Russian Prime Minister Viktor Zubkov wants a forest-industry development strategy by March.
Photo: Vyacheslav Reutov
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PM Disappoints Foreign Forest Investor
Russian Prime Minster Viktor Zubkov visited Syktyvkar yesterday, where he told Peter Oswald, head of the European division of the Mondi paper and packaging group (part of the Anglo-American Holding), that, since Russia has the world's most stable economy, the government will not cancel its scheduled duty increases on timber, nor will investors in the sector get tax benefits or priority status. But they may be able to receive benefits from regional programs of the federal investment fund.
In Syktyvkar, the prime minister chaired an away meeting of the government Forest Industries Complex Development Council and visited the Syktyvkar Paper and Cellulose Plant, which Mondi took control of in 2004. Mondi executive Oswald told Zubkov that the company has invested ˆ264 million in the plant since taking it over and is ready to begin a ˆ500-million refitting, if that reconstruction is including on the list of the sector's priority investment projects, a form of support included in the new edition of the Forest Code. Oswald also asked that his company be allowed to rent more forest land and that it receive additional tax benefits “within the framework of current legislation.”
Oswald erroneously asked Zubkov about tax benefits, since regions now provide those benefits on investment agreements, not the federal government. He had no need of asking about rising duties, since the prime minister had addressed that issue a few hours previously, saying that those plans would not be reconsidered. Raising the export duty on timber to a protective level by 2010 is a key point in Russian WTO negotiations with the European Union. Zubkov also ordered a development strategy for the sector through 2020 be written by March.
www.kommersant.com
All the Article in Russian as of Jan. 30, 2008
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