Translated using ChatGPT service.
With rising external demand and exports, manufacturing output in July 2025 continued to grow for the second consecutive month. This trend is expected to continue.
Compared to July 2024, both in raw and calendar-adjusted data, manufacturing production increased by 10.8%. Overall, in the first seven months of the year, output was 3.9% higher than the same period last year. It is anticipated that stable growth in manufacturing will continue in the coming months, and annual output will significantly exceed 2024 levels. The growth in manufacturing will continue to be driven by external market demand and increasing export volumes.
At the same time, positive industrial development remains constrained by geopolitical uncertainty and U.S. import tariffs, which may affect the competitiveness of Latvian exporting companies. Overall, although forecasts are positive, the industry will need to maintain flexibility and the ability to adapt to changing global trade conditions. Challenges will persist for companies still connected to Russian and other CIS markets; these companies must continue to restructure their operations, seeking new supply and sales markets.
Positive contributions to growth are also being provided by sectors oriented toward the domestic market. Their dynamics are influenced by household purchasing power, including wage growth, tax changes, price stabilization, and other factors.
Within manufacturing subsectors, development trends vary. In June of this year, year-on-year, the most significant positive impact on manufacturing growth for the second consecutive month was in the two largest subsectors: wood processing (+7.3%) and food manufacturing (+11.7%). Production also increased in electrical equipment (+20.9%), automobiles and trailers (+33.4%), and computers, electronic, and optical equipment (+13.5%). In contrast, clothing production decreased (-22.7%).
In July, year-on-year, manufacturing turnover at current prices also increased significantly, by 11.9%. Sales volumes rose sharply both in exports and on the domestic market (by 13.6% and 9.1%, respectively). The most notable increases were in wood processing products, food products, and electrical equipment sales.