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Europe to Increase R&D Spending to 3% of GDP by 2020, Seeks to Surpass U.S. in High Tech Research

Thursday, May 13, 2010 8:24
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The European Union is seeking to wrest the lead in high tech research and development from the U.S. and Japan as part of its strategy to revive an ailing economy, increase employment and lower the school dropout rate.

The EU’s forthcoming report Research and Innovation Strategy for Europe focuses on the major societal challenges, has a broad definition of ‘innovation’ and seeks to remove bottlenecks to the flow of knowledge, European Commissioner for Research, Innovation and Science Máire Geoghegan-Quinn has announced.

The Commissioner was speaking at the European Technology Platforms conference in Brussels, Belgium on  May 11th. The Research and Innovation Strategy represents a major plank of the wider Europe 2020 Strategy that sets out the actions needed to help Europe emerge from the economic crisis as a ‘smart, sustainable and inclusive economy’. Among other things, the Europe 2020 strategy reiterates the goal of boosting research and development (R&D) spending in Europe to 3% of GDP (gross domestic product); R&D spending in the EU is currently below 2%.

R&D spending in Europe is below 2%, compared to 2.6% in the US and 3.4% in Japan, mainly as a result of lower levels of private investment. It is not only the absolute amounts spent on R&D that count – Europe needs to focus on the impact and composition of research spending and to improve the conditions for private sector R&D in the EU. Europe’s smaller share of high-tech firms explains half of our gap with the US. 

The Research and Innovation Strategy will be published by September of this year, so that EU leaders can discuss it at their Autumn European Council meeting.

‘As the Research and Innovation Commissioner, my job is to help create the conditions for a more dynamic Europe. A Europe where innovative firms want to do business, and where talented people want to live and work,’ stated Mrs Geoghegan-Quinn. ‘One of my first tasks is to draw up a new Research and Innovation Strategy that sets out how we intend to drive forward the research and innovation parts of Europe 2020.’

Although details of the Research and Innovation Strategy are still under discussion, the main features of the strategy are clear, Mrs Geoghegan-Quinn explained.

Firstly, the strategy will refocus research and innovation policies on the major challenges facing Europe and the world, such as climate change, energy efficiency, health and ageing. In addition, the strategy will be based on a broad understanding of ‘innovation’, including not only research but innovation in business models, management structures and the delivery of public services. Finally, Mrs Geoghegan-Quinn pointed out that, ‘the strategy will aim to remove all major bottlenecks to the flow of knowledge and to the emergence of what we’re calling a ‘Single Market for Research and Innovation’.’

Many aspects of the strategy, such as promoting researcher mobility, developing world-class infrastructures and reducing the fragmentation of national research efforts, are already key features of EU research and innovation policies.

Mrs Geoghegan-Quinn also noted that the strategy will give a ‘vigorous push’ to efforts to agree on an EU patent. ‘Enough is enough: let’s finally finish the job!’ she exclaimed.

The Commissioner also set out her plans for the future of the EU’s Research Framework Programmes. ‘I intend to tie it much more closely to the major societal challenges and ensure it has more leeway to fund innovation,’ she said.

Spain, which currently holds the presidency of the EU Council, is also gathering input for the research and innovation aspects of the Europe 2020 Strategy. At a recent conference in Bilbao, Spain, Spanish Minister of Science and Innovations Cristina Garmendia commented: ‘Without more science and innovation, but above all, without the necessary interaction between them, Europe will not be able to maintain its current leadership in certain areas and much less aspire to improve its position in the international ranking.’

The following figure illustrates three possible growth scenarios from Europe 2020 Strategy in an attempt to illustrate paths of economic recovery from the financial crisis and indicates the reasoning behind a more than 30% increase in research and development spending to spur the European economy.

Education, training and lifelong learning: A quarter of all pupils have poor reading competences, one in seven young people leave education and training too early. Around 50% reach medium qualifications level but this often fails to match labour market needs. Less than one person in three aged 25-34 has a university degree compared to 40% in the US and over 50% in Japan. According to the Shanghai index, only two European universities are in the world’s top 20.

Digital society: The global demand for information and communication technologies is a market worth $2.5 trillion (€2,000 billion), but only one quarter of this comes from European firms. Europe is also falling behind on high-speed internet, which affects its ability to innovate, including in rural areas, as well as on the on-line dissemination of knowledge and on-line distribution of goods and services.

The following figure illustrates three possible growth scenarios from Europe 2020 Strategy in an attempt to illustrate paths of economic recovery from the financial crisis and indicates the reasoning behind a more than 30% increase in research and development spending to spur the European economy

Image credit: Europe 2020 Strategy:

For more information, please visit:
 Máire Geoghegan-Quinn’s website:
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 Europe 2020 strategy: LINK`http``color: rgb(0, 51, 102); text-decoration: none; `LINK

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