Breakdown of draft 2020 state budget

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Cabinet put forward the draft 2020 state budget to Parliament a week ago. The state budget proclaimed as “digital, transparent and efficient” projected fiscal revenue at 12.9 trillion MNT and fiscal expenditure at 13.87 trillion MNT, while deficit amounts to 2.1 trillion MNT. The fiscal revenue projection equals to 29 percent of GDP, expenditure to 34.1 percent of GDP, and deficit amounts to 5.1 percent of GDP. The fiscal revenue is 1.8 trillion MNT higher than the 2019 state budget projection.

Key actions set for supporting stable economic growth in the draft bill were to gradually reduce fiscal deficit by maintaining fiscal discipline; undergo tax reform dedicated to support businesses, investment and employment; upgrade customs and border checkpoints to raise trade turnover and collect higher royalty from natural minerals; resume expenditure reform to boost yield and accessibility; complete investment projects of previous years and start socially-beneficial projects; and reform soum budgets to develop rural areas. The budget draft stipulates efficient debt management for 2020 in an effort to minimize fiscal and economic burdens from the high-interest 2.9 billion USD foreign securities repayment between 2021 and 2024. It also specifies actions aimed to reduce fiscal deficit and approve a state budget with zero deficit in 2023.

Dulguun Bayarsaikhan