MONGOLIA AT A GLANCE

Landlocked Country

A Vast Territory

Ulaanbaatar - A City State

Poor Infrastructure

A Small Population

Few Foreigners Living in Mongolia

A Young Population

An Urban Majority

An Educated Nation

Religious Plurality

A Sole Language

Strong Freedom of Speech

A Functional Democracy

A Real Parliamentary System

The Third Neighbor Policy

A Growing Economy

A Stable Currency

Increasing Disposable Income

UB: A Nomad City

A Crowded Household

UB: A Horse-Riding City

Real Estate Prices

FRANCE UK GERMANY ITALY

1,564,116 km2 

TOP 5 CITIESTOP 5 CITIESTOP 5 CITIES

ULAANBAATAR 1,350,000 49,1%

ERDENET 88,000 3,2 %

DARKHAN 75,000 2,7 %

CHOYBALSAN 38,000 1,4 %

MORON 35,000 1,2 %

Only 1 Railway Track& just A few paved roads (5%)

HEADS OF CATTLE

&

INHABITANTS33,000,000 2,750,000

The country is landlocked, sandwiched between Russia and China. This presents considerable logisitcal and infrastructure challenges in particular in such a vast country. Being locked-in between Russia and China, two powerful neighbours, often also means that geopolitics take precedence over business logic as national unity and independence must be saveguarded at all costs.

Mongolia is made up of a surprisingly vast territory, of over 1,5 million square kilometers. This is the equivalent of France, the UK, Germany and Italy all put together, with a little to spare - maybe for the Vatican or Lichtenstein. This wThi ith a population of barely 3 million people gives Mongolia the lowest population density in the world.

In terms of infrastructure, Mongolia still has much progress to do with a single railway track running from China to Russia and only 5% of its roads (what few roads there are) paved. Beyond this, the current urban infrastructure is struggling to cope with the staggering growth in population within the cities.

According to the latest of�cial census, we only have 16,500 of�cially registered foreigners resident in Mongolia. Of which 52% are Chinese, 3,500 are Westerners, 15% Russians and the remaining 1,800 are split between Khazaks, North Koreans, Vietnamese, Turks and so forth...

Of the 2,7 million population in the country, 70% live in an urban environment while 30% still lead a nomadic life-style tending to cattle. This is a dramatic change from the last decade where nearly 50% of the country still led a nomadic lifestyle.

In terms of religion, Mongolia is well balanced and there are no religious tensions amongst the population. Just over half of the population is Buddhist while 40% are of�cially Atheasits. Only 3% declare themselves to be Islam-ists, mostly from the western Khazak regions. Interestingly, only 2% of the population is registered as being of the Christian faith.

Most important of all is the use of language and today in Mongolia we bene�t from having considerable freedom of speech, this is found throughout the press, access to internet and is visible on a daily basis with demonstra-tions on Sukhbaatar Square.

The parliament that was voted in 2012 is split fairly evenly between the Democractic Party at 46% and the MPP (Mongolian People’s Party) at 33% while the Justice Coalition only has about 14% of the seats and the Civil Will Green Party as well as the Independent candidates make up the rest.

GDP growth in the country has been staggering, and while we are now at about 4,000 USD per capita we expect to reach a GDP per capita of nearly 12,000 USD by 2016. This growth in GDP can be explained from its relatively low starting base as well as the current mining boom taking place throughout Mongolia.

Monthly average dispoble income has been going up consistantly over the past 6 years and we see little reason for it to slow down any time soon. This contributes signi�cantly to the creation of a solid middle-class who will soon have suf�cient purchasing powers to obtain the obligatory accessories of relative wealth (apartments, cars, holidays etc....)

Ulaanbaatar is a crowded city with an average household size of about 6 people. Quite a lot for an average apart-ment size of only 65 square meters. The demand for additional housing is now considerable while the supply is lagging behind.

We have seen considerable growth over the past few years and currently average prices per square meter stand at: Low-to-mid residential is between 1,500 USD and 3,000 USD per square meter. Mid-to-high end residential is between 2,500 USD and 10,000 USD per square meter. Grade A & B of�ce is between 2,000 and 6,000 USD while grade A & B retails currently sells at anywhere between 2,000 and 7,000 USD.

The country is very much driven by its capital of Ulaanbaatar with over half the population currently residing in the city. This makes Ulaanbaatar a city state within this very large country, all �ights literaly go to and from Ulaan-baatar and all descions are made in the Capital.

Surprisingly, Mongolia has a population of 33 million heads of cattle for only 2,7 million inhabitants. I believe that it is the only country in the world to have such a high ratio of people versus cattle. This makes the country still economically dependent on husbandry for basic every-day necessities such as meat, cashmere and wool.

Mongolia bene�ts from having an extremelly young population with nearly half of its population still in education and soon to join the workforce. 46% of the population is of working age and only 5% are considered ageing, a fairly unique situation in the region, particularily when compared to China, Russia and Japan that all have mas-sively ageing populations.

Education in Mongolia is a legacy from the Soviet Union days but it still achieves a staggering 97% literacy rates, one of the highest in Asia and no small feat when you consider that Mongolia has the lowest population density in the world.

Importantly, Mongolia has a single unifying language, but which is written on two scripts, one is the new cyrilic alphabet while the old mongolian script is coming back into fashion after being banned for over 70 years during the Soviet period.

People vote in fair and democratic elections every 4 years, in June 2012, a new parliament was voted in and the people of Mongolia will vote for at the Presidential election in 2013. The role of the President is mostly ceremonial while the Prime Minister holds the real power as the head of Parliament.

Mongolia practices its now famous third neighbour policy with great ef�ciency, it essentially means that when given a choice they would much rather trade with any country other than China or Russia. The closest "third neighbours" are generally considered to be the US, South Korea, Japan, Australia, Canada and the EU.

The Currency, the Mongolian National Togrog, has been extremelly stable overall against the USD and is consid-ered to be a reasonably solid currency by international watchdogs. It is not pegged to the USD or any other cur-rency and is a free trading currency with no restrictions on international repatriation of capital.

Interestingly, of the 1,3 million inhabitants of Ulaanbaatar today, only about 40% live in an actual building with solid walls, the vast majority - 60% - still live in the traditional nomadic type of housing known as "a ger". This is gradually improving but is not keeping up with the rapid pace of urbanisation in Ulaanbaatar.

We call UB a horse-riding city, despite Mongols swapping the horse for the car the principal is the same. We have a staggering 170,000 cars for only a 125,000 property titles. The 125,000 property titles include all types of prop-erty, not only residential but also commercial, retail, industrial and so forth. Another interesting tidbit is that of the 170,000 cars of�cially registered in UB, over 50% of them have a value of over 20,000USD.

52% - CHINESE8,700

22% - Westerners3,500

15% - RUSSIANS2,500

11% - OTHERS1,800

49%0 to 24 years old

46%25 to 59 years old

5%60 and +

INHABITANTS

2,750,000

70%1,920,000URBAN LIFE

30%830,000NOMADIC LIFE

LITERACY RATE

97,4%

CHRISTIANITY

2%ISLAM

3%BUDDHISM

53%SHAMANISM

3%NO RELIGION

39%

NONE

Yes !We have !

Yes !We have !

Yes !We have !

Yes !We have !

Yes !We have !Yes !

We have !

... but we writewith two

character sets

We all speakMongolian !

PRESIDENTEACH 4 YEARS

PARLIAMENTEACH 4 YEARS

76 PARLIAMENT MEMBERS

DEMOCRATICPARTY 46%

14%JUSTICE

COALITION

33,3%MONGOLIAN

PEOPLE’S PARTY

0,4%INDEPENDENT

CANDIDATES

0,3%CIVIL WILL

GREEN PARTY

$2,000

$4,000

$6,000

2007 2009 2011 2013 (est)

GDP per Capita

TUGRIK or MNT

MNT500

MNT1,000

MNT1,500

2002 2005 2008 2011

MNT vs USD

175,000

350,000

525,000

700,000

2006 2008 2010 2012

Monthly Average Household Income (MNT)

37%550,000BUILT UP

63%850,000GER DISTRICT

1,350,000INHABITANTS

6 OCCUPANTSPER HOUSEHOLD

CARS

170,000PROPERTY TITLES

125,000

Vs

Low to MidResidential

1,500 - 3,000 USD

Mid to HighResidential

2,500 - 10,000 USD

Grade A & BOf ce

2,000 - 6,000 USD

Grade A & BRetail

2,000 - 7,000 USD

presents

A Boutique Real Estate Investment Firm based in Ulaanbaatar and focused exclusively on bringing true added-value to its investors.

www.mad-mongol ia.com