The objective of this report is toanalyze in depth the current public investment managementsystem and to assess whether or not it is able to meet thischallenge of delivering good quality projects in thepriority areas in a macro-economically sustainable manner;and to recommend what needs to be done to improve the systemso that it is able to effectively transform natural resourcerevenues into sustainable capital assets. In making itsrecommendations, this report focuses on some of the detailsthat need to be laid out in implementing regulations inorder to make the Fiscal Stability Law (FSL), Budget Law ofMongolia (IBL), and Public Procurement Law of Mongolia(PPLM) work. The report also suggests amendments to some ofthe existing laws that pose a risk to meeting the fourobjectives. In proposing policy options, the report isconscious of the political economy of reform and, whereverpossible, analyzes the compatibility of the technicalsolutions with the political interests of policy-makers.