The Economic and Environmental Impact of Foreign Direct Investment on the Mongolian Coal-Export Sector

36 Pages Posted: 19 Sep 2019

See all articles by Ragchaasuren Galindev

Ragchaasuren Galindev

Queen's University Belfast

Tsolmon Baatarzorig

Independent

Nyambaatar Batbayar

National University of Mongolia - Economic Research Institute

Delgermaa Begz

National University of Mongolia - Economic Research Institute

Unurjargal Davaa

National University of Mongolia - Economic Research Institute

Oyunzul Tserendorj

National University of Mongolia - Economic Research Institute

Date Written: September 17, 2019

Abstract

This paper examines the impact of Foreign Direct Investment (FDI) intended to increase the exporting capacity of the coal sector on the Mongolian economy and environment by using a recursive dynamic Computable General Equilibrium model. FDI was used to expand the coal-export sector as well as to construct a railway line connecting the Mongolian main coal reserve and the Chinese border. FDI had a positive impact on macroeconomic variables such as GDP, employment, investment, and household consumption but produced a Dutch disease effect in some sectors. The new railway reduced the environmental impact of transporting coal.

Keywords: CGE model, Mongolian economy, Mining, Fiscal consolidation

JEL Classification: D58, E62, I32, Q33

Suggested Citation

Galindev, Ragchaasuren and Baatarzorig, Tsolmon and Batbayar, Nyambaatar and Begz, Delgermaa and Davaa, Unurjargal and Tserendorj, Oyunzul, The Economic and Environmental Impact of Foreign Direct Investment on the Mongolian Coal-Export Sector (September 17, 2019). Partnership for Economic Policy Working Paper No. 2019-21. Available at SSRN: https://ssrn.com/abstract=3455321 or http://dx.doi.org/10.2139/ssrn.3455321

Ragchaasuren Galindev (Contact Author)

Queen's University Belfast ( email )

25 University Square
Belfast, BT7 1NN
Ireland

Tsolmon Baatarzorig

Independent ( email )

No Address Available

Nyambaatar Batbayar

National University of Mongolia - Economic Research Institute ( email )

Suite 503, Building #5
Ulaanbaatar
Mongolia

Delgermaa Begz

National University of Mongolia - Economic Research Institute ( email )

Suite 503, Building #5
Ulaanbaatar
Mongolia

Unurjargal Davaa

National University of Mongolia - Economic Research Institute ( email )

Suite 503, Building #5
Ulaanbaatar
Mongolia

Oyunzul Tserendorj

National University of Mongolia - Economic Research Institute ( email )

Suite 503, Building #5
Ulaanbaatar
Mongolia

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