Ulaanbaatar /MONTSAME/. In connection with the establishment of Free Economic Zone in Khushig Valley, we talked with D. Oyunkhorol, the representative of the government and the head of Administration of Khushig Valley Development.
-What is the progress of the work since the approval of the draft resolution of the Parliament to establish a Free Economic Zone in the Khushig Valley?
- The Government of Mongolia is working to intensify the construction of New Settlement Zones, Free Economic Zones, and Satellite Cities, which are included in the action program for the implementation of the "New Recovery Policy". Within the framework of this work, focusing on decentralization of Ulaanbaatar city and reduction of congestion, based on the new "Chingis Khan" international airport, it is intended to establish a residential zone with a free economic zone where 150 thousand people will work and live on 31 thousand hectares of land in the Khushig Valley. It has not been long since the draft resolution of the Parliament to establish a Free Economic Zone in 1000 hectares of 31 thousand hectares of land. The free zone is planned as a tourism complex, a cultural and creative production center, a trade and service center, an information technology cluster, and an international financial center.
- How will the establishment of a free economic zone effect on the economy of our country?
- Our country has a brown economy that is too dependent on the mining sector. In the future, we need to diversify our economy and develop the economy of the service sector. This will create an opportunity for development that meets the goals of ecologically friendly and sustainable development without leaving anyone behind. On the other hand, by introducing world-recognized services that meet international standards in the tourism industry, thousands of young people will get jobs and many opportunities will open up.
- What remarkable developments are planned to attract tourists?
- An airport-based tourism complex and an entertainment centers will be built. Also, one of the newly emerging products in the tourism industry in recent years is to get health and beauty services for tourists. If this service is developed and introduced, it is seen to be very promising. According to the study of "Medical Tourism" conducted by the Bank of Mongolia in 2020, in 2019 alone, about 22,000 citizens of Mongolia received medical services worth 68.6 million US dollars abroad.
Then, if large international hospitals and a medical centers combining Western and Eastern traditional treatments were to built in our free zone, Mongolia will have the opportunity to receive world-class health services. In this way, the costs of medical treatment and services flowing abroad will flow domestically. It also means that our country will be able to become an exporter of medical services. The skills of Mongolian doctors have improved a lot. The establishment of an international medical centers will open opportunities for our specialized doctors to compete in the world in many fields, such as surgery, dentistry, and traditional medicine.
- How to solve the financing of the construction works? Is there any legal framework for investment?
- Foreign and domestic private sector enterprises to invest in construction work are still submitting proposals. We are working to meet regularly with the representatives of these organizations and reflect their suggestions. As for the legal environment, we are working to create a regulatory environment based on international legal norms and create opportunities for investors to conduct stable activities. It is estimated that this will increase foreign and domestic investment and expand Mongolia's gross domestic product or economy by 10-15 percent. For this purpose, international free zone policy has been studied very well. It is necessary to go according to the international standards of organizing the administration of the free zone in the form of a corporation. The corporation operates on the basis of public-private partnership(PPP), which is the most feasible option for raising bonds, loans and other sources of financing from the domestic and foreign markets.
- This is a big development for Mongolia. How are you planning to solve the critical infrastructure problem here?
- The infrastructure work on 31,000 hectares of Khushig Valley integrated planning is nearing completion. Preliminary engineering measures, sewage network, treatment plant, clean water supply, information communication, electricity and heat supply projects are being implemented. In the first instance, 1000 hectares of Free Zone land needs to be connected to the infrastructure, so we request the Ministry of Defense and International Investors to immediately prepare and provide the blueprint. In the framework of planning, the goal was to solve the engineering infrastructure solution with a tunnel system according to modern smart city standards. In general, it is considered necessary to obtain international consulting services in order to properly and optimally plan the economic free zone from the beginning.
- The issue of establishing a casino was discussed. Will it be success?
- 550,000 tourists come to our country every year and 3.5 percent of GDP is generated by the tourism industry, but the figures are insufficient. Therefore, modern tourism services should be developed to increase the number of tourists. It is seen that by establishing a casino will be an opportunity to develop the economy in the field of tourism. Foreign countries are developing casinos as a business with high economic benefits. 5800 casinos are operating in 155 countries. Now, in addition to these countries, casinos are being established in Japan and Dubai. There is an example of countries with casinos whose economy grew by 35 percent even during the pandemic. The Ministry of Justice is working to create a legal framework for the establishment of a casino. Minister H. Nyambaatar emphasized that in the draft law, "Casinos are to be established in the most liberal manner, excluding Mongolian citizens." It will be necessary to provide a very strict barrier and control to prevent Mongolians from entering. We are seriously conducting various researches to include as many ideas as possible in the law.
