Parliament has commenced deliberations on the 2027 budget framework and the fiscal projections for 2028–2029. These foundational documents will define Mongolia’s economic outlook for the next three years and set the stage for the formal adoption of the 2027 state budget this autumn.

While the state budget is theoretically designed to catalyze development through investments in energy, infrastructure, innovation, and technology, the majority of government spending remains concentrated on recurrent expenses. For the 2026 fiscal year, total expenditure is set at MNT 33 trillion. However, MNT 24.9 trillion, the vast majority of the budget, is allocated to operational costs, such as civil service salaries, bonuses, and utility maintenance.

Social welfare remains a dominant fiscal priority, with MNT 9.2 trillion earmarked exclusively for social insurance, child benefits, and pensions. In contrast, capital investment for development projects accounts for only MNT 8.5 trillion of the total budget.

This spending pattern is expected to persist in the coming years, even as the government faces pressure to fund critical infrastructure. Despite these fiscal constraints, Ulaanbaatar city officials have maintained a commitment to addressing the shortage of educational facilities by 2027 through the construction of new schools and kindergartens.