economic-valueIn support of financial transparency and accountability, Nevsun has voluntarily committed to disclosing payments made to governments. This disclosure is aligned with “Publish What You Pay” initiatives that call on companies to disclose their payments to governments, such as the Extractive Industry Transparency Index (EITI) and proposed legislation in the U.S. and Canada.

Since the Bisha Mine began commercial operations, our economic contributions have been considerable. Of approximately $2.4 billion in economic value generated, over $1.2 billion* represents direct payments into the Eritrean economy. These economic benefits continue to generate many spin-off effects.

Note that some of the goods and services purchased from local suppliers are ultimately sourced from outside the country—which reduces the value of the spin-off effects to far less than the gross values in the table. The largest example would be the approximately $24 million in fuel purchase deposits made during the year (2014 – $42 million).

Payments to governments and government-owned entities from 2011 to 2015 are shown included in the chart below:

Payments to Government (Forms of Taxation) Total 2015 2014 2013 2012 2011
Income Taxes $416,843 $21,790 $88,983 $60,484 $209,586 $36,000
Royalties 115,379 17,620 30,331 14,774 31,462 21,192
Payroll taxes 29,100 8,199 6,631 6,370 5,159 2,741
Witholding taxes, customs & duties (1) 21,553 6,347 4,260 5,007 3,236 2,703
$528,919 $53,956 $130,205 $86,635 $249,443 $62,636
Payments to ENAMCO
Distributions (2) 163,750 19,000 76,750 --- 68,000 ---
Return of capital (2) 81,409 --- --- --- --- $81,409
$245,145 $19,000 $76,750 --- $68,000 $81,409
Total Payments to Government $828,034 $72,956 $206,955 $86,635 $317,443 $144,045

* $828 million in income taxes, royalties and other government remittances, plus $394 million in local supply of goods and services

[1] Withholding taxes were merged with customs and duties in the 2014 reporting year

[2] Of the $245.2 million paid to ENAMCO through December 31, 2015, ENAMCO has repaid $88.2M in connection with its acquisition of an equity interest in BMSC