Minister Väyrynen: Russia seeks solution for wood tariff dispute

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Minister for Foreign Trade and Development Paavo Väyrynen (Centre) is cautiously optimistic about a potential resolution to the current dispute relating to Russia’s plan to raise the export tariffs for wood sold to Finland.
      "Russia is actively seeking a resolution that would satisfy Finland", said Väyrynen at a meeting with the press in Helsinki on Thursday. However, he stressed that this is not a bilateral problem between Finland and Russia.
      "The European Commission will make an effort to negotiate the wood tariffs with Russia. In addition, from Russia's point of view the move is largely about their exports of wood to China", Väyrynen noted.
     
Russia is raising export duties at a very brisk pace. In July, the tariff was raised from four euros per cubic metre to ten euros, and in April next year it is to be 15 euros. By 2009, the duty will rise to EUR 50 per cubic metre.
      The duties will effectively put a stop to imports of Russian wood to Finland, as the tariff would then be largely the same as the stumpage of timber logs per cubic metre in Finland.
      According to the Finnish forest industries, this development would lead to closures of mills. The European Union regards such duties as being against the protocol signed with Russia, reported Väyrynen.
     
The wood tariff dispute has also been seen as a violation against the World Trade Organisation treaty that Russia signed three years ago.
      Moreover, the conflict threatens to add pressure to the Russia - EU summit that is to take place in Russia on May 17th to 18th, as well as to the G8 summit that is to be held in Germany from June 6th to 8th.
      According to various expert statements, Russia is using its customs and duty policy to compel Western countries to build pulp and paper mills in Russia, while at the same time Russia’s own industry is plotting to acquire cheap wood. Some say that Russia's decision to raise the export tariffs on raw timber might be a response to Finland's rejection of an undersea electric cable from St. Petersburg to Kotka.


Previously in HS International Edition:
  Professor says wood tariffs could be payback for Finnish rejection of undersea cable (16.2.2007)
  Russian export tariff could end timber imports into Finland (12.2.2007)

Helsingin Sanomat