Russia’s next round of tax increases on log exports has been shelved by 9-12 months. The announcement, from Russian prime minister Vladimir Putin, “pleasantly surprised” Finnish prime minister Matti Vanhanen.
The controversial log export taxes, which are being implemented in stages and were set to rise to euros50/m2 on January 1, 2009, has irked Finland, as the increased cost of Russian logs stands to leave Finnish timber processors short of timber because of the unaffordable exported material. Thousands of job losses could be made as a result and mills left short of timber.
Stora Enso also welcomed the postponement.
“This is an indication of the desire to avoid barriers to international trade that would hamper the economies on both sides of the border,” said Stora Enso ceo Jouko Karvinen. “This decision gives us more time to adjust our operations to the postponed wood duty.”