Having grown by more than 65% since 1997, the global market for packaged water continues to be led by Western Europe, which accounts for almost 40% of total consumption and has a per capita figure some six times the world average, according to figures released this week.

In a report into the sector, research group Canadean, says Western Europe is not only the largest regional market but also the most developed. It is dominated by Italy, France, Spain, Belgium and Germany which enjoy a significant combined share.

Italians in particular are very heavy drinkers and per capita consumption is expected to exceed 200 litres by 2006. As consumers adopt healthier lifestyles, they are becoming increasingly concerned about the quality of tap water. Scandinavia, which enjoys exceptionally high quality tap water, is therefore unsurprisingly the nation with the lowest consumption.

North America, the second largest region, has also performed strongly with consumption more than doubling since 1997. Average annual growth over this period is bettered only by Asia. Still water is the leading segment as the share of consumption attributable to sparkling is minor, and declining. Spring water is also decreasing rapidly as the main growth continues to be delivered by distilled brands. Furthermore, the report predicts a market share for spring water of no more than 5% at the end of 2003 - a huge decline from the estimated 25% less than a decade ago!

Third placed Asia has accelerated fastest in recent years. It has a huge population and despite this rapid expansion, per capita consumption is still very low offering huge potential for further growth. Interestingly, sparkling water is not widely viewed as a beverage and tends to be consumed mainly by tourists.

On a global level, still water outsells sparkling in every region except Eastern Europe. With still water perceived as a refreshment drink, sparkling is being increasingly positioned as a separate soft drink entirely. Supported by its traditional strongholds of Central/South America, Australasia and Europe, mineral water retains its dominance over table/distilled although the gap is narrowing. PET is increasing its share of packaging largely at the expense of glass and single-serve packs are becoming more popular, driven by the growing importance of "on the go" consumption.

"Overall, packaged water is expected to continue to rise sharply, providing much of the incremental volume for the soft drinks industry as a whole. As would be expected with such a potentially lucrative market, competition looks to be intensifying. However, there should still be plenty of opportunity for price positioning, particularly in the more sophisticated markets," Canadean said.