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Trade and Investment
The legal basis for trade and economic affairs was established through the Agreement between the Government of Canada and the Government of Mongolia on Trade and Commerce of 1994, and the Convention on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and on Capital signed in 2002.
Having in mind of potential increase in overall trade turnover and necessity to legalize the interests of business entities on both sides, the two Governments are eagerly working on the draft of the Foreign Investment Promotion and Protection Agreement (FIPA) and have held the fifth round of negotiation at Ottawa in July, 2011.
The inclusion of Mongolia to the Canada’s List of Countries eligible for General Preferential Tariffs /GPT/ enables Mongolia to enjoy preferential tariffs in exporting gold, hides and skins, leather products, carpets and other animal originated products including combed cashmere to Canada. Mongolia’s import from Canada mainly consists of agricultural products, mining machinery, loading and uploading equipment, spare parts and telecommunication facilities.
Mongolia imports from Canadian: $36,188,723
From 1990 through 2013 total foreign direct investment of Canada in Mongolia estimated USD 400.5 million mainly in the mining sector. 98.18 percent out of total investment covered geology and mining exploitation and extraction, 1.13 percent for trade and food, and the remaining 0.69 percent for other sectors, which mean 56.8 percent of total registered Canadian companies are dealing with trade and food while 21.1 percent engaged with geology and mining, and 22.1 with other sectors.
Canada’s main commercial interest in Mongolia is mining investment. Canada is the sixth-largest source of foreign investment in Mongolia. Efforts are underway to expand bilateral trade into new sectors such as agriculture, and construction. In support of these efforts, bilateral cooperation memoranda of understanding have been signed with Mongolian agencies by Agriculture and Agri-Food Canada and the Standards Council of Canada.