Smart Specialisation Strategy for

Finland – Key Elements

25th March 2014

Leena Sarvaranta

Member of KET HLG Sherpa Group

VTT Technical Research Centre of Finland

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In order to really grasp Smart Specialisation

you need to understand why KETs are so important

1. European Union now has an integrated KETs strategy which will

be implemented through industrial policy and other related

policy priorities

2. KETs investments in the European Union will be done by

combined financing from

ESIF - Smart Specialisation in Member States

Horizon 2020 - Value Chains in Pan-European Project

Consortia

EIB - Grants and Loans for Companies

Principles for combined funding/financing are decided,

implementation is still under debate!

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WHAT IS “KETS”?

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Implementation of KETs Agenda through Industrial Policy

KETs Investment through Horizon 2020, Structural Funds, and EIB Grants and Loans

KETs Agenda: Re-industrialisation of Europe create jobs, enhance competitiveness of European

value chains – Europe needs to master its critical industrial value chains Independency

Commission Communication COM(2009) 512 on KETs in 2009 Potential impact of KETs in strengthening Europe’s industrial and innovation capacity (nanotechnology, micro and nano electronics,

advanced materials, photonics, industrial biotechnology and advanced manufacturing systems)

Setting up 1st High Level Group on KETs 2010-2011 (one year mandate) to elaborate a single comprehensive strategy on KETs in

Europe

Commission Communication COM(2012) 341 on KETs in 2012 KETs policy recognized and approved by all EU Member States

Setting up 2nd High Level Group on KETs 2013-2014 (two year mandate) to forge the implementation of KETs policy in Europe and to

advise the Commission

Commission Communications on Industrial Policy in 2010, 2012, 2014 Europe needs to reverse the declining role of industry in Europe for the 21st century by investment and innovation on KETs

An Integrated Industrial Policy for the Globalisation Era 2010

A Stronger European Industry for Growth and Economic Recovery 2012

A European Industrial Renaissance 2014

Commission Communication COM(2013) 542 on Defence and Security Sector KETs with dual-use potential

The new Cohesion Policy and Smart Specialisation)

KETs are one of the investment priorities of the European Regional

Development Fund (ERDF) as a relevant investment for the smart

growth of regions (Smart Specialisation). Formal Partnership

Agreements and Operational Programmes are expected to be

submitted by Members States for the adoption by the EC in 2014

KETs in Horizon 2020

Key Words: Crosscutting KETs Value Chains – TRL -

Valley of Death - Proof of Concept – Early Stage

Prototyping - Technology Validation – Demonstration

– MultiKETs Pilot Plants – Industrial Deployment in

Europe

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EU’s Key Enabling Technologies (KETs)

COM(2012) 341

KETs are knowledge intensive and associated with high R&D intensity, rapid

innovation cycles, high capital expenditure and highly skilled employment

KETs enable process, goods and

service innovation throughout the

economy and are of systemic relevance

KETs are multidisciplinary, cutting across

many technology areas with a trend

towards convergence and integration

KETs can assist technology leaders in other fields to capitalise on their research efforts

EU’s KETs are micro-/nanoelectronics, nanotechnology,

photonics, advanced materials, industrial biotechnology and

advanced manufacturing technologies

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WHAT IS SMART

SPECIALISATION?

Regional Policy

What is Smart Specialisation?

= a process of priority setting in national and regional innovation strategies in order to achieve place-based economic transformation by building on and developing competitive advantage through fostering

own strengths in Research and Innovation Identifying other unique characteristics and assets of a territory Matching that with the business needs

To seize emerging opportunities and market developments in a coherent manner while avoiding duplication and fragmentation of effort at EU level.

Cohesion Policy

Regional Policy

Smart Specialisation Strategies

Smart Specialisation Strategies should be developed in an entrepreneurial discovery process trough involving: national or regional managing authorities stakeholders such as business, universities and other

higher education institutions and RTOs and civil society/users.

The authorities directly involved in the implementation of Horizon 2020 should be closely associated to this process.

Cohesion Policy

Regional Policy

No "one-size-fits-all"

Policies must be tailored to the local context, acknowledging that there are different pathways for regional innovation and development. By:

• a) rejuvenating traditional sectors through higher value-added activities and new market niches (mining Silesia; shipbuilding Skåne; automotive West Midlands);

• b) modernising by adopting and disseminating new technologies (logistics Flanders);

• c) diversifying technologically from existing specialisations into related fields (Aeronautics in Toulouse to GPS technologies);

• d) developing new economic activities through radical technological change and breakthrough innovations (Tourism in Balearic Islands);

• e) exploiting new forms of innovation such as open and user-led innovation, social innovation and service innovation (Historical heritage in Italy).

• Adapted from: R. Ortega

Billion EUR

Less developed regions 164.3

Transition regions 31.7

More developed regions 49.5

Cohesion Fund 66.4

European territorial cooperation 8.9

Of which

Cross border cooperation 6.6

Transnational cooperation 1.8

Interregional cooperation 0.5

Outermost regions and northern sparsely populated regions

1.4

Youth Employment initiative 3.0

TOTAL 325.1

ESIF: European Structural and Investment Funds

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SMART SPECIALISATION

STRATEGY FOR FINLAND

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R&D&I Investment in Finland (2011)

€/ inhabitants in main city regions

Source: Statistics Finland

A sparsely populated country with 5.4 million inhabitants, a

large land mass and an isolated location in Northern Europe.

So far, gross domestic expenditure on R&D&I (GERD) has

represented 3.9% of GDP. The share of business expenditure

on R&D&I (BERD) has accounted for more than 70% of all R&D

investments.

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Key Enabling Technologies (KETs) addressed

by TEKES and the Academy of Finland

in multiple R&D&I programmes

There is a successive chain of TEKES programmes that have

supported industrial biotechnology and nanotechnology since

the 1990s, such as the SymBio programme with the total funding

volume of €65m in 2006-2011 and the FinNano programme with

the funding of €70m in 2005-2010

The Strategic Centres for Science, Technology and Innovation

(SHOKs), which are public-private partnerships launched in 2007-

2009, have focused on Key Enabling Technologies in the areas of

energy & environment, bioeconomy and metal products &

mechanical engineering

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Cities´ Role in Smart Specialisation for Finland

In 2013, important national development programmes for cities were

under preparation: Innovative Cities (INKA programme) and Witty

City (Tekes programme)

The purpose of these programmes is to help cities to develop attractive

innovation hubs in Finland

City regions are challenged to create new types of ecosystems based

on smart specialisation, leading to knowledge-based development of

business environments and lead markets.

Moreover, cities and SMEs will find interesting new opportunities opened

up in the Horizon 2020 programme, and the European Innovation

Partnership on Smart Cities and Communities (EIP SCC) will lay basis

for integrated policy coordination between European Union and the

Member States in the coming years.

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Thematic Priorities in the Finnish City Regions 2014-2020

Bioeconomy

JOENSUU, Jyväskylä, Seinäjoki

Cyber Security

JYVÄSKYLÄ

Future Health

OULU, Kuopio, Metropolitan Area, Tampere, Turku

Smart City and Industry Renewal

TAMPERE, Lahti, Oulu, Metropolitan Area, Turku

Sustainable Energy Solutions

VAASA, Lappeenranta, Pori

ONLY 10% of ERDF funding

for Finland is channelled

through Tekes and for these

City Development Programmes

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The Finnish Government Programme 2011-2015

includes important industry policy priorities

CleanTech

Bioeconomy

Value chains from Green Mining to Metals and Engineering

New ICT

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EU’s new industry policy is paving the way

towards renaissance of the European industry

Heavy investments are needed for prototyping, piloting, demonstration, industrial

deployment and production in Europe.

This is also addressed in the Conclusions of the European Council on 21st March

2014.

The European Council recalls that key enabling technologies (KETs) are of crucial

importance for industrial competitiveness.

KETs of high industrial interest, such as batteries for electro-mobility, intelligent

materials, high performance production and industrial bioprocesses, should be

strengthened by swiftly identifying projects of European interest.

Special attention should be paid to the role of cleantech as a cross-cutting element for

enhancing the competitiveness of the European industry. The Commission is invited to

report on how to promote cleantech through concrete actions in all relevant EU

policies.

See in particular paragraph 12:

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HOOK UP WITH OPERATIONAL

PLANS IN REGIONS

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Two programmes – two approaches

H2020 – Funding comes from Brussels

Apply for funding at EU-level - basis H2020 Work Programmes

Consortia include complex Pan-EU networks of competence centres

ESIF – Funding comes from your region

Apply for funding in each region and with the relevant authority

Operational plans of the regions should include a HOOK in terms of a

high keyword:

Supporting the shift towards a low carbon economy in all

sectors (this is a MUST!)

Strengthening research, technological development and

innovation (including KETs)

Enhancing access to and use and quality of ICT

Enhancing the competitiveness of SMEs

Other

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TECHNOLOGY FOR BUSINESS