ULAN-UDE, April 11 (RIA Novosti) – Russia will earmark 400 billion rubles ($13 billion) to finance priority projects in the country’s forestry industry to make the sector attractive for investment and address its long-term problems, President Vladimir Putin said on Thursday.
“We must also make forestry attractive for investment. We plan to invest over 400 billion rubles in 118 projects in the sector which have received priority status,” Putin told a State Council meeting which discussed measures to increase the efficiency of the forest industry.
Russia’s forestry business has been in the doldrums for the past two decades, marred by poor governance, low investment potential and the growth of illegal felling and illegal timber sales.
Up to 20 percent of timber logging or about 35 million cubic meters of timber is illegal, with economic damage from illegal timber sales estimated at 13-30 billion rubles ($420-$970 million) annually, according to WWF Russia and World Bank data.
The existing system for forestry project selection, which favors large production facilities for timber processing, should also cater for small and medium businesses, Putin said, adding Russia also needed universal methods of support for all businesses which could bring economic and social benefits.
Putin also said Russia needed to stiffen punishment for illegal loggers.
“First of all, we need to streamline a system of accurate monitoring and define tougher measures for those who barbarically destroy the forest,” Putin said.
Over 7,000 people were fined in 2012 for illegal felling, with damage amounting to around 10 billion rubles, the president said, adding only 2 percent of these funds were recovered.
“The forest also needs to be rescued from illegal felling, which has increased by 66 percent in the past five years and the amount of this felling remains colossal,” Putin said.
