Putin promises speedy decision on wood tariffs

Vanhanen to meet with Russian PM on Sunday

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Russia is to make a decision in the near future on the future of its tariffs on raw timber, promised Prime Minister Vladimir Putin in a cabinet session on Monday.
      "In 2010 we will be operating on the basis of a real situation", said Putin, according to the news agency Ria Novosti.
      According to Putin, any decision will take account both of the interests of Russian timber producers and foreign partners. One of these partners is Finland, although admittedly the demand for wood from Russia has declined of late.
     
Last November, Putin postponed the implementation of export tariffs on the sale of raw timber, on the occasion of a meeting with his Finnish counterpart Matti Vanhanen in Moscow.
      This week Putin has an opportunity to repeat the exercise, as he will be seeing Vanhanen in St. Petersburg at a forest summit on Sunday.
      As Putin sees it, the financial crisis cannot be permitted to hinder the modernisation of the Russian forest industry, but rather Russia must be able to have competitive production for the international market.
      "We can no longer continue with the present trading model of selling raw timber for exzport and buying back building materials, furniture, and paper", said Putin, quoted by the Interfax news agency.
     
Russia also initially justified its timber tariffs on the grounds that it was thinking by raising the cost of timber to encourage foreign forest industry players to invest in Russia.
      The Moscow-based newspaper Gazeta wrote on Monday that the Russian Ministry of Trade and Industry was unhappy with the way foreign investors, including Finland, had stepped up to invest in the domestic forest industry.
     
From the Finnish side, the feeling is that the industry has already invested quite significantly.
      The Finnish Ministry of Employment and the Economy has calculated that the aggregate value of Finnish forest industry companies' investments in Russia over the last fifteen years comes close to one billion euros.


Previously in HS International Edition:
  Russia postpones wood tariffs again (3.9.2009)
  Russian minister says Halonen influenced decision to postpone wood tariff hikes (28.11.2008)
  Putin: Russia to postpone implementation of wood tariffs (13.11.2008)

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