Global r&d set to grow by 5% over next two years
Availability of qualified personnel and funds are having positive effect on innovation, survey finds
EU-based companies that currently invest most in r&d are expecting their global r&d investments to grow by 5% annually between 2011 and 2013, according to figures published by the European Commission.
This is more than double last year's forecast and is a significant turnaround from the 2.6% cuts in r&d investment implemented by these companies in 2009.
The sixth EU Survey on R&D Investment Business Trends also revealed that an average of 27% of the annual sales of these companies comes from products introduced in the past three years.
‘The survey provides welcome positive economic news and grounds for cautious medium-term optimism, given that business r&d is a key driver of sustainable growth and jobs,’ said Máire Geoghegan-Quinn, commissioner for research, innovation and science.
‘But if we are to achieve our Europe 2020 targets, including getting r&d investment in the EU up to 3% of GDP, we will need these forecast investments for 2011–13 to be delivered in practice. We will also need further increases in the rate of growth of private r&d investment in subsequent years, both by the big companies covered in this survey and by SMEs.
She also suggested that an Innovation Union in Europe would need to be delivered so that investing in r&d in the region is more attractive than doing so elsewhere.
The companies that participated in the survey expect their r&d investment inside the EU to grow 3% a year over the next three years.
Although this is lower than the growth expected for their r&d investment in other world regions, the companies still expect to locate 75% of their investments in the EU. They expect to make the largest percentage increases in r&d investment in China (25%), Japan (17%), other European countries (8%), India (8%) and the US and Canada (5%).
The Commission said this trend – the same as in three out of four previous surveys – shows that EU-based companies want to benefit from the growth in emerging economies while still retaining a strong overall focus on the EU. This is confirmed by the companies' figures for nominal r&d investment amounts, which are set to increase by €2.2bn over the next three years in the EU and €2.7bn outside the EU.
Top factors indicated as having a positive effect on innovation were the availability of qualified personnel and of public support such as grants and monetary incentives. Collaboration with other entities, such as higher education institutions, was also seen as important.
Negative factors were cited as the enforcement costs of Intellectual Property Rights (IPR) and the time needed to obtain IPR protection.
The European Commission's in-house science service, the Joint Research Centre (JRC), and the Directorate General for Research and Innovation carried out the survey.
The results are based on 205 responses of mainly larger companies from the 1,000 EU-based companies in the 2010 EU Industrial R&D Investment Scoreboard.
Taken together, these 205 companies are responsible for r&d investment worth almost €40bn, constituting around 30% of the total r&d investment by the 1000 EU Scoreboard companies.