ADB approves $225 million project to upgrade hospitals in 19 provinces and health centres in 11 soums

The Asian Development Bank (ADB) has approved a $225 million loan project to improve the quality and accessibility of healthcare in Mongolia’s provinces and soums. It is the bank’s largest investment in Mongolia’s health sector to date and aims to provide life-saving and specialised care to more than half of the population in the provinces by 2031.

The Strengthening and Modernizing Provincial Health Care Services Sector Project (Project No. 59045-001) comprises two loans: $110 million from ordinary capital resources (Loan 4819-MON) and $115 million from concessional ordinary capital resources (Loan 4820-MON). The Ministry of Health will implement the project, with the first phase focusing on Dornogovi Province.

What the project will deliver

The project will upgrade the infrastructure and equipment of general hospitals in 19 provinces, including emergency, trauma and intensive care units, modern operating theatres and ambulance fleets. Advanced technologies will be introduced to diagnose and treat cardiovascular diseases, cancer and other complex conditions.

A new 300-bed hospital will also be built in Ovorkhangai Province, expanding access to advanced and specialised care outside the capital. In addition, new health centres will be established in 11 soums near major national roads and border crossings. These centres will bring emergency and primary healthcare closer to local residents and travellers.

Another key component of the project is digital health and telemedicine. A digital referral system will connect provincial and soum hospitals with tertiary hospitals in Ulaanbaatar, improving the exchange of diagnostic and treatment information and the processes for referring patients to higher-level care and receiving them back. This will enable people to consult specialists without necessarily travelling to Ulaanbaatar.

Healthcare workers will also be trained to provide a broader range of services and treat complex conditions locally, while hospital management capacity will be strengthened. Hospital designs will take into account the differing health needs of women and men.

Climate resilience and disaster preparedness

The project places particular emphasis on climate-resilient infrastructure and emergency medical protocols. Investments will help hospitals maintain essential services during natural disasters and emergencies, including dzuds, floods and heatwaves.

Why the project matters

According to the ADB, around 66 percent of Mongolia’s hospital bed capacity remains concentrated in Ulaanbaatar. As a result, people in rural areas often travel hundreds of kilometres to receive specialised care, leading to delayed diagnoses and high costs. Noncommunicable diseases account for 73 percent of deaths nationwide, while provincial hospitals continue to face shortages of equipment and human resources.

The project documents also note that people living in poverty or at risk of poverty account for 42 percent of Mongolia’s total population. Poverty is more concentrated in rural areas and the provinces, while lower-income households make less use of healthcare services.

“Many households living in the provinces and rural areas travel hundreds of kilometres to receive specialised care. This delays diagnosis and places a heavy financial burden on them,” said ADB Country Representative in Mongolia John Juhyun Jeong. “This project will change that. More capable hospitals and health centres, emergency and specialised care, and modern technologies will reach people across Mongolia.”

The broader picture

The ADB has been one of the leading international partners supporting the modernisation of Mongolia’s health system since 1993. As of 2021, its total support to the sector, including loans, grants and technical assistance, had reached $255 million.

Other international institutions are also actively supporting Mongolia’s health sector. The World Bank has provided more than $70 million for COVID-19 response and health system preparedness projects, as well as $19.5 million for a digital health project. The European Bank for Reconstruction and Development has provided a $43.2 million loan to build a 250-bed hospital in Darkhan-Uul Province and a $34.9 million loan for a specialised cardiovascular centre in Ulaanbaatar.

Observers and analysts, however, stress that the effectiveness of spending is as important as the amount of financing. Governance, procurement and corruption remain major challenges in the health sector, and significant gaps in access and infrastructure have persisted despite the large loans secured.

The project is notable because it focuses not only on upgrading hospital buildings, but also on developing local human resources, equipment and digital health systems in parallel. If implemented as planned, more than half of the population in the provinces will be able to access life-saving and specialised treatment closer to home by 2031.