France leads way in functional foods (say the French)

Global manufacturers of functional foods are clamouring to set up shop in France, thanks to country's health-conscious consumers and a generous government tax credit for R&D, according to the Invest in France Agency.

The agency said that between 2002 and 2007, the functional foods sector generated 200 new international investment projects in France — 7% of all such projects in the country.

Several of France's 71 pôles de compétitivité, which are clusters of excellence located all over France that specialise in specific industrial sectors, are now focused on functional foods, said the Invest in France Agency.

These include Nutrition Santé Longévité, based in Nord Pas-de-Calais; Prod'Innov in Aquitaine; Vitagora in Burgundy; and [email protected] in Languedoc-Roussillon.

France's functional foods market is thriving: it was valued at 900 million euros in 2006, with an estimated annual growth rate of more than 10%.

According to an Ipsos survey published in October 2007, 52% of French consumers polled were concerned about the effects on their health of the food they eat.

The French government supports research activities through an R&D tax credit that is currently the best of its type in Europe, according to the Invest in France Agency. This credit reimburses up to 50% of R&D expenditure for the first year (up to 100 million euros), 40% in the second year and 30% in subsequent years.

Innovative projects under way in the functional food sector involve French giants Danone and Lactalis, but overseas companies also have an important market presence. Japan's Shiseido is said to be developing an anti-wrinkle yoghurt with aloe vera, for example. Pharmaceutical laboratories are also understood to be actively developing nutraceutical products in France.

"This sector offers high development potential, combining three industries in which France is particularly strongly positioned as the European leader in each of these sectors — agri-food, pharmaceutical and cosmetics," said Philippe Favre, chairman and CEO of the Invest in France Agency.

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