zprávy z Mongolska

Podnikání v Mongolsku - jak na to ?

Podnikání v Mongolsku - jak na to ? - obrázek

Podnikání v Mongolsku - jak na to ? - obrázek

With the current mining and investment boom, there are many companies entering and planning to enter the Mongolian market. Let us cover some major problems which face foreign investors in Mongolia. More...

At the beginning, he/she should decide whether to go it alone or with a Mongolian partner. Of course, a partnership is like the proposition of marriage. Live alone or get married? If you are optimistic towards marriage or you are lucky enough, it is better to get a Mongolian partner. Sometimes, you will have a Mongolian partner anyway. If you are bored from Mongolian scrutiny or you are excited to become suddenly macho, you will end up having a Mongolian partner anyway. This is a partner, who will be like your wife, girlfriend or whatever you wish to call him/her.

Next, you will need local personnel unless you plan to bring many of your country mates. Unless you are Chinese, Russian or Korean, you will need to find the right local people. Nowadays, it is a little bit easy. There are several staffing companies or headhunters operating now. Still, they are not experienced, and they do not have enough people in their database. Usually, you will need to put advertisements in the newspaper. You do not need to put advertisement in Mongolian; you can put them in your language. However, it is better to put them in English. Since many Mongolians know some English. For example, some friend of a friend might see the ad and tell him/her that a Brazilian mining company is looking for a Portuguese speaking secretary. Many Mongolians believe that job advertisements are in newspapers merely to give some legitimacy to a company. They think that you cannot be hired through job advertisements. Probably, this is true to some extent thanks to the practices of some international organizations and foreign embassies.  Therefore, you should not worry if your advertisement nets few calls and inquiries.

There might be several reasons for low responses to your job announcements. Obvious, there is a shortage of qualified people in Mongolia due to the country’s small population.  Another reason is too complicated. For example, you are looking for a good driver who speaks all five UN foreign languages. He/she might exist in Mongolia, but in reality this great person might not have a CV. This driver will have his driving license and that is it-nothing else. Another reason is quite funny. It might that several applicants sent their applications to your company but your secretary threw all of them in the garbage. He/she really wants to put his/her uncle in this position.

Probably, the best solution is to first hire a local chief executive officer, or local deputy. Then he should take responsibility to build a dream team of local talent. Otherwise, your secretary or your wife will take the advantage to build your company or office. The second most important local key person is the accountant. Of course, some naïve foreign companies will bring someone from overseas. Usually, Russian companies like to bring their own Chief Accountants and Chief Financial Officers. Usually in Russian companies they are women. Anyway, you will definitely need a local accountant. The best option is to hire experienced local personnel. Thanks to efforts of Arthur Andersen and other foreign accounting companies, you can find reasonable local accountants. Maybe he/she will not speak English, but your financial documents will be in good English. Of course, you also need to hire an accountant with a local or international CPA, and who has relevant experience. Otherwise you will have many problems. One foreign company hired a librarian as their Chief Accountant, who later studied accounting in university. But the company faced so many problems with the local tax authority and they had to pay huge fines, and in the end she finally learned accounting. Later, she was even promoted to CEO. Of course, it is up to you whether to hire a librarian or a musician as your Chief Accountant.

Sometimes, foreign companies prefer to hire a part-time accountant. Maybe, it is a smart way to save money. In reality this usually does not work. You cannot ask so much from a part-time employee. Also, these people are most likely to choose to leave your company if he/she always does part-time work. Usually, they are university accounting professors or some government employees, who are looking for additional income. This is still not a good solution, unless you came to Mongolia for a short period to play around or to do some illegal stuff such as money laundering etc.

Now, if you have followed this advice, you will have fixed your personnel problems for a while. But you should be aware that Mongolians are quite mobile. If you will hire younger people, they might want to go overseas to study or take maternity leave or even your competitor might offer a higher salary or better package to lure him/her away. Usually, foreigners and even foreign companies that have been in Mongolia for a long time do not have any ideas about local packages. Therefore, it is the best solution to ask your Mongolian CEO or local accountant to formulate your company compensations.  Of course, before your arrival in Mongolia, you will read so much literature where authors will persuade you that Mongolia needs foreign investment, and Mongolia is very cheap and Mongolians are dying to work for foreign companies. This was the case ten years ago but it is not true anymore. Now, Mongolians became wealthier, and some Mongolian companies are offering more than foreign companies.

Next, you should expect a lot of attention from Mongolian regulatory agencies and you might even need to approach them yourself. For example, imagine that you want to open a bank in Mongolia. Until now, there is only one foreign bank which received a banking license in Mongolia. Nobody really knows how to obtain a banking license. You might approach the relevant Mongolian authorities, and they will tell very contradictory explanations about that.

Recently, Price Waterhouse entered Mongolia. They organized a huge reception to celebrate this. Probably, they invited all VIP’s, which includes the President of Mongolia, Prime Minister of Mongolia etc.  Until now, all Mongolia VIPs liked to go to such events, now they receive so many such invitations that they cannot participate in every event. The best solution is to invite relevant people who will definitely come. Another important thing is that if you will not invite someone, you might face problems later. For example, imagine that you are opening a vodka factory in Baganuur district.  You first need to invite local authorities and regulatory agencies from Baganuur. Otherwise, you will face big resistance from them, and even the President of Mongolia will not help you. The opening and closure of the National Recreational Park is a good example for that point.

Regulatory agencies will pay special attention to your company, and their requirements might be contradictory. Very often, they will interpret legislation in a different way than you expect. Of course, you can challenge them in local courts, but your victory might kill your relationship with the local government and regulatory agencies once and forever.

In closing, there are several obstacles to doing business in Mongolia. They are not fatal, and usually it depends on you and your team. Keep in mind, there are more successful foreign companies working here than companies which withdrew from Mongolia.

G. Chingis

Source: UB Post 21.9.2010


23.09.2010 02:07:26
Bohemia UB: česká základna v Mongolsku www.bohemia-UB.com
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