1ST ADB-ASIA THINK TANK DEVELOPMENT FORUM“INNOVATION AND INCLUSION FOR PROSPEROUS ASIA”

THE PRESIDENTIAL OFFICE OF MONGOLIA AND ACADEMY OF SCIENCES OF MONGOLIANATIONAL DEVELOPMENT INSTITUTE OF MONGOLIANATIONAL DEVELOPMENT INSTITUTE OF MONGOLIA

CHALLENGES AND LESSONS OFCHALLENGES AND LESSONS OF POLICY INNOVATION IN MONGOLIA

Doctor and professor ENKHBAIGALI ByambasurenDirector of the NDIMDirector of the NDIM

The views expressed in this paper/presentation are the views of the author and do not necessarily reflect the views or policies of the Asian Development Bank(ADB), or its Board of Governors, or the governments they represent. ADB does not guarantee the accuracy of the data included in this paper/presentation andaccepts no responsibility for any consequence of their use. Terminology used may not necessarily be consistent with ADB official terms.

GLOBAL INTERFACE FRAMEWORK FOR INNOVATION AND POLICY

Restructuring economy and improved openness

Increasing export

Knowledge sharing s a g

and Policy

innovation

Attracting FDI

Improving workforce

quality

Institutional strengtheningEstablishing effective national innovation system

innovation

Raising techologicalg

level of economy

A BRIEF COUNTRY PROFILE: MONGOLIAA BRIEF COUNTRY PROFILE: MONGOLIA

MONGOLIAMONGOLIA

• Area: 1,564,115.75 km2 (19th) • Population: 2,892,876 mln (2012)Population: 2,892,876 mln (2012)

In Ulaanbaatar (capital city): 1.350.000• Formation

Xi f d ti (f d 209 BC)Xiongnu confederation (formed 209 BC)Mongol Empire (formed 1206)Independence declared (from Manchu Qing Dynasty) 1911 December 29,Changed economic and political system into free market economy and democracy, 1990

• Geography: Between Russian Federation and P.R.Chinamountains, forest, steppe, desert, no sea access , , pp , ,

GDP per capita $5,371 $ (2012)• Political system: Great Khural (Parliament, 76 seats)• Natural resources: Copper Molybdenum Gold Coal UranusNatural resources: Copper, Molybdenum, Gold, Coal, Uranus…• Animal husbandry: 48 mill (Cow, Sheep, Goat, Horse, Camel)• Literacy rate: 96.7% 4

CHALLENGES AND LESSONS OF POLICY INNOVATION

Current situation and main challenges:

• Restructuring economy and improved openness • Establishing effective national innovation system• Institutional strengtheningg g

Lessons learned from past 23 yearsLessons learned from past 23 years

ConclusionsConclusions

CURRENT SITUATION AND MAIN CHALLENGESCURRENT SITUATION AND MAIN CHALLENGES:

WHAT WE HAVE DONE SINCE 1990WHAT WE HAVE DONE SINCE 1990

Changed the old system into free economy and democracy SuccessfulEstablished multiparty system SuccessfulEstablished multiparty system SuccessfulEstablished private sector and market economy SuccessfulFreed exchange rate of currency SuccessfulFreed exchange rate of currency SuccessfulRe-established banking and financial system SuccessfulImproved and liberalized education system Successfulp yDecentralized the old institutional system, promoted local governance

Successful

Supported foreign investment Successful

… …… ….

RESTRUCTURING ECONOMY AND RESTRUCTURING ECONOMY AND IMPROVED OPENNESS

ECONOMIC DEVELOPMENT

Man economists noted that economic Many economists noted that economic development is long term process, rather

ECONOMIC

development is long term process, rather than short time increases in scale or

DEVELOPMENTgrowth

Local → globalorientation of export, knowledge based economyknowledge based economy

In last two decades, economies started getting more started getting more interdependent or dependent from international market.

Orientation of export, knowledge b d i tti i based economy is getting main strategic goal of most countries in the long runthe long run.

C S CLUSTER

Is cluster a predefined stricture, limited by boundaries of one country or a form of self organized structure that offers country, or a form of self organized structure that offers competitive advantages 12

In calculations for 2008, we calculated RCA’s using Balassadefinition.

Proximities and PRODY, EXPY’s has been calculated for 2008 ,according to method used by

C.A.Hidalgo, B.Klinger, A.L.Barabási, R.Hausmann using C.A.Hidalgo, B.Klinger, A.L.Barabási, R.Hausmann using data of 779 products of 224 countries.

Total 528 products that recorded in database of export of Mongolia by 2008 For years from 1975 to Total 528 products that recorded in database of export of Mongolia by 2008 For years from 1975 to 2000 we used RCA calculations used by Hidalgo et al (Hidalgo CA, B Klinger, A-L Barabasi, R

Hausmann, Science (2007)).

13

PRODUCT SPACEPRODUCT SPACE

Different node sizes represents share of the represents share of the product in total world trade and colors of the lines that connect the nodes represent proximity (di t b t i f (distance between pair of products) red is the closest distance dark closest distance, dark blue, yellow and light blue are followed. Here we use Leamer’s cluster classification of sectors by i t it

14

intensity.

19751975

15

19801980

16

19911991

17

19951995

18

20002000

19

20082008

20

Structure of the economy is not transforming idlrapidly

The main difference compared to other countries seems to be very slow, merely no significant change. y g g

• Mongolia has just starting production of not many but some goods with higher income. • Since it is just starting, mainly initiated by private companies, technology or, human resource

capability is not yet ready to export, the results may not be visible in macroeconomic data.

1975 1980 1991 19952000 2008

21

Compared with other First, it has not been developed in last decades. Before 1990’s this is mainly

Compared with other countries, export set of M li h th related to “unnatural process in

economy”, in another words centralized li E th h i

Mongolia has three features.

economy policy. Even though, since 1990’s there are yet no new products in export.export.

Second, products with high density or nearest are still unsophisticated products or raw materials.

Third is, these product density are low. It means Mongolia not yet have capabilities means Mongolia not yet have capabilities to jump to new products or have significant changes in economy

22

structure.

ECONOMIC DEVELOPMENT

I t d f l i g t i iti ti d i l l b I t d f l i g t i iti ti d i l l b Instead of leaving to initiatives driven solely by Instead of leaving to initiatives driven solely by market, to initiate policies that simulates market, to initiate policies that simulates

INNOVATIVE CLUSTERING will be better option. INNOVATIVE CLUSTERING will be better option.

POLICIES THAT SUPPORT ENVIRONMENTAL FRAMEWORK FOR INNOVATIVE CLUSTERSINNOVATIVE CLUSTERS

St t l t f ti i (i) to gain access to technology or diffuse technology and innovation

• Structural transformation is a process that has many

(ii) provide public goods necessary for exporting,

(iii) product oriented sector policies,

sides and needs appropriate environment process.

(iv) stimulating collaboration between sides or stakeholders (promoting joint R&D efforts with suppliers and users),

p

(v) supporting access to international market,

(vi) to speed up the learning process; (vi) to speed up the learning process;

(vii) lowering costs

24

GOVERNMENT DRIVEN

PRIVATE SECTOR INITIATIVES LED EFFORT INITIATIVES LED PROCESS

25

THE ROLE OF THE GOVERNMENTTHE ROLE OF THE GOVERNMENT

FACILITATOR that brings actors together and provide stimulating FACILITATOR that brings actors together and provide stimulating framework for clustering and innovation process. framework for clustering and innovation process.

26

• promoting intensive • promoting intensive interactions,

• sharing of facilities g• exchange of knowledge

and expertise t ib t t h l • contribute technology

transfer effectively• networking and networking and

information dissemination

l t li i th t ti l t cluster policies that stimulate innovative activity 27

Currently enough capabilities have t t b l t d d not yet been accumulated and

capabilities embedded in current export basket are not enough to

jump to new products.

Economy will need strong and y gconsistent policies

The government has to initiate policies that support innovative policies that support innovative clustering process as soon as possible

28

possible.

Economic diversification is collaboration with private sector, but not just collaboration; it needs working together to determine j ; g gstrategies and designs.

Not o l big co a ies s all a d edi co a ies i o ati e Not only big companies, small and medium companies, innovative actors will have important role in this process.

Few big player oriented approach should never be taken, for this approach will be much risky and it may limit further clustering opportunities by reducing competition unnecessarily.

International experiences show that spreading risk and all players International experiences show that spreading risk and all players network oriented approach is crucial for economic structural transition is not short term process transition is not short term process.

29

E bli hi ff i i l Establishing effective national innovation system

INDUSTRIAL AND S&T: OPPORTUNITIES

Visioning & Guidance Development policies are comparatively newly developedFor a small country, S&T infrastructure and human resource are relatively well developed

FinancingFinancingLack of unified policy on financing of innovation activities; Venture fund is not establishedRising tendency of S&T funding in recent yearsg y g y

Legal & Regulatory St t li S&T /1998/State policy on S&T /1998/Law in S&T /1998, 2006/Law on technology transferLaw on technology transferPatent Law /1993,2006/Copyright Law /1993,2006/NDS, STMP, NISDP

INDUSTRIAL AND S&T POLICY: CHALLENGESINDUSTRIAL AND S&T POLICY: CHALLENGES

Visioning & Guidance Improve of contribution of S&T sector to the national economy (science-industry collaboration)Identify S&T priority fields and key technologies based on industrial needs

• (which instruments are effective)Concentrate resources in chosen directionsConcentrate resources in chosen directionsSet up technological forecasting systemImprove of public awareness on innovation and technology

Economic Incentives Establish research universities with corporate approachesEstablish and develop science parks which support innovation-and-knowledge based and global-market aimed Establish and develop science parks which support innovation and knowledge based, and global market aimed

companiesDevelop venture capital that supports innovation-and-knowledge based, and global-market aimed companiesImprove the protection of intellectual property rightsAssessment system for the innovation activity and its outcome

FinancingFi d ff i fi i l h i f i j i R&D i i i b i d d d iFind out effective financial mechanisms for encouraging joint R&D activities between industry and academia

Legal & Regulatory N ti l P d l h b d l d H th l k i t li d di ti d li k th National Programs and plans have been developed. However, they lack in centralized coordination and link; they are

not comprehensive and sector-focused; implementation strategy is not concrete; funding is not ensuredTo develop an optimal national technology roadmap for Mongolia

ICT and Emerging technologiesCHALLENGES AND OPPORTUNITIES

ICT & EMERGING TECHNOLOGIES: OPPORTUNITIES

Visioning & Guidance: First steps are taken to establish a S&T park “Boroogiin Hundii” and

other S&T parks

Legal & RegulatoryDeveloped National program for the high technology research Developed National program for the high technology research

development program

ICT & EMERGING TECHNOLOGIES: CHALLENGES

Economic Incentives:To identify sound mechanisms for Government guarantee for investmentsGovernment support to “Boroo valley science park” and others

Fi iFinancingWhich financial instruments are effective for supporting basic research and

applied R&Dapplied R&DWhich financial incentives are suitable for commercialization of research

results f f f How to attract financial resources /like pension fund/ for venture capital

Legal & Regulatory Legal & Regulatory Laws/Acts: venture company, investment company, pension fund, cooperate

annuity, science park, innovation, securities, start- up’sy, p , , , p

CURRENT SITUATION OF EXPORTCURRENT SITUATION OF EXPORT AND CHALLENGES FACING

Global interface

THE FOREIGN TRADE OF MONGOLIA ENTIRELY DEPENDS ON FLUCTUATIONS OF THE WORLD MARKET PRICES

It is expected that the mining sector output will increase and have significant contribution for It is expected that the mining sector output will increase and have significant contribution for economy. Even so, depending on fluctuation of the world market prices will not be advantage

• In November and December, 2008 when the financial and economic downturn affected many countries in the world, and the international prices of copper fell to its 2004 level due to weak demand for copper and copper concentrate leading to reduction of sales of mineral products of Mongolia by about 50 percent compared to September, 2008.of sales of mineral products of Mongolia by about 50 percent compared to September, 2008.

• The import of petroleum products, machinery and some other consumer goods plays a significant role in Mongolia’s economy. The average price of petroleum products in Mongolia in 2008 were 38-51 percent higher compared to the average prices in 2007. The fluctuation of world price directly affects government budget and the entire economy.

EXPORT COMMODITY DIVERSIFICATION IS NEEDED

• High technological cost norm influencing sectors negatively • High technological cost norm influencing sectors negatively

• Sectors are strongly dependent from import of raw materials equiments High • Sectors are strongly dependent from import of raw materials, equiments. High production cost, high risk, depending import from few market reduces firms interest to invest in technology.

• Intersectoral linkages are weak. Clusters are not fully developed. • Mongolia is not benefiting Generalized System of Preferences effecitvely

• While Mongolia has right to over 7200 items to export using zero GSP tariffs to European countries, exporting g g p g p , p gonly 17 items.

TECHNOLOGY IMPORT IS INSUFFICIENT AND IT HAS NEGATIVE IMPACT ON EXPORT

• Equipment ratio is 12 2 percent of import it is not enough if we consider deterioration of total capital Equipment ratio is 12.2 percent of import, it is not enough if we consider deterioration of total capital.

• Growth of equipment import is directly related to mining, construction and infrastructure in estments in recent ears (41 percent) investments, in recent years (41 percent).

• There is no significant growth in other sectors equipment import.

• Technological innovation is mainly dependent on small scale technological diffusion of firms.

• MNC’s contributions in technological innovation is unnoticeable. Export oriented MNC’s are not processing raw materials, instead exporting low technology commodities.

CURRENT SITUATION OF FOREIGN DIRECT INVESTMENTGlobal interface

CURRENT SITUATION OF FOREIGN DIRECT INVESTMENT

FDI ENVIRONMENT IN MONGOLIA

Bases of current FDI environment:Bases of current FDI environment:

• In 1990, the Parliament approved the Law on Foreign Investment, which created a legal base for operations of f i d titi foreign-owned entities.

• Mongolia joined the Washington Convention on the Settlement of Investment Disputes between the State and Nationals of another State (1965) in 1996 and the Seoul Convention on Investment Insurance in 1999.

• Mongolia is also a full member of the Multilateral Investment Guarantee Agency of the World Bank Group since • Mongolia is also a full member of the Multilateral Investment Guarantee Agency of the World Bank Group since 1999 and has signed Avoidance of Double Taxation Agreements with 33 countries, as well as Agreements on Mutual Protection and Encouragement of Investment with 41 countries.

• The improvement in the foreign direct investment climate has been reflected in UNCTAD’s Inward FDI p gPerformance Index where Mongolia’s ranking rose from 82nd in 1995-1997 to 15th in 2001-2003.

SMALL SCALE FDI DOES NOT ALWAYS CONTRIBUTE TECHNOLOGY AND KNOW HOWAND KNOW HOW

Companies registered in FDI office by ınvestment range

Percantage in total FDI

Initial investment reqiurement is above USD100 000 since August,2008, according to FDI law

FDI IS MAINLY IN MINING/OIL SECTORMONGOLIAN SECTORAL FDI (USD)

Main FDI Sectors 1990-2004 2005 2006 2007 2008 2009Mining/Oil Geological Mining/Oil Geological services 493,972.74 183,961.9 195,390.34 336,985.65 485,189 643,454.5

Trade support services 162,764.31 53,376.6 103,388.43 111528.37 187,447.8 132,636.4

Others 92,880.36 52,884.3 47,739.57 13,882.50 6,875.8 3,510.3Banking & financial services 67,105.46 9,671. 11,982.63 21,936.52 4,495.9 3,219.3

Light industry 85,001.91 1,792.1 1,454.22 1,205.34 18,208 92.8Engineering services/construction material manufacture 55,237.94 772.7 1,791.75 4,273.45 1,894.7 9,366.5Processing: animal raw materials 53,516.29 825.3 292.5 540 - -

Total FDI 1,120,894.91 316,839.2 366,545.59 499,962.11 708,922.5 801,158.3

TECHNOLOGICAL INNOVATIONGlobal interfaceTECHNOLOGICAL INNOVATION

TECHNOLOGICAL INNOVATION DEPENDS ON MANY FACTORS

Technological norm cost

Innovation polıcy

Law environment

Structure of economy, interrelations of sectors

Sectoral and

Financing mechanism

Skill of labor

organizational factors

Skill of labor

infrastructureEnvironmental

factorsTechnological

factor

R&D level

ISSUES OF TECHNOLOGICAL INNOVATION AFFECTING GLOBAL INTERFACE OF MONGOLIA

There are unrevealed potentials as ll i i gwell as issues upcoming:

• Establishing national ginnovation system is just beginning

• Innovation and technology gypolicies are not clear

• Financing mechanism needs

SECTORAL POLICIES FOR INNOVATION NEEDED

Sectoral and organizational factors of innovation

• Lack of skilled labor is affecting innovation negatively. Attracting skilled labor from abroad is critical in this situation The abroad is critical in this situation. The Government of Mongolia is going to launch a new program.

Speed of technological innovation

• Domestic market with low price and technological innovation elasticity is not

it bl i t f f t i t

Market entry/investment need

Organizational t bilit t i t suitable environment for fostering strong

competition. Export orientted sectoral policy for innovation is essential.

management, capability to invest

Skill of labor

S t l li i f i tiSectoral policies for innovation

competition

STRATEGIC INNOVATORS AND TECHNOLOGY MODIFIERS WILL HAVE IMPORTANT ROLES IN NIS

• Currently, intermittent innovators are very few only in

t i di ti k Strategic innovators Strategic

innovators some sectors, indicating weak competition in domestic market, low interest in technological innovation and

Intermittent innovators Intermittent innovators

non-innovators

non-innovators

technological innovation and ability to finance

• technology modifiers are mainly big companies

Market Market big companies.

TechnologyTechnologyTechnologyTechnology

Companies are more interested in profitable and incremental Technology

modifiers Technology modifiers

Technology adopters

Technology adopters

p finnovations easy to modify or improve.

SOME RESULTS OF INNOVATION BARRIERS STUDY

ISSUES RELATED TO FREE TRADE ZONESGlobal interfaceISSUES RELATED TO FREE TRADE ZONES

UNUSED POTENTIALS OF FREE TRADE ZONESUNUSED POTENTIALS OF FREE TRADE ZONES

The Mongolian government launched its free trade zone (FTZ) program in 2004.

In 2010, these issues remain concerns:

• Currently there are two FTZ areas located along the Mongolia spur of the trans Siberian highway:

1. Benchmarking of Mongolia’s FTZ Program against current successful international practices shows deficiencies in the Mongolia spur of the trans-Siberian highway:

• Altanbulag • Zamyn-Uud

successful international practices shows deficiencies in the legal and regulatory framework as well as in the process being followed to establish FTZ’s in the country.

2 L k f i l i l i d d l d fi i i • Both FTZs are inactive, with no development at either site.

2. Lack of implementing regulations and procedural definitions encapsulated in transparency and predictability, required to implement key international best practices.

3. Funding is not sufficient for infrastructure requirements for Zamyn-Uud and Altanbulag sites.

AREAS OF FOCUS AND POLICY CHALLENGESGlobal interface

AREAS OF FOCUS AND POLICY CHALLENGES

GETTING PART OF WORLD GLOBAL INTERFACE

• Policy coherency, consistency, and co-ordination (3C’s of policy)• Strengthening quality and structure of institutionsStrengthening quality and structure of institutions• Focused FDI environment and focused free economic/trade zones• Absorbing technology and knowledgeAbsorbing technology and knowledge• Tapping talent abroad and improving workforce quality• Working with MNC’s carefullyg y

LOW IMPORT DISEMBODIED TECHNOLOGY REDUCE THE INFLOW OF EFFECTIVE TECHNOLOGICAL KNOWLEDGE

License fees

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ranc

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d st

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d ng

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razi

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Ch

In Fr

Un

Un

ki Re

ko br Ja

As share of GDP 0.08 .07 .16 .15 .44 .65 .17 .23

As share of merchandise imports

.48 .71 .79 1.25 1.97 2.22 2.48 3.17

imports

POLICY COHERENCY, CONSISTENCY, AND CO-ORDINATION (3C’S OF POLICY)

Strenghtening institutional capability will be the next step:Strenghtening institutional capability will be the next step:

• Individual policies for industrual structure, clustering, technology Individual policies for industrual structure, clustering, technology development, institutional development, trade, education and financial system should be coordinated O ll li h h ld b b d M li li iti f • Overall policy coherency should be based on Mongolian economy peculiarities for scarce resource requires allocate efficiently and be focused, instead of fair allocation to all in short and middle term.

• Strenghtening Public service system as well as capabilities of individual public workers will be a top priority.

• Performance criterias timetables and evaluation mechanisms for policies should be • Performance criterias, timetables and evaluation mechanisms for policies should be clear.

• Increase transparency in these policy regulations

ATTRACTING FDI, FOCUSED FREE ECONOMIC/TRADE ZONES

FDI policies and its possible impacts should be reconsidered in detail FDI policies and its possible impacts should be reconsidered in detail and should be coordinated according to know how and technology needs cluster policy and export policies needs, cluster policy and export policies.

Free economic zone initiatives should be continued and learning from good practices will have a positive impactgood practices will have a positive impact.

Policies related to MNC’s especially in strategic sectors should be more l clear.

ABSORBING TECHNOLOGY AND KNOWLEDGE

Total impact of absorbing technology and knowledge on economy will be visible in Total impact of absorbing technology and knowledge on economy will be visible in longer term. Even though, long term objective of building a knowledge based economy should be divided into middle and short term practical steps.

Technical standarts of technology quality should be developed and implemented.

Policies supporting technology diffusion, as well as technology import should be clear d h ld b l d h li i and shold be related to human resource policies.

Ab bi t h l d k l d ill d li i t d liti l Absorbing technology and knowledge will need policy consistency and political leadership.

TAPPING TALENT ABROAD AND IMPROVING WORKFORCE QUALLITY

In most cases talent abroad comes back if domestic job opportunities work environmentIn most cases, talent abroad comes back if domestic job opportunities, work environment and future promise are attractive.

Even so, in some cases, it seems that purposeful programs and supportive policies can be effective for inflow of skilled personnel.

Upgrading domestic workforce, priority given to high quality education supportive to N ti l I ti S t h i l lNational Innovation System have crucial roles.

HUMAN RESOURCES: OPPORTUNITIES

Visioning & Guidance:E i b f hi h d ti i tit tiExcessive number of higher education institutionsLarge number of oversea-studentsRising tendency of returnees with master and PhD-degree Economic Incentives :Government grant fund is establishedStrong support from government for higher educationGovernment funding for universities is weakLooking for options to increase R&D expenditureFinancingLegal & Regulatory g g y

Institutional strengthening

Б б Бодлогын чадавхийг бэхжүүлэх шинэчлэлийн чиглэлүүд

Strenghtening policy Strenghtening policy capabilities capabilities

Innovation in policy

Innovation in policy

Innovation of policy making policy

formulationpolicy

implementationpolicy making

capability

LEARNING FROM A PROTECTIONIST POLICY EXPERIENCE

CASE OF TEXTILES AND CLOTHING INDUSTRY

Textiles and clothing industry collapsed during the post-1990 transition, due to lack of investment, outdated technology, and losing post communist country markets. By 2001, the number of foreign-invested factories had increased to 77 out of total 82 factories in textile and clothing sector This boom was made possible by two main factors clothing sector. This boom was made possible by two main factors.

• Mongolian exports were unrestrained in the US market, while those of its major competitors were not. The country also possessed a pool of trained workers (from the T&C industry prior to 1990) that could be rapidly deployed to service orders for large US retail chains like Wal Mart QVC shopping J C Penney and TargetWal-Mart, QVC shopping, J.C. Penney and Target.

• These opportunities were exploited by transnational companies that not only produced themselves, but also allocated a large number of orders to Mongolian domestic companies.

• The industry emerged as the third largest recipient of FDI after mining and services (All quotas were slated for elimination on January 1, 2005, under the WTO Agreement on Textiles and Clothing)Textiles and Clothing).

On January 1, 2005, the WTO eliminated quotas completely and it changed the pre-2005 situation in the global garment industry and trade. The purchasing companies shifted their orders from Mongolia to China, Vietnam, and other Southeast Asian countries, where p g p gproduction, transportation costs and other competitive conditions were more favourable. By the end of 2005, Mongolian exports ofgarments to the United States fell by over 40 percent in value (from US$229 million to US$134.7 million). This resulted in a decline in the number of workers employed in the clothing sector to around 11,000 by the end of 2005. By 2007, the share of T&C in total exports stood at a mere 1 percent indicating both an absolute and relative decline of the industry.

LEARNING FROM A PROTECTIONIST POLICY EXPERIENCE

• The same risks are possible for other sectors After using reduced tariff barrier export The same risks are possible for other sectors. After using reduced tariff barrier, export regulations, and lowered FDI tax for few years and declaring bancruptcy, reregistering under new name is common practice for small companies.

• Mining companies extracting more resources in short time, using outdated technology hazardous to environment is also one of bad lessons of protectionist policy in Mongolia. hazardous to environment is also one of bad lessons of protectionist policy in Mongolia.

1 I ti i P li M ki1. Innovations in Policy Making

Reformation of regional (domestic) national8

Reformation of regional (domestic) national8 Policy

h iPolicy

h i Improving quality of Improving quality of (domestic), national8 economical development policy according to the

current situation

(domestic), national8 economical development policy according to the

current situation

coherencyimprovementand improvement of law

system

coherencyimprovementand improvement of law

system

Improving quality of policy research and

policy analysis

Improving quality of policy research and

policy analysis

Incl ion of eo le and Incl ion of eo le and Cafef l anal i of Cafef l anal i of Considering all policy Considering all policy Inclusion of people and sides should be the

standard, norm of policy making and policy

Inclusion of people and sides should be the

standard, norm of policy making and policy

Cafeful analysis of impacts of policy on

economy, society and environment it should

Cafeful analysis of impacts of policy on

economy, society and environment it should

g p yoptions and

transparency in policy analysis and policy

h d b

g p yoptions and

transparency in policy analysis and policy

h d b making and policy analysis

making and policy analysis

environment, it should be norm and standartenvironment, it should be norm and standart research needs to be

improvedresearch needs to be

improved

2 I ti i li i l t ti2. Innovations in policy implementation

Mutual understandings Mutual understandings Getting more focused on

specific policies at Getting more focused on

specific policies at Evaluating policy Evaluating policy gabout the concept of

development at national level

gabout the concept of

development at national level

p pupper, middle and lower

level, it should be common norm of policy

implementation

p pupper, middle and lower

level, it should be common norm of policy

implementation

g p yimplementation in every

level, setting a continuous improvement system

g p yimplementation in every

level, setting a continuous improvement system

implementationimplementation

Performance Performance Continous improvement of Continous improvement of Performance EVALUATION SHOULD

be relevant and clselyrelated to efforts and

Performance EVALUATION SHOULD

be relevant and clselyrelated to efforts and

Continous improvement of policy

implementation, setting a mechanism to support

Continous improvement of policy

implementation, setting a mechanism to support

Evaluating possible risks iof policy

implementation, planning risk aversion activities of

Evaluating possible risks iof policy

implementation, planning risk aversion activities of results achieved in

implementing policyresults achieved in

implementing policyinitiatives and efforts for

itinitiatives and efforts for

itrisk aversion activities of policy implementation.

risk aversion activities of policy implementation.

3 I ti i li biliti3. Innovations in policy capabilities

Improving policy h h

Improving capabilities f bli t t

Improving policy makers knowledge b t li l i research human

resource capabilitiesof public servants to

implement policyabout policy analysis and policy research

methodologies

Evaluating policy Improving cooperation b id d Evaluating policy

implementation process and improving capabilities of

between sides and organizations in order

to improve policy h lit d

Improvement in policy making inclusion and

publicrelationscapabilities of monitoring research quality and

inclusivenesspublicrelations

The common criteriasof innovationof innovation

Based on research, learning from international experiences & best practices and lessons learned

Creativeness innovativeness and using Creativeness, innovativeness and using resources effectively

Дээд түвшин: үндэсний нэгдмэл бодлого, стратеги, хөгжлийн гол чиг шугамуудын түвшний шинэчлэл, засгийн газрын

шинэчлэлийн чиглэлүүдийг тодорхойлох

Нийтлэг

Creating and improving capabilities, lasting solutions

Дунд түвшин: стратегийн шинжтэй томоохон хөрөнгө оруулалтууд, салбар

хоорондын хамтын ажиллагаа, салбарын бодлого зохицуулалтын шинэчлэл

шалгуурууд

S l i bl l t l d Анхан шатны түвшин: нийгэмд, төрийн

байгууллагуудад бүтээлч сэтгэлгээ, шинэчлэлийн үзэл

баримтлал, хандлага, арга барилыг төлөвшүүлэх, энэ чиглэлийн нийтийн

ойлголт төсөөллийг дэмжих зорилго бүхий байнгын шинэчлэл

Solving problems completely and systematic approach

National security and economical independentness

E l f f i i iExamples of areas of innovations ongoing

Innovation of

governance

Innovations in economy

policy

I ti G t

Reform in public office

p y

Inoovative Government

Innovations in Juctice

system

Innovation for for

improving policy

capability