AKIPRESS.COM - Growth in Mongolia slowed from double-digit levels in 2011-13 to 7.8 percent in 2014 and is projected to decelerate to 3.3 percent in 2015, according to an outlook prepared by the European Bank for Reconstruction and Development.

The situation is observed as a result of lower FDI in the mining sector (due to the delays in several large mining projects, including the second phase of the Oyu Tolgoy (OT) project), lower commodity prices and weaker demand for commodities from China.

Domestically, a slow-down in the real estate sector is also contributing to more subdued growth.

The togrog has depreciated significantly in 2014 and 2015, notwithstanding significant interventions of the National Bank in the foreign exchange market and gradually tightening monetary policy.

Inflation is expected to remain relatively high, at around 8.2 percent.

The likely re-starting of the second phase of OT in late-2015, with significant investment expected in 2016 (and thereafter), can be expected to push up growth to a projected 5 percent in 2016. The potential loosing of fiscal policy in 2016 in the wake of parliamentary elections that will take place in June 2016 could give a further short-term boost to growth.

Real GDP Growth (forecasts as of 5 November 2015)