The near term outlook for unprocessed roundwood exports from Russia is not materially affected by the import tariff structure imposed by china, though ther appear to be inconsistencies in how tariffs are applied to Russia. China has historically had preferential tariff structures favoring the import of unprocessed timber with increasingly higher tariff rates for semi-processed and finished products, thus favoring domestic manufacture of the wood raw resource. Although 'special arrangements' can often prevail for trade with Russia, importers of Russian timber in the northeast of China complain that they must pay full duties on wood imported even under barter arrangements or from labor-export agreements. Government officials indicated that this could be 'resolved' in the case of trade with Russia, although no clear policy appears to exist dealing with such issues. The role of finance and credit arrangements will perhaps be most significant for China's importers.
Russian enterprises have virtually no working capital and little possiblitiy of credit.
In many cases, supplis must be paid for in advance, in some cases including timber. Productin is impossible without adequate credit or advance payment from buyers of timber products. Given the financial situation of many forest products enterprises within China, it is unlikely that advance payment for imported timber can be feasible any time soon. Greater roles for banking stitutions, including letters of credit and foreign exchange accounts will be reaquired if timber trade with Russia is to expand.