Middle East and Africa
Introduction
The Middle East and Africa (MEA) region has the fastest-growing populations in the world. With GDP per capita also on the rise, there is enormous potential for increasing the consumption of processed and packaged food. There is an urgent need to provide affordable and nutritious food and beverages to a growing population with income levels that are still relatively low. As cold chains are lacking in many parts of the region, aseptic carton packaging solutions are sought after as a way of bringing more products to more people. The addition of bag-in-box and spouted pouches to the SIG portfolio presents new opportunities for the safe delivery of a wider range of products.
2022 overview
The ending of COVID-19 restrictions – in particular the re-opening of schools – contributed to strong revenue growth for SIG, with in particular a rebound in portion packs of non-carbonated soft drinks. The placing of new aseptic carton filling machines and the ramping-up of machines placed in earlier periods also played a significant role.
Given that disposable incomes in MEA remain relatively low compared with international standards, the need for affordability becomes even more acute, especially in an inflationary environment. The flexibility of SIG filling machines enables our customers to respond to consumer needs by switching to smaller formats, thereby limiting the need for consumer price rises.
Performance highlights
Seizing the dairy opportunity
Several years ago, SIG initiated a strategy to increase the weighting of liquid dairy in its portfolio. We did so in the knowledge that, while the demand for milk as a cheap source of protein is growing, per capita milk consumption in the region remains very low – around one tenth of the level in Europe. Our strategy has led to an expansion of liquid dairy volumes from 54% in 2018 to 64% in 2022. This has been accompanied by a strengthening of our position with key customers. We have expanded our liquid dairy share in South Africa with new installations at Lactalis and FairCape Dairies. We have also seen market share gains in liquid dairy in Saudi Arabia and Egypt.
“It was vital for us to find a premium packaging which complemented the superior quality, modern image and innovative ingredients of our existing liquid dairy product. We were looking to relaunch in the Saudi Arabian market with a new look and feel. Following our close cooperation with the team at SIG, we quickly found an innovative solution that allows us to offer additional benefits to our consumers. combismile not only ensures differentiation on the shelf due to its unique shape and modern look, but it also clearly shows the high product quality and offers our mobile consumers unmatched on-the-go convenience.”
Hisham Ezz El-Arab
Chief Executive Officer (CEO) at Al Safi Danone
Innovation and service excellence
In MEA, food is a relatively new category for aseptic carton and one where we are also growing our presence with customers such as Arla and Baladna.
It is not just about the quality of our packs and the innovation that lies behind them. Service is a key component of our offering and is tailored to the needs of our customers. Our 24/7 remote service, provided through our Reliability Centre, provides immediate and efficient problem-solving for customers in hard-to-reach areas and makes the best use of the expertise we have available.
Pioneering in sustainability
We welcome the increasing interest in sustainability that is spreading across the region. We are not just promoting the environmental benefits of our cartons – we are taking an active role in promoting a circular economy. In Egypt, we have launched “Recycle for Good”, an innovative recycling initiative to enable households to arrange direct collection of used aseptic carton packs using a mobile app. The programme, in partnership with Tagaddod, is the first of its kind in the Egyptian market.
Looking ahead
SIG’s business in MEA covers 18 countries, yet the region comprises 70 countries, offering significant scope for expansion. Our expansion strategy is to establish a foothold in one country and use it as a base to serve neighbouring countries. For example, from Mauritania we can reach into Mali, Chad, Niger and Senegal.
The Middle East and Africa represent unexplored markets for Scholle IPN. That is already starting to change. Our Centre of Excellence at the Dubai Silicon Oasis is now demonstrating to customers the expanded range, including bag-in-box and spouted pouch as well as carton.
1 At constant currency.
2 At constant currency, adjusted for the consolidation of the former Middle East joint ventures.