The export of timber to Europe became impossible. Europe is outraged, writes a complaint to the WTO, demands to lift restrictions and return everything as it was
European firms made good money when they made products from our wood, and sold them back to us at times more expensive. But 2022 put an end to that. European organizations are outraged. Declares that this is contrary to all the rules, and demand that everything be returned as it was. What happened?
Still, there must be some kind of justice in the world. And I want to believe that it will lead only to good things. For many years, furniture, construction and other firms in European countries received wood directly from Russia for a penny. They settled in very well. We bought cheap raw materials. They made furniture and other products from it and returned it back to Russia, winding up the added value as much as possible.
Changes have taken place in 2022. Russian politics has slightly changed the rules. For the whole of 2022, Russia has introduced restrictions on timber exports. The numbers are just cosmic. Very unexpected for everyone. Protective duties - 80%.
European organizations are outraged. Official complaints to the WTO are being prepared
This amount of protective duties will deal a strong blow to the finances of European companies. Huge amounts of money will be lost. Need someone to blame! And they decided to make Russia the culprit, whose resources have been used for a pittance for decades.
The WTO designates the amount of protective duties - from 10 to 18%. A factor of 80% is the collapse of the entire woodworking and furniture industry in Europe. European countries can buy wood only in Russia and Finland. But in modern realities, neither one nor the other option will suit the Europeans. Companies will suffer unforeseen losses and will not be able to cover costs.
The European Commission believes that changes in the conditions for the sale of wood by Russia are unacceptable. The purchase of Finnish wood (which costs several times more) does not suit them either. That is why it was decided to file a complaint with the WTO. We can say that this complaint is a deliberately failed option. The WTO cannot force a country to sell resources. The terms of sale are dictated by the market and set by the seller.
In addition to the increase in duty, there has been another important change in the international timber trade. In order to take the export of timber under total control, Russia blocked almost all border points for the export of timber to Europe. There was only one customs crossing left. Although there were at least 30 of them.
After filing a complaint with the WTO, 60 days must pass before arbitration is convened. It is assumed that during these 60 days the parties should discuss the problem and agree. If this does not happen, the European commissioners will consider the complaint and make a decision.
But our politicians insured themselves in advance against such measures, in which case we may be obliged to do what we do not want. Remember the changes to the Constitution that were made recently? One of the points concerned precisely such moments! Now in the Main Legislation of our country it is written that foreign decisions do not prevail over Russian ones and cannot be binding.
In my opinion, this is a very unexpected, but very correct decision. I didn't think we'd be able to do that. But one thing is clear - in 2022 Europe will not see our tree! I hope this will help to maintain and perhaps slightly reduce the sharply soaring prices for building materials and furniture.
I hope that now in Russia it will now make sense to process wood, make furniture and building materials.