Russia to delay timber export duty hike: Putin

08:50, October 26, 2009      

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Russian Prime Minister Vladimir Putin said Sunday that Russia will not raise export duties on raw timber in 2010 amid a trade dispute with neighboring Finland, Russian news agencies reported.

"The moratorium on raising export duties on round timber will remain in force for the next year. I believe it possible to make a similar decision for 2011," Putin told a press conference after talks with his Finnish counterpart Matti Vanhanen in Russia's northern city of St. Petersburg.

Putin said the decision to delay the next round of duty hike was because of a slump in demand for timber amid the global financial crisis.

Vanhanen, for his part, said he was satisfied with the Russian decision and the Finnish government would decide on the construction of the Nord Stream gas pipeline across its territories in early November.

"After that, the environmental authorities will give their permission to the passage of the gas pipeline. We expect this to be done by the end of the year," Vanhanen told reporters.

Russia started tax increases on round wood back in 2007 over its unwillingness to play the role of a raw material supplier to global markets. The country has been trying to diversify its economy, which depends heavily on exports of energy and raw materials, and create competitive value-added and high-technology industries.

The Nord Stream pipeline project, currently being built by Russia and Germany, aims to eventually pump 55 billion cubic meters of Siberian gas per year to Western Europe through the Baltic Sea, bypassing Ukraine and former Soviet republics. Denmark recently gave its approval to the project.

Source: Xinhua
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