Politicians will protect State forests from being privatized or listed on stock exchange

The political environment has reacted to concerns in the public sphere about the possible weakening and even privatization of the company Latvijas valsts meži. The Union of Greens and Farmers (Zaļo un Zemnieku Savienība) has asked Prime Minister Krišjānis Kariņš for clarification on plans to list shares in state-owned companies on the stock exchange, while the company's new Supervisory Board has started talks with the forest industry, promising to keep the current strategic direction unchanged.

The Memorandum of Cooperation between Latvijas valsts meži and the Latvian Forest Industry Federation outlines three strategic objectives for the sector: 1) to double the value added per job in the forest sector by 2030, 2) to double the value of forest products by 2030, 3) to create 25% more productive forest stands.

The new Supervisory Board is starting talks

Edmunds Beļskis, Chairman of the new Supervisory Board of the company, says: "I am well aware of the importance of Latvia's largest forest company in the context of the development of the Latvian economy. It is in the national interest to increase the efficiency of forest resource use and to enhance the long-term benefits of renewable natural resources for society. That is why I am positive about the cooperation between industry organizations and companies that has already taken place, as well as the objectives and areas of cooperation set out in the Memorandum of Cooperation." This is a quote from the joint statement of the Latvian Forest Industry Federation and Latvijas valsts meži "Latvian Forest Industry Federation starts talks with the new LVM Supervisory Board on cooperation in promoting the development of the forest industry."

Listing - an old FICIL recommendation

The emergency statement was issued in response to the release of information from the political backroom into the public domain. Neatkarīgā has already reported on the privatization networks and the looming green taxonomy for forestry: "Restless time for the State forests." The government has a Cross-sectoral Coordination Center, and through this office, the idea of at least partial privatization of state-owned enterprises - listing on the stock exchange - is raised from time to time. This is an old recommendation of the foreign investors' council FICIL, which would be beneficial for foreigners, but not for Latvian citizens. That is why a number of large state-owned companies have been designated by law as non-privatizable, including Latvijas valsts meži. In 2020, its turnover amounted to 349.7 million euros, and 60.9 million euros was paid in dividends to the state budget. That is what people are worried about.

The Greens and Farmers are getting involved

The Union of Greens and Farmers (Zaļo un Zemnieku Savienība), in a statement to the public, says that "covert attempts to privatize Latvijas valsts meži are unacceptable."

The recent change of the Supervisory Board, with the appointment of representatives from outside the forest sector, raises concerns about whether the Ministry of Agriculture is thus pursuing political interests that are not based on sound forest management in the national interest. "ZZS believes that such a strategically important company for Latvia as Latvijas valsts meži should be retained in state ownership, therefore ZZS Members of the Saeima have prepared questions to the Prime Minister Krišjānis Kariņš, asking him to provide detailed information on which state-owned companies are planned to list their shares on the stock exchange in the next few years."

Gerhards says no to privatization

ZZS also calls on Minister of Agriculture Kaspars Gerhards to provide information on the strategy and plans of the Ministry of Agriculture as a shareholder of Latvijas valsts meži regarding the development of the company, including its efficient management in the best interests of the public.

It should be recalled that the short answer received by Neatkarīgā to a question about the possible sale of the company was as follows: "Minister Kaspars Gerhards is categorically against the privatization of Latvian state strategic companies." So those who are flirting with the idea of selling off Latvijas valsts meži are, at least for the time being, quickly shut down. The challenges that the European green course inevitably brings to Latvia will be enough for the company. It is not only in Latvia that some forces and characters would like to make our flagship forestry company the keeper of a huge nature reserve.

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