| Project Detail |
Project Name
Strengthening Soum Center Infrastructure and Green Development
Project Number
56212-001
Country / Economy
Mongolia
Project Status
Approved
Project Type / Modality of Assistance
Technical Assistance
The technical assistance (TA) will support the Ministry of Construction and Urban Development (MCUD) and soum center governments to improve soum center infrastructure and green development. This will be achieved through the formulation of integrated infrastructure and economic development plans for selected soum centers, and the preparation of regulatory and technological tools, as well as institutional strengthening support.
The TA is closely aligned with the priorities of the country partnership strategy of the Asian Development Bank (ADB) for Mongolia, 20212024, which aims to support climate-resilient infrastructure to drive competitiveness and diversification.
Project Rationale and Linkage to Country/Regional Strategy
Mongolia transitioned from a centrally planned to a market-based economy in the 1990s. The aimag and soum centers were unable to continue serving as anchors of economic activities because of the collapse of their economic, processing, and productive functions, and the dismantling of cooperatives. State cooperatives, processing facilities, and services for the rural economy fell into disrepair and were abandoned. Rural inhabitants were thus compelled to migrate to Ulaanbaatar to seek economic opportunities, leading to stagnation in rural areas and a disproportionate burden on the capitals infrastructure. As of 2022, Ulaanbaatar accounted for 68% of the urban population and 63% of Mongolias gross domestic product, illustrating the countrys drastic territorial imbalance. Rural migrants have created vast ger areas (unplanned settlements) in the outskirts of Ulaanbaatar, which have become major contributors to urban traffic congestion and pollution.
Soum centers are the foundation of Mongolias urban network. They provide basic public and economic services to soum residents and serve a critical role in catalyzing local economic growth, thereby absorbing rural migrants and relieving population pressure in Ulaanbaatar. However, soum center development is constrained by a lack of basic infrastructure, urban services, and economic opportunities. These challenges have also made soum centers more vulnerable than other urban settlements to climate change risks and economic shocks, such as that caused by the coronavirus disease (COVID-19) pandemic. Since 1940, Mongolia has experienced significant climate change with increased average temperature, declining rainfall, increased drying of water bodies, and extreme weather events.
Weak infrastructure. As of 2020, 254 of Mongolias 309 soum centers lacked basic infrastructure. Most soum centers use unreliable or unsafe water sources, such as rivers, dams, lakes, unprotected wells, or springs. Sewage is commonly disposed in pit latrines. Most households dispose of solid waste in unplanned garbage dumps, causing air, soil, and water pollution. Heating in soum centers mostly relies on individual heat-only boilers, which are coal-based and contribute to air pollution and greenhouse gas emissions, with very few centralized heat networks. Soum centers lack affordable housing, social services, public spaces, and other amenities, and the regulatory frameworks for soum centers have been too weak to properly guide and control their development. Particularly, water infrastructure planning and construction guidelines and regulations are intended for medium and large-sized urban settlements and are not applicable to soum centers. Urban planning in soum centers lacks cross-sectoral integration and consideration to infrastructure life-cycle costs. To strengthen the climate resilience of the infrastructure, technologies that cater to the socioeconomic reality of soum centers (e.g., low population density and weak financial capability) need to be explored.
Limited economic opportunities. The economic activities of soum centers mainly involve mining, livestock, arable farming, forestry, tourism, and transport and logistics. The poor living conditions in soum centers make it difficult to attract the human resources needed to further boost local industries. In addition, economic opportunities in soum centers have been constrained by (i) weak strategies for soum center economic development; (ii) poor economic infrastructure and services; (iii) insufficient micro, small, and medium-sized enterprise financing; and (iv) inadequate business knowledge and labor skills, including regarding e-commerce, especially among women entrepreneurs. Because soum economies rely heavily on natural resources and have been significantly affected by climate change, there is an urgent need to adopt a green economic development approach.
Inefficient delivery of urban services. Delivery of urban services, such as water supply, heating, and sewerage, is inefficient. The services are frequently interrupted because of a lack of utility staff. Institutional capacity in urban infrastructure operation and maintenance (O&M) and asset management are lagging in soum centers. Low tariffs have contributed to the utilities poor financial performance.
The Government of Mongolia has developed strategies and policies in response to these challenges. In its long-term development policy, the government has committed to supporting regional and local development, and lifting the quality of life for all citizens through infrastructure development. The New Recovery Policy calls for (i) developing infrastructure and housing in rural areas to attract residents, businesses, and services; (ii) strengthening O&M of soum infrastructure with a full range of high-quality services; and (iii) creating a supportive environment for local agricultural businesses. MCUD formulated a Soum Center Development Program (footnote 8) as a priority project under the New Recovery Policy.
The TA will contribute to achieving ADBs Strategy 2030 operational priorities (OPs) by accelerating progress in gender equality (OP2); tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability (OP3); making cities more livable (OP4); and strengthening governance and institutional capacity (OP6). It is also closely aligned with the priorities of ADBs country partnership strategy for Mongolia, 20212024, which aims to support climate-resilient infrastructure development and institutional capacity and governance strengthening. The TA will support Sustainable Development Goals 11 and 13 by enhancing inclusive, sustainable, and climate-resilient urban infrastructure development. The TA will support the Government of Mongolia to prepare infrastructure investment projects which include elements aligned with Group of 20 (G20) principles of quality infrastructure investment.
Lessons. ADB has been supporting green, competitive, and sustainable urban and territorial development in Mongolia by (i) supporting capacity building and institutional reforms to improve planning, development, and operation and management of urban services; (ii) improving basic urban infrastructure and social services; and (iii) catalyzing local urban economic growth. This TA will build on the provincial development plans, policy frameworks, and financing tools that have been or will be formulated through these interventions and supplement institutional support for soum center development that is adapted to local needs and economic growth potential. The TA aims to formulate transformative and sustainable models for soum center development to integrate engineering and socioeconomic infrastructure and to synergize economic and urban development. The TA will help catalyze investment in soum center development, thereby supplementing ADBs ongoing projects (footnote 15) in Ulaanbaatar, aimag centers, and inter-soum centers.
Impact
Urban-rural development recovered; and quality of life, green development, and regional development sustainability achieved (New Recovery Policy and Vision 2050Long Term Development Policy of Mongolia) |
