Mongolia’s Newly Found Wealth

Hong Kong (I-Newswire) March 4, 2011 - The world's best performing tender in 2010? Crisis in the Euro zone from Ireland to Spain have plummeted the Euro. The US Dollar continues a painfully slow recovery from the 2008 financial crisis, and is nowhere near its top-performance peak. The Tugrik; the official currency of Mongolia, is actually the best performing currency, according to several sources including the World Bank.

Only the South African Rand and the Australian Dollar came close to the Tugrik, which finished the year 15% higher to the US Dollar. This is fueled by the discovery, and subsequent mining, of a vast array of mineral wealth such as copper, gold and coal.

Few analysts predicted the rapid spike in Mongolia's economy; the landlocked nation's currency is rarely followed by Wall Street firms. Much of the economic activity in the country is still conducted using the barter system, and until 2009 any worldwide currency could actually be used to purchase goods. The following year it was mandated that all transactions be conducted using the Tugrik.

Is the new found wealth actually finding its way into the hands of ordinary Mongolians? Well, if the appearance of a Louis Vuitton store in the capital is any indication..money is coming it, but it tends to stay at the top and rarely trickle down to the rural workers.

Demand, coming especially from China, will continue to strengthen the Tugrik. As much as 3.7 billion US Dollars were invested in the Oyu Tolgi mine last year alone, one of the world’s largest deposits of gold and cooper wealth. At its peak, the mine is predicted to boost Mongolia's GDP by 20-30% between 2013 and 2014.

Perhaps this will start a trend, and other mineral rich countries with weak currencies, such as Paupa New Guinea and Bolivia, will begun to show up on Wall Street’s radar...perhaps just for the sake of taking a break from the continuous poor performance of the Dollar and Euro.

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