial Stability Project is being successfully implemented at the Macroeconomic Policy Division (the Macroeconomic Policy Department; the Ministry of Finance, Mongolia) to improve macroeconomic policy tools and enhance research capacity. One of the key areas of the project’s support to the beneficiary is to support the utilization of most recent knowledge and innovations in macroeconomic modeling and macroeconomic analysis tools & techniques, which have been in practical and effective use at the international and domestic research institutes. 

The 9 outputs so far have been secured to achieve the beneficiary’s target outcome of increased utilization of the most recent knowledge and innovations in macroeconomic modeling and macroeconomic analysis tools & techniques. Taken as an example, a Fiscal-Monetary DSGE model which determines a fiscal rule, in which fiscal policy responds not only to the fluctuations of main commodity prices but also a response to the indicators such as output gap, deviation from target inflation rate, changes to the interest rates, and currency fluctuation, and interacts to the monetary policy tools have been developed and has been in use ever since. With this model, various macroeconomic policy questions of the country’s past recessions and recoveries were addressed, using stylized evidence of the period between 2000 and 2019. Another example comes with the handbook to make practical and effective use of budget aspects of the GFSM 2014 for macroeconomic analysis. 

Indeed, these outputs bring a real contribution to the beneficiary for more effective use of new analytical tools and techniques for macroeconomic policymaking. For example, the beneficiary prepares and delivers A QUARTERLY MACROECONOMIC DIAGNOSTICS REPORT FOR THE BUDGET POLICY MAKERS. 

 

In this report, the macroeconomic situation in the country, from the point of view of budget policy, is assessed in the areas of 1) Real sector; 2) Fiscal sector; 3) Monetary sector; and 4) External sector. The reports detail the critical economic events that happen to the relevant sector during the reporting period, analyze the factors behind the situation, integrate those sectoral assessments into a comprehensive analysis, and offer policy recommendations to address the challenges. For example, the Fiscal sector part covers the areas of i) Fiscal policy; and ii) Fiscal stability. In the Fiscal policy, the General Budget of Mongolia is assessed through every general budget governor, while the analysis of Fiscal stability deals with the general government budget balance and the government debt. The critical information of the global economy is also brought out in chapter five. 

 

The Macroeconomic Diagnostics Report offers the benefits as follows: 

  1. Any staff involved in budget policymaking and monitoring can be informed of the same information of the macroeconomic situation and near-term outlook;
  2. Staff experience to compare how the macroeconomic situation changed during the reporting period with the previous quarter`s results increased;
  3. Staff is enabled to identify major risks that may change perceptions of macroeconomic fundamentals and make policy recommendations on responding to new situations and economic shocks;
  4. The policymakers can utilize a clearer outlook of key macroeconomic indicators;
  5. A more structured debate and discussions about the macroeconomic situation and potential impacts on budgeting activities allow policymakers to communicate key policy issues more easily;
  6. A structured database of historical events of the country’s macroeconomic situation. 

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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