The Role and Potential of Timber in Construction for Achieving Climate Neutrality Objectives in Latvia

Abstract

Low-carbon development is closely linked to the concept of sustainability, which focuses on both economic growth and the targeted reduction of greenhouse gas (GHG) emissions, facilitating the transition to climate neutrality. This process involves the efficient use of resources and necessitates systemic transformations across various sectors of the economy. For Latvia to achieve its climate neutrality objectives, it is essential to adhere to the principles of the bioeconomy, with a particular emphasis on the use of timber in construction. This approach combines opportunities for economic development with environmental protection, as timber is a renewable resource that contributes to carbon sequestration. The utilisation of timber in construction enables carbon storage within buildings and substitutes traditional materials such as concrete and steel, the production of which is highly energy-intensive and generates substantial CO₂ emissions. Consequently, timber use also reduces indirect emissions associated with the construction sector. The objective of this study is to identify the main barriers hindering the broader application of timber construction materials in Latvia’s building sector and to propose solutions to overcome these obstacles. The research tasks include an analysis of climate neutrality and construction targets within the EU and Latvia; an examination of the current situation and influencing factors regarding Latvia’s forest resources, their harvesting, processing, use in construction, and trade balance; and the identification of critical problem areas and the delineation of possible solutions. For theoretical and situational analyses, the authors employ methods such as scientific literature review, policy content analysis, descriptive methodology, statistical data analysis, and interpretation of quantitative and qualitative data. The results are synthesised using PESTEL analysis, which serves as a continuation and elaboration of the initial SWOT analysis assessment and is visualised through graphical representation. The authors of this study participated in a national-level expert group whose members represented the Parliament of the Republic of Latvia, responsible ministries, forest managers, construction companies, wood product manufacturers, and representatives from higher education and research institutions. The following hypotheses are proposed and substantiated in this article: (1) Latvia possesses sufficient forest resources to increase the share of timber used in construction, (2) increasing the use of timber in construction would significantly contribute to both Latvia’s economic development and the achievement of climate neutrality targets, and (3) the expansion of timber use in the construction sector depends on a restructuring of national policy across multiple sectors. Suggested solutions include the improvement of regulatory frameworks for timber harvesting, processing, and utilisation in related sectors—agriculture and forestry, wood processing, and construction. The key challenges for policymakers include addressing the identified deficiencies in Latvia’s progress toward achieving its CO₂ targets, introducing qualitative changes in timber harvesting conditions, and amending regulations governing the forest management cycle accordingly. For timber processing companies, it is crucial to ensure stable conditions for their commercial activity. Promoting the use of timber in construction requires a broad set of changes in safety and financial regulations and procurement requirements. Timber construction is relevant not only in the building sector but also in civil engineering, and modifications and additions to educational programmes are necessary. The promotion of timber use among the wider public is of great importance. At all stages of timber processing—from harvesting to integration in buildings—access to financial resources should be facilitated. As numerous sectors of the national economy (agriculture, forestry, wood processing, construction, logistics, etc.) are involved in timber processing, interdisciplinary research is required to address complex challenges that demand expertise from multiple fields.

1. Introduction

Low-carbon development is a significant issue worldwide. Strategic international objectives to reduce emissions contributing to climate change are defined under the United Nations Framework Convention on Climate Change (UNFCCC) [1], which entered into force in 1994. The Kyoto Protocol [2] was adopted in 1997 based on this framework, setting binding emission reduction targets—many of which were ultimately not achieved. In 2015, the Paris Agreement [3] established a global consensus aimed at limiting global warming and tackling climate change. This agreement has been ratified by all EU Member States.

To reach climate neutrality by 2050, the European Union has developed a series of policy documents forming the strategic basis for the transition towards a sustainable economy (see

Table 1. EU strategic policy documents for achieving climate neutrality (developed by the authors).

Document	Strategic Goals	Strategic Directions
European Green Deal [4]	Achieve EU climate neutrality by 2050	Supports sustainable, energy-efficient, and resource-efficient economic development; promotes the use of renewable and local resources.
Regulation (EU) 2021/1119 European Climate Law [5]	Establishes the framework to achieve climate neutrality in the EU by 2050	Sets a binding EU target of at least a 55% reduction in GHG emissions by 2030 compared to 1990 levels; provides legal certainty and predictability for planning the transition to a carbon-neutral economy.
“Fit for 55” Package [6]	A legislative package to reduce EU GHG emissions by at least 55% by 2030	Covers energy efficiency, renewable energy, and comprehensive reform of the EU Emissions Trading System (ETS).
National Energy and Climate Plans (NECPs) [7]	10-year plans describing how each Member State intends to meet the EU’s energy and climate targets by 2030	Outlines approaches to decarbonisation, energy efficiency, energy security, market integration, research, innovation, and competitiveness.

).

According to statistical data, buildings consume approximately 30% of the world’s final energy and account for around 26% of energy-related global CO₂ emissions. Of these emissions, about 70% are indirect—resulting from energy consumed during building operation (e.g., heating and electricity)—while approximately 8% are direct emissions originating from the production of construction materials. In the EU, buildings account for 40% of energy consumption and approximately one-third of total GHG emissions. Forests in the EU absorb nearly 9% of total GHG emissions, making them a critical carbon sink. Both forest area and timber volume have been increasing; over the past 30 years, the forested area in the EU has grown by 9%, and timber stock has increased by 50% [8].

Low-carbon development can be achieved through both the reduction in GHG emissions and the enhancement of carbon sequestration. Between 2010 and 2020, the annual average carbon sequestration in forest biomass across Europe amounted to 155 million tonnes, which represents 10% of gross GHG emissions in the EU-28. A major lever for climate protection lies in the substitution of fossil-based materials and energy sources with wood—for both material and energy use—thereby preventing emissions. Consequently, promoting timber as a substitute for high-emission construction materials is a crucial measure in addressing climate change. Non-metallic construction materials (such as concrete, bricks, stone blocks, and glass) dominate in the EU construction sector with a market share of 91% of the mass and 88% of the volume, whereas metallic construction materials have a market share of 6% of the mass and 2% of the volume. Currently, timber accounts for only 3% of the mass and 10% of the volume of building materials used in the EU, indicating significant potential for broader utilisation [9].

In the construction and real estate sectors, emissions can be reduced by improving energy efficiency during the building’s operational phase and by altering the material composition during construction. Increasing the share of timber in construction is one such approach, as it enables substantial carbon storage.

To support carbon emission reduction through sustainable forest management, the European Economic and Social Committee (EESC) issued an opinion on “Wood Construction for Reducing CO₂ Emissions in the Building Sector” [10]. The EESC identifies bio-based construction materials as an essential element of the green transition and advocates for the increased use of timber in construction without placing political obstacles. The Committee emphasises the public sector’s exemplary role—public buildings should increasingly incorporate timber. The EESC’s recommendations for promoting wooden construction are as follows:

• Public sector role model;
• Support for research and innovation;
• Sustainability and life cycle criteria in procurement procedures;
• Carbon certification system taking into account the offsetting role of wood products;
• Analysis of barriers related to formal, legal, and technical requirements;
• Training and professional development.

Compared to other traditional building materials, wood stores carbon even before it is used as a construction material (wood consists of approximately 50% pure carbon). Building with wood can save up to 40% of CO₂ emissions compared to concrete [11].

Wood is an energy-efficient, low-carbon building material that can significantly contribute to achieving Europe’s climate policy objectives, especially in urban environments [12,13]. Processed timber—or structural timber—offers numerous environmental, social, and economic advantages [14] over conventional materials such as steel or concrete.

Although many types of buildings can be designed using either timber or reinforced concrete, they are not entirely interchangeable, due to the following limitations:

• Building height: In the case of cross-laminated timber (CLT), the practical limit is often 8–12 storeys, whereas concrete buildings are not subject to such restrictions.
• Load-bearing requirements: Heavy loads or long spans are more practical in reinforced concrete or steel structures.
• Exposure to moisture: Reinforced concrete is generally preferred for structures in humid environments.
• Fire safety and related insurance constraints: Insurance premiums for timber structures are usually higher.

Regarding the availability of service providers, reinforced concrete structures are widely used around the world, meaning that there are contractors, engineers, and suppliers in almost every region who have experience in working with concrete. Supply chains are also well established. In the case of timber buildings, however, specialised expertise is required for design, manufacture, and installation, and the number of experienced contractors and engineers remains insufficient in many countries. Logistics for timber buildings can also be more complex if building elements need to be transported from specialised production facilities.

Major barriers to the development of timber structures in Latvia include a lack of knowledge and skills, as well as concerns regarding fire safety, structural stability, and durability [15].

During its work, the expert group concluded that the sector is characterised by a knowledge deficit, arising from both shortcomings in the education system and unclear regulatory acts, as well as a certain reluctance to assume responsibility. This is reflected in insufficient knowledge and experience regarding the application of fire safety regulations, limited expertise in structural design solutions, and inadequate understanding of the specific requirements of timber construction project management—including logistics. It is important to note that timber has practically not been used in civil engineering structures in recent decades, resulting in the loss of practice and historical experience in this field.

As there is an urgent need to develop low-carbon solutions for the built environment, demand for timber construction is expected to grow [16]. Studies show that timber structures are also a cost-effective solution in climate change mitigation. Given the potential rise in demand, further research is needed to evaluate the economic and environmental impacts of increased timber usage in construction [17].

There are relatively few scientific publications addressing the issues of timber use in Latvia’s construction sector. Although wood has historically been recognised as a key building material, recent decades have seen architects avoiding timber in public and multi-residential buildings [18].

Although many buildings in Latvia—both residential and public (for example, churches) as well as engineering structures (for example, bridges)—historically used timber, during the Soviet occupation, concrete structures were increasingly employed, which in turn developed the industry and specialist knowledge but, at the same time, disregarded the availability of local resources and national economic interests. When an expert group evaluated the differences between timber and concrete construction approaches, the following was concluded:

• There are limitations on constructing large timber buildings, related to material fire safety requirements, transport conditions, and building durability. Therefore, this study specifically focuses on building types where timber construction faces no significant restrictions, such as private houses, ancillary buildings, and small public buildings, as well as appropriately sized engineering structures.
• Although there are no direct restrictions in Latvia on designing any type of building in timber, it is always necessary to seek economic and sustainability advantages, while being aware of the construction sector’s role in achieving CO₂ targets. Thanks to the work of the expert group, the Ministry of Economics, together with the Ministry of the Interior (Emergency Service), is already reviewing regulatory acts to remove unjustified restrictions, allowing more than 90% of all buildings designed in the country to be executed in timber.
• In addition to the above, the role of society and building clients in making economic and sustainability decisions must be particularly emphasised. If the private residential construction sector is well-developed, the opposite is true for larger residential (apartment) and public building construction: only the client’s willingness to choose timber as a material, along with appropriate state support (economic, regulatory, and administrative burden reduction), can promote further development of the timber industry and the creation or re-profiling of companies.

Some studies have explored forest sector governance in Latvia, offering proposals for sustainable development and economic viability while considering ecological and social factors [19]. Others have assessed the readiness of Latvia’s wooden house construction sector to engage in a circular economy and timber waste recycling, along with the adequacy of legal frameworks to support waste management [20].

Latvia and Lithuania have conducted research on specific wood-based construction materials, such as glued laminated timber [21]. Alternatives to concrete and steel reinforcement structures have also been explored—CLT has proven to be a viable substitute for concrete in buildings up to eight storeys high [22].

2. Materials and Methods

In order to assess the potential for promoting timber construction as a means of advancing Latvia’s climate neutrality objectives, the authors developed and applied an evaluation methodology comprising three principal stages (see Figure 1).

The first stage entails the collection and analysis of information. The data required for the study is categorised into four main groups:

• Analysis of policy planning documents;
• Analysis of timber resource availability;
• Analysis of the timber product market;
• Analysis of timber construction.

In the course of the policy document analysis, attention was focused on Latvia’s overarching long- and medium-term national development planning programmes, as well as strategies relevant to climate neutrality and the construction sector. To assess timber resource availability, the current situation regarding forest area and timber stock, along with their development dynamics, was analysed. The authors also addressed the necessity of revising the numerical threshold for minimum felling diameter. In analysing the timber product market, the authors identified timber product categories and focused specifically on those categories related to the construction sector. This study examined the volumes and trends of timber production, import, and export. Fuelwood was not included within the scope of this research.

In concluding the information analysis, the authors focused on timber construction by examining the current situation, as well as overall trends in the construction sector and specifically within the timber building segment.

For the examination and analysis of information, the authors employed methods such as a scientific literature review, content analysis of policy documents, monographic or descriptive method, mathematical statistical data analysis, and both quantitative and qualitative data interpretation. The graphical method was applied for the synthesis and presentation of results.

Secondary data were drawn from EU/Latvian legislative portals, the Latvian State Land Service, the national statistics portal, and Eurostat. Descriptive and exploratory analyses assessed timber building shares (by number and area) and 15-year changes in building area, in absolute and relative terms.

For the collection of primary data, the authors collaborated with and interviewed an expert group whose members represent the following institutions: the Latvian Parliament (legislative authority of Latvia); the Ministry of Economics (responsible for national economic development, industrial policy, housing policy, construction, and the internal market); the Ministry of the Interior (responsible for fire safety and firefighting issues); the Ministry of Climate and Energy (responsible for energy, climate change, and environmental policy); the Ministry of Agriculture (responsible for agriculture, rural development, and the forestry sector); the Timber Construction Cluster (which unites timber building and structural manufacturers and suppliers of timber construction solutions operating in Latvia); the Institute of Civil Engineering and Wood Processing (conducts scientific research in forestry, construction and environmental engineering, landscape architecture, and materials science); the Latvian Builders Association (an independent public organisation uniting around thirty of Latvia’s largest construction companies); JSC Latvijas Valsts Meži/Latvian State Forests (manages state interests in forestry, ensuring the preservation and growth of forest values); and three higher education institutions—Riga Technical University, Latvia University of Life Sciences and Technologies, and Vidzeme University of Applied Sciences. The expert group includes all relevant stakeholders to support the research process and provide the necessary qualitative and quantitative information for achieving the aims of this study.

In the second stage, based on the results of the information analysis conducted in the first stage, a PESTEL analysis was used to evaluate the development of timber building construction in Latvia, with the initial (preliminary) data obtained using the SWOT analysis method. The information required for the SWOT analysis was collected during the work of the expert group. These qualitative strategic planning tools were used to identify the main influencing factors, which were then applied in the development of the sector’s strategic plan.

PESTEL analysis was used to study the macro-environment and identify external factors that are practically impossible to control but have a significant impact on the development strategy. The aim of SWOT analysis was to identify and evaluate the internal (Strengths and Weaknesses) and external (Opportunities and Threats) factors of the timber building construction sector. Both primary and secondary research data were used in the PESTEL and SWOT analyses.

The third stage involved identifying possible courses of action to promote timber construction, thereby contributing to the achievement of climate neutrality targets and supporting sustainable development. These directions were developed in close connection with the previously conducted PESTEL and SWOT analyses. The proposed solutions covered all PESTEL categories: political, economic, social, technological, environmental, and legal. The Opportunities and Threats identified in the SWOT analysis were used to define the solutions.

In subsequent research, the authors plan to expand the study in several directions in order to examine in greater detail the feasibility and potential impact of the proposed solutions. The planned research directions include, but are not limited to, the following:

• Modelling economic benefits;
• Application of timber construction materials in civil engineering structures;
• Enhancement in educational content and opportunities.

This study has the following methodological limitations:

• The research is based on the analysis of specific political documents and regulations referenced in the study.
• The Latvian statistical data on buildings used in the study are based on the building classification according to Cabinet of Ministers Regulation No. 326, “Building Classification Regulations.”
• The study covers the period from 2010 to 2025.
• The study relies on the construction regulatory acts that were in force at the beginning of the research, as during the study (including the work of the expert group), changes were made both to fire safety requirements and to general building construction standards.
• The study reflects the opinions of a narrow circle of experts regarding the use of timber in engineering structures, since this material has not been widely used for a long time, and a broad expert pool cannot be identified. Rather, it involves research experts who aim to promote the development (revival) of this sector.
• The study uses specific and comprehensive results from interviews with the expert group.

In this study, several potential biases in policy document analysis are acknowledged, particularly in the context of promoting timber building construction and its linkage to economic growth and climate objectives:

• Alignment with national agendas: Documents may be formulated to support priority sector directions (e.g., forestry and timber export competitiveness), which can exaggerate expected benefits or downplay risks.
• Institutional authorship bias: Materials prepared by ministries and industry organisations may reflect the strategic interests of specific institutions (including the risk of “greenwashing”).
• Selection and availability bias: Publicly available, more recent, or Latvian/English-language documents may be overrepresented compared to less accessible sources.
• Temporal and cyclical bias: Policy cycles (e.g., pre-election periods, EU funding planning rounds) may influence rhetoric and the ambition of targets.
• Confirmation bias: Researchers’ initial hypotheses may unconsciously influence interpretation.
• Implementation gap: Goals expressed in documents may not reflect actual implementation (due to regulatory and market barriers, or capacity constraints).

3. Aspects of Timber Building Construction in Latvia

3.1. Climate Neutrality and Sustainable Construction Objectives in Latvian Policy Planning Documents

Latvia’s national policy documents identify climate neutrality and sustainable construction as key directions to reduce environmental impact and promote the transition to a green economy. These documents emphasise the development of a low-carbon economy, efficient resource use, and the integration of renewable energy sources in line with European Union climate objectives.

3.1.1. Latvia 2030 Sustainable Development Strategy and the National Development Plan (NDP)

These long- [23] and medium-term [24] planning documents do not specifically address the use of timber in construction. However, they do define broader goals such as sustainability, the prudent use of natural capital, and climate-resilient development (see Figure 2).

Latvia 2030 highlights the country’s natural resource value and the accessibility of its environment as a unique opportunity to develop a “green” economy and sustainable consumption, shaping and maintaining Latvia’s image as a “green country”—a key component of its international identity.

One of the NDP’s strategic directions is a “green course” towards a low-carbon, resource-efficient, and climate-resilient economy. A central task is the reduction in greenhouse gas emissions in the national economy (see Figure 3).

3.1.2. Latvia’s Climate Neutrality Strategy to 2050

Latvia, along with other EU Member States, has developed a strategy to achieve climate neutrality by 2050 [25]. This strategy aims not only to reduce GHG emissions across all economic sectors but also to increase CO₂ sequestration. The overarching objective is to achieve climate neutrality by 2050 (see

Table 2. Latvia’s intermediate targets for achieving climate neutrality, kt CO₂ eq. (developed by the authors, based on [25]).

	1990	2030	2040	2050
GHG emissions (excl. LULUCF)	26,299	−65%	−85%	Climate neutrality 1
CO2 sequestration and GHG emissions in LULUCF	−9828	<1047	0 2
Total GHG emissions (incl. LULUCF)	16,471	−38%	−76%

¹ Climate neutrality achieved through sequestration within LULUCF. ² Sequestration balances out sectoral emissions.

).

To reach climate neutrality, it is essential not only to reduce emissions but also to increase carbon sequestration. The strategy sets two core targets:

• Reduction in GHG emissions in all economic sectors;
• Enhancement in CO₂ sequestration.

For the land use, land use change, and forestry (LULUCF) sector, it is expected to act as a net carbon sink. Simultaneously, progress towards climate neutrality also enables the fulfilment of bioeconomy goals—for example, by promoting the use of wood for high-value-added products, including export goods.

3.1.3. National Energy and Climate Plan (NECP) 2021–2030

This policy document [26] includes a Climate Policy Roadmap aiming to support climate change mitigation and climate resilience, with the goal of achieving climate neutrality by no later than 2050. It ensures that national targets are met in accordance with EU and international commitments, considering environmental, social, economic, and governance sustainability.

The NECP emphasises the importance of forests and wood-based products. By sustainably managing forest stands and enhancing their resilience, it is possible to increase CO₂ sequestration in the LULUCF sector, promote the use of wood in construction, stimulate innovative wood product development, and use biomass—including recycled wood—for energy production.

The action plan identifies specific development pathways, such as

• Promoting the use of locally produced materials by increasing timber use in construction;
• Establishing new facilities to process currently exported roundwood into value-added timber products, thereby supporting circular economy principles and technologies.

The total GHG reduction target for 2030 in the NECP aligns with Latvia’s Climate Neutrality Strategy—a 65% reduction compared to 1990. For the LULUCF sector, Latvia’s indicative target for 2030 is a net sequestration of −644 kt CO₂ eq. However, recent data shows that the sector is emitting more than it absorbs.

An analysis of the LULUCF sector reveals a long-term decline in CO₂ sequestration since 1990 (see Figure 4), largely due to decreased sequestration in forest land, driven by an increased proportion of overgrown and mature forests, higher logging volumes, and natural mortality [27]. Latvia thus faces significant challenges in this sector. The current trend indicates that the 2030 targets are unlikely to be achieved.

Non-fulfilment of climate targets constitutes a violation of EU law and may result in legal proceedings at the EU Court of Justice, including potential financial penalties—although these would not exempt the government from meeting its obligations.

3.1.4. Latvian Construction Sector Strategy

The construction sector is predicted to become a competitive and sustainable development-oriented sector in the future, providing society with high-quality, safe, and efficient construction services and creating a modern living environment for current and future generations in the long term. The recently adopted Construction Strategy [28] does not specifically address the issue of wooden construction; however, the development direction “Sustainability” includes two sub-directions:

• Climate neutrality and emission reduction (development of low-carbon construction products—identification of construction products and mechanisms with lower or close-to-zero CO₂eq. emissions (research and development) and production);
• Promotion of the use of local resources in construction, which includes public sector leadership in sustainability (construction of new buildings owned by the state and municipalities and their capital companies, mainly from wood or other solid biomass raw materials), integration of local resources into building renovation, and reconstruction and construction of new buildings.

The strategy also envisages the development of a unified sustainable approach and methodology for the construction process across the public sector, based on the requirements of the EU Taxonomy Regulation [29] and the universal design approach.

3.2. Forest Resources in Latvia

The total forest area in Latvia covers 3.316 million hectares, accounting for just under 52% of the national territory (for comparison, forests cover just under 39% of the European Union’s territory (see Figure 5), whereas they account for approximately 31% globally). The dominant tree species are Scots pine (Pinus sylvestris) and Norway spruce (Picea abies), comprising approximately 53% of forest stands, followed by birch (Betula spp.) with around 30%. Other commonly found species include aspen, alder, black alder, ash, and oak. The overall forest area continues to increase as a result of targeted afforestation policies [30].

Against the background of the European Union, Latvia stands out with a very high forest cover and ranks as the fifth most forested country after Finland, Sweden, Slovenia, and Estonia (see Figure 5), being among the top 25 most forested countries globally [32].

As shown in Figure 6, forests in Latvia are not evenly distributed; the most forested regions are in the west of the country (Kurzeme region) as well as in the north and central areas (Vidzeme region), where there are large forest areas and active logging and regeneration. Pines dominate in Kurzeme, while spruces and deciduous trees are more common in Vidzeme, which also contains many protected areas (reserves, national parks). Forests in the northeast of Latvia (Latgale region) grow in wet areas and are mostly mixed-species forests, including birch, spruce, and aspen. The southern part of Latvia (Zemgale region) is the least forested region, as agricultural land predominates. Forests have also been preserved around the capital, Riga, particularly in the surrounding areas (Pierīga), although rapid urbanisation is affecting forest cover here. Although forest distribution is uneven, Latvia’s relatively small territory prevents logistical problems in transporting timber from forest areas to processing sites.

State-owned forests account for 46% of the total forest area (1.527 million ha) and are managed by the state joint-stock company “Latvia’s State Forests” (AS “Latvijas Valsts meži”, Riga, Latvia). The remaining forest land is owned by approximately 135,000 individual forest owners, most of whom are private individuals [30].

The State Forest Service, an institution under the Ministry of Agriculture, is responsible for overseeing forest governance across the national territory. Its tasks include the implementation of forest policy, monitoring compliance with regulatory requirements, and managing support programmes for sustainable forest management.

As shown in Figure 7, both forest area and timber stock have demonstrated growth trends in Latvia. Over the past 15 years, forest area has increased by 2%, while timber stock has grown by 4.7%. In the last five years, the expansion of forest area has stabilised, and a slight decline in timber stock has been observed [34].

An evaluation of the regulatory framework [35] concerning final felling diameter thresholds in Latvia and neighbouring Baltic Sea countries [36,37], along with research on forest maturity models in Latvia, suggests a need to adjust these thresholds. Lowering the diameter limits for final felling could improve the efficiency of land use, enhance forest productivity, increase forest capital value and the potential for annual net income, and boost the competitiveness of the forestry sector. Importantly, such a change would also positively affect CO₂ sequestration.

While reducing logging intensity may increase short-term carbon storage in living biomass, in the long term, this approach may result in higher GHG emissions from decaying timber and lead to the loss of economic potential. In Latvia, nearly one-third of forest stands have exceeded the age threshold for final felling, meeting the criteria for regenerative harvesting. These older forests are less efficient at sequestering carbon compared to younger, actively growing stands.

With the application of modern, advanced forestry techniques, it is possible to grow trees of similar dimensions more quickly than in the past. Therefore, it is advisable to include the final felling diameter as an alternative to age-based criteria in felling regulations. This benefits both the state and forest owners—the latter can harvest timber earlier, provided they manage their forests responsibly, using selected planting material and applying appropriate silvicultural practices. From a climate perspective, this approach supports the establishment of more productive stands with higher CO₂ sequestration capacity. Moreover, it reduces the need for climate-related subsidies, as forest owners are naturally incentivised to adopt optimal management strategies.

Another key consideration is the risk of pest-related forest damage. In the case of Norway spruce, this risk is particularly high. Scientific evidence suggests that harvesting spruce at around 50 years of age significantly reduces the risk of bark beetle infestations while still allowing the growth of trees of sufficient size for industrial use. Notably, coniferous species are the most commonly used raw material in the construction sector.

To ensure the long-term storage of carbon captured in timber, it is essential to process it into products with extended life cycles. Timber used in construction has the longest service life among wood-based products. Additionally, timber products substitute for other construction materials (e.g., concrete, steel) that have much higher carbon footprints. Even in the case of energy use, when wood replaces fossil fuels, the climate impact is still favourable.

Mass timber buildings showed an 81–94% lower GWP than concrete buildings and 76–91% lower global warming potential (GWP) than steel buildings [38]. Building out of CLT would have emitted roughly +95,000 kg of CO₂, mostly from the production of CLT and glulam and some from concrete and metal brackets, which would still represent only about 18% of the RC building’s emissions. Thus, the timber option is dramatically more environmentally friendly from an embodied carbon standpoint, on the order of 5–10 times lower GWP [39]. The authors of [40] examined and analysed 62 peer-reviewed articles. Their results show the variety in scope, lifespan, system boundary, data sources, and indicators. Studies on MTC have been conducted at the building material, component, structure, and entire building levels, as well as at the urban level. The majority of studies compare the LCA of reinforced concrete (RC) and CLT buildings. The global warming potential (GWP) and life cycle energy are the most frequently evaluated category indicators among the articles. It is found that the average embodied energy of mass timber buildings is 23.00% higher than that of RC alternatives, while the average embodied greenhouse gas (GHG) emissions of RC buildings are 42.68% higher than those of mass timber alternatives. There is a clear general trend that mass timber buildings generally have a lower GWP and life cycle primary energy (LCPE) than RC and steel buildings.

There is a growing trend in the use of glued laminated timber (glulam) construction systems, which do not require large-diameter logs. These systems offer advantages by addressing traditional structural limitations—such as enabling longer spans and greater precision in design.

3.3. The Market for Timber Products in Latvia

The total gross value added (GVA) generated by the forestry and logging industry in the EU reached EUR 27.9 billion in 2022. In absolute terms, these industries generated the greatest GVA in Finland (EUR 4.4 billion), France (EUR 3.9 billion), and Germany (EUR 3.2 billion) in 2022. The GVA of the forestry and logging industry represented 0.17% of the EU GDP in 2022. The GVA generated by forestry and logging accounted for more than 1% of GDP in four countries in 2000: Sweden, Estonia, Latvia, and Finland. This was still the case for two countries by 2022: Latvia (1.36%) and Finland (1.64%). In the EU, about 476,260 persons worked in the forestry and logging sector in 2022. The largest workforce is recorded in Sweden with 61,000 persons, followed by Romania (53,900 persons) and Germany (42,000 persons). In Latvia, 12,500 persons work in the forestry and logging sector [31].

The forestry sector is a vital component of Latvia’s national economy. In 2022, forestry, wood processing, and furniture manufacturing together accounted for 7% of the national gross domestic product (GDP). Timber product exports amounted to EUR 4.2 billion, constituting 20% of the country’s total export volume [41].

The wood processing industry is the largest manufacturing sector in Latvia. As of 2024, it accounted for 26% of total manufacturing turnover and 34% of the value added created by the manufacturing sector (2021) and employed 25% of the manufacturing workforce (2023) [41].

Timber products in Latvia include the following categories:

• Industrial roundwood (excluding fuelwood);
• Fuelwood;
• Charcoal;
• Wood chips, sawdust, and wood waste;
• Wood pellets and wood residues (agglomerated or similar forms);
• Sawn or split timber (thickness > 6 mm).

In construction, the primary materials used are sawn or split timber, which are produced from industrial roundwood. This is a key stage in wood processing—converting raw logs into higher-value-added products. The remaining categories are energy wood products, which are burned to generate heat and electricity.

In Latvia, the largest volume of timber production comes from roundwood; throughout the period, it shows an upward trend, indicating that raw materials for timber product manufacturing are readily available in the country. Compared to other European countries (see Figure 8), Latvia ranks ninth in timber product production, highlighting the significant importance of this industrial sector to the national economy.

An analysis of the production–import–export balance of construction-grade timber and related wood products during 2017–2023 (see Figure 9) reveals that the majority (85–98%) of domestically produced timber is exported. Meanwhile, imports account for 15–35% of domestic production [43].

Following a peak in 2021, there has been a notable decline in both production and trade volumes, which has continued into 2024. This downturn has been influenced by several factors, including geopolitical instability, sanctions against Russia and Belarus, and a decrease in construction sector demand.

3.4. The Current Situation in the Timber Building Sector in Latvia

A timber building is defined as a structure in which the load-bearing elements (foundations, vertical structures such as external walls, frames, intermediate floors, roof structures, and coverings), as well as the internal and external finishes, are made of wood or wood-based materials [44,45].

The following categories of timber buildings are identified:

• Log buildings—Walls are formed by horizontally placed and interlocked round logs;
• Timber frame buildings—The structural core consists of a wooden frame;
• Hybrid buildings—Construction intentionally combines various materials (e.g., wood, concrete, steel, glass);
• Wood-panel insulated buildings—Structures with thermal insulation are provided by wood-based panels.

This analysis classifies buildings according to Latvia’s official categorisation of building types [46]—distinguishing between residential and non-residential buildings. The residential building categories include

• Single-family houses;
• Multi-family residential buildings;
• Shared housing for various social groups.

The main categories of non-residential buildings are

• Hotels and similar accommodation facilities;
• Office buildings;
• Wholesale and retail trade buildings;
• Transport and communications buildings;
• Industrial and warehouse buildings;
• Buildings for public entertainment, education, and health care;
• Other non-residential buildings (Other non-residential buildings, which are buildings of penal institutions, prisons, defence forces, border guards, police and firefighting services, water closets, outbuildings of households, individual garages, individual baths, cellars, summer kitchens, greenhouses, security guards, gatehouses, individual garden houses, outhouses not otherwise classified, etc.).

Figure 10 shows the types of wooden buildings that dominate certain building groups.

In Latvia, wood is primarily used for the construction of single-family houses (private homes).

However, various public buildings, industrial facilities, warehouses, and infrastructure structures have also been built, although there are relatively few. Examples include the regional offices of JSC “Latvijas valsts meži,” (Riga, Latvia) the Ogre Library, the finished product warehouse of JSC “Latvijas Finieris” (Riga, Latvia) and the Jelgava Water Tourism and Sports Center (see Figure 11).

According to the State Land Service, at the beginning of 2025, there were 1,379,312 buildings in Latvia, of which 715,168 (51.8%) were timber buildings. The total floor area of all buildings amounted to 213.7 million m², while timber buildings accounted for 46.4 million m² or 21.7% of the total built-up area (see

Table 3. Buildings and timber buildings in Latvia in 2025 (developed by the authors, based on data from the State Land Service).

2025	Number			Area, Million m2
	Total Buildings	Wooden Buildings	Proportion of Wooden Buildings	Total Buildings	Wooden Buildings	Proportion of Wooden Buildings
Residential buildings
Single-apartment houses	319,772	179,441	56.1%	39.4	17.7	44.9%
Two- or more-apartment houses	53,843	20,182	37.5%	55.2	4.7	8.5%
Multi-apartment houses of various social groups	789	165	20.9%	1.0	0.1	6.4%
Total residential buildings	374,404	199,788	53.4%	95.5	22.4	23.5%
Non-residential buildings
Hotels	6582	3838	58.3%	2.9	0.5	17.3%
Office buildings	6977	933	13.4%	6.6	0.3	4.4%
Commercial buildings	8086	1942	24.0%	5.5	0.3	5.6%
Communication buildings and garages	14,560	532	3.7%	5.0	0.1	1.5%
Industrial production and warehouses	49,754	2413	4.8%	28.2	0.7	2.3%
Entertainment, education, and health care buildings	8046	1304	16.2%	12.2	0.5	4.0%
Other buildings	910,903	504,418	55.4%	57.8	21.6	37.4%
Total non-residential buildings	1,004,908	515,380	51.3%	118.2	23.9	20.2%
Total	1,379,312	715,168	51.7%	213.7	46.3	21.7%

).

In the residential building segment, the highest share of timber buildings is found among single-family houses (56.1% by number; 44.9% by area). Multi-family residential buildings also show a notable proportion of timber structures—37.5% by number, though only 8.5% by area, indicating smaller average sizes. Shared housing for various social groups represents a small portion of the housing stock overall, with timber buildings accounting for 20.9% by number and only 6.4% by area.

In the non-residential sector, the highest proportion of timber buildings is in the hotel category (58.3%), followed by “other non-residential buildings” (55.4%) and retail buildings (24.0%). These categories also dominate in terms of floor area.

Other non-residential buildings cover a wide range of uses, and analysis of statistical data shows that most of them are small, as indicated by the ratio of number to area (the average area per building is 155 m²). In this group, wooden buildings have the highest proportion in terms of number and the second-highest proportion in terms of area among non-residential buildings.

The subsequent analysis examines trends in residential and non-residential timber building construction over the past 15 years (see

Table 4. Dynamics of timber residential and non-residential buildings in 2010–2025, million m² (developed by the authors, based on [51] and data from the State Land Service).

	2010	2015	2020	2025	Increase	Increase
	Residential Buildings				Million m2	%
Single-apartment houses	15.41	15.77	16.42	17.70	2.29	13.0%
Two- or more-apartment houses	3.89	4.21	4.39	4.68	0.79	16.9%
Multi-apartment houses of various social groups	0.04	0.03	0.04	0.06	0.02	32.4%
Total residential buildings	19.34	20.01	20.85	22.44	3.10	13.8%
	Non-residential buildings
Hotels	0.21	0.28	0.37	0.49	0.29	58.0%
Office buildings	0.20	0.21	0.25	0.29	0.09	31.6%
Commercial buildings	0.23	0.26	0.28	0.31	0.08	27.1%
Communication buildings and garages	0.06	0.07	0.07	0.08	0.01	19.5%
Industrial production and warehouses	0.56	0.57	0.60	0.65	0.09	14.4%
Entertainment, education, and health care buildings	0.28	0.33	0.39	0.48	0.21	42.6%
Other buildings	20.58	20.83	21.23	21.60	1.02	4.7%
Total non-residential buildings	22.11	22.55	23.19	23.91	1.80	7.5%
Total	41.45	42.56	44.04	46.35	4.90	21.3%

).

Over this period, both the total number and the floor area of timber buildings have increased moderately. The number of timber buildings has grown by more than 15,000 units (2.1%), while their total floor area has expanded by 4.9 million m² (10.6%).

Table 5. New buildings constructed in 2010–2025, thousand m² (developed by the authors, based on [51] and data from the State Land Service).

	All New Buildings	New Buildings Made of Wood	New Buildings Made of Other Materials	Proportion of New Buildings Made of Wood
Residential Buildings
Single-apartment houses	4630.6	2294.1	2336.5	50%
Two- or more-apartment houses	2225.7	789.7	1436.0	35%
Multi-apartment houses of various social groups	51.9	20.3	31.6	39%
Total residential buildings	6908.2	3104.1	3804.1	45%
Non-residential buildings
Hotels	330.9	286.8	44.1	87%
Office buildings	453.4	91.0	362.4	20%
Commercial buildings	787.9	84.0	703.9	11%
Communication buildings and garages	262.8	14.9	247.9	6%
Industrial production and warehouses	3544.1	94.3	3449.8	3%
Entertainment, education, and health care buildings	724.5	206.3	518.2	28%
Other buildings	2684.9	1022.3	1662.6	38%
Total non-residential buildings	8788.5	1799.6	6988.9	20%
Total	15,696.7	4903.8	10,792.9	31%

shows that in the residential segment, the greatest absolute growth has occurred among single-family homes (+2.29 million m²), while in the non-residential segment, “other buildings” have seen the largest increase (+1.02 million m²). In relative terms, the highest growth has been in shared housing (+32.4%), and in the non-residential segment, it was in hotels (+58%) and buildings for entertainment, education, and health care (+42.6%).

An analysis of the timber share in new buildings constructed over the last 15 years reveals that 4903.8 thousand m²—or 31%—of all newly built floor area was made of timber. The largest absolute floor area of new timber buildings was recorded in the single-family housing and “other buildings” categories. In relative terms, timber buildings dominate in the hotel and single-family home categories.

This analysis shows that, both in absolute and relative terms, timber buildings are most prevalent in the single-family housing segment. The “other buildings” category—which includes household utility structures such as garages, saunas, cellars, summer kitchens, and greenhouses—also sees the widespread use of wood as a construction material. By contrast, timber is minimally used in the recent construction of industrial facilities, communication infrastructure, and retail buildings.

4. Results and Discussion: Evaluation of Timber Building Development Opportunities in Latvia

4.1. PESTEL Analysis of Timber Use in the Construction Sector

PESTEL analysis is a comprehensive tool that helps identify and evaluate macro-environmental or external factors influencing industry policy planning. It enables a thorough assessment of the external environment of forestry, the wood industry, and timber construction in Latvia, as well as the identification of key driving forces affecting sectoral development and their interrelationships.

• P—Political Factors

EU policy is focused on the utilisation of renewable resources across energy and other sectors, including construction. Funding for these objectives is available through EU structural funds, as well as other support instruments.

Long- and medium-term political planning documents in Latvia emphasise the significant role of wood utilisation; however, with regard to the construction sector, no specific strategies or tasks are outlined to promote the full exploitation of wood’s potential.

The use of wood in construction is interconnected with several other economic sectors, including agriculture, forestry, and the wood processing industry. Nevertheless, collaboration among these sectors to date has been insufficient in establishing common strategic objectives.

Current forest management policies restrict logging volumes, despite available resources allowing for potential expansion.

• E—Economic Factors

In recent years, the national economy has experienced a downturn (GDP declined by 0.3% in 2023 compared to the previous year and by 0.4% in 2024 [52], and the decline is expected to continue in 2025, which does not encourage long-term investment in the construction sector in general, including in the use of wood.

Due to stagnation in the construction industry (construction output decreased by 4.7% in 2024 [53]), a large proportion of produced timber is exported rather than utilised domestically.

Economic downturns have constrained the financial resources of companies, thereby delaying investments in timber construction projects, as such projects often require higher initial capital than conventional construction.

Although electricity prices in Latvia have decreased significantly since 2022, they remain relatively high and volatile [54], which impedes energy-intensive wood processing. As a result, companies frequently choose to export unprocessed or minimally processed timber rather than processing it domestically.

The wood processing and timber construction sectors are subject to fluctuations in global timber markets. According to industry experts, the situation in European and global markets is complex, with forecasted price volatility for roundwood and sawn timber, generally following an upward trend and potentially continuing until 2030.

According to the Bank of Latvia, interest rates for loans in Latvia and the Baltic states are among the highest in the Eurozone. For example, in the first quarter of 2024, mortgage rates in the Baltic states were approximately two percentage points higher than the Eurozone average. In the corporate sector, interest rates remained persistently high in 2024, with a significant share of variable rates, resulting in very high effective borrowing costs. This has created financing challenges, particularly in rural regions. In municipalities surrounding Riga, outstanding mortgage loans are close to Eurozone averages, whereas in other areas of Latvia, lending is very limited, not exceeding 10% of municipal GDP [55].

Labour availability and costs are a crucial factor in timber construction. Wood is advantageous as a material because timber structures can be prefabricated to a much higher degree than conventional construction, reducing labour costs.

The state and municipalities own almost half of Latvia’s forest area, providing an opportunity to influence sectoral policy decisions.

• S—Social Factors

Latvia’s population continues to decline, which reduces demand for construction products. This trend also negatively affects the availability of specialists in forestry, construction, and related sectors.

Historically, Latvia has developed an education and research system related to timber construction. However, the use of wood in Latvian construction remains limited due to insufficient knowledge and experience in modern timber design and engineering.

Historical stereotypes regarding the durability and fire safety of wooden buildings, as well as their scale, continue to influence perceptions.

Currently, societal values are shifting towards sustainable solutions, and in the construction sector, there is a gradual return to wood as an environmentally friendly and aesthetically appealing building material.

• T—Technological Factors

Timber architecture and construction are integral to Latvia’s historical identity. By combining traditional building practices with modern technologies, the sector’s development can be stimulated.

Recently, innovative technologies and solutions have emerged, enabling the use of wood in increasingly complex structures. Advances in technologies such as CLT and other engineered wood products also address safety and structural performance concerns.

Wood products in construction have a wide range of applications and can be used for buildings of various sizes, functions, and types.

Wood is also an effective thermal insulation material; however, in Latvia, timber is still underutilised for implementing energy efficiency measures in large-scale buildings.

• E—Environmental Factors

Wood is one of the most widely used renewable construction materials. During growth, trees absorb carbon dioxide and release oxygen into the atmosphere. The carbon sequestered in wood remains stored for the lifetime of the timber structure or product. Moreover, wood is recyclable: when a building is dismantled, timber can be reused, continuing to function as a carbon store.

Sustainable forest management, encompassing the governance and utilisation of forests and forest lands while maintaining biodiversity, productivity, regeneration capacity, and vitality, is a critical factor ensuring the availability of raw timber materials.

Agriculture and forestry in Latvia are closely linked to the carbon sequestration targets set under the LULUCF sector at the EU level. Achieving these targets by 2030 has become challenging. The use of wood in construction could support and accelerate the achievement of these goals.

• L—Legal Factors

Regarding the use of wood in construction, regulations and building codes contain various ambiguities and contradictions, which hinder the broader utilisation of timber as a building material. Consequently, timber construction faces formal legal challenges compared to conventional methods (concrete, metal, brick, etc.), slowing sectoral development. Different institutions also have varying interpretations of regulatory requirements.

4.2. SWOT Analysis of Timber Use in the Construction Sector

Based on analysis of the current situation, a SWOT analysis was developed to inform a strategy for increasing timber utilisation in the construction sector—simultaneously advancing climate neutrality and economic growth.

• Strengths

• Renewable, low-carbon material that stores sequestered CO₂;
• Strong national tradition and public acceptance of timber construction;
• Abundant forest resources under diverse ownership;
• Suitable for both new builds and retrofits; high energy performance;
• Prefabrication allows faster, lighter, and more flexible construction with less road impact;
• Strong research, education base, and positive economic spillovers across sectors;
• Can improve housing quality and affordability.

• Weaknesses

• Continued reliance on imported, non-renewable materials;
• Limited expertise in modern timber engineering;
• High export share of raw timber, low domestic processing capacity;
• Energy-intensive drying processes, exposed to volatile energy markets;
• Conservative forest policies constrain harvesting;
• High upfront capital costs and limited enterprise resources;
• Ambiguities in building codes and regulations;
• Underuse of timber in large-scale retrofits.

• Opportunities

• Policy support for domestic timber use and resource mobilisation;
• Expansion of manufacturing into high-value, long-lifespan timber products;
• EU funding for R&D, innovation, and sustainable materials;
• Education system adaptable to specialised training;
• Use in energy-efficient retrofits and renewable energy integration;
• New financial instruments for timber projects;
• Export promotion of prefab and processed timber products;
• Digitalisation and automation in construction.

• Threats/Barriers

• Vulnerability to global timber and energy price fluctuations;
• Complex and inconsistent regulations across jurisdictions;
• Higher legal/technical hurdles vs. conventional construction;
• Financing challenges, especially in rural regions;
• Slow economic growth, population decline, and labour shortages;
• Risks of missing LULUCF targets, sanctions, or delayed EU regulation compliance.

4.3. Policy Recommendations and Solutions

To overcome barriers and harness the potential for expanded timber use in the construction sector, changes are required in policy frameworks and regulatory environments governing timber harvesting, processing, and application. This necessitates the coordinated involvement of several key economic sectors—including agriculture, forestry, wood processing, and construction (see Figure 12).

The necessary changes in sectoral policies and regulatory frameworks to promote the use of domestically produced building materials in Latvia, aimed at addressing related challenges, are presented in

Table 6. Necessary changes in sectoral policies and regulations (developed by the authors).

Proposed Activity of Change	Stage of Timber Processing
	Timber Harvesting	Timber Processing	Timber Use
Shorten harvesting cycles to enable earlier and sustainable use of forest resources	×
Stabilise energy costs and support renewable energy use in wood processing		×
Promote public awareness of timber as a construction material			×
Mandate timber use in state and municipal procurement			×
Review and adapt regulations (e.g., fire safety) and provide training in timber construction			×
Incentivise timber use in insulation and renovation through higher support levels			×
Improve financing access for consumers and producers	×	×	×
Adjust tax policies to favour sustainable construction materials			×
Expand timber-focused education and training across all levels			×
Explore timber applications in civil engineering (bridges, infrastructure, modular builds)			×
Support interdisciplinary research	×	×	×

, according to the stages of timber processing.

These proposed directions aim to strengthen the domestic timber value chain, increase the added value of wood products, and support climate objectives through greater integration of bio-based construction.

Increased timber harvesting and the conservation of biodiversity constitute a significant challenge, as they entail several negative consequences:

• Loss of habitats: Large-scale logging operations destroy the habitats of numerous plant and animal species that are adapted to specific forest ecosystem types.
• Decline in species populations: Logging reduces populations of species that depend on old-growth trees, deadwood, and the natural structure of forests.
• Environmental changes: Clear-cutting alters the microclimate, moisture regime, and soil conditions, affecting the diversity of plant and fungal communities.

To mitigate the negative impacts of timber harvesting, various solutions are being successfully implemented in Latvia:

• Sustainable forest management: Practices that provide economic benefits while preserving forest ecosystems and their functions over the long term. These include selective or gradual logging that maintains forest structure and ensures continuous regeneration, as well as reforestation of clear-cut areas, which is mandatory under Latvian legislation, thereby restoring the stand with new, high-quality trees.
• Expansion and management of protected areas: Logging is prohibited or restricted in these areas, preserving habitats for rare and endangered species.
• Innovations and technology: The use of drones and satellite data allows for improved planning of logging operations, identification of sensitive areas, and assessment of forest conditions. Specially designed forest machinery is employed to extract timber with minimal disturbance to the soil surface and forest undergrowth.

5. Conclusions

Timber, as a renewable and locally available resource, should be regarded as an essential tool for reaching national climate neutrality targets. Its capacity to store carbon and substitute for high-emission materials such as concrete and steel makes it particularly valuable. Moreover, intensified use of timber in construction not only contributes to climate objectives but also stimulates national economic development and job creation—supporting sectors such as forestry, timber processing, and logistics.

Despite these positive aspects, the share of timber in Latvia’s construction sector remains modest—accounting for only around one-third of newly built floor area in the past 15 years. Non-renewable materials—many of them imported—still dominate the market. Timber harvesting is limited by conservative forest management policies, while timber processing is constrained by high and volatile electricity prices. As a result, exporting unprocessed timber remains more economically viable than producing value-added products domestically.

In the construction process, complex and ambiguous regulatory frameworks create additional barriers. These challenges often lead developers to favour non-renewable materials, which appear administratively simpler. In addition, insufficient knowledge of modern timber construction techniques and limited access to finance—especially in rural regions—further hinder the sector’s growth.

In conclusion, this study confirms the initial hypotheses.

The hypotheses were tested based on quantitative statistical data analysis. Long-term statistics demonstrate that forest areas and timber stocks in Latvia exhibit an increasing trend. Moreover, Latvia ranks among the most forested countries in both the EU and globally. However, only a small proportion (less than 15%) of the timber construction materials produced is utilised domestically, with the majority exported. This indicates that sufficient quantities are produced to significantly increase the share of locally used timber in construction.

Increasing the proportion of timber in construction would result in substantial CO₂ sequestration, as trees absorb carbon dioxide during their growth period. This would contribute to achieving the EU’s climate neutrality targets. Since 1990, Latvia has experienced a decline in CO₂ sequestration, resulting in challenges in complying with EU legislation and, consequently, incurring financial penalties. Expanding the use of timber construction materials would enhance carbon sequestration and reduce or eliminate such penalties, freeing resources that could be redirected towards economic development.

As evidenced by the PESTEL and SWOT analyses, existing political priorities and regulatory frameworks do not sufficiently promote the broader use of timber as a construction material, particularly in the sectors of large residential buildings, non-residential buildings, and civil engineering structures.

To address these challenges and expand the role of timber in the construction industry, regulatory reforms are required across forestry, timber processing, and construction sectors.

Sustainable timber use requires updating forest management regulations to reflect modern approaches to biodiversity and climate goals. For processing enterprises, stable and affordable energy is essential to remain competitive and resilient.

In construction, reforms should revise fire safety rules, mandate timber in public procurement, and adjust taxation and support schemes for renewable materials. Expanding timber’s role in civil engineering and addressing skill gaps through updated education and public awareness are also priorities.

Financing remains a major barrier: improved credit access, lower interest rates, and fairer collateral rules are needed across the timber value chain. Finally, interdisciplinary research is vital to tackle ecological, technological, and economic challenges that span multiple sectors.