"The private sector will play a critical role to end to poverty, achieve less inequality and to have a planet that can support us all by 2030."

August 28, 2018

Beate Trankmann/ Photo by UNDP Mongolia


Following interview was conducted by Mongolia’s Observer Magazine in October, 2017.

Observer: In 2015, world leaders agreed on a new development agenda - the Sustainable Development Goals (SDGs) – to end poverty, reduce inequality and protect our planet by 2030. What are the key challenges for Mongolia to address and what progress has already been made?

Beate Trankmann: Since its transition to democracy, Mongolia has achieved important development gains. Progress in strengthening democratic governance and human rights make Mongolia a model of democracy in the region.  In 2015, it entered the ‘high’ human development category for the first time. It  currently ranks as 92nd out of 187 countries on the 2016 Human Development Index..Since 1990, life expectancy at birth jumped by 9.5  years; expected years of schooling grew by 4.6 years; and GNI per capita rose by about 124 percent.

Until 2014 economic progress had lifted half a million people out of poverty. But its development gains remain fragile. As a result of the recent economic slowdown, Mongolia has seen poverty levels rising again, currently affecting nearly one in three people (29.6 percent) compared to 21.6 percent in 2014.  And while Mongolia was one of only nine countries around the globe to have achieved the MDG goal on maternal mortality reduction (MMR), recent trends show an increase in maternal mortality rates from 2015-2016.

The benefits of Mongolia’s largely mining-led growth have also not been shared equally. Areas that have benefitted from mining are seeing greater wealth, such as those in the mineral-rich Umnugovi, with poverty rates as low as 15.4 percent.  . However other areas – such as the Govisumber region – show poverty levels as high as 52 percent. In Ulaanbaatar, inequality in opportunities and access to services are a key challenge with one third of the capital living in ger districts, without sanitation, running water or central heating. Poverty in UB, which used to be lower than in rural areas is also fast catching up and much of the recent overall increase in national poverty rates has been driven by an increase in poverty in the  capital city.  

Mongolia’s heavy reliance on mining – making up 20 percent of GDP and 90 percent of exports – makes it vulnerable to global volatility, such as sudden commodity price changes as seen in 2012-2015. While growth is recovering – at more than 5 percent in the first half of 2017 according to official data, from just 1 percent in 2016 – it remains mining-based. Further diversification into areas such as agriculture, renewable energy, tourism and technology is needed to realise lasting, sustainable growth – and jobs. Unemployment remains at about 10 percent nationwide, and around 17 percent for those aged 20-24 years old. This must be resolved across multiple industries, given mining only accounts for 4 percent of jobs. Sectors such as agriculture, by contrast, create 28 percent of jobs.

Economic progress has also come to some extent at the expense of environmental degradation. Mongolia is one of the most vulnerable countries to climate change on earth. Over the past 70 years, its average temperatures have increased by more than 2°C, already surpassing the limit the world is trying to avoid, and rising by almost three times than the global average. Climate-related disasters, such as droughts and dzuds, are putting greater strains on herding communities and threatening rural livelihoods. This has led to more migration to Ulaanbaatar and as a result, greater air, water and soil pollution. Without adequate housing, families in ger districts must resort to burning coal during winter that can lead to air pollution in some districts more than 30 times the WHO safe limit, raising serious concerns for human health. Major efforts are needed in climate change adaptation and mitigation, which the UN is already working on here. This includes protecting and managing water resources, as well ensuring environmentally friendly energy, housing and insulation.

Mongolia’s government has shown strong commitment to addressing these challenges, incorporating the SDGs into its Sustainable Development Vision for 2030. The SDV envisages a Mongolia that is one of the leading Middle Income Countries by 2030 - ending poverty and preserving the country’s valuable environment, while continuing to build strong and stable governance systems. A new government institution – the National Development Agency (NDA) – was also set up in 2016, to oversee long-term planning and facilitate policy coherence in carrying out the SDV and SDGs. It is also in charge of regional development policies and public investment. The next step now is for Mongolia to continue translating the aspirations of the SDGs and the SDV into detailed plans, sector policies and government budgets across all levels. To protect the important development gains made since the democratic transition and halt the recent reversals, it will also be crucial that these plans identify possibilities to continue prioritizing government investments into social services and environmental protection measures despite the tightening fiscal space.

Observer:  What role is the UN playing in helping to achieve the SDGs in Mongolia?

Beate Trankmann: To guide our support for Mongolia’s development over the next five years, we launched a new Development Assistance Framework (UNDAF) for 2017-2021 in consultation with the government. From now through the end of 2021, we will focus on promoting inclusive growth and sustainable use of natural resources, improving equitable access to social services, as well as strengthening governance in Mongolia.

To achieve this, the United Nations will contribute an estimated $79 million in joint activities in addition to programmes supported by individual UN agencies.

We will work with all stakeholders, including the government, private sector, civil society and young people, aged 15-34 years old – accounting for one third of Mongolia’s population – towards these goals.

We will also provide high-level policy and technical advice to enable the SDGs and the SDV to be carried out. This includes mainstreaming the SDGs into national and local level government plans and developing screening tools for example to review and align sectoral strategies and policies with the SDV and the SDGs. It also includes guiding strategies for better targeting of scarce public resources towards social and environmental outcomes and towards key SDGs that can accelerate progress across the entire 2030 agenda. We will also be looking at SDG financing strategies involving both the public and private sector, forging broad alliances to achieve the SDV/ SDGs. Work will furthermore help put data and monitoring systems in place to track progress over time and inform policy making including through innovative approaches to data generation and real-time monitoring by using big data.

In addition, UN will continue to support Mongolia in achieving its development targets through specific on the ground interventions and projects that can accelerate country’s SDGs progress, such as diversification of herder household income sources, contributing to better health outcomes through mobile health clinics or supporting reduction of heat losses in public buildings, to name a few.

Observer: How can the SDGs be financed in Mongolia, and what role should the private sector and public-private partnerships play?

Beate Trankmann: The private sector will play a critical role in whether we can realize an end to poverty, less inequality and a planet that can support us all by 2030. The UN estimates the total investment needed to achieve SDGs in developing countries over the next 15 years ranges from USD 3.3 trillion to 4.5 trillion a year – and that 70 percent of the funding must come from corporations. Companies can bring investment, expertise and innovation to key sustainable development areas, such as agriculture. For example, Mongolia has more than 61 million heads of livestock, but further investments are needed to raise the nation’s agricultural processing standards, to boost dairy and meat exports and create more jobs in agro-processing, as an alternative to herding. This could facilitate a shift away from ever-increasing numbers of livestock to sustain rural livelihoods, towards qualitatively better products. It would also create alternative income opportunities in agriculture – such as dairy products – allowing for a reduction in livestock numbers to decrease pressures on overstretched grazing grounds.   

Mongolia’s potential for expanding renewable energy is also strong. An estimated 10 percent of its territory, approximately the size of Greece, is suited to creating wind energy and the country enjoys an average of 270-300 sunny days a year. Private and public investments in renewable energies and new technologies will help protect Mongolia’s environment, reduce winter air pollution and limit Mongolia’s exposure to commodity price changes.

Mining is likely to remain the main driver of Mongolia’s economy in the years ahead. However, mining companies can mitigate and offset any damage they do to the land. They can make a difference by rehabilitating landscapes and protecting nature reserves, as well as finding ways to use less water and energy. With support from the Global Environment Facility and the UN, Mongolia is introducing new landscape valuation methods and mechanisms to offset unavoidable environmental damage caused by mining operations – an approach which is rather new to and not widely availed off by the mining companies in Mongolia.  Companies can also contribute to local development through corporate social responsibility (CSR) initiatives, such as providing schools and clean water to the communities around them.

Directing resources towards human development and protecting the planet are investments, not costs. Sustainable business is smart business. Fighting poverty, raising education and health helps produce the right talent and skills needed among employees, as well as consumers with greater spending power. Sustainable practices also ensure more natural resources remain available for future use.

Doing business responsibly is also a marketing asset, helping companies promote a more positive image to customers, investors, the media and other stakeholders. According to Adweek, Millennials represent $2.45 trillion in spending power – and young consumers are putting their money where their heart is. Omnicom reports that 70 percent of Millennials will spend more money on brands supporting causes they care about.

The financial burden of sustainable, inclusive investments is lessened on all fronts when public and private sectors work together. The UN is no longer a primary donor, but rather a service provider and investment partner. We can help companies to reduce their risk through blended model financing, with UN grants to limit their exposure. We can also help to develop the enabling environments for sustainable investments by coordinating across stakeholders, including with the government, communities and civil society. In addition, the UN can offer global expertise and experience to build public-private partnerships that achieve development solutions. It can also offer its finance and procurement systems as well as its networks across government to carry out large scale investment programmes – whether public or private. For example, in the Philippines, the UN is a partner in procuring key education equipment including IT systems and delivering services to schools in 5,000 islands while developing systems for their monitoring jointly with the government and civil society organizations.

Observer: What can the general public and regular citizens do to help end poverty, reduce inequality and protect their environment?

Beate Trankmann: The SDGs are about changing the way we live, behave, consume, produce and invest. All of us can contribute to achieving them, even through small adjustments in our daily routines. This includes turning off lights and appliances when we are not using them. It involves considering the goods we use or buy, such as choosing locally grown produce to create jobs in our communities, or avoiding food waste by consuming fruits and vegetables that may otherwise be thrown away, but remain perfectly fine to eat. Sustainable lifestyles involve declining plastic bags and recycling whenever possible, such as sharing the clothes, books and toys that your family no longer needs, or asking your local Khoroo to provide recycling bins to separate trash.  It includes changing how we transport ourselves - considering, for instance, to walk, cycle, or take public transport, rather than a car or taxi.  

We can also make a difference through choices we make about our representation. Consider for example, how your organisation could encourage more female leaders, to improve gender equality in decision-making. Mongolians also have the right to vote, as well as take part in civil society organizations. All citizens – and young people especially – should consider whether they are making their voices heard, so they can shape their futures.