Key Findings
CPMM in 2022 showed the following year-on-year changes in Mongolia’s road and rail transport data from 2021:
- Border-crossing time for road transport shortened from 6.3 hours to 4.0 hours.
- The cost of crossing borders by road decreased from $37 to $22.
- Total road transport cost was down from $1,632 to $1,455.
- SWOD increased from 35.4 km/h to 52.2 km/h, and SWD rose from 20.8 km/h to 31.4 km/h.
- Rail crossing time increased from 11.8 hours to 12.2 hours.
- The rail crossing cost dropped from $32 to $20.
- Total transport cost by rail increased from $360 to $440.
- Rail SWOD rose from 21.9 km/h to 21.2 km/h, and SWD from 13.0 km/h to 12.6 km/h.
Table 3.11: Trade Facilitation Indicators for Mongolia, 2020–2022
| Road Transport | Rail Transport | ||||||||
| 2020 | 2021 | 2022 | 2020 | 2021 | 2022 | ||||
| TFI1 | Time taken to clear a border-crossing point (hour) | 4.8 | 6.3 | 4.0 | 8.9 | 11.8 | 12.2 | ||
| Outbound | 1.5 | 2.7 | – | 2.1 | 9.8 | 20.1 | |||
| Inbound | 5.0 | 6.6 | 4.0 | 10.6 | 12.9 | 9.3 | |||
| TFI2 | Cost incurred at border-crossing clearance ($) | 87 | 37 | 22 | 39 | 32 | 20 | ||
| Outbound | 27 | 12 | – | 6 | 5 | 5 | |||
| Inbound | 90 | 37 | 22 | 51 | 42 | 25 | |||
| TFI3 | Cost incurred to travel a corridor section ($, per 500km, per 20-ton cargo) | 1,463 | 1,632 | 1,455 | 852 | 360 | 440 | ||
| TFI4 | Speed to travel on CAREC Corridors (km/h) | 24.4 | 20.8 | 31.4 | 17.1 | 13.0 | 12.6 | ||
| SWOD | Speed without Delay (km/h) | 33.5 | 35.4 | 52.2 | 21.5 | 21.9 | 21.2 | ||
km = kilometer, km/h = kilometers per hour, SWOD = speed without delay, TFI = trade facilitation indicator.
Source: Asian Development Bank.
Table 3.12: Border-Crossing Performance in Mongolia, 2020–2022
| BCP, Corridor and Direction of Trade | Duration, hours | Cost, $ | ||||||||
| 2020 | 2021 | 2022 | 2020 | 2021 | 2022 | |||||
| Road Transport | ||||||||||
| Yarant | (4) | Outbound | 1.8 | 2.7 | – | 24 | 2 | – | ||
| Inbound | 2.7 | 25.9 | 11.5 | 202 | 205 | 198 | ||||
| Zamiin-Uud | (4) | Outbound | – | – | – | – | – | – | ||
| Inbound | 5.2 | 5.0 | – | 110 | 38 | – | ||||
| Altanbulag | (4) | Outbound | – | – | – | – | – | – | ||
| Inbound | 4.7 | 5.4 | 2.1 | 7 | 8 | 8 | ||||
| Bichigt | (4) | Outbound | – | – | – | – | – | – | ||
| Inbound | 1.6 | – | – | 7 | – | – | ||||
| Rail Transport | ||||||||||
| Sukhbaatar | (4) | Outbound | – | – | – | – | – | – | ||
| Inbound | 4.8 | 12.2 | 12.2 | 5 | 5 | 5 | ||||
| Zamiin-Uud | (4) | Outbound | 2.1 | 9.8 | 20.1 | 4 | 4 | 5 | ||
| Inbound | 11.5 | 13.1 | 7.9 | 32 | 55 | 36 | ||||
BCP = border-crossing point.
Source: Asian Development Bank.
Trends and Developments
Road performance indicators improved on all Mongolia’s corridors in 2022. The time needed to cross the border by road shortened overall, aided by faster times at Yarant and Altanbulag BCPs. Yarant is on CAREC Corridor 4a, which moves coal from Mongolia to the PRC and PRC-manufactured goods in the other direction. Altanbulag BCP is used for bilateral trade between Mongolia and the Russian Federation and the transit for shipments between the PRC and the Russian Federation. The average road border-crossing cost dropped 40% from $37 to $22, although changes in the foreign exchange rates were a significant factor. While the US dollar−togrog rate was relatively stable in 2021, the togrog depreciated by about 21% against the dollar in 2022.[1]
Rail transport indicator performances were mixed. Lengthier outbound train processing drove up border-crossing time. Border-crossing costs declined, but the total rail transport cost was up, reflecting a rail freight tariff increase during the year. Rail SWOD and SWD showed a small dip. CPMM focused on the CAREC Corridor 4b rail crossings at Sukhbaatar with the Russian Federation and Zamiin-Uud with the PRC in the south. Border-crossing time and cost at Sukhbaatar were unchanged in 2022, while the Zamiin-Uud results were better on both indicators.
ADB has supported trade facilitation in Mongolia through its Regional Improvement of Border Services by upgrading the BCP facilities and equipment at Altanbulag and Sukhbaatar[2]. ADB approved an additional $27 million in 2019 to cover new BCPs at Bichight on the PRC border and Borshoo on Mongolia’s frontier with the Russian Federation. Under another ADB initiative, Mongolia’s automated customs information system will be modernized, and preparatory work done for a single-window solution connecting different information systems in multiple ministries to Mongolia’s BCPs[3]. CPMM previously covered the Bichight BCP, but the crossing point was closed during 2021 and 2022 due to upgrade work at the adjacent PRC BCP.
[1] Based on official foreign exchange rates from Mongol Bank, the country’s central bank. (www.mongolbank.mn)
[2] ADB, www.adb.org/projects/47174-001/main
[3] ADB, www.adb.org/news/adb-upgrade-two-new-border-crossing-points-mongolia-ease-trade
Recommendations
Coordinate border infrastructure and management upgrades with the PRC.Erenhot was the most time-consuming of the PRC’s rail BCPs for outbound traffic in 2022 (44.4 hours). Trains moving through Erenhot from the PRC into Mongolia at its Zamiin-Uud BCP were being held up due to a restriction on rail movements ordered to address congestion in the other rail adjacent stations. This suggested some limitations in the handling capacity between the Erenhot and Zamiin-Uud BCPs. The problem could be addressed through greater coordination between the two countries on infrastructure upgrades, more effective border movements, and other trade facilitation measures.
Streamline border controls at Zamiin-Uud. Zamiin-Uud BCP reported a marked increase in outbound rail border-crossing time in 2022. The delays were due to several factors, including restriction upon entry at this station to receive shipments from other Mongolian stations or from Erenhot, marshalling, and waiting for high priority container express trains to pass. Streamlining border controls can possibly reduce these crossing times.