Mongolia Country Summary

FATF Status

Mongolia is no longer on the FATF List of Countries that have been identified as having strategic AML deficiencies

Compliance with FATF Recommendations

The last follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Mongolia was undertaken in 2023. According to that Evaluation, Mongolia was deemed Compliant for 9 and Largely Compliant for 31 of the FATF 40 Recommendations. It remains Highly effective for 0 and Substantially Effective for 0 of the Effectiveness & Technical Compliance ratings.

Mongolia faces significant challenges related to corruption and crime, which have been exacerbated by rapid economic development driven by mineral resources. Public discontent over high-level government corruption, particularly in state-owned enterprises, has led to protests and investigations, yet many perceive these actions as politically motivated rather than genuine efforts to combat corruption, resulting in a lack of trust in the judicial process and enforcement of anti-corruption laws.

Mongolia's economy presents a mix of promising opportunities and significant challenges for investors, particularly in sectors like mining and energy, which are politically sensitive and fraught with risks such as expropriation and ineffective dispute resolution. While the country offers relatively few barriers to market access and encourages foreign investment, the lack of a stable regulatory environment and the perception of favoritism towards state-owned enterprises deter potential investors. Recent legislative efforts aimed at improving the investment climate have garnered support from the business community, yet concerns remain regarding the government's commitment to consistent implementation of these laws, leaving Mongolia's investment landscape precarious and potentially uninviting for foreign capital.