Head of the Republic of Karelia Sergey Katanadov has taken part in the Finnish-Russian forest summit held in St.Petersburg.

A number of fundamental, even saving decisions for the forestry branch of Karelia had been made at the international forum.

Moratorium on increase of round timber export customs duties will be prolonged for 2010, and perhaps for 2011. It was declared by the Prime Minister of Russia Vladimir Putin at the Third Finnish-Russian forest summit in St.Petersburg. Now the duty makes €15 per one cubic metre of timber, and since January 1, 2010 it should grow up to €50 per one cubic metre. It would lead to crash of a number of forest enterprises and would threaten future of the branch.

In turn, it is also extremely important for the economy of Finland which in many respects is focused on Russian round timber. Experts specify, that such decision will positively affect negotiations between Russia and Finland on the subject of the Nord Stream gas main and dialogue between Russia and the European Union on the entry into the WTO.

Nevertheless, Vladimir Putin has warned, that the moratorium on increase of duties is an interim measure: 'Role of supplier of the raw material cannot suit Russia, and the moratorium will not last forever.'

Decisions of the summit are very actual for Karelia as the wood-producing region with the longest border upon Finland. It is natural, that participation of the Head of the Republic in the event was of great importance. Having returned from the summit, Sergey Katanandov has commented on its course and decisions:

- We were very busy with preparing for the summit, I participated in the session of Timber Council and a number of other meetings. Finland and Russia are tied by close good neighbourly relations, for each other we are key trading partners. Many problems related to, first of all, the crisis phenomena in economy have accumulated in our partnership. The summit in St.Petersburg was held in the context of the crisis.

- We have discussed very important issues, - Sergey Katanandov has told. - The main of them was taking advantages of northern wood. It happens, that now competition in the markets is won by the South and Latin America and Africa. Of course, it does not suit us, because Russia possessed huge forest resources and should be presented in the market adequately. Northwest of Russia is one of the regions most developed from this point of view. Participants of the summit have addressed to the Government with the request to prolong the moratorium on increase of timber duties. Assuming that all governors support the country-chosen strategic course on deep processing of wood within the territory. However everybody understand, that implementation of these policy needs time. The issue of deciduous wood was discussed particularly. Meanwhile, in Russia practically there are almost no capacities to process aspen and birch wood. I hope, that the state decision on this subject will be made soon, too.

- The forest complex is not just an abstract concept, - Sergey Katanandov considers. These are people living and working in Segezha, Kondopoga, Muezersky, in logging camps of the North. Millions of citizens of Karelia, Arkhangelsk and Vologda areas, the Republic of Komi depend on it. It is clear, that if production does not sell well, timber remains on allotments, these people cannot live normal life. The situation demands "manual management". There's no wonder, that attention of the top management of the country is attracted to this issue, - Head of the Republic of Karelia considers.

Making comments on the decision of the Prime Minister of the Government of the Russian Federation on prolongation of the moratorium on introduction of protecting duties on round timber export duties, Sergey Katanandov has told:

- Vladimir Putin was forced to make this decision though it was correct and duly. In the context of the crisis it is necessary to act according to the situation, to show flexibility, and it is very good that our state has learned to show such flexibility concerning matters of principle. The proposed establishment of zero duties on exported birch and aspen just rescue many timber enterprises. We consider that if such decision is made, it will allow us to move forward in harvesting of deciduous wood, and to improve the branch as a whole which today is overstocked with the deciduous wood and just does not know what to do with it.

On the reaction of Finnish partners on decisions of the summit Head of the Republic of Karelia has noticed:

- Negotiation with the Finnish partners did not stop in recent time. We support constant dialogue within the scope of frontier cooperation. Of course, Finns expected some steps from the government of Russia and rate decisions of the summit very high. It is possible to expect, that in this context they will begin to invest in development of timber processing in Russia more actively. In particular, matters concern construction of several factories in territory of Vologda and Nizhniy Novgorod areas, and Karelia should also work in this direction.

Maxim Tikhonov
Press-secretary of the Head of the Republic of Karelia