Professional Services on Macroeconomic modeling for Mongolia

EXPRESSION OF INTEREST

The United Nations Development Programme Office seeks the services of an international entity/research institution or a consultancy firm to support the development and institutionalization of an integrated macro-economic model for Mongolia.

Background

Mongolia faces a range of critical macroeconomic issues which require a consistent, sound, and evidence-based macroeconomic policy responses. However, there is no comprehensive model of the economy that could help answer the analytical questions and provide suitable policy responses. Various initiatives have been implemented but these have been hampered by conflicting priorities, which resulted in lack of prioritization, limited participation and gaps in resource allocation. Often, the initiatives have had limited grounding in research and analysis and therefore, have not been supported by corresponding resource provisions, which made their implementation unrealistic. There is an urgent need to develop and institutionalize an econometric model to assist policy makers in forecasting, planning, and policy analysis.

 Objective

The overall objective of this consultancy is to help the Government of Mongolia develop a policy-oriented and integrated macroeconomic model that will assist it to:

•          Forecast macroeconomic parameters and trends associated with commodity price fluctuations and other global trends;
•          Optimally manage mining sector revenue inflows (which will lead to substantial budget revenue increases);
•          Assess implication of incorporating poverty reduction and inequality-reducing goals into economic policies and possible impact on macroeconomic fundamentals; and
•          Assess feasibility of introducing targeted social safety nets and social protection and other priority interventions to achieve the MDGs.

 A key component of the assignment is to develop the requisite capacity within the NDIC to operate the model in future with minimal external support. This may require organization of specific training of national staff to operate the software.

Key tasks

In order to achieve the objectives, the selected international institution/consultancy firm will undertake the following tasks:

 1.       Develop an integrated macroeconomic model with Mongolia-specific features and modules that include:

 (i)     decomposition of upcoming mining sector revenues and their impact on country’s macro economy, returns to the investors, and wealth distribution;

(ii)   commodity price fluctuations, particularly oil , copper and coal prices, and their management through creation risk hedging mechanisms;

(iii) specific characteristic and features of the agriculture sector in Mongolia including natural phenomena such as droughts, dzud and disasters, etc.

(iv) mainstreaming MDGs into development plans, ensuring synergies between the national priorities, and defining  their financing strategies;

(v)   flexibility to incorporate new sectors/modules into the model; and        

(vi) make simulations of sudden and unexpected shocks etc.

2.       Build national capacity to use, operate and own the model through:

 (i)     Training of national staff at specific stages during the contract period;

(ii)   Regular communication with core national staff to guide them on the techniques of the model and in various computations, analysis, simulations, forecasting and interpretation of outputs;

(iii) Ensure the sustainability and national ownership of the proposed model; staff training; warranty of a modeling and reliability of technical matters.

Eligibility of Contractor:

The institution/consultancy firm should have at least five (5) years’ experience of research and/or consultancy in the fields of applied economics, poverty, human development, or related fields with a focus on development policy analysis.

 The Team Leader/Task Manager should possess the following qualifications:

•          An advanced degree (preferably Ph.D.) in econometrics, economics, statistics, social science or related fields with a focus on development economics;
•        At least 10 years of experience of managing large projects in the area of macroeconomic modeling;
•          Substantial knowledge of macroeconomic issues with proven skills in developing policy options and problem identification/solving;
•          Knowledge and experience of working in transitional economies and/or Mongolia will be an asset;
•          Extensive experience in working at a senior level with Governments and familiarity with project management operations and procedures;
•          Excellent teamwork and participatory techniques with superb communication skills;
•          Knowledge of various donor agencies/multi-lateral institutions and UNDP project management operations and procedures will be an asset.

It is anticipated that the assignment will require a maximum of three (3) international staff: (i) One Team Leader/Task Manager; (ii) One Senior Expert; and (iii) One Junior Expert.

If you meet the above qualifications and are interested, please express your interest to: registry.mn@undp.org with a copy to enkhmandakh@undp.org

 The deadline for submission of completed proposals is Monday, 08 August, 2011, 5p.m. UB time.

 Selection and contracting will be conducted in accordance with the UNDP rules.

Submitted documents will not be returned to the applicants.