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.