In this study, we reviewed Mongolia’s and major GHG emitting countries’ experiences towards carbon reduction and their strategies in meeting their NDCs to achieve net-zero emissions. We also quantitatively assessed the long-term economic and environmental impact of a shock generated by the carbon-neutral policy in Mongolia. As for the quantitative assessment, we developed a Computable General Equilibrium (CGE) model based on the recursive dynamic CGE model for estimating the long-term economic impact of emission reduction policies in the coal sector. Using the model, we will project long-term economic development and CO₂ emissions under the four alternative scenarios. In addition, the environmental impact is measured by CO₂ emissions of sectors. Finally, we proposed policy recommendations and strategies to decrease the economic dependency on the coal sector and move towards a green technology-based economy.