The competition concern of First Vice Premier Sergey Ivanov has turned into the mere smoke the better part of benefits looked forward to by timber majors.
Photo: Dmitry Azarov
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Timber Majors Stripped Of Customs Benefits
Russia’s Economic Development Ministry and Industry and Energy Ministry submitted to the cabinet for approval a draft ruling specifying criteria for choosing top-priority investment projects for woods’ development. Contrary to hopes of timber majors, the draft spells out no customs benefits for such projects.
The government will focus on the draft ruling with criteria and procedures to pick out the investment projects of top priority for woods on June 28, as the document is expected to take effect on July 1. So the dispute of timber merchants and bureaucrats about granting preference to investors in projects of high-level forest utilization has reached the final straight.
According to the draft, capital investments in top-priority project will exceed 300 million rubles and several projects of a single investor could be consolidated. A certain authorized body, which establishment will be decided by cabinet, will supervise activities of investor. Without any tenders held to the effect, that body will be entitled to conclude a lease for a wood area that will provide logs for the project. It will also calculate 50 percent of the minimal lease payment for the pay-back period of the project specified in the bid.
Contrary to all expectations of timber majors, the draft spells out no customs benefits for the projects. Industry and Energy Ministry hasn’t abandoned the efforts to widen the list of preference given to investors, but the sources say that First Vice Premier Sergey Ivanov stepped in to oppose the benefits, reasoning “they would torment competitive environment.”
www.kommersant.com
All the Article in Russian as of June 21, 2007
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