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Supply Chain

'Don't Push Food Companies Across The Border', Warns Belgium's Fevia

By Robert McHugh
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Fevia, the umbrella trade association of the Belgian food industry, has called on the government to take measures quickly to strengthen the competitiveness of food companies and to stabilise the Belgian food chain for the future.

Due to cost inflation over the past two years, sales volumes among Belgian food companies have fallen by 3%.

While supermarket chains initially held back on passing on increased costs, the situation has shifted since mid-2022.

However, Fevia warns that most food manufacturers are still only partially able to pass on increased costs, which is putting their profitability under pressure.

Structural Handicaps

At the same time, Fevia says food companies continue to struggle with a series of 'structural handicaps' that have weighed on their competitiveness for several years, such as a wage cost handicap of 25% and fiscal policies that make their products more expensive.

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Fevia warns that new policy measures, such as an increase in the packaging tax of €60 million or the announced increase in VAT from 6% to 9%, threaten to widen the gap between Belgium and its neighbouring countries.

Read More: One In Six Belgian Supermarkets At Risk Of Closure: Study

'Effective Account'

The association says policymakers can intervene by not expanding the existing packaging tax, but by converting it into a stimulating instrument in the field of sustainability.

Fevia is also asking policymakers to take 'effective account' of cross-border purchases before taking policy measures, such as the recent proposal for a VAT increase on food as part of fiscal reforms.

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'Essential Sector'

“If we still want Belgian food on the table tomorrow, our policymakers will absolutely have to focus more on our food industry as an essential sector and central link in the agri-food chain," said Bart Buysse, Fevia CEO.

"Otherwise, we risk becoming dependent on other countries for our food in the long term.”

Read More: Top 10 Supermarket Retail Chains In Belgium

© 2023 European Supermarket Magazine – your source for the latest supply chain news. Article by Robert McHugh. Click subscribe to sign up to ESM: European Supermarket Magazine.

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