Impact of Mining Sector on Economic Security (Mongolia)

Abstract

History of the world reminds us it is not so easy to develop economy using natural resource. Mineral resource enables the developing countries which haven’t got sufficient capital resource as it is the biggest asset of the countries. Just like other developing countries, our country also faces certain difficulties to manage and spends the natural resource income which comes in the certain time of period and it has some fluctuations. Also, the governance hasn’t been composed well enough, due to that, the income can’t be secured from short term expenditure pressure; consequently, it can’t be directed to the long term investment and economic strategy implementation. These two reasons are the main problems to keep economic balance. Therefore, it depends on the economic supply reaction that whether external factors of economic security, especially economic bubble based on mining sector affect the other sector activities adversely or support. Operation to ensure the economic security is implemented through the main policy and principles of macro-economic. This article will explain why it is difficult to ensure the economic security by converting the natural resource into development.