1. TRENDS AND OPPORTUNITIES IN THE NON-ALCOHOLIC BEVERAGES INDUSTRY Alain Beaumont Secretary General, UNESDA Trends of competitiveness of Agro-food industry, 15 November 2007

2. What I will cover today Snapshot of our industry Drivers of competitiveness in the non-alcoholic drinks sector Industry trends Future trends How DG Enterprise can continue to be supportive

3. Trends of competitiveness of Agro-food industry, 15 November 2007 Our industry  The non-alcoholic beverages sector covers all soft drinks including still drinks, fruit drinks, carbonates, energy drinks and sports drinks  Volumes in Europe are 55 billion litres  Value some 40 billion Euros  Key players: large companies eg. Coca-Cola, PepsiCo, Orangina Group, GlaxoSmithKline majority of players are SMEs – more than 1,000 bottlers in Europe with factories employing 50 people or less  UNESDA members comprise both national associations and companies

4. Trends of competitiveness of Agro-food industry, 15 November 2007 What is driving competitiveness? The primary driver of competitiveness in our sector today is health and wellness  Governments, civil society and the media are focused on the rising incidence of obesity  There is general acknowledgement that the causes are multi- factorial “..globally there are over 1 billion overweight adults – 300 million of them obese.. the rising epidemic reflects the profound changes in society and behavioral patterns…over recent decades…” Teenage obesity rates are >20% in some parts of the EU

5. Trends of competitiveness of Agro-food industry, 15 November 2007 “Business, civil society and government must work together to stem the rise of obesity among our children.” EU Commissioner for Health and Consumer Protection, Markos Kyprianou We are a responsible industry committed to playing our role

6. Trends of competitiveness of Agro-food industry, 15 November 2007 We have acted on two levels 1.Recognised the concerns. Our commitments to the EU Platform include:  Stop direct sales to primary schools in the EU  Promote choice and smaller serving sizes in secondary schools  Stop direct advertising to children under the age of 12  Place unbranded vending machines in secondary schools

7. Trends of competitiveness of Agro-food industry, 15 November 2007 « UNESDA’s commitments are at the extreme end of best practice". Robert Madelin, Director General, DG Sanco, European Commission

8. Trends of competitiveness of Agro-food industry, 15 November 2007 2.Innovated:  Invested in development of new products and formulations that meet the needs of today’s society no sugar low sugar fruit based drinks new ingredients emerging product areas eg flavoured waters, carbonated juices

9. Trends of competitiveness of Agro-food industry, 15 November 2007 How are these trends transforming the industry? Products with healthy profiles are in demand The sector is growing fast  Volume of low calorie products has increased 50% in the past 5 years A regulatory and society environment that fosters innovation and enables organisations to invest in introducing new products is a key driver of competitiveness and growth in the sector

10. Trends of competitiveness of Agro-food industry, 15 November 2007 The role of the European Commission Like all industries, we need a sure regulatory environment in order to thrive and be competitive The Commission’s self-regulatory approach to diet and obesity has enabled us to:  Act fast  Continue to innovate and develop new areas and product lines  Meet expectations of consumers, society and shareholders The Commission should promote its regulation including the safety of authorised ingredients in order underpin public confidence and counter dubious science

11. Trends of competitiveness of Agro-food industry, 15 November 2007 Future trends Sustainability will be a key trend for our industry We have long been involved in the area of packaging where we have a role to play in ensuring high levels of recovery, recycling and refilling in different market situations Reducing carbon footprint and meeting the climate change challenge is a responsibility for all of us and our industry wants to play its role We contributed to the Commission consultation on Sustainable Production and Consumption and look forward to working together

12. Trends of competitiveness of Agro-food industry, 15 November 2007 How DG Enterprise can ensure that the sector continues to be competitive By recognising the success of the self-regulatory model and supporting our needs in two key areas: Products  ensuring an environment where innovation can flourish. In particular that the needs of SMEs are recognised and promoted in order that the local businesses that characterise our industry in Europe can continue to thrive Packaging  ensuring that the infrastructure for recovery and recycling of packaging is in place. Limit barriers to development of recycled containers and improve energy and water efficiency of refillable packaging.

13. Thank you