Measuring the forest-based bioeconomy in Estonia, Latvia, Lithuania, and Finland

Abstract

ABSTRACT This paper aims to present an input-output model of the forest-based bioeconomy, enabling insight into its contribution to total gross value added (GDP), employment, and CO2 emissions in Estonia, Latvia, Lithuania, and Finland. To quantify this contribution, the paper utilizes input-output tables of the four countries. The forest-based bioeconomy includes forestry, the processing of forestry products (forward linkages), and the direct and indirect use of inputs (backward linkages) from forestry and processing industries. Our analysis reveals that while forestry itself is a small industry, contributing minimally to GDP (ranging from 0.40% in Lithuania to 1.90% in Finland), and the forest-based bioeconomy is considerably larger. For instance, its contribution to GDP ranges from 3.59% in Lithuania to 7.22% in Estonia. Moreover, the forestry-based bioeconomy exhibits negative net CO2 emissions, primarily due to CO2 sequestration by forest lands and harvested wood products. Despite the substantial negative CO2 emissions associated with forestry activities, without sequestration, the forestry-based bioeconomy's share in total emissions ranges from 5.14% in Lithuania to 14.88% in Finland.