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Raising the bar – Positive trends are shaping Europe’s sweetest industry

Graham Paul

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Good news for Europe’s chocoholics: their favourite industry is growing. The size of the European chocolate sector is projected to reach $57 billion by the middle of the next decade. This represents a major chunk of the world’s $162 billion total. It even dwarfs the US market, which is expected to surpass $22 billion in value.

Germany holds the continent’s largest market share, at 15 per cent. In a close second place is the UK, whose government estimated last year that the country’s chocolate exports were worth more than £680 million – a significant 84% rise from the £370 million recorded ten years ago. More broadly, the manufacture of cocoa and chocolate is today worth over £1 billion to the British economy.

Reaching for the top shelf

It is not all about raw growth, however. New forms of consumer demand are driving several changes in the industry.

One noticeable trend has been the rise of top-shelf chocolate. Britain’s Department for Environment, Food & Rural Affairs has found that foreign buyers “are showing an increasing taste” for quality chocolate exports. This mirrors the trend across the pond, where according to consumer surveys premium brands now account for nearly 20 per cent of all US sales of the sweet stuff. It is a considerable share of a national market regularly tapped by almost four fifths of adult consumers.

Closely linked to this trend has been the boom in “craft chocolate”. Over the past half-decade, independent start-up chocolatiers, using artisanal production methods, have been looking to eat into the market share of “Big Chocolate”. They are seeking to mirror the rapid growth of the craft beer industry – which has already drawn millions of global consumers away from the larger established brewers.

Indeed, in order to meet rising domestic and foreign consumer demand, the Department for International Trade has noted that “the number of independent chocolatiers in the UK has grown in recent years, with more artisanal and specialized products being launched”.

It’s good for you

Another major transformation in the consumer market has been a move towards healthier products. In the UK, messages on the dangers of excessive sugar and fat consumption seemed to begin to make an impact in 2017, when the 12 biggest brands reportedly faced losses of £78 million; the profits of artisanal and independent makers of organic and healthier varieties, in contrast, remained on the up.

Dark chocolate also seems to be becoming more popular. The proportion of chocoholics choosing dark chocolate has grown to 48 per cent in recent years, according to recent surveys. Taken in moderation, it has been found to offer benefits to heart, artery and brain health.

Helping to drive demand for dark chocolate, and for products made with plant-based substitutes for cow milk, has been the ongoing rise of veganism. Since 2014, the number of British vegans has quadrupled: an estimated 600,000 now have a plant-based diet, or 1.16% of the population. Growth is not expected to slow anytime soon. It is estimated that a quarter of the British population will be either vegan or vegetarian by 2025 (with just under half of all British consumers calling themselves flexitarians).

“We are definitely seeing greater demand for vegan, gluten-free and dairy-free products,” says Niels Østenkær, CEO of Copenhagen-based brand Simply Chocolate. “Brands are adjusting to the ‘free-from’ culture. Those high-end chocolate makers able to stay on top of this demand – with a clear message, values and focus on quality – will be the winners of tomorrow.”

Increasing pressure to go green

Last – but by no means least – is the growing call for a sustainable chocolate sector. “No serious chocolate maker can comprehend a future for the industry without greater sustainability,” says Østenkær. “Consumers demand it. Investors are increasingly doing so – in fact, our own owner, Alshair Fiyaz, absolutely insists on sustainability.”

In the industry at large, however, there remains much to do to go green. Many certification programmes exist which promise greater equity and better conditions for commodity farmers. But the International Cocoa Association, a trade body, has found that the proportion of cocoa sold worldwide under the Fair Trade label remains as little as 0.5 per cent. The warning comes amid wider fears of “greenwashing” – the danger that of the multitude of labels and certifications on the market today, some may not require the most stringent of standards, and instead be used as a marketing gimmick.

Østenkær believes the solution lies in taking a holistic approach: “We need a guarantee of sustainability across the board. That is why at Simply Chocolate we only use chocolate certified by Cocoa Horizons, a programme which supports the livelihoods of farmers, promotes workable, entrepreneurial farming methods, helps them boost productivity, and contributes to the economic development of their communities – all the while protecting the natural environment.”

Of course, making the chocolate industry sustainable goes far beyond the ingredients themselves. Østenkær explains: “Chocolate depends on an intricate global supply chain – from the grower, all the way to the factory and distribution. We need to ensure compliance at all stages of that supply chain. So work at the local level is critical. That is why we produce all of our chocolate by hand at our factory in eco-friendly Copenhagen, ensuring that we know exactly what goes into our bars. We’re even installing solar panels on the roof to reduce our carbon footprint!”

Europe’s chocolate industry is not only expanding, it is evolving – and in a positive direction. Tastes are changing, consumer trends are shifting, and awareness of sustainability is fast developing. It is an exciting time in the land of chocolate.

Data

European strategy for data: What MEPs want

EU Reporter Correspondent

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Find out how MEPs want to shape the EU's rules for non-personal data sharing to boost innovation and the economy while protecting privacy.

Data is at the heart of the EU's digital transformation that is influencing all aspects of society and the economy. It is necessary for the development of artificial intelligence, which is one of the EU's priorities, and presents significant opportunities for innovation, recovery after the Covid-19 crisis and growth, for example in health and green technologies.

Read more about big data opportunities and challenges.

Responding to the European Commission's European Strategy for Data, Parliament's industry, research and energy committee called for legislation focussed on people based on European values of privacy and transparency that will enable Europeans and EU-based companies to benefit from the potential of industrial and public data in a report adopted on 24 February 2021.

The benefits of an EU data economy

MEPs said that the crisis has shown the need for efficient data legislation that will support research and innovation. Large quantities of quality data, notably non-personal - industrial, public, and commercial - already exist in the EU and their full potential is yet to be explored. In the coming years, much more data will be generated. MEPs expect data legislation to help tap into this potential and make data available to European companies, including small and medium-sized enterprises, and researchers.

Enabling data flow between sectors and countries will help European businesses of all sizes to innovate and thrive in Europe and beyond and help establish the EU as a leader in the data economy.

The Commission projects that the data economy in the EU could grow from €301 billion in 2018 to €829 billion in 2025, with the number of data professionals rising from 5.7 to 10.9 million.

Europe's global competitors, such as the US and China, are innovating quickly and applying their ways of data access and use. To become a leader in the data economy, the EU should find a European way to unleash potential and set standards.

Rules to protect privacy, transparency and fundamental rights

MEPs said rules should be based on privacy, transparency and respect for fundamental rights. The frree sharing of data must be limited to non-personal data or irreversibly anonymised data. Individuals must be in full control of their data and be protected by EU data protection rules, notably the General Data Protection Regulation (GDPR).

The committee called on the Commission and EU countries to work with other countries on global standards to promote EU values and principles and ensure the Union’s market remains competitive.

European data spaces and big data infrastructure

Calling for the free flow of data to be the guiding principle, MEPs urged the Commission and EU countries to create sectoral data spaces that will enable the sharing of data while following common guidelines, legal requirements and protocols. In light of the pandemic, MEPs said that special attention should be given to the Common European Health Data Space.

As the success of the data strategy depends largely on information and communication technology infrastructure, MEPs called for accelerating technological developments in the EU, such as cybersecurity technology, optical fibres, 5G and 6G, and welcomed proposals to advance Europe's role in supercomputing and quantum computing. They warned that the digital divide between regions should be tackled to ensure equal possibilities, especially in light of the post-Covid recovery.

Environmental footprint of big data

While data has the potential to support green technologies and the EU's goal to become climate neutral by 2050, the digital sector is responsible for more than 2% of global greenhouse gas emissions. As it grows, it must focus on lowering its carbon footprint and reducing E-waste, MEPs said.

EU data sharing legislation

The Commission presented a European strategy for data in February 2020. The strategy and the White paper on artificial intelligence are the first pillars of the Commission's digital strategy.

Read more about artificial intelligence opportunities and what the Parliament wants.

The industry, research and energy committee expects the report will be taken into account in the new Data Act that the Commission will present in the second half of 2021.

Parliament is also working on a report on the Data Governance Act that the Commission presented in December 2020 as part of the strategy for data. It aims to increase data availability and strengthen trust in data sharing and in intermediaries.

Parliament is set to vote on the committee report during a plenary session in March.

A European strategy for data 

Data Governance Act: European data governance 

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Aviation Strategy for Europe

Commission approves €26 million Irish aid scheme to compensate airport operators in context of coronavirus outbreak

EU Reporter Correspondent

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The European Commission has approved, under EU state aid rules, a €26 million Irish aid scheme to compensate airport operators for the losses caused by the coronavirus outbreak and the travel restrictions imposed by Ireland to limit the spread of the coronavirus. The aid consists of three measures: (i) a damage compensation measure; (ii) an aid measure to support the airport operators up to a maximum of €1.8 million per beneficiary; and (iii) an aid measure to support the uncovered fixed costs of these companies.

The aid will take the form of direct grants. In case of support for the uncovered fixed costs, aid can also be granted in the form of guarantees and loans. The damage compensation measure will be open to operators of Irish airports that handled more than 1 million passengers in 2019. Under this measure, these operators can be compensated for the net losses suffered during the period between 1 April and 30 June 2020 as a result of the restrictive measures implemented by the Irish authorities in order to contain the spread of coronavirus.

The Commission assessed the first measure under Article 107(2)(b) of the Treaty on the Functioning of the European Union and found that it will provide compensation for damage that is directly linked to the coronavirus outbreak. It also found that the measure is proportionate, as the compensation does not exceed what is necessary to make good the damage. With regard to the other two measures, the Commission found that they are in line with the conditions set out in the state aid Temporary Framework. In particular, the aid (i) will be granted no later than 31 December 2021 and (ii) will not exceed €1.8 million per beneficiary under the second measure and will not exceed €10 million per beneficiary under the third measure.

The Commission concluded that both measures are necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a member state, in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. On this basis, the Commission approved the three measures under EU State aid rules. More information on the Temporary Framework and other actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.59709 in the state aid register on the Commission's competition website once any confidentiality issues have been resolved.

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Aviation/airlines

Aviation: Slot relief enacted

EU Reporter Correspondent

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Following a proposal by the Commission from December 2020, the Council has adopted the amendment to the Slot Regulation that relieves airlines of airport slot-use requirements for the summer 2021 scheduling season. The amendment allows airlines to return up to half of the airport slots that they have been allocated before the start of the season.

Transport Commissioner Adina Vălean said: “We welcome the final text of the amendment which allows to better adjust slot rules to consumer demand for air travel, fosters competition and sets the path for a gradual return to normal rules. I expect that this initiative will incentivise airlines to make efficient use of airport capacity, and that it will ultimately benefit EU consumers.”

The Commission has delegated powers for one year after the amendment enters into force, and so can extend the rules until the end of the summer 2022 season, if necessary. The Commission may also adapt the use rate within a range of 30-70%, depending on how air traffic volumes evolve. The legal acts will be published in the EU Official Journal in the coming days and enter into force the day after their publication. You will find more details here.

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