Translated material
Square timber
The government will create a forest council
With unprecedented activity, the government has taken on the forestry industry, which brings Russia both gigantic profits (in terms of foreign exchange earnings, income from timber exports is second only to trade in energy resources and weapons), and gigantic losses (the country exports cheap unprocessed timber with extreme opacity of the entire system of relations in the forestry complex ). The Cabinet of Ministers is trying to turn what is considered a negative throughout the world economy - protective export duties on the export of unprocessed timber - into a positive. Prime Minister Viktor Zubkov resolutely pursues this line. “Stop exporting round timber,” he said yesterday in Vologda, where he arrived to participate in a meeting of the council of the Union of Timber Industrialists and Timber Exporters. “Even today there are voices calling for the duties to be removed. We believe that this is not our path,” Mr. Zubkov was very categorical.Energy and categoricalness in this matter are apparently very necessary. Back in March 2006, Vladimir Putin, meeting with members of Mikhail Fradkov’s cabinet, demanded urgent measures . “If we chew snot for years, then we won’t change anything. It is necessary to take all measures to stimulate timber processing in Russia, and not to drive round timber abroad. Otherwise they are moving back and forth in huge numbers, and nothing has been done,” the head of state was indignant. In his address to the Federal Assembly in April of this year, Vladimir Putin already noted positive changes: “The government has already decided to gradually increase export duties on round timber. Without infringing on the interests of our foreign partners, we must still think about developing our own processing base, including continuing to reasonably reduce duties on technological equipment, speeding up the provision of forest plots, and co-financing the creation of the necessary infrastructure.”
However, according to Mr. Zubkov, the “voices” are still “sounding.” So that no one doubts the consistency of this forest policy, a non-regulatory special body will be created in the government. “There will be a permanent council in the government, which I will probably head,” the prime minister said.
Viktor Zubkov explained that the council will go through the entire chain of problems in the forestry industry and outline “ways out of the current crisis.”
“Our land is rich, but there is no order in it,” Mr. Zubkov spoke in the tone of epics, inviting Deputy Minister of Industry and Energy Denis Manturov to briefly outline the program for reviving the timber processing industry. The deputy minister said that in addition to the appeal to duties (in particular, import duties on the import of high-tech equipment and export duties on the export of highly processed wood products have been abolished), the main emphasis will be on investment and state support for timber processing.
According to an official of the Ministry of Industry and Energy, to date, 39 regions have presented 220 investment projects applying for money from the investment fund. “We chose four of them. This is a project in the Khabarovsk Territory with a funding volume of 580 million euros and a payback period of eight years, in the Krasnoyarsk Territory - 132 million euros, where the payback period will be five years, in the Leningrad region - 100 million euros with a payback period of two years, and in the Tver region -- 175 million euros with a payback period of five and a half years. All of them are realistic to be launched next year,” said Mr. Manturov.
However, this scale did not inspire the meeting participants too much. The Presidential Plenipotentiary Representative in the Northwestern Federal District, Ilya Klebanov, asked rather sharply: “Where did they come from, these projects? Frankly speaking, not a lot! And what do they decide? There is a task - not a single (log - Ed. ) round timber should be exported to China! This, I understand, is the task!”
The prime minister stood up for the newly appointed deputy minister, who, by the way, previously worked primarily in the military aviation industry, and in recent years has been involved in the consolidation of helicopter enterprises on the basis of the Oboronprom holding: “It is useful for Denis Valentinovich to be baptized here. But don't swear at him. We gathered to speak out and solve forest problems. The bazaar station will not give anything here. And the main thing is that we will have a permanent council under the government.”
Large timber merchants were ready to immediately believe in the magical power of the council. They immediately lobbied their interests quite actively. Chairman of the Board of Volga OJSC Shalva Breus demanded from the Prime Minister benefits and preferences, as well as subsidized interest rates on loans. The Prime Minister promised to consider all proposals and instruct ministers to take them into account.
As a result of the meeting, it was decided that investment projects with a volume of 300 million rubles or more will benefit from state support; they will also be accompanied by a 50 percent discount on the rental of production facilities for timber processing. Minister of Economic Development Elvira Nabiullina confirmed that protective duties on round timber exports will not be abolished, and from January 1, 2009 they will be prohibitive. As for foreign investment, it is clear from Ms. Nabiullina’s words that, it turns out, this is not the most important thing for the government today. There is a desire to achieve export of our products with a high degree of processing. Minister of Natural Resources Yuri Trutnev, in turn, said that a comprehensive plan would be adopted to combat forest theft.
The history of the settlement of relations with the EU (to whose countries at the WTO negotiations Russia promised not to introduce protective export duties) was left for later. “When we are accepted into the WTO, then we will think about what to do with protective duties, but now we must somehow raise our industry,” Denis Manturov told Vremya Novostey.