EU forest industries, including wood processers for the building industry and paper producers, will be able to buy cheaper imports of raw spruce and pine from Russia, under an agreement approved by Parliament on Wednesday.
Russia is to open up a low export duty quota for spruce and pine and allocate a relatively large share of it to the EU. Within this quota the export duty will be 13% for spruce and 15% for pine, compared to the out-of-quota export duty rate of 80%. The deal also stipulates that the EU can allocate the quota according to its internal procedures.
"We have reached a new turning point in EU - Russia trade relations. For the first time, the EU will be administering the third country's tariff-rate quotas", said MEP Inese Vaidere (EPP, LV), who drew up Parliament's recommendation, adding that the deal was "an important asset for the stability and reliability of the trade relations and a step towards more stable and predictable trade with Russia".
Room to grow
Russia is the EU's largest supplier of imported wood (up to 60%). EU imports of spruce and pine from Russia dropped by 80% after 2007, when Russia imposed export duties on raw lumber to boost its own wood-processing industries.
The value of total EU imports of Russian wood fell from about €2.54 billion in 2007 to about €1.51 billion 2011, which harmed EU wood processors, particularly in the pulp and paper industry.
Finland, which traditionally has accounted for 50% or more of these imports, is likely to be the key beneficiary. Others will include Latvia, Lithuania, Estonia, Sweden, Germany and Poland.
The deal, the negotiation of which was linked to Russia's accession to the WTO, has applied provisionally since 22 August 2012, when Russia officially became a WTO member.