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Retail Trade and Consumption

In 1985 retail trade turnover was 4,138.4 million tugriks, of which 3,948.4 million tugriks occurred in state outlets. Retail trade in Mongolia rose slowly from negligible levels - the equivalents of 60,000 tugriks in 1921 and 8.7 million tugriks in 1924 - to 184.8 million tugriks in 1940. Beginning in the 1950s, retail trade grew dramatically as large-scale Chinese and Soviet assistance permitted Mongolia to purchase imported consumer goods not produced domestically. By 1960 the total reached 975.8 million tugriks, and after Mongolia's 1962 entry into Comecon, retail trade increased to 1,914.6 million tugriks in 1970. Total retail trade in 1980 and 1985 was, respectively, 3,348.3 million and 4,138.4 million tugriks. In 1985 foodstuffs accounted for 49.9 percent and non-food commodities, for 50.1 percent of retail trade in state trading organizations. Ulaanbaatar accounted for 41.6 percent of retail trade in state trade organizations.

In 1984 Mongolia's state retail trade and public catering enterprises included 1,382 shops, 2,498 stalls and agents, and 543 restaurants and canteens. In the 1980s, the government began introducing self-service stores, with a limited variety of products, into the state retail network. The self-service stores eliminated the practice of triple queuing - lining up to select, then to pay for, and finally to receive products purchased. State retail outlets, including mobile shops in rural areas, offered equipment for arad households, such as batteries, cooking pots, and paraffin lamps, as well as special-order departments for goods not stocked. A wider range of goods was available in urban areas, particularly in Ulaanbaatar.

Most of the private traffic outside the urban areas is still based on motorcycles in 2004. Here you see a gas station about 200 km to the southwest of Ulaanbaatar. Photo courtesy G. Berger.

The capital's main department store in the late 1980s was Ulsyn Ih Delguur. In addition, there was a specialty shop restricted to members of the Mongolian nomenklatura. Two duty-free shops (in Ulaanbaatar's main hotels) sold foreign luxury goods and high-quality domestic products to foreigners exchanging hard currencies and to Mongolians possessing hard-currency vouchers. A Sunday market for spare parts and odds and ends was located in the northern suburbs of Ulaanbaatar. Prices in this market, unlike those in the state retail system, were negotiated freely.

All other prices were controlled strictly by the government, and great efforts were made to ensure stable prices for consumer goods. Before January 1988, prices were determined by the State Committee for Prices and Standards, the functions of which were absorbed by the new State Planning and Economic Committee. Retail prices were said to have declined by 0.5 percent from 1970 to 1980. In the late 1980s, however, it was unclear how economic reforms would affect retail price levels. Although the draft state enterprise law stipulated that enterprises would set their own prices for products, the role of the State Planning and Economic Committee in setting price guidelines was uncertain. There were indications that the government thought that some inflation would be unavoidable.

In the late 1980s, the Mongolian government was working to raise the standard of living by increasing per capita food consumption and by offering a greater number and variety of consumer goods for purchase. In the Eighth Plan, the supply of foodstuffs was to rise by 23 percent. Efforts were to be made to increase agricultural production; to raise the efficiency of foodstuff procurement, shipment, storage, and sale; and to eliminate spoilage and losses. Changes in the average annual per capita consumption of foodstuffs revealed a changing diet. Consumption of such traditional foods as meat and dairy products declined, while consumption of such foods as vegetables, bread, and sugar increased. In 1985 the government launched a fifteen-year Target Program for the Development of Agriculture and the Improvement of Food Supplies. Per capita meat consumption was to drop to 88 kilograms. Other per capita consumption targets were cereals, 13 to 15 kilograms; dairy products, 120 to 130 kilograms; eggs, 35 to 50 kilograms; flour and flour products, 110 to 115 kilograms; fruits and berries, 11 to 13 kilograms; potatoes, 47 to 53 kilograms; sugar and sugar products, 24 to 26 kilograms; and vegetables 29 to 31 kilograms. The Eighth Plan also aimed to increase the commodity turnover of public catering establishments by 19 to 21 percent. More restaurants and cafeterias were to open, and tastier meals in greater variety were to be offered.

Statistics on retail sales of consumer goods were sketchy, but they revealed increasing availability of goods since the 1970s. In 1984 the minister of trade and procurement stated that, between 1970 and 1983, the sale of motorcycles per 1,000 people increased 140 percent; of refrigerators, 900 percent; of television sets, 140 percent; of vacuum cleaners, 280 percent; and of washing machines, 310 percent. A British journalist, Alan J.K. Sanders, calculated that between 1975 and 1982, 1 family in 345 purchased a car, 2 families in 3 acquired radios, and each family bought 2 watches or clocks. From 1975 to 1983, roughly one family in seven bought a motorcycle; one in nine, a bicycle, and one in twenty-eight, a camera. During the 1975-83 period, one urban family in three acquired a refrigerator or washing machine; one in three, a television set; and one in seven, a vacuum cleaner. The Eighth Plan targeted the sale of consumer goods to rise by 21 to 24 percent. The plan stipulated an increase in sales of "cultural-everyday durables and also garments and knitwear, carpets, and other types of industrial commodities." The plan's goals for increased retail sales were part of the government's efforts to increase the quantity and the quality of consumer goods.

Mongolian sources revealed little about other services. In 1985 Mongolia had 465 hotels, 760 public baths, 295 beauty and barber shops, 125 photography shops, 130 dry cleaners, and 392 shoe-repair shops. The Eighth Plan called for increasing consumer services by 27 to 29 percent, including an expansion of 55 to 57 percent in rural areas.

Last Update: 2010-12-07