Contribution to Economic Development of the Region 

The diamond mining industry, represented by our company, plays a major role in the economy of Russia’s largest region, providing employment to the residents of Western Yakutia and significant tax revenues to budgets at all levels of government.

Employment

As a town-forming company, ALROSA has production infrastructure facilities in single-company towns of Western Yakutia and is the main employer providing jobs for residents of the towns of Mirny, Udachny, Nyurba, and Lensk, the settlements of Aikhal, Chernyshevsk, Zarya, Vitim, and Markoka, and the villages of Suntar, Olenek, Arylakh, Syuldyukar, and Taas Yuryakh. In the Mirny District, for instance, more than 48% of the local working population is employed at ALROSA plants.

Our company’s HR policy is strategically focused on employing local residents1, which is one of the areas of mutually beneficial cooperation with our stakeholders: state authorities, municipal governments, and local communities. About 94% of the company's personnel live and work in the Republic of Sakha (Yakutia), and 42.9% of the members of the highest governing bodies of the company (the Supervisory Board and Executive Committee) are also residents of Yakutia.

We believe that by employing local residents we are making a significant contribution to the sustainable development of the region and helping it to achieve multiple objectives:

  • providing jobs for residents, which is one of the main indicators of the level of social and economic development of any region;
  • our commitment to a stable economic growth enables us to maintain and improve the standard and quality of life of the local residents;
  • the availability of jobs and demand for skilled labour provide a powerful incentive for the young people and their professional and career growth, which is an important demographic factor for the regional economy;
  • a relatively low unemployment rate, a significant share of young people within the general population, decent wages and a good social package guaranteed to our employees: all of this contributes to a favourable social and economic climate in the region.

Social Infrastructure

ALROSA is widely known for its social investments aimed at building and maintaining social infrastructure facilities that provide services for the public good. This is an undoubted contribution of the company to the region’s economic development. Suffice to mention investments in the cultural and sports facilities that the company owns and operates for the benefit of all residents of Mirny and other districts of Western Yakutia, as well as annual contributions to the non-profit special purpose fund of future generations of the Republic of Sakha (Yakutia).  

Taxes

In 2012 ALROSA paid to budgets and extra-budgetary funds RUB 29,128.4 million or 20.7% more than in 2011.

ALROSA's 2012 tax payments to budgets of various levels 

 

Over the last three years the size of corporate tax payments to the federal budget increased by more than six-fold, reaching RUB 2,596.0 million in 2012.

The amount of tax payments to the budget of the Republic of Sakha (Yakutia) increased yoy by 16.6%. ALROSA remains one of the main taxpayers that form the budget of the Republic of Sakha (Yakutia), and its share in the region’s tax revenues accounts for more than 26%. 

In the reporting year, ALROSA paid RUB 569.7 million to municipal budgets, or 21.6% more than in 2011.

Non-tax payments

Being the main shareholders of ALROSA, the Russian Federation, the Republic of Sakha (Yakutia) and eight municipalities receive additional budget revenues in the form of dividends. The total amount of dividends that were paid out in 2012 amounted to RUB 8,175.1 million or RUB 1.11 per one ordinary share. 

State support2

In 2012, our company received budgetary funds in the amount of RUB 263.1 million. RUB 65 million of these funds was provided as a state subsidy for the implementation of a project aimed at creating an integrated environmentally innovative technology for mining and processing diamantiferous ores in the Extreme North. Most of the received state funds were used to compensate for current expenses related to the provision of housing and communal services to residents (RUB 129.3 million), round-trip passenger air travel from the Far East to European Russia at a special airfare rate (RUB 56.1 million).

 

Local residents mean residents of human settlements of the Republic of Sakha (Yakutia). 
2 Detailed information about state support is available in the ALROSA Annual Report for 2012.