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Federal Forest Management Agency (Rosleskhoz) head Valery Roshchupkin admitted 18.12.2007 that measures in the new Forest Code to attract investment in the logging and lumber milling
industry are insufficient to create any qualitative change and a
program to raise duties gradually on lumber exports has led only to the
growth of exports. The current Forest Code came into effect a year ago.
Roshchupkin said that four projects, worth $2.5 billion, can be
discussed by the government when regional authorities submit them. A
total of 85 projects are under consideration by regional authorities.
None of them will be ready for implementation before 2009, however.
Two years ago,
Russian President Vladimir Putin declared the reduction of undressed lumber and the development of
lumber processing in Russia areas of priority. Gradual increases will
bring export duties on lumber to 80 percent of cost by 2009.
Simultaneously, duties on finished wooden products will be eliminated.
This summer, a resolution was passed by the government providing
benefits to investment projects worth more than 300 million rubles.
Those benefits include provision of plots of forestland without an
auction, lowered rent and duty-free importation of equipment.
Roshchupkin suggested that more stimuli are needed. He proposed
lowering rent on forestland to zero, subsidizing interest on credits
and direct state cooperation in creating infrastructure, especially
roads. The Ministry of Industry and Energy opposes cofinancing
infrastructure. No action is being taken to draft new legislation on
forest management. Industry lobbyists will probably attempt to raise
the topic with the government again next year.
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