A socially oriented non-financial development institution and a major organizer of international conventions, congress, exhibitions, business, social and sporting, public, and cultural events.

The Roscongress Foundation is a socially oriented non-financial development institution and a major organizer of international conventions; exhibitions; and business, public, sporting, and cultural events. It was established in pursuance of a decision by the President of the Russian Federation.

The Foundation was established in 2007 with the aim of facilitating the development of Russia’s economic potential, promoting its national interests, and strengthening the country’s image. One of the roles of the Foundation is to comprehensively evaluate, analyse, and cover issues on the Russian and global economic agendas. It also offers administrative services, provides promotional support for business projects and attracting investment, and helps foster social entrepreneurship and charitable initiatives.

Each year, the Foundation’s events draw participants from 208 countries and territories, with more than 15,000 media representatives working on-site at Roscongress’ various venues. The Foundation benefits from analytical and professional expertise provided by 5000 people working in Russia and abroad. In addition, it works in close cooperation with 160 economic partners; industrialists’ and entrepreneurs’ unions; and financial, trade, and business associations from 75 countries worldwide.

The Roscongress Foundation has Telegram channels in Russian (t.me/Roscongress), English (t.me/RoscongressDirect), and Spanish (t.me/RoscongressEsp). Official website and Information and Analytical System of the Roscongress Foundation: roscongress.org.

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Russia’s Forest at a Crossroads: What’s Next?
2 September 2021
15:00—16:30
KEY CONCLUSIONS
The ban on the export of low-grade timber has had a mixed effect on the development of forestry companies

The volume of logging has decreased over the past three years. At the same time, the volume of processed sawn timber has increased by 7.5%, which in a certain way has had a both positive and negative impact on the situation — Anatoliy Bobrakov, Deputy Minister of the Russian Federation for the Development of the Far East and the Arctic.

Indeed, over three years we completed a kind of first stage, when timber was handed over in exchange for investment, and now it is already possible to calculate economically what this led to [...] I think in the East this led to a sharp imbalance because not all the forest has been leased [...] while the forest that has been leased is also not all being used, and it’s clear that, having secured the annual allowable cutting rate, entrepreneurs are forced to choose parts and build roads in parts. These are always short-term solutions based on under market volatility — Oleg Bocharov, Deputy Minister of Industry and Trade of the Russian Federation.

It would be impossible to say unequivocally that the expectations about the threat of a ban on the export of round timber has not affected the current investment processes. Everyone knows how to count money, and everyone adapts — Oleg Bocharov, Deputy Minister of Industry and Trade of the Russian Federation.

We aren’t seeing a reduction in the labour force or a massive layoff. I wouldn’t make a tragedy out of this — Oleg Bocharov, Deputy Minister of Industry and Trade of the Russian Federation.

Low-grade timber needs to be exported until a sufficient number of processing plants are built

In the absence of infrastructure and processing capacity, the ban on exports [of low-grade timber] is having a, shall we say, drastic impact on the economy [...] Of course, the absence of a sorter in the Far East [...] is imposing specific features on the region. We can’t send this wood anywhere except for export — Konstantin Lashkevich, Chief Executive Officer, RFP Group.

ISSUES
A lack of infrastructure is hindering the industrial development of logging areas

What challenge are we seeing in this regard? We understand that today the annual allowable cutting rate [...] is not accessible for industrial development. A lack of infrastructure, forest roads in particular, prevents entrepreneurs and loggers from developing the wood that could be harvested. As the Ministry of Development, we are particularly interested in the resource that exists in the Far East today [...] being used as much as possible in economic growth — Anatoliy Bobrakov, Deputy Minister of the Russian Federation for the Development of the Far East and the Arctic.

We need certain conditions. What does that mean for our company? It’s either the existence of an annual allowable cutting rate [...]. We are ready to build forest roads ourselves [...] What do we need from the state [...] if we are going to develop the production of pellets, biofuel, and anything else in the Far East. We need shipping terminals. If we don’t have them, then there will be no logical conclusion to production — Nikolay Ivanov, Managing Director, Segezha Group.

Not every business can independently ensure infrastructure due to high costs. Partners and investors are needed

Given the high costs of building [forest roads], we understand that timbermen won’t be able to do this on their own. They will not be able to put these costs on their business plan, — Anatoliy Bobrakov, Deputy Minister of the Russian Federation for the Development of the Far East and the Arctic.

We only see the successful projects in the Far East as the ones that have partners [...] Where are the companies now that went into investment projects without investors? — Konstantin Lashkevich, Chief Executive Officer, RFP Group.

The absence of centres to process low-grade wood requires attracting partners to the business since there is not enough government support

There are three vectors that need to be urgently addressed. The first is for timber processing companies to nevertheless find a solution and enable this low-grade wood to be exported for a period of 3–5 years because we have to produce it [...] The second is to make a favourable decision so that we can attract serious foreign partners to our business because serious investment resources are needed [...] Also, appealing to the Ministry of Industry and Trade, I would very much like the Industrial Development Fund to have a chance to help develop centres for the processing of low-grade wood so that programmes are instituted not for five hundred million, not for two billion, but for around ten billion roubles because this would create a solution — Konstantin Lashkevich, Chief Executive Officer, RFP Group.

SOLUTIONS
Get investors and the state involved in building the infrastructure needed for the timber industry

Today, we are working on creating a mechanism via which we could introduce into commerce a resource that is not available to loggers today. To enable investors to build forest roads [...] we are working out a mechanism via which the state would reimburse the cost of forest roads, while increasing the forest lease rate within the term of the lease agreement with the consent of such an investor, — Anatoliy Bobrakov, Deputy Minister of the Russian Federation for the Development of the Far East and the Arctic.

Indeed, this is where the state’s role should be [...] Let’s understand to what extent business cannot provide investments, and the state should support it. Obviously, this includes warehouses and transhipment assembly points — Oleg Bocharov, Deputy Minister of Industry and Trade of the Russian Federation.

As for our support measures, you all know that we are actively developing the Industrial Development Fund. I think that this is the most honest and fair instrument to access medium and long-term financial resources at reduced rates — Oleg Bocharov, Deputy Minister of Industry and Trade of the Russian Federation.