Mr. Harris Kupperman reports

MONGOLIA GROWTH GROUP LTD. PUBLISHES JUNE 2012 MONTHLY LETTER TO SHAREHOLDERS

Mongolia Growth Group Ltd. has released its June, 2012, letter to shareholders.

June, 2012, shareholder letter

To the shareholders of Mongolia Growth Group

June was another month of moderate growth in our portfolio. Outside of acquisitions to almost complete a redevelopment site, we only made one mid-sized acquisition. However, we are still negotiating on a number of sizable assets that are on the market, but we have no certainty that a transaction will take place. At the same time, we continue to make sales from our list of held-for-sale assets. These sales continue to be at very agreeable prices.

During June, we noticed a substantial slowdown in the pace of business activity due to the elections and the pending Nadaam celebrations. Last year, this lull lasted roughly the month of July; however, this year, due to the elections, this period has been extended substantially. It is our expectation that by mid-August, the pace of business activity will pick up again. Fortunately, the majority of our tenants continue to pay their rents on time, and our vacancy rates remain quite low.

I should note that Mandal continues to make progress, particularly in the auto segment. Since the government introduced mandatory auto liability, Mandal has sold 2130 policies and now insures almost 1 per cent of all the autos in Mongolia. While the government has mandated that all drivers buy policies, the police will not begin issuing fines until Oct. 1, 2012. As we get closer to that date, I would expect the rate of policy acquisition should accelerate.

Without much to report on, I think it makes sense to take a quick look at Mongolian economic statistics as it has been a while since I've spoken about the continued rapid growth that we've witnessed here. While most of the world continues to fret about problems in Europe and anemic growth in other developed countries, Mongolia reported a first quarter growth rate of 16.7 per cent in 2012. This is down only slightly from the annualized growth rate of 17.3 per cent in the fourth quarter of 2011. Much more importantly to future growth, the massive Oyu Tolgoi copper and gold mine is expected to begin commercial production in the first half of 2013 which should substantially increase government tax revenues and allow continued investment in infrastructure -- which is vitally needed.

Our business is designed to be leveraged to this growth, and we have naturally seen many of the positive effects of it.

Sincerely,

Harris Kupperman

Chairman and chief executive officer

Mongolia Growth Group Ltd.

For further details on the foregoing document, please refer to the corporation's filing on SEDAR. For more information on Mongolia Growth Group, please see the company's website.

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