As reported by MiddleAsianNews, the capital of Mongolia, Ulaanbaatar, is distinguished by impressive digitalization of public services. However, the development of an export-oriented IT sector presents a separate challenge.
Mongolia has achieved significant progress by transitioning to digital governance without the prior establishment of a technological base, which typically precedes such changes.
The E-Mongolia platform, launched in 2020, provides access to 181 government services through a mobile app and website, with plans to add another 492. It integrates systems such as E-Barimt (VAT management) and E-Halamj (social services), facilitating the implementation of the "Vision Mongolia 2050" strategy by reducing bureaucratic barriers. In 2022, the Agency for Regulation of Digital Government Services was established to oversee these transformations. Mongolia rose from 74th to 46th place among 193 countries in the UN e-Government Development Index for 2024 — a significant achievement for a nation with a population of 3.3 million, landlocked between Russia and China.
However, upon deeper analysis, it becomes clear that digital transformation in Mongolia is much more complex than it may seem at first glance. In the global StartupBlink ecosystem ranking, the country ranks 80th, improving its position by one spot but with a negative annual growth of five percent. Mongolia has 75 registered startups and ranks fifth in East Asia. In the field of educational technology, Mongolia excels, ranking 57th in the world and fifth in the region with 13 startups (17 percent of the total). From 2017 to 2025, Mongolia attracted only 14 million dollars in startups — an amount insufficient to fund a single Series A round in other countries.
Government initiatives extend beyond e-government. The "Digital Nation" program aims to increase transparency, reduce bureaucratic procedures, and support entrepreneurship.
Attempts to develop e-commerce, financial services, and programs supporting youth entrepreneurship, such as Youth Business Mongolia, create some infrastructure; however, compared to more developed ecosystems, they are still in the early stages.
In the IT sector competitiveness index by Reinvantage, Mongolia ranks 26th among 32 countries, surpassing Albania by 0.56 points but lagging behind Moldova by 0.87 points. The country performs well in economic impact (12th place) but significantly lags in the business environment (30th place), indicating limited sector value despite challenging regulatory conditions.
Key indicators suggest that the IT sector is virtually indistinguishable from the telecommunications industry. The average gross salary in ICT in 2024 was 673 euros — 81 percent higher than in 2020, but still one of the lowest among the sectors studied. Meanwhile, the average salary across the economy reached 636 euros, indicating a minimal difference of 6 percent — one of the smallest gaps among countries, confirming the limited value of the ICT sector compared to other industries.
In 2024, the number of ICT workers exceeded 21,000, compared to 17,500 in 2020, reflecting a growth of 20.8%. This figure is below average but exceeds the overall employment growth rate of 8.5%. The share of ICT in total employment increased from 1.4% to 1.6%, which is about half of the average rate of nearly 3%.
The number of students studying ICT specialties increased by 44.7% from 2020 to 2024. The number of graduates rose by almost 39%, indicating growing interest, albeit from a low baseline. The export of ICT services accounts for only 0.26% of GDP, significantly lower than the average of 2.3% (excluding Cyprus). The added value reached 2.02% compared to an average of 4.59%. These data confirm that the telecommunications sector dominates in Mongolia, rather than the information technology sectors.
“Mongolia has successfully digitized public administration. However, creating an export-oriented IT industry requires entirely different conditions that Mongolia has yet to demonstrate,” emphasized Emerging Europe.
