First Deputy Prime Minister Viktor Zubkov
Photo: Dmitry Lekay
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Gov’t Lifts Industrial Equipment Duties
First Deputy Prime Minister Viktor Zubkov yesterday made permanent the temporary exemption from import duties on equipment for metallurgy, construction, the forest industry and textile production for which no equivalent is made in Russia. There are a total of 90 types of equipment that have been exempted from duties, as established in a list compiled by the Federal Customs Service. The government thus intends to help plants modernize in 2009, even in the midst of a global crisis. The move may have come too late, however.
Former minister of economic development and trade German Gref had lobbied for the removal of those duties since 2000. In 2006, the duties were lifted from 700 types of equipment, and another 98 types were added in March 2008. The additional group was exempted for ten months.
According to the Ministry of Economic Development, more than a third of imports into Russia can be classed as “machines and equipment,” and that share is growing. In January and February 2006, it was worth $6.3 billion. In January and February 2007, it was worth $10.3 billion, and in January and February of this year, it had more than doubled.
The measure is especially meant to support the metals industry. A spokesman for Novolipetsk Metals Combine commented, however, that “Today, that measure cannot stimulate the growth of investment in the sector by itself. Additional stimuli are needed.” Severstal is reducing capital investment in the fourth quarter of this year by 20 percent of the annual plan and its $8-billion investment plan for 2009-2011 has been postponed “until clarification of the economic situation and improvement of market conditions.” Evraz Group has cut production in Russia and Ukraine by 25 percent and is reconsidering its 2009 investment program. Analysts say steel production in Russia will fall 10 percent next year.
www.kommersant.com
All the Article in Russian as of Dec. 05, 2008
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