The “special background” of the Nature Restoration Law
The European Union Nature Restoration Law, which came into force in August 2024, mandates that member states restore at least 20% of EU land and sea areas by 2030, and all ecosystems in need of restoration by 2050. To achieve the overall 20% target, the regulation includes incremental goals for specific habitat types, including forests, grasslands, and peatlands currently in poor condition. By 2030, countries must ensure a good condition for at least 30% of these habitats currently in poor condition – prioritising Natura 2000 areas. This figure must increase to 60% by 2040 and reach 90% by 2050. During the development of the regulation, both Finland and Sweden strongly opposed these targets, citing disproportionate costs for countries with a high proportion of forests. Currently, in the autumn of 2026, member states are at a critical stage: national nature restoration plans are being drafted and negotiated, requiring each country to define specific areas, measures, and funding sources itself. This process has currently caused immense tension between Finnish producers and the government.
The Finnish forest sector’s alarm signal
Finnish sawmill owners, farmers, and those working in the pulp and paper industry have joined together in a highly insistent appeal to Prime Minister Petteri Orpo. The industry is demanding that the government protect timber resources as much as possible in the national nature restoration plan from restrictions imposed by Brussels.
The Finnish sector is facing a funding shortfall of approximately 400 million euros per year, which is necessary to meet the requirements of this Brussels regulation. The head of the Finnish Sawmills Association, Tino Aalto, emphasises that companies have made significant investments in production capacity, relying on the availability of stable local timber, which is now directly threatened by the new plan. Scenarios modelled by the Natural Resources Institute Finland, Luke, show that if the regulation's requirements to “restore” 2.3 million hectares of commercial forest are met, the annual timber harvesting volume could fall by as much as 16.8 million cubic metres – from Finland’s base volume of 80 million cubic metres.
A reduction in timber harvesting of this scale would result in losses of up to 1.8 billion euros per year in the forest sector's value added. By comparison, the “most favourable” scenario, which would involve the restoration of 300,000 hectares, would cause “only” 370 million euros in losses. Scientists have concluded that in the case of the milder scenarios, the losses could only be offset by additional investments of one billion euros per year in higher-value products, such as packaging or lignin-based chemicals.
The current draft of the proposal that the Finns are preparing to send to Brussels remains incomplete. As usual, it is never enough for eco-activists; Greenpeace reports that forest habitat areas are currently excluded from the draft because intense negotiations with the European Commission are still ongoing. Decision-making is politically divided – the current government will submit the draft plan, but the final plan will be approved by the next Finnish government in September of next year.
Projections for Finland
For Finland, whose economic pillars have historically been woodworking and pulp, incorrect implementation of the regulation threatens a loss of global competitiveness and a rise in unemployment in the regions. Executives at Metsä Group warn that errors in the plan could weaken the country's fiscal position by 0.5–1.5 billion euros per year.
Most of the land to be restored in Finland is in the hands of private owners – particularly in the productive south of the country. If the state tries to implement the regulation using repressive methods rather than fair compensation, the goals will fail due to sharp resistance. It really is that simple, because the Finns will not give up.
In its national plan, Finland will attempt to use the maximum flexibility allowed by the regulation to protect its industry. However, the forest sector will have to diversify rapidly – moving from classic sawmilling to higher-value chemical and composite material production in order to create more value from a smaller volume of timber.
What does this mean for us?
For the Latvian forest and timber industry, the Finnish crisis is not a distant example, but a direct mirror image and an early warning. We, the Forest Certification Council of Latvia, have already pointed out several times that the Finnish experience is fully applicable to the situation in Latvia. It is critically important for Latvia to follow how officials define Latvia's national nature restoration plan. We must not allow 'over-compliance' or so-called gold-plating, by taking on stricter obligations than the regulation requires, which would paralyse the local timber market.
Latvian forest sector organisations, together with the government, must be able to argue in Brussels that rational and active forestry ensures regional security and independence from fossil resources. Only a strong forest sector can generate the tax revenue from which real nature conservation can be funded at all.
The Finnish example shows that if nature restoration affects private forests without adequate funding, the process will reach a dead end. In Latvia, we should more actively develop carbon sequestration and agricultural regulations (CRCF), which would allow private forest owners to earn a profit from ecosystem services, for example, through rotation periods or afforestation, turning restrictions into a new business model.
It is absurd, but in a situation where a sharp increase in demand for timber is predicted globally, the implementation of Brussels regulations means that in Finland, as well as in Latvia, the forest and wood-processing sector must prepare for a potential long-term drop in roundwood resource availability. This means that state and private capital will need to increase investment in timber construction, wood chemistry, and innovation to maintain the sector's place in the GDP structure.
The Finnish example clearly shows that the European Union Nature Restoration Law is not just a document of ecological content – it is a direct economic instrument that reallocates resource availability. The Latvian forest sector must act proactively by demonstrating the real situation in the forest and demanding an assessment of the economic consequences for every restriction that is attempted to be introduced into the Latvian National Development Plan.
Sources: Information sites of the Finnish and European Union forest and related sectors