EU governments still underspending on research and failing to get innovation outputs

Hitting the EU’s target for member states to invest 3 per cent of GDP in research is not going to happen by 2020, according to the latest assessment from the European Commission.

A report on the European “semester”– the EU economic oversight mechanism – says on average EU countries are still under-investing in R&D. It also lays out familiar shortcomings in member states’ science systems, in an attempt to guide countries towards a stronger performance.

“In a nutshell, our 2017 analysis shows that member states attach an increasing role to research and innovation (R&I) policy as a competitiveness and growth enabler,” said Román Arjona, head of the analysis and monitoring of national research and innovation policies unit in the Commission’s directorate for research. “But concerns remain about the pace of R&I policy reform in support of higher quality and impact of public investments.”

Speedier reforms, in particular more cooperation between science and business, are needed, even in some of the most advanced countries, Arjona said.

Progress in improving the business environment and boosting R&D investment in the 28-nation bloc is varied.

EU Research Commissioner Carlos Moedas may be alarmed to find his native Portugal occupying a very low (24th) position in innovation performance. Making Europe better at exploiting breakthroughs in the lab has been the Commissioner’s main policy since taking office.

Meanwhile Austria, which ranks second among member states on public and private R&D spending, does not manage a matching performance in innovation.

R&D spending in Austria as a percentage of GDP amounted to 3.07 per cent in 2015 however, making it one of the few countries to climb above the Commission’s target.

Another traditional big investor in research – among the highest in the world in fact – Finland has seen its R&D budget shrink over the last few years, as it tries to drag itself out of a debilitating recession.

The legacy of the 2008 financial crisis continues to impede public investment in research in most member states – but particularly in Central and Eastern Europe.

Lithuania’s science performance is in a bad way, with the volume of highly cited scientific publications falling during recent years. 

“On a value-for-money comparison, Lithuania is also one of the worst performers in EU. The majority of R&D output is produced by public research institutions, with weak capacity to exploit results for economic benefits,” the Commission says.

Romania’s science system remains befuddling, with more than 150 public institutions undertaking R&D.

The planned creation of a National Council for Science, Technology and Innovation Policy “may be an important step” towards putting a coherent shape on the confusion, the Commission says.

Access to finance for small businesses meanwhile is identified as the most important challenge in some member states.

For example, in Greece 30 per cent of SMEs point out access to financing as their most serious problem, as do 25 per cent of SMEs in Cyprus.

More encouragingly, the Commission finds most European governments are on the way to meeting EU targets on emission reductions, renewable energy and energy efficiency.