Many people expect that Mongolia, with its vast reserves of high-quality coal and its close proximity to China, may become the Saudi Arabia of Coal. If in 2008, Mongolia exported merely 4 million tons of coal, in first 9 months of this year that number reached 15.7 million tons, constituting more than 40 percent of the value of total exports. But this is just the start. It is expected to grow even faster when Tavan Tolgoi, which has more than 6 billion tons of coal on site, starts production. The government estimates that next year a huge amount of revenue will be collected from coal sector. However, there could be large revenue shortfalls at a time the global economy is crumbling. Uncertainty in the macro economy will decelerate Chinese coal demand growth, experts predict.
