Technical assistance to Mongolia for civil aviation policy development
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Technical assistance to Mongolia for civil aviation policy development

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  • English
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    • Corporate Creators:
      Asian Development Bank
    • Subject/TRT Terms:
    • Publication/ Report Number:
      TAR:MON 36240
    • Resource Type:
      Tech Report
    • Corporate Publisher:
      Asian Development Bank
    • Abstract:
      The Asian Development Bank (ADB) has a long history of involvement in civil aviation in Mongolia. The ADB projects have been evaluated as successful, with Mongolia Civil Aviation Authority (MCAA) now well established, Ulaanbaatar airport managing increasing passenger loads, and international overflights generating substantial revenues for the central budget. Tourism arrivals are increasing rapidly despite the events of 11 September 2001, and are projected to increase steadily for the foreseeable future. Long-term growth depends on the availability of reliable safe domestic air transport. Apart from tourism, air transport also plays an important domestic socioeconomic function in Mongolia. Although ADB is investing in the improvement of a north-south road corridor, for most of Mongolia the cost of developing and maintaining a surface transport network is prohibitive, and air transport offers the best and sometimes only quick link between rural areas and Ulaanbaatar. However, the role of civil aviation in the overall economy remains limited. The sector is dominated by the state, which owns and manages nearly all civil aviation assets and services but does not have the resources for strategic development. In January 2001, the Government issued Privatization Guidelines for 2001-2004, which spells out the objectives, general principles, methods, and legal framework for a new privatization program to divest of valuable assets, including the national airline, the Mongolia Civil Air Transport Company (MIAT). MCAA subsequently organized an aid agency roundtable to discuss MIAT?s privatization in the context of the overall development of civil aviation. Further discussions between aid agencies and the Government led to a consensus that, prior to MIAT privatization, the Government needed to (i) develop a forward-looking policy and regulatory framework for civil aviation that facilitates private sector participation, (ii) prepare a priority investment plan identifying specific areas for public and private investment, and (iii) overhaul MIAT operations and management. The Government requested ADB TA on the policy and regulatory side, while the European Bank for Reconstruction and Development agreed to finance the investment study and a management contract for MIAT. This paper looks at the issues involved and outlines what the TA will require and produce. 12p.
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