Page | 36Chapter 3: Economy
Introduction
Mongolia’s economy—reliant on the prices of
commodities, such as minerals and cashmere
wool—was hit hard by the global recession of
2008–2009. Although general economic
conditions rebounded in 2010, the agricultural
sector, a major component of Mongolia’s overall
economy, has continued to suffer owing to
livestock losses from harsh winter weather known
as a zud. Inflation has also remained a threat to the
economy’s health, fueled by rising prices on
imported food staples and large increases in public assistance.^180
Agriculture
The agricultural sector in 2010 generated about
15% of Mongolia’s gross domestic product (GDP)
and provided employment for roughly 40% of the
country’s population.^181 Most of this agricultural
production involves livestock, with meat (sheep,
cattle, goat, horse, and camel), milk (cow, goat,
and sheep), and wool making up 9 of the
country’s 11 most valuable agricultural
products.^182
Livestock
Mongolia’s mix of livestock animals has changed dramatically in recent years. In 1985,
sheep outnumbered goats by more than a 3-to-1 margin.^183 By 2005, however, Mongolian
herders possessed more goats than sheep, a change driven in large part by the lucrative
(by Mongolian standards) cashmere trade.^184
(^180) Mongolian Views, “World Bank Outlines Mongolia’s Economic Trends,” Mongol Messenger, 2 January
2011,
While Mongolia’s goat stock increased by
nearly 285% between 1985 and 2005, all other livestock species (camels, horses,
http://www.mongolianviews.com/2011/02/world-bank-outlines-mongolias-economic.html
(^181) Bureau of East Asian and Pacific Affairs, U.S. Department of State, “Background Note: Mongolia,” 8
March 2011, http://www.state.gov/r/pa/ei/bgn/2779.htm
(^182) Food and Agriculture Organization of the United Nations, “FAOSTAT: Commodities By Country:
Mongolia: 2008,” 2011, http://faostat.fao.org/desktopdefault.aspx?pageid=339&lang=en&country=141
(^183) J. M. Suttie, “Country Pasture/Forage Resource Profiles,” Food and Agriculture Organization of the
United Nations, 2000 (data amended by S. G. Reynolds in October 2006),
http://www.fao.org/ag/AGP/AGPC/doc/Counprof/Mongolia/mongol1.htm
(^184) Finance Business News, CNN Business, “High Cost of Cashmere on Mongolian Plains,” 12 September
2010, http://www.financebusinessnews.net/high-cost-of-cashmere-on-mongolia-plains/