Mongolia

Higher mining output in Mongolia has boosted exports, investment, and growth, but has generated limited linkages to the wider economy. GDP grew 7.8 percent in the first half of 2026 as mining windfalls spilled into construction, services, and public consumption. Yet private activity and employment gains remained modest. Non-mining growth of 4.3 percent mainly reflected agriculture’s post-dzud rebound. High inflation further constrained household consumption growth.

Growth is projected at 5.7 percent in 2026 and around 5.5 percent over the medium term, supported by mining, fiscal expansion, and large infrastructure investments. Elevated inflation and fuel supply disruptions weigh on households and the private sector. Monetary tightening should help moderate inflation in the medium term, while fuel supply constraints keep price pressures elevated in the near term.

Mongolia’s fiscal position will weaken as rising infrastructure, wage, pension, and off-budget spending, and softer non-mining revenues following the recent tax reform increase financing pressures and reliance on mineral revenues. Meanwhile, monetary policy is tightening, though its effectiveness could be limited by the fiscal stance. A better-balanced policy mix would rationalize spending while protecting productive investment and maintaining monetary restraint until underlying inflation pressures ease.

Risks remain tilted to the downside. Fuel shortages could slow growth and sustain inflation. Rising recurrent spending, weak non-mining revenues, and reliance on one-off receipts heighten fiscal risks, while the exclusion of large infrastructure projects weakens transparency and the underlying fiscal position. If inflation remains elevated and growth continues to generate only limited gains in employment and income, poverty reduction could slow further. On the upside, faster infrastructure delivery could support medium-term growth.

(Last updated: October 2026)

In 2026, Mongolia and the World Bank Group mark the 35th anniversary of Mongolia’s membership in the World Bank. Since the signing of the Articles of Agreement in February 1991, the partnership has evolved into a broad development program spanning virtually every major sector of the economy, with cumulative commitments of the International Bank for Reconstruction and Development (IBRD) of approximately US$1.74 billion. The current portfolio totals US$2,040.45 million, comprising US$439.45 million from IBRD, US$849 million from the International Finance Corporation (IFC), and US$752 million from the Multilateral Investment Guarantee Agency (MIGA).

Over the past three decades, World Bank Group financing has concentrated on sectors critical to Mongolia’s long-term development, including sustainable energy, transport, agriculture, and sustainable finance, complemented by investments in governance, human capital, and institutional strengthening. Together, these interventions have supported Mongolia’s economic transformation and resilience.

In addition to supporting development projects through lending and grants, the Bank provides advisory services and analytics (ASA) to Mongolia. Mongolia’s ASA portfolio provides strategic analytical and advisory support across a broad range of sectors, including social protection, health, public finance, digital transformation, disaster risk management, energy, environmental sustainability, transport resilience, and private sector development. Overall, the portfolio and pipeline are strongly aligned with Mongolia’s priority development challenges, particularly in infrastructure, connectivity, and climate resilience.

(Last updated: October 2026)

The World Bank Group’s Country Partnership Framework (CPF) for Mongolia, originally covering FY21-25, has been extended through June 2027 following a Performance and Learning Review (PLR), which found that the strategy remains relevant and effective. The extension will help achieve results in areas affected by implementation delays and align the next country strategy with Mongolia’s 2027 presidential elections.

The CPF supports Mongolia’s resilient recovery and inclusive, sustainable growth through three focus areas: strengthening economic governance; boosting competitiveness and climate resilience; and improving quality of life. The PLR further strengthened the focus on climate resilience and repositioned urban livability under this agenda to reflect increasing environmental and climate risks in Mongolia’s cities.

During the extension period, the World Bank Group will continue supporting job creation, private sector development, digital transformation, climate resilience, and disaster preparedness through an integrated approach across the World Bank, IFC, and MIGA. The program will deepen engagement in sustainable energy, agriculture and agribusiness, urban resilience, financial sector development, and disaster risk financing, while maintaining targeted support for education, health, employment, and social protection.

The CPF remains aligned with Mongolia’s Vision 2050, the Government’s 2024-2028 Action Plan, and the World Bank Group’s mission to end poverty and boost shared prosperity on a livable planet.

(Last updated: October 2026)

Mongolia’s private sector plays a critical role in creating more and better jobs, supporting economic diversification, and strengthening resilience. Small and medium-sized enterprises (SMEs) make up the vast majority of businesses in Mongolia and are an important source of employment, entrepreneurship, and innovation. Yet many firms and individuals continue to face challenges accessing finance, expertise, and market opportunities that they need to grow, invest, and create more and better jobs, particularly for women and youth.

IFC supports private sector-led development through investments, advisory services, and private capital mobilization. IFC’s current engagement includes expanding access to finance through local financial institutions, strengthening sustainable finance and capital markets, supporting entrepreneurship and private sector competitiveness, and helping mobilize private investment in infrastructure and other priority sectors. IFC is also working with public and private sector partners to develop innovative financing approaches that can support sustainable growth and urban development.

By working with both public and private sector partners, the World Bank Group aims to unlock new opportunities for job creation, productivity, private investment, and long-term economic resilience in Mongolia.

(Last Updated: October 2026)