A. BACKGROUND 

Mongolia has received a credit from the International Development Association (IDA) for the Strengthening Fiscal and Financial Stability Project (SFFSP). The Objective of the SFFS Project is to contribute to the Government of Mongolia’s efforts to strengthen fiscal and financial stability and improve the quality of expenditure. The project is designed into five components: (I) Strengthening Macroeconomic and Fiscal Management; (II) Improving the Efficiency of Public Financial Management; (III) Enhancing Financial Sector Stability; (IV) Strengthening the Social Protection System; (V) Project Management and Monitoring. The objectives are to: Strengthening fiscal responsibility and implementing relevant policy measures, improving fiscal discipline, strengthening the resiliency of the banking system, improving public expenditure quality in social protection, providing support for Project implementation, coordination, monitoring and evaluation, including, inter alia, audit arrangements, reporting requirements, procurement and financial management activities respectively. For more details, please refer to the Project Appraisal Document Report No. PAD2269.

The Mongolian capital market is still developing which means securities market legislation and its framework and enforcement that can be further improved. There is already the legal framework in place which ensures issuance and circulation of basic products (mostly shares and government securities) and functioning of basic infrastructure. Issuance of local corporate debt securities is rare and needs to be made more efficient. But there is nascent demand for derivatives in Mongolia. While appropriate legal framework alone is not sufficient to create a developed and efficient market, it is definitely a prerequisite, and certain legal reforms may lift existing barriers for market participants.

Currently, the Securities Market Law or other Mongolian laws do not cover such instruments as standard OTC (over-the-counter) derivative and repo contracts used in international trade and documented on the basis of ISDA master agreement and GMRA documentation. Recently, derivatives and repos are starting to be used in Mongolia and there is a certain demand in the market for international investors to enter into derivative transactions with Mongolian counterparties. Mongolian regulators and market participants should create Mongolian standard documentation for derivatives and repo transactions to bring the current practices closer to internationally accepted standards.

Therefore, in order to develop derivative financial instruments and improve the legal environment for the application of international standard agreements, the Ministry of Finance (MOF) is seeking to hire a professional national individual consultant to develop research and recommendations on this issue. The reviewing process will be closely supervised by MOF throughout the period of the consultancy service and in addition, the consultant is expected to coordinate the work with the Financial Regulatory Committee and other relevant organizations. 

B. OBJECTIVES OF THE ASSIGNMENT 

The main objective of the National Individual Consultant is to assist the Financial Market and Insurance Division (FMID) of Financial Policy Department of Ministry of Finance (MOF) for to develop derivative financial instruments and improve the legal environment for the application of international standard agreements. 

C. SCOPE OF WORK

The consultant shall carry out the following tasks, but not limited to:

1. Determine the current status of derivative market’s situation and its legal and regulatory framework.

2. Conduct research on best practices and international standard derivative agreements.

3. Coordinate with Financial regulatory commission on the current regulatory framework and consult potential result of introducing international standard agreements.

4. Develop recommendations on the improvement of law and regulatory framework of derivative instruments.

5. Undertake such other tasks including coordination of other activities relating to the assignment as reasonably requested and/or assigned by the Director of FPD and Financial Market and Insurance Division head.

D. DELIVERABLES

The Consultant shall provide the following deliverables in regard to the aspect of this assignment:

I. The inception report will conclude the current status and types of derivatives and its agreement structure and usage;

II. The interim report on the best practices and international derivative’s standard agreements for respective products; and

III. Final report includes the recommendation on the development and usage of international standard derivative agreements;

E. CONSULTANT’S QUALIFICATIONS/ SELECTION CRITERIA

• Education: A suitable candidate should have a bachelor’s degree from an accredited university and in the fields of Finance and Economics and Investment. Additional academic or professional background on specializing the capital market would be highly preferable. 

• Experience:  Incumbent should have at least 5 years of relevant professional experience with the skill of developing legislation, conducting financial and economic analysis; and an excellent understanding of Mongolian capital market’s current condition, and its challenges, laws, and regulations. 

• Language skills: Fluent written and spoken skills in English and Mongolian. 

• Other skills:

a. Excellent skills in research, facilitation of workshops, and consultations.

b. With excellent skills and abilities to function effectively and collaboratively in a team environment.

c. Be proficient in PC-based applications such as Word, Excel and data management, and have excellent web research and navigation skills.

F. SUPERVISION AND REPORTING 

The consultant will report directly to the director of FMID of MOF. The senior specialist on financial market tasks in collaboration with head of the FMID will provide input to the evaluation of the consultant’s performance.

G. CONTRACT DURATION AND PAYMENT SCHEDULE

The consultant is expected to commence working effective from July 2021. The duration of the assignment is 6 months.

• 30% – will be paid upon successful completion of the deliverable (i) stated in the TOR conditional on the Client’s approval; 

• 30% –will be paid upon successful completion of the deliverable (ii) stated in the ToR conditional on the Client’s approval; and

• 40 %–will be paid upon successful completion of the deliverable (iii) stated in the ToR conditional on the Client’s approval.

H. INSTITUTIONAL ARRANGEMENTS

The relevant counter specialist of FMID shall provide necessary data and information to the consultant for performing the assignment. The MOF will provide office space with furniture, internet access, computer, and printers.

If you possess the above qualifications, please submit following documents via email to procurement@sffs.mn:

1. Cover letter indicating why she/he considers her/himself suitable for the position.

2. Detailed CV highlighting relevant skills/experience.

3. Copy of diplomas or certificates; and,

4. Two (2) reference letters from previous last two employers no later than 17:00, June 4, 2021.

The consultant will be selected in accordance with the World Bank’s Procurement Regulations for IPF Borrowers (July 2016).

The submitted documents will not be returned to the applicants. Please be noted that incomplete applications would not be considered for evaluation. Only selected candidate will be contacted.

Address for submission of Expression of Interest: Attention to Ms. Ariunaa G, Procurement Specialist, Strengthening Fiscal and Financial Stability Project, Address: Room #204, Negdsen undestnii 8/2, 4th khoroo, Chingeltei District, Ulaanbaatar, Mongolia. Tel: 70120582 or via email to: procurement@sffs.mn.

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