The Structural Changes and Competitiveness of the Forest and Wood Sector in Baltic Countries within 1999-2016

Abstract

The structural changes and the competitiveness of forest and wood sector in three Baltic countries: Estonia, Latvia and Lithuania were analyzed in the period 1999-2016. Different concepts of competitiveness are discussed in the introductory part to find a proper approach for empirical analysis. Time series data of international trade from the Eurostat database were used to analyze the development of forest and wood sectors in Baltic countries. The relative trade advantage (RTA) index was applied for assessing the relative success of foreign trade, referred to aggregated EU28. The forest and wood sector of Baltic countries has mainly oriented to the mechanical wood processing, which formed 68% of Estonian, 64% of Latvian and 59% of Lithuanian total output value in 2015. However, the trends are dissimilar: the expanding of mechanical wood processing was remarkable in Estonia while in Latvia the forestry and logging, in Lithuania the paper and paper products increased their share.
The value of exported goods by the forest and wood sector has increased more than 200% in Estonia and Latvia, and approximately 500% in Lithuania during the period from 1999 to 2016. At the same time the decrease of RTA index for primary products (forestry and logging) is common for all countries.

Key words: forest and wood sector, competitiveness, Baltic countries, relative trade advantage index