The report looks into the issue why, in the presence of strong economic performance in recent years, there had been extremely little or no progress in poverty reduction? Income poverty and growing inequality are the major problems in Mongolia that lead, in downward spiral, to deterioration of the quality of life of people and households in all other dimensions and denial of human rights. The NHDR 2007will analyse the main causes of poverty (focusing on income poverty) and obstacles to poverty reduction. It will advocate that not just growth, but the quality of growth; not any employment, but quality (decent) employment that matters for poverty reduction. The report will try to bring together both (macro) economic and social policies in its analysis, arguing that the ‘fixation’ on economic growth will not bring desirable results in poverty reduction.