Mongolia Weekly: Mongolia presses OT talks, probes Rio Tinto; S&P lifts rating; PPP oversight tightens

October 24, 2025 to October 30, 2025

This week's top 10 stories from Mongolia, selected from our daily intelligence briefs.

1. Government Opens Talks with Rio Tinto to Cut Oyu Tolgoi Shareholder Loan Interest, Speed State Returns

Mongolia has opened formal negotiations with Rio Tinto and Oyu Tolgoi LLC to amend financing and governance terms for the Oyu Tolgoi mine, aiming to lower the reported ~11% shareholder loan interest to about 6–7%, stop a contested 6% management fee (previously tied to a voided Dubai agreement and estimated at roughly USD 1.5bn), and accelerate dividend flows to the National Wealth Fund. A government task force led by Finance Minister B. Javkhlan and Industry and Minerals Minister G. Damdinnayam will begin talks around October 27–30 under Cabinet mandate; Justice Minister B. Enkhbayar is overseeing related London arbitration issues, while Parliament’s oversight committee has demanded outcomes and external audits despite Oyu Tolgoi declining to brief it directly.

The government also seeks governance changes—an independent board member, stronger veto and transparency provisions—and to boost Mongolia’s revenue share above 50%, challenging current arrangements it says leave roughly 25% of benefits to Mongolia and 75% to investors. The talks occur amid management turnover at Rio Tinto and Oyu Tolgoi, ongoing Entrée/Ontre licence disputes, and national‑security concerns about past contract processes (notably the 2009 Investment Agreement and seven‑year revision cycle). If successful, the renegotiation could materially accelerate state cash flows and alter long‑term fiscal projections tied to one of Mongolia’s largest mining assets.

Local Coverage: news.mn, eagle.mn, gogo.mn, montsame.mn, ikon.mn, urug.mn

From daily briefs: 2025-10-24, 2025-10-25, 2025-10-28, 2025-10-29, 2025-10-30, 2025-10-31

2. Rio Tinto launches internal probe into alleged procurement irregularities at Oyu Tolgoi, seeks law‑enforcement cooperation

Rio Tinto has opened an internal investigation into alleged corruption and procurement irregularities at Oyu Tolgoi LLC, where it holds a 66% stake (the Government of Mongolia holds 34%), and has sought cooperation from law‑enforcement agencies. The probe follows actions by Mongolia’s General Intelligence Agency, which on October 23 executed searches of homes, offices and company sites and detained four Oyu Tolgoi JSC officials — Legal Director D. Amartuvshin, Procurement Manager B. Serchmaa, Senior Specialist Ch. Nergui, and Department Head M. Ganbold — on allegations including bribery, abuse of office, illicit enrichment and money laundering. Investigators reportedly froze assets including roughly MNT 10 billion in cash, luxury property certificates and vehicles; media reports note Amartuvshin is the spouse of MP O. Nomintsetseg.

The case poses material risks to one of Rio Tinto’s largest growth assets — the underground expansion targeted to make Oyu Tolgoi the world’s fourth-largest copper mine by 2030 after production rose about 78% last quarter — by threatening supplier relationships, project timelines and governance oversight. Rio Tinto and Oyu Tolgoi have said they are cooperating with authorities, declined further details while reviews continue, and reiterated a zero‑tolerance stance on corruption, inviting confidential complaints to [email protected]. Potential independent audits, enforcement outcomes and any substantiated breaches could affect vendor vetting, costs and the project’s ability to scale copper output amid rising electrification and data‑center demand.

Local Coverage: montsame.mn, news.mn, unuudur.mn, itoim.mn, ikon.mn, urug.mn, gogo.mn

From daily briefs: 2025-10-24, 2025-10-25, 2025-10-28, 2025-10-29

3. S&P Lifts Sovereign Rating to BB- with Stable Outlook After Fiscal Tightening and Export Gains

S&P Global Ratings upgraded the sovereign rating to BB- with a stable outlook — the highest level in 13 years — citing improved fiscal performance since 2022 driven by stronger mining exports, sustained growth and active debt management that has lowered the debt‑to‑GDP ratio. S&P expects modest deficits over the next 1–2 years and policy continuity despite domestic political shifts; the upgrade follows Fitch’s affirmation at B+ (Stable) and Moody’s upgrade to B1 (Stable), signaling broader confidence across the “Big Three.”

Policy actions underpinning the move include a MNT 2.2 trillion cut to 2025 budget spending, a government focus on deficit reduction, and accelerated coal exports that helped push foreign reserves to a record level. S&P and other agencies say the improved rating should reduce external borrowing costs and strengthen bank and corporate funding, widening private‑sector access to foreign capital — a development Prime Minister G. Zandanshatar framed as validation of the government’s prudent debt policy and political stability.

Local Coverage: news.mn, eagle.mn, itoim.mn, montsame.mn, news.mn

From daily brief: 2025-10-31

4. Parliament Panel Advances PPP Law Amendments, Tightens MOF Oversight of Project Financing

On Oct. 29 the Parliament Economic Standing Committee advanced a first reading of amendments to the Public‑Private Partnership (PPP) Law and considered implementing measures for the Sovereign Wealth Fund, while also forming a working group on a revised Law on Standardization. Key provisions would require the Ministry of Finance (MOF) to review and issue opinions on PPPs financed from the state budget or by user fees/project revenues; mixed‑financing PPPs would need MOF approval and review by the Government’s oversight council, and if approval is refused the MOF must provide a written rationale to the central PPP authority.

Lawmakers insisted the sector minister be present for further deliberations, signalling heightened legislative scrutiny. The Ministry of Mining and Heavy Industry warned that activation of exchange trading tends to raise product prices, a factor that could affect revenues for resource‑linked PPPs and the new sovereign wealth fund framework—underscoring fiscal and commercial implications for project structuring and state oversight.

Local Coverage: gogo.mn

From daily brief: 2025-10-30

5. China, Russia and Mongolia Advance Cross-Border Road Transport; Kyrgyzstan Accession Discussed

Transport ministries of China, Russia and Mongolia held the fifth Joint Committee meeting online to review their intergovernmental agreement on international road transport via the Asian Highway network and agreed to maintain 2026 permit quotas at 200 permits per country, signalling incremental but steady cross‑border trucking capacity. The session also advanced discussions on admitting the Kyrgyz Republic via an additional protocol, which would extend the corridor’s reach into Central Asia and potentially reconfigure regional freight flows.

Passenger services were a prominent agenda item: China re‑tabled a proposal to open an irregular passenger route linking Dalian–Erenhot–Zamyn‑Uud–Altanbulag–Kyakhta–Irkutsk, together with a suggested protocol amendment to formalize passenger route coordination. If adopted, the combined freight quota stability, Kyrgyz accession and new passenger arrangements could streamline logistics, diversify travel options and strengthen overland connectivity across Northeast Asia’s trade routes.

Local Coverage: gogo.mn

From daily brief: 2025-10-25

6. Asian Youth Games Open in Bahrain with 4,000 Athletes; Mongolia Fields 134 Across 20 Sports

The third Asian Youth Games opened in Manama, Bahrain, this week, marking the event’s return after a 12‑year hiatus under the Olympic Council of Asia. Over 4,000 athletes from 45 national Olympic committees will compete across 10 days (dates: Manama opening this week), with new additions to the program including cycling and Muay Thai. Triathlon results carry direct Olympic implications, as winners earn quota places for the Dakar 2026 Youth Olympics, creating immediate qualification pathways for promising youth competitors.

Mongolia has entered a 134‑strong delegation across 20 sports, led at the opening ceremony by basketball player B. Emüjin and volleyball player Ts. Anand, and accompanied by senior Mongolian NOC officials including Secretary‑General E. Badar‑Uugan and executive member Ch. Amarsanaa. Early competition produced a notable result: Mongolia’s men’s volleyball team beat hosts Bahrain 3–1 to reach the quarterfinals, underscoring Mongolia’s competitive depth and potential to convert youth performance into future Olympic qualification.

Local Coverage: ikon.mn, gogo.mn, montsame.mn, eagle.mn, news.mn, urug.mn, unuudur.mn

From daily brief: 2025-10-24

7. State-Owned Enterprise Reforms Stall as Governance Failures Persist and “Erchist Mongol” Plan Fades

Mongolia’s planned overhaul of its 109 state-owned enterprises (SOEs) has stalled, leaving persistent governance failures: parliamentary disclosures show 44% of SOEs are in crisis and 10 firms produce 85% of total profits. The incoming government has not advanced prior proposals to cut the SOE portfolio by 20% or to link executive pay to performance, and the Temasek-style holding “Erchist Mongol” — which consolidated 44 entities across energy, transport and markets — has gone quiet despite its CEO G. Amartuvshin warning of capacity and remuneration gaps.

Reform momentum has shifted from SOE-specific bills toward amendments to the Law on State and Local Property and the Company Law after lobbying stalled earlier measures. Analysts and officials including B. Tsengel, head of the State Property Policy and Coordination Agency, and former PM L. Oyun-Erdene point to the need for independent boards, IFRS-based disclosure, competitive neutrality with the private sector, and an empowered, autonomous State Property Agency to curb political appointments, opaque finances and misaligned incentives that even allowed bonuses at loss-making firms.

Local Coverage: unuudur.mn

From daily brief: 2025-10-28

8. Industrial Output Falls 3.6% in First Nine Months as Mining Contracts

Preliminary data from the National Statistics Office show Mongolia’s industrial output fell 3.6% year‑on‑year to MNT 30.7 trillion in the first nine months of 2025 (a decline of MNT 1.2 trillion). The contraction was driven by mining, which dropped MNT 2.1 trillion (8.4%) to MNT 22.7 trillion; coal production value from stone and brown coal plunged MNT 5.0 trillion (32.3%), while crude oil extraction fell MNT 113.9 billion (13.3%).

The numbers indicate weaker extractive activity outweighed gains elsewhere in industry, underscoring Mongolia’s dependence on coal and oil. For investors and operators, the slowdown implies potential headwinds for export revenues, logistics demand and fiscal receipts unless commodity volumes or prices recover in Q4 2025.

Local Coverage: urug.mn

From daily brief: 2025-10-30

9. Northeast Asia Dialogue in Ulaanbaatar Targets Infrastructure, Energy, Water and Urban Resilience

From October 21–23, Ulaanbaatar hosted a Northeast Asia multistakeholder forum on sustainable development that convened government agencies, private-sector leaders, civil society, international organizations, researchers and youth to address infrastructure, energy, water management, urban sustainability and regional cooperation. Participants reviewed SDG implementation, identified barriers to cross-border projects in a landlocked context and sought practical collaboration pathways and policy alignment to advance resilient urban systems and resource management across the region.

Mongolia reiterated its commitment to the SDGs despite logistical constraints, with State Secretary L. Munkhtushig calling for strengthened regional partnerships grounded in innovation and inclusion to “leave no one behind.” The meeting’s outcomes are expected to shape project-level collaboration and regional policy coordination on infrastructure, energy and water resilience in Northeast Asia.

Local Coverage: unuudur.mn

From daily brief: 2025-10-24

10. Chinese Import Curbs Lift Mongolian Coal to Record 9.29 Million Tons in September

China’s customs data show Mongolian coal shipments to China hit a record 9.29 million tonnes in September 2025, up 33% year‑on‑year and the highest monthly volume since data began in 2015, bringing Mongolia’s nine‑month exports to 62 million tonnes. The surge follows Beijing’s policy to curb domestic coal output — including closures and capacity checks that pushed thermal coal to an eight‑month high and lifted metallurgical coal futures roughly 30% since July — prompting Chinese buyers to diversify toward nearby, lower‑cost suppliers.

Mongolia’s logistical advantages and government coordination underpin the export gains: 2 million tonnes have already moved via the Tavantolgoi–Gashuunsukhait railway with another 2 million tonnes planned by year‑end under a trilateral effort involving the Railway Authority, Erdenes Tavantolgoi (ETT) and China Energy; a 2025–2027 bilateral framework targets 5 million tonnes annually within a broader 247 million‑tonne arrangement. Analysts at Wood Mackenzie and Kpler say proximity and lower trucking/rail costs make Mongolia a durable supplier, while port stockpiles (2.24 million tonnes at Ganqimaodu by Oct. 19) and ongoing regulatory moves on cross‑border rolling stock suggest the trade shift is likely to persist in the near term.

Local Coverage: news.mn, urug.mn, itoim.mn, gogo.mn

From daily briefs: 2025-10-24, 2025-10-25, 2025-10-28, 2025-10-30

About This Weekly Digest

The stories above represent the most significant developments from Mongolia this week, selected through our AI-powered analysis of hundreds of local news articles.

Stories are drawn from our daily intelligence briefs, which synthesize reporting from Mongolia's leading news sources to provide comprehensive situational awareness for international decision-makers.