We have built a solid bridge to successfully integrate Mongolian businesses into the Southeast Asian markets
Doing Business in Asia Alliance /DBiAA/ and Small and Medium Enterprise /SME/ Development Fund of Ministry of Food, Agriculture and Light Industry have jointly organized “Mongolia – ASEAN business week” - a series of events including investment pitching, executive training, and business networking event in Ulaanbaatar between January 20th and 24th, 2020.
Ms Enkhzul Orgodol, Founder and Global CEO of DBiAA and Mr Luis Arcangel, Advisory Board Chairman of the DBiAA were interviewed on the occasion of the said event.
DBiAA has been working to provide opportunities to Mongolian businesses to enter and/or expand in the Southeast Asian markets. First of all, please introduce us to the DBiAA.
Luis: DBiAA was founded in Singapore in 2015 and was officially opened in Mongolia in 2017. The alliance has official representation in the Southeast Asian markets as well as representatives in other Asian countries. Southeast Asia, per se, is a huge market with a population of over 600 million people and its middle class demand for different products and services is constantly growing. The Association of Southeast Asian Nations (ASEAN) is working on creating more intensive integration for their business and economy which are comparable to the European Union. Thereby, ASEAN activities are not just limited to the Southeast Asian region, but also trade, business, and economic integration with the other Asia - Pacific nations. Therefore, Mongolia can successfully participate in this business and economic integration through deepening its cooperation with Southeast Asian countries since the founder of DBiAA is a Mongolian and it is registered and headquartered in Ulaanbaatar.
We are an international business alliance, so we organized our annual meetings in the Philippines in 2018 and in Cambodia in 2019, respectively. This year’s annual meeting will be held in July in Singapore.
Enkhzul: It is not just local businesses’ concerns when they need to expand and need to be a part of the regional business and economic integration. A complex set of questions are raised within the export ecosystem of a certain country such as whether the government has made general agreements on tariffs and trade and other agreements with the target countries where the businesses are willing to export to; whether the businesses have sufficient human resources and financial capitals; whether international development institutions and professional associations provide technical and financial assistance to support the local businesses to internationalize in the target markets etc. Therefore, the DBiAA aims to create a conducive export ecosystem for the Asia - based businesses with its holistic end - to - end solutions.
In this regard, we cooperate with public, private, and international organizations. For instance, we are working with SME development fund of MOFALI, EU TRAM project supported by the European Union, Cambodian Alumni Association of the Lee Kuan Yew School of Public Policy, and Public Policy Research Institute of Nepal.
What opportunities are there for Mongolian businesses to expand into Southeast Asian markets and vice versa?
Luis: Since DBiAA started, its representatives effectively cooperated in areas of discovering and developing ways to lead local businesses to become international players. We have brought together a pool of highly capable and connected business partners and consultants in most of the emerging markets in Asia as well as some economically advantaged places like Japan and USA. It provides a great foundation for us to expand our activities.
DBiAA is headquartered in Mongolia. We believe that Mongolia can be a bridge to provide geopolitical, human and cultural links among the Eurasian countries. We have successfully started opening doors for local businesses to enter the global market through this bridge between Europe and Asia. Businesses and experts from not only Asia, but Europe, USA, Australia, and other regions highly value our business model and have started to join us. We are pleased with this profound collaboration for which we have worked consistently over the past 3 years.
Enkhzul: On the one hand, although Mongolian businesses have been exploring export opportunities and making certain attempts to realize them in the last decade, they still have not achieved their desired results yet. We have found out that the businesses had mainly been targeting high value markets, such as Europe, Japan and the USA, which impose high standards on the exporters. Therefore, the businesses have faced tremendous barriers to meet those high standards and requirements with their limited resources to enter such markets. Since 2015, we studied the Southeast Asian markets and found out that Mongolian businesses are able to achieve their export goals within a shorter term if they shift their target markets from the traditional ones and shift their business strategies. We have been working on executing our suggested strategy since 2017. The Southeast Asian markets are 5 steps away from us, if we say the traditional ones are 10 steps away. Even, SME development fund of MOFALI agreed there are tangible opportunities to achieve in this market faster. In October 2019, DBiAA and SME development fund of MOFALI signed a Memorandum of Understanding, and in December we organized a joint delegation visit to the Philippines through our key partners.
On the other hand, an increasing number of Philippine businesses have entered Mongolia successfully as a result of the bridge we have built. Several IT based and professional service companies which do not require hard infrastructure, transportation, customs, or logistics handling, have started operating in Mongolia.
As we can see from our successful cases, export is not only to do with manufactured products, but it can be done in many different formats as a way of becoming a part of the regional business and economic integration. For instance, three different companies of our Advisory Board Chairman Luis have entered the Mongolian market successfully through the DBiAA. Through his operations in Mongolia, many Mongolian businesses have also been able to exchange their ideas and brainstorm potential solutions with the DBiAA international experts. Furthermore, we are aiming to introduce Mongolian manufacturers of strategically important sectors like food and agriculture to the unconventional markets.
DBiAA is working on comprehensive financial and non-financial solutions to support businesses to successfully enter the Southeast market with over 600 million people. For example, as a result of our recent “Mongolia – ASEAN business week” - the comprehensive event, three Mongolian companies have received an initial investment offering totaling $ 500,000 during their investment pitching. Also, our DBiAA team has already started working on business matching and partnership development for five local brands that have tremendous potential to enter the Southeast Asian markets, namely the Philippines.
Mr Luis, as a foreign investor and an entrepreneur, how do you describe Mongolian economy and market opportunities? Tell us your first assumption of Mongolian economic environment and your current viewpoint.
I first arrived in Mongolia in 2017. My first asuumption about Mongolia was that it was a mining country mostly based on the information I accessed in English. When I arrived in Ulaanbaatar, my initial assumption completely changed. I discovered that Mongolia had a lot more resources than just mining. Mongolia has huge human resources potential and capacity in IT and communication sector.
In addition, I would like to highlight that Mongolia has more potential to grow if it begins to promote its traditional agriculture, livestock, tourism, and other sectors to the international markets in more creative ways. DBiAA can assist both businesses and governments in this regard.