Establishment of the State Stock Company “Latvia’s State Forests” was determined by an order of the Cabinet of the Republic of Latvia issued in October 1999. Staff recruitment was immediately started and in 2000 the company was ready to commence its activities. The first felling area was already sold on January 3, thus ensuring an uninterrupted wood flow to one of the most important sectors of economy in Latvia – timber industry. The existing principles of measuring standing trees applied formerly had to be changed completely, evaluation system of felling areas had to be reorganised fundamentally in order to obtain objective data on the volume of the available assortment. Analytic aggregation of data on timber market was set up, methodology for collecting prices of timber assortment in Latvia’s regions was developed, costs related to harvesting operations were studied and analysed. These activities gave an opportunity to store up a considerable amount of economic information, which the LVM finds useful also at present.
The next stage in the development of the LVM is connected with November 2001 and the following months when changes in the LVM structure were needed.
As a result, the LVM was transformed into a company of concern type. Thanks to these internal changes planning of financial resources and making of reports on economic activities have become more successful, setting of objectives for each sphere of activities is clearer and control of their fulfilment is more efficient.
At present the LVM manages commercially usable state-owned forests and, alongside with the forest management that includes timber selling, the LVM develops other kinds of activities as well. It offers hunting and recreation facilities and obtains seeds and planting stock to ensure forest regeneration.
The LVM represents interests of the state in forest management ensuring the preservation and increase of forest values as well as the highest possible income.
Uìis Rotbergs, WWF Latvia manager: “Foundation of the LVM has created preconditions for forestry in the state-owned forests of Latvia to base its activities on the principles of entrepreneurship, that is, to invest resources in the company and gain economic benefit in the future. The separation of the supervisory and economic management functions has allowed to diminish both conflicts of interests and impact of corruption in the forestry sector. Certainly, great tasks are still to be undertaken in the future. It can be said that the LVM took over the forests when their value was equal to zero and it was done without evaluation. Therefore the scale of values determining what a good forest management is and, in a broader sense, what the value of forests is, should be instilled in the social awareness. Society has to be aware of the benefits it receives from its forest property both in the state and private sector and realise that investing in forests as much as possible will increase the value of forests and ensure circulation of products and services at a higher quality in the future.”