Nov 02, 2005. /Lesprom Network/. In a recent meeting of the lumber industry in the central Russian region of Kostroma, Prime Minister Mikhail Fradkov indicated that Russia could not continue exporting roundwood. With a quarter of global forest reserves, Russia exports 12 million m3 of roundwood to Finland alone every year while Russia annually imports lumber and paper products worth $3 billion from its Scandinavian neighbour. Mr. Fradkov said cutting-edge technology and foreign experience should be used to drive the Russian lumber industry forward. "Russia has enough raw materials and skilled workers. Those are our competitive advantages", Mr. Fradkov added. However, the Premier recognized that these advantages had not been used to the full extent and suggested that foreign partners could help solve problems facing the industry. Contribution to economy relatively modest Forests account for 75% of Russia's territory, with 1,139 million hectares stretching from the Pacific coast to the Baltic Sea. However, forests products have not contributed to the Russian economy to the same extent as oil and gas. According to Valery Roshchupkin, head of the Federal Forestry Agency of the Natural Resources Ministry, a major obstacle is the inefficiency of forestry agencies. Tree felling has reached only 21% of its capacity. Russia currently fells 170 million m3 out of the possible 550 million m3. Due to shortage of machinery and production capacity, Russia principally exports roundwood. According to unofficial data, over half of exported timber is felled illegally. The state is beginning a campaign against illegal felling, using satellites to monitor forests.