Competitiveness of Estonian forest and wood cluster
The objective of the current study on the competitiveness of the forest and wood industry of Estonia is to find out the success factors for the development of the field in order to allow for the liquidation of bottlenecks of the sector and magnify the advantages at the national level as well as to provide enterprises with high-quality information for decision-making.
This study regards the forest and wood cluster of Estonia as an integral value chain of wood processing from forestry and logging to wood processing, production of wood products, production of paper and paper products and furniture production, which consists of about 2,000 enterprises.
The forest and wood cluster is a very important part of the Estonian economy. Wood, paper and furniture industry together provide more than 20% of the total production and value added of manufacturing industry in Estonia. This is more than in most of the other countries in the Baltic Sea region. The forest and wood cluster is one of the main stabilisers of foreign trade in Estonia: its export amounting to 1.5 billion euros accounted for 12% of the export of goods in Estonia in 2012. The added value created by the cluster amounted to 4% of the GDP in 2011. Therefore, it is extremely important for the Estonian economy that this cluster develop and be truly competitive.
Within the last decade the forest and wood cluster in Estonia has undergone very fast and successful development. The wish to compare ourselves with the forest and wood clusters in the Nordic countries, which are some of the most competitive in the world, indicates at the same time the courage to set far-reaching objectives and the will to work for the achievement thereof.
The competitiveness of industry depends on the enterprises’ choice of strategy and activities in open market competition, as well as on the activities of the state in the development of a green economy, incl. the supply of labour force, several legal acts, etc. As the world economy is constantly changing, the strategy of enterprises and public policy must also be updated in a consistent process.
Therefore, we recommend that enterprises and the Ministry of Economic Affairs and Communications establish, on the basis of the recommendations outlined in this report, a common action plan that defines main activities, persons in charge, etc. This action plan should be regularly updated according to the actual achievements and emerging future needs.
First of all, we recommend focusing on the following three courses of action:
– Updating strategies and further positioning of enterprises on the market;
– Internationalisation of enterprises and reinforcing their presence in the Baltic Sea region;
– Development of the Estonian state into a smart customer.