Launch of the eTrade Readiness Assessment of Mongolia (UNCTAD)

Arguments

The government of Mongolia attaches great importance to the development of e-commerce as a way to diversify the economy

Supporting facts:

• The government of Mongolia, in collaboration with UNCTAD, conducted an e-trade readiness assessment

• The assessment was conducted from 2022 to 2023 with results and recommendations anticipated during the launch event

Topics: e-commerce, Mongolia, economic diversification

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Gerelmaa Davaasuren asks about the role of the United Nations resident coordinator’s office in coordinating all activity to help Mongolia become a digital nation and develop the e-commerce ecosystem.

Supporting facts:

• Dapa Mishra is a friend of Mongolia, knows everything in Mongolia, and is very supportive for Mongolia.

• Dapa Mishra has close contact with the government officials and all the stakeholders, including the civil society.

• Dapa Mishra coordinates all activity of the United Nations and other international organizations in Mongolia.

Topics: Digital Nation, E-commerce Ecosystem, Mongolia, United Nations

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Report

The government of Mongolia, in collaboration with the United Nations Conference on Trade and Development (UNCTAD), has placed significant importance on the development of e-commerce as a means to diversify the economy. An e-trade readiness assessment was conducted from 2022 to 2023 to evaluate the country’s preparedness for e-commerce.

The assessment, supported by UNCTAD, aims to provide valuable insights and recommendations to further enhance e-commerce development in Mongolia. The results and recommendations from the assessment are expected to be unveiled at an upcoming launch event. Mongolia, being a landlocked developing country situated between two larger neighbors, faced substantial trade challenges, which were exacerbated by the COVID-19 pandemic and border closures.

These difficulties had a negative impact on the economy, prompting Mongolia to explore e-commerce as a potential solution to achieve economic stability. By embracing e-commerce, Mongolia aims to overcome trade obstacles and build greater resilience. The United Nations resident coordinator’s office plays a crucial role in coordinating all activities related to assisting Mongolia in its journey towards becoming a digital nation and developing an e-commerce ecosystem.

Led by Dapa Mishra, the office maintains close contact with government officials and stakeholders, including civil society, to drive collaboration. Through these coordinated efforts, the United Nations, along with other international organizations, aims to support Mongolia’s digital transformation and foster the growth of e-commerce.

In conclusion, the government of Mongolia and UNCTAD have undertaken an e-trade readiness assessment to explore the potential of e-commerce for economic diversification. Despite facing challenges due to the COVID-19 pandemic and border closures, Mongolia recognizes the importance of e-commerce in stabilizing the economy.

The United Nations resident coordinator’s office plays a vital role in coordinating efforts to assist Mongolia in becoming a digital nation and fostering the development of the e-commerce ecosystem. This collaborative approach seeks to create a more resilient and dynamic economy for Mongolia’s future prosperity.

Arguments

Mongolia is committed to implement e-trade readiness

Supporting facts:

• More than half of Mongolians have access to the Internet

• e-Solutions program is aimed at equipping the population with digital skills

• Recent enactments like e-Signature Law and Law on National Payment System

Topics: e-trade, digital infrastructure, digital literacy, legal readiness

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Report

Mongolia is making significant progress towards e-trade readiness and promoting a tech-inclusive economy. With over half of the population now having access to the Internet, the country is actively implementing programs to ensure that its citizens have the necessary digital skills.

This emphasis on enhancing digital literacy will play a crucial role in enabling individuals to participate in the digital economy. Recent legislative actions, such as the e-Signature Law and the Law on the National Payment System, demonstrate Mongolia’s commitment to building a strong digital infrastructure.

These enactments provide a legal framework to support e-trade operations and facilitate secure online transactions. By enacting these laws, Mongolia is actively working towards establishing an environment where electronic transactions can be conducted safely and with confidence. Mongolia’s dedication to e-trade readiness is further highlighted by its ongoing efforts to develop an IT service export strategy in collaboration with the International Trade Center.

This strategy aims to facilitate the export of Mongolian IT services, creating opportunities for economic growth and entrepreneurship. Additionally, the country is exploring innovative solutions such as enhanced transportation networks and drone deliveries, which will not only improve efficiency but also enhance the overall e-trade ecosystem.

Mongolia’s Vision 2050 underpins its commitment to a tech-inclusive economy. This long-term vision serves as a roadmap for advancing technology adoption and ensuring that no one is left behind in the digital transformation. By embracing technology, Mongolia aims to drive economic prosperity, foster innovation, and create a society that fully embraces the benefits of the digital era.

Overall, there is a positive sentiment towards the advancement of e-trade and the digital economy in Mongolia. The country’s efforts in expanding digital infrastructure, promoting digital literacy, enacting relevant laws, and forging partnerships are crucial steps in creating an enabling environment for e-trade.

With its commitment to a tech-inclusive economy, Mongolia is poised to unlock the economic potential of the digital age and create opportunities for its citizens to thrive in the global marketplace.

Arguments

In Mongolia, majority of e-commerce activities are domestic and centered in the capital. E-commerce hasn’t picked up on the cross-border yet

Supporting facts:

• Most online shopping in Mongolia occurs in the capital, with usage of domestic and international third-party marketplaces. Around 500 responses were collected during the study period of e-trade readiness

Topics: Mongolia, E-commerce, Cross-border e-commerce

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ICT infrastructure in Mongolia is a national priority but requires significant improvements

Supporting facts:

• ICT infrastructure investments are increasing but not specifically encouraged. Connectivity is insufficient, especially in rural areas and cost is a major barrier. Despite 3G, 4G and possibly impending 5G deployment, they are likely to be limited to the capital

Topics: Mongolia, ICT infrastructure, E-commerce

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The need for increased financial literacy and diversifying investment options for e-commerce in Mongolia

Supporting facts:

• Most Mongolian SME’s engaged in e-commerce activities are self-financed. This lack of financial backing leads to a short lifespan (less than 3 years) of these startups. Despite existing financing options, the awareness is low

Topics: Mongolia, Investment, E-commerce

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Report

The e-commerce sector in Mongolia faces numerous challenges, according to a study. The majority of online shopping activities in the country are domestic and primarily centred in the capital city. Cross-border e-commerce has not yet gained momentum in Mongolia. One of the major issues highlighted by the study is the lack of a comprehensive vision or roadmap for the development of e-commerce.

While the country has various strategies and policies related to e-commerce, there is a clear absence of a well-defined plan to advance this sector. High-level political support is identified as a crucial factor for the development of e-commerce in Mongolia.

Despite the presence of strategies and policies, the study points out that there is a need for clear political backing to drive the growth of the sector. Another significant challenge faced by Mongolia is the inadequacy of its ICT infrastructure, particularly in rural areas.

Despite increasing investments in ICT infrastructure, connectivity remains insufficient in remote regions. The high cost of connectivity is also identified as a major barrier to the development of e-commerce. Although 3G, 4G, and possibly impending 5G deployments are expected, their availability is likely to be limited to the capital city.

Trade logistics and facilitation present significant hurdles for the e-commerce sector in Mongolia. The vast geography of the country and laborious customs clearance processes make cross-border e-commerce particularly challenging. Additionally, the presence of multiple ununified addressing systems further complicates deliveries.

The study also highlights the financial challenges faced by Mongolian SMEs engaged in e-commerce activities. Most of these SMEs are self-financed, resulting in a short lifespan for startups, typically less than three years. Despite existing financing options, there is a lack of awareness about them, further hindering the growth of e-commerce.

Furthermore, there is a larger issue of public awareness regarding the laws regulating e-commerce in Mongolia. According to the study, around 90% of Mongolians are unaware of the laws applicable to e-commerce, indicating a significant lack of trust in the sector.

This lack of awareness raises concerns about consumer protection and highlights the need for improving transparency and education in this regard. In conclusion, the e-commerce sector in Mongolia faces several challenges. The lack of a comprehensive vision or roadmap, inadequate ICT infrastructure, trade logistics and facilitation hurdles, financial constraints, and limited public awareness about e-commerce laws are the key areas that need to be addressed to foster the growth of this sector in Mongolia.

Increased financial literacy, diversification of investment options, and the provision of political support are crucial in overcoming these challenges and unlocking the full potential of e-commerce in the country.

Arguments

EBRD is committed to support Mongolia in realizing its Vision 2050 via digitalization and has identified fixed-line broadband infrastructure and access to finance as major bottlenecks

Supporting facts:

• EBRD has invested 2.3 billion euros, 75% of it to the private sector in Mongolia since 2006

• They have signed an MOU with the Ministry of Digital Development and Communication to formalize this commitment

• Only 11% of Mongolia’s population is connected via fixed lines while mobile has high penetration

• A third of the businesses cite inadequate infrastructure as a key reason not to invest in e-commerce solutions

• EBRD offers direct finance, credit lines and advisory services through SME local currency program

Topics: Digital Transformation, EBRD, Broadband Infrastructure, Access to Finance, Vision 2050

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Report

The European Bank for Reconstruction and Development (EBRD) has been a significant investor in Mongolia since 2006, having contributed €2.3 billion to the country’s development. The bank has focused on supporting the private sector, with 75% of their investments directed towards this sector.

To solidify their commitment to digitalization, the EBRD has recently signed a Memorandum of Understanding (MOU) with the Ministry of Digital Development and Communication in Mongolia. One of the major challenges that Mongolia faces is low connectivity rates, with only 11% of the population having access to fixed lines.

In contrast, mobile penetration is significantly higher. This limited connectivity is seen as an obstacle for businesses looking to invest in e-commerce solutions. In fact, a third of businesses in Mongolia cite inadequate infrastructure as a key reason for not pursuing e-commerce opportunities.

Recognising this bottleneck, the EBRD has identified fixed-line broadband infrastructure as a major area where support is needed. To address these challenges, the EBRD offers several avenues of support. Through their SME local currency programme, they provide direct finance, credit lines, and advisory services to businesses in Mongolia.

This programme is part of the bank’s broader efforts to foster economic growth and innovation in the country. Julia Anderson, a prominent advocate, fully supports the EBRD’s initiatives in Mongolia. She specifically highlights the importance of extending the bank’s investments to young innovative companies.

Additionally, she emphasises the need for expanding broadband rollout throughout the country. Given the EBRD’s track record in investing in broadband infrastructure internationally, Anderson believes that the bank is well-positioned to help Mongolia overcome its connectivity challenges. In conclusion, the EBRD’s commitment to supporting Mongolia in realising its Vision 2050 through digitalisation is commendable.

Recognising the barriers posed by inadequate fixed-line infrastructure and limited access to finance, the EBRD offers direct support to businesses in Mongolia through their SME local currency programme. Julia Anderson’s endorsement further emphasises the importance of investing in young innovative companies and expanding broadband rollout to drive economic growth and foster innovation in Mongolia.

Arguments

The national export strategy for Mongolia is primarily focused on the non-mining sectors. E-commerce is a natural opportunity for small businesses looking to engage in international trade, improving their operational efficiency and generating new market linkages. Despite the constraints and challenges, approximately 30% of small businesses in Mongolia are already using e-commerce, especially within emerging sectors such as IT services.

Supporting facts:

• 60% of small businesses in Mongolia have between 1 and 9 employees

• Approximately 30% of small businesses are already engaged in e-commerce

• E-commerce can improve operational efficiency like inventory management and addressing new customer needs

• New emerging sectors such as IT services can utilize e-commerce to build new market linkages.

Topics: National Export Strategy, E-commerce, Small Businesses, IT services

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Report

The national export strategy of Mongolia primarily focuses on non-mining sectors and acknowledges the potential of e-commerce for small businesses in engaging in international trade. Approximately 30% of small businesses in Mongolia are already utilizing e-commerce, particularly in emerging sectors like IT services.

This adoption of e-commerce is driven by the recognition that it can improve operational efficiency and create new market linkages. However, small businesses in Mongolia face constraints and challenges when it comes to embracing e-commerce. These include logistical issues, difficulties in trade facilitation, and a lack of necessary skills.

Solutions can be found to overcome these obstacles, such as the development of digital public goods that provide specific knowledge on e-commerce practices and international trade. To address the limited capacities of small businesses, it is crucial to focus on skills development.

Data from the Mongolian Chamber of Commerce highlights the prevalence of microenterprises among small businesses, emphasizing the need to support them in acquiring the skills necessary for successful engagement in e-commerce and international trades. The concept of digital public goods as a solution becomes significant in bridging the skills gap of small businesses.

By offering accessible and tailored resources, digital public goods empower small businesses to overcome trade-related challenges and fully leverage the benefits of e-commerce and international trade. It is important to note that there is a mixed sentiment regarding the current state of e-commerce adoption among small businesses in Mongolia.

While some businesses have embraced e-commerce, others still face difficulties due to various constraints. Continued efforts and support are necessary to foster a broader adoption of e-commerce practices among small businesses in Mongolia. In conclusion, the national export strategy of Mongolia recognizes the potential of e-commerce in non-mining sectors, particularly for small businesses.

Approximately 30% of small businesses already engage in e-commerce, but challenges such as logistical issues, trade facilitation problems, and skills development needs persist. Strategies such as the development of digital public goods can help overcome these obstacles and promote broader adoption of e-commerce practices.

Continued support is crucial to enable small businesses in Mongolia to fully benefit from e-commerce and international trade opportunities.

Arguments

UNCTAD is committed to supporting Mongolia in its journey towards digital transformation and embracing digital era

Supporting facts:

• Mongolia has internet accessibility of 84.3% and 4.8 million mobile connections, mostly in urban areas

• A UN joint program on digital transformation has been submitted under the SDG Fund for Mongolia

• Mongolia is developing a national e-commerce strategy

Topics: digital transformation, e-trade readiness, digital strategy development

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Mongolia needs to tackle challenges like rural connectivity, internet awareness and literacy, and last mile access

Topics: rural connectivity, digital literacy, digital divide

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Report

Mongolia is actively pursuing digital transformation and e-commerce development, with a particular focus on improving internet accessibility and increasing mobile connections in urban areas. Currently, Mongolia has an internet accessibility rate of 84.3% and 4.8 million mobile connections, primarily concentrated in urban areas.

This indicates a strong foundation for the country to build on in its digital journey. To support Mongolia’s digital transformation, a joint program on digital transformation has been submitted under the SDG Fund. This is a positive step towards securing the necessary resources and expertise to drive the country’s digital agenda forward.

The commitment of the United Nations Conference on Trade and Development (UNCTAD) in assisting Mongolia with its digital transformation signifies the global recognition of the importance of embracing the digital era. Efforts to achieve e-commerce development in Mongolia are being carried out in collaboration with multiple stakeholders.

The Ministry of Foreign Affairs and the Ministry of Digital Development and Communications have joined forces to assess e-trade readiness in the country. This assessment involves the active participation of key national stakeholders from both the public and private sectors, ensuring a comprehensive and inclusive approach.

Additionally, international organizations have come together to contribute to this project, highlighting the importance of cross-cutting cooperation and multi-stakeholder conversations in achieving digital transformation and e-commerce development. This collaborative approach acknowledges that the involvement of various stakeholders will be crucial in successfully implementing digital initiatives and strategies.

However, there are still challenges that need to be addressed. Mongolia faces issues such as rural connectivity, internet literacy, and last-mile access. These challenges are essential to tackle to ensure that everyone, regardless of their location or level of digital literacy, can benefit from the country’s digital advancements.

Bridging the digital divide and promoting internet awareness and literacy will be key in ensuring that the benefits of digital transformation are accessible to all. Furthermore, embracing a digital economy has the potential to help Mongolia diversify from its commodity-based economy.

By harnessing the opportunities presented by digital transformation, Mongolia can promote economic growth and generate new avenues for employment. The E-Trade Readiness Assessment can play a vital role in providing policy recommendations and guidance to accelerate Mongolia’s digital transformation, enabling the country to leverage its digital potential effectively.

In conclusion, Mongolia is making notable progress towards digital transformation and e-commerce development. With a focus on improving internet accessibility, involving multiple stakeholders, and addressing challenges such as rural connectivity and the digital divide, the country is positioning itself to embrace the digital era.

The shift towards a digital economy also presents an opportunity for Mongolia to diversify its economy and drive economic growth. The support and commitment from UNCTAD, along with the involvement of various stakeholders, will be crucial in ensuring the success of Mongolia’s digital journey.

Arguments

Digitalization is recognized as a cross-cutting enabler for achieving the Sustainable Development Goals

Supporting facts:

• Almost all governments, United Nations agencies and development partners are developing and implementing projects and programs in digitalization.

Topics: Digitalization, Sustainable Development Goals

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Efforts in digitalization are bringing limited impacts due to lack of digital cooperation and coordination.

Supporting facts:

• Entities are implementing their work in silos, leading to a high chance of duplication of efforts and a lost opportunity for building synergy.

Topics: Digitalization, Cooperation, Coordination

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United Nations resident coordinators and their offices play a key role in coordinating digital transformation.

Supporting facts:

• As the United Nations resident coordinator in Mongolia, Tapan Mishra coordinated the cooperation between the Ministry, UNTAD, and the UN Mongolia to build synergy by jointly organizing series of digitalization activities, including the launch of Mongolia ET Ready Assessment Report, the 2023 Global Digital Dialogue.

Topics: United Nations, Digital Transformation, Coordination

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Report

Digitalisation is widely recognised as a crucial factor in achieving the Sustainable Development Goals (SDGs). Governments, United Nations agencies, and development partners across the globe are actively engaged in developing and implementing projects and programmes in digitalisation. It is understood that digitalisation has the potential to act as a cross-cutting enabler for the successful attainment of the SDGs.

However, despite the efforts in digitalisation, there is a notable limitation in the impact being achieved. This limitation can be attributed to a lack of digital cooperation and coordination among different entities. Many organisations are working independently, resulting in duplicated efforts and missed opportunities for collaboration.

This siloed approach hampers the potential synergy that can be created through effective digital cooperation and coordination. To address this issue, it is crucial to enhance digital cooperation and coordination among all relevant stakeholders. United Nations resident coordinators and their offices play a significant role in this regard.

In the case of Mongolia, for example, Tapan Mishra, the United Nations resident coordinator, successfully coordinated cooperation between the Ministry, UNTAD, and the UN Mongolia. This collaboration led to the organisation of various digitalisation activities, including the launch of the Mongolia ET Ready Assessment Report and the 2023 Global Digital Dialogue.

Such joint efforts demonstrate the importance of United Nations resident coordinators in coordinating digital transformation and fostering synergy amongst different entities. Furthermore, proactive engagement with all relevant players in the field of digitalisation is essential. Regular meetings with relevant ministries can help address emerging issues and unlock potential opportunities for cooperation.

This proactive approach ensures that all stakeholders are involved and that collaborative efforts are maximised, leading to more significant and effective outcomes in digitalisation. In conclusion, digitalisation is widely recognised as a critical enabler for achieving the Sustainable Development Goals.

However, the limited impact being achieved in digitalisation is largely due to a lack of digital cooperation and coordination. United Nations resident coordinators and proactive engagement with relevant players are essential in coordinating digital transformation, fostering collaboration, and ultimately achieving substantial progress towards the SDGs.