Corruption risk assessment in mining sector of Mongolia
The mining sector plays an important role in the Mongolian economy, and therefore it is
critical that the sector be transparent, accountable and corruption-free. The corruption
prevention measures will be more effective when corruption risks of the mining sector
are studied systematically. Corruption prevention will be more effective if corruption
risks of the mining sector are studied systematically.
In response to this necessity, the Independent Research Institute of Mongolia (IRIM)
conducted an assessment and identified corruption risks in the four phases of mining:
exploration, pre-operation, operation and post-operation phases of the geology and
mining sector. The assessment was commissioned by the United Nations Development
Programme (UNDP), and used A Practitioner’s Guide for Corruption Risk Mitigation in
Extractive Industries (developed by UNDP). Forty-three interviews were conducted with
representatives - from ministries, agencies, local authorities, civil society organizations
and mining companies - involved in decision-making in the four phases of mining.
Also, a desk review of 70 documents was conducted.
This assessment did not cover common minerals, uranium, oil and artisanal mining.
Also, it did not study licensing issues of mining construction in detail, which are more
related to other sectors. Furthermore, corruption risks related to public procurement
were not studied in detail, since they apply to all sectors.
This assessment report consists of six chapters, conclusions and appendicies. The first
chapter introduces the assessment methodology, and the second chapter outlines the
current situation in the mining sector, its contribution to the economy and the legal
The third chapter identifies corruption risks in the geological exploration phase and the
fourth chapter identifies corruption risks in the pre-operation phase. The fifth chapter
deals with corruption risks in the operation phase while the sixth chapter classifies
corruption risks in the post-operation phase.
Brief conclusions, summarizing identified risks and factors contributing to them are
included at the end of each of the chapters. A total of 15 corruption risks were
identified as a result of the assessment, are summarised in the general conclusions.
The assessment team aimed to reflect views of the respondents – ministries, agencies,
aimag and soum governors, Citizens Representatives Khurals, CSOs, state and private
companies, civil society organisations, industry associations, and local citizens – equally;
and received comments from all key stakeholders.
The assesment team also developed a proposal for a corruption risk mitigation action
plan, and submitted it to the Working Group for developing ‘Corruption Risk Mitigation
Action Plan’. The Working Group was established by the Resolution of the Minister for
Mining No. A/40 of 12 April, 2016.