Miners in Tyva Republic to Subsidize Reindeer Breeding

Posted on by

Mar. 15 – The government of Siberia’s Tyva Republic has asked foreign and domestic miners operating in the region to pay subsidies to local reindeer breeders, according to the republic’s web site.

Under the agreement, China’s Longxing and the local Golevskaya Mining Company will allocate 600 rubles (US$20) for the maintenance of each reindeer in the Todzhinsky District of Tyva, where both companies operate and where 77 percent of the region’s reindeer population is located. The funds will go to the district’s reindeer breeding farms.

The companies will spend a total of 600,000 rubles (US$20,000) each for this purpose.

As of January 1, 2012, there are 1,778 reindeer in the region, according to the Tyva Office of Statistics. During the Soviet Era, in particular in 1981, there were 14,500 reindeer in the republic.

China’s Longxing LLC, a subsidiary of Zijin Mining Group and Heilongjiang Longxing International Resource Development Group, is contracted to construct a RMB200 million (US$31 million) ore mining and enrichment plant in the Republic of Tyva by the end of this year.

Longxing LLC has a development license for the local Kyzyl-Tashtyg polymetallic ore field with 12.9 million metric tons of B+C1+C2 reserves, including copper (2 million tons) and pyrite ore (6.2 million tons).

With a designed capacity of up to 1 million tons of ore per year, the plant is expected to earn the owner at least US$31.3 million, or €23.1 million, annually.

“Mining companies’ investment will help increase the population of the reindeer herd in the republic,” Sholban Kara-ool, prime minister of republic government, said to the local press.

Tyva reindeer-breeding farms currently receive 1,200 rubles (about US$42) in subsidies per reindeer from the republican budget and another 300 rubles (US$11) from the federal budget.

In the past three years, reindeer subsidies amounted to 46 million rubles (US$1.5 million).
Russia is home to 1.2 million reindeer, comprising two-thirds of the world’s population of domesticated reindeer. In the past 15 years, the reindeer population in Russia has almost halved.

Reindeer breeding is the main economic activity for indigenous people in several parts of Siberia and the Russian North.

Foreign direct investment in the regional economy amounted to US$42.2 million in 2010, with 58.6 percent originating from China. Almost 80 percent of all investment was allocated in the region’s mining industry, according to the republic’s statistics office.

Leave a Reply

Your email address will not be published. Required fields are marked *

Dezan Shira & Associates

Meet the firm behind our content. Dezan Shira & Associates have been servicing foreign investors in China, India and the ASEAN region since 1992. Click here to visit their professional services website and discover how they can help your business succeed in Asia.

Never Miss an Update

Subscribe to gain even better insights into doing business in Russia. Subscribing also lets you to take full advantage of all our website features including customizable searches, favorite, wish list and gift functions and access to otherwise restricted content.

Scroll to top