research and innovation research and innovation state of the innovation union clara de la torre...

Research and Innovation


State of the Innovation Union

Clara de la TorreDirector of Research and InnovationDG Research and Innovation

Brussels, 19 April 2013



Overview• State of the Innovation Union - overall progress

highlighting state of play on the main EU initiatives.

• Country Profiles - analysis of performance of the research and innovation systems of individual Member States.

• Scoreboard - snapshot of performance based on 25 indicators spanning the whole innovation cycle. Allows comparison of relative strengths and weaknesses and performance monitoring. 2



Protecting public R&D spending

3

Increasing

Broadly flat

Decreasing



Findings• Positives:

• Total R&D budgets of the 27 EU Member States increased nominally by ca. 8% between 2007 and 2011.

• Business R&D expenditure in the EU also 10% higher in 2011 than before the crisis (2007) in nominal terms.

• Top R&D investing companies headquartered in the EU expect their global R&D investments to grow by an average of 4% annually over the period 2012 to 2014.

• EU R&D intensity grew from 1.85% of GDP before the crisis (2007) to 2.03% of GDP in 2011.

4



Growing Innovation Divide

5

Innovation leaders

Modest innovators



Findings• Warning signs:

• Total R&D investment by EU Member States slowed down in 2010 and decreased in 2011.

• Increasing disparities in performance of Member States and regions - process of convergence in performance has come to a halt for the first time since 2001

• Firms piling up cash reserves and differing research and innovation investments due to low confidence in future prospects of the European economy.

6



International Comparison

• Innovation leaders, US, Japan and South Korea outperform EU.

• Innovation performance gap with US and Japan has closed since 2008, but performance lead of South Korea has increased.

• EU continues to have a strong performance lead over Australia, Canada and all BRICS countries, but China is catching up.

7



Global value chain income

8



FDI by US firms

9

Overseas research and development expenditure of US firms (1994-2008)

Source: EC 2012, Study “Internationalisation of business investments in R&D and analysis of their economic impact”

0

5000

10000

15000

20000

25000

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Mio

US

D

EU

Japan

Other OECD

Non-OECD Asia

Rest of the world



Not all bleak!

• One of the world best-performers in terms of high quality science and innovative products

• Capture the largest share (28%) of income generated in global manufacturing value chains

• Prime beneficiary of foreign R&D investments by US firms

• Specialised in medium-high tech sectors, but two-thirds of business R&D investment in US clustered in high-tech – e.g. health and ICT. 10



Policy Shift• Concrete actions on European Research Area

• Improved business environment thanks to unitary patent, faster standard setting, modernised EU procurement rules and a European passport for venture capital funds

• European Innovation Partnerships are pooling resources and concentrating demand and supply-side measures on key societal challenges

• Gist of the Commission's proposal for Horizon 2020 accepted.

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Implications for Member States

"Invest, Reform, Transform"

•Continue to invest by protecting R&D budgets

•Reforms to improve the efficiency of the national research systems

•European economy must be transformed through a stronger presence in high-tech sectors while maintaining and revitalising current industrial fabric

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research and innovation research and innovation state of the innovation union clara de la torre...

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