MBR final low res

Malta Business Review
INNOVATION LEADERSHIP
Reaffirming Europe’s Innovation Leadership
by Peter Stracar
Europe has an intrinsic relationship with innovation, and whilst we
might perceive ourselves as being innovative, the GE Innovation
Barometer 2018 report, suggests that global business leaders feel
that in terms of innovation leadership in Europe has now been
overtaken by Asia.
Peter Stracar, President and CEO, GE Europe at GE
The latest statistics from Eurostat don’t
make for good reading either. They show
that while gross domestic expenditure on
R&D relative to GDP across the EU-28 has
risen by 40% over the past ten years to
around 2.04%, it remains comparatively
well below corresponding ratios recorded in
Japan (3.29% in 2015) and the United States
(2.79 % in 2015). Three years ago, China’s
R&D expenditure rose to 2.07% of GDP and
surpassed that of the EU-28. If Europe is
becoming less innovative and no longer a hot
bed of invention, then we have a problem in
terms of economic growth and productivity.
Commit more EU funding to
R&D and Innovation
Europe, like all regions is operating in a more
challenging environment and grappling with
the impact of automation and future work.
If we in Europe seriously want to compete
globally, then we will need to match and
exceed spending in other regions.
I would welcome a consistent scaling up of
the EU’s budget for research, development
and innovation and applaud the call from
last year’s Lamy report to double the
overall budget of the post-2020 EU R&D&I
programme. I would also encourage a
"If Europe is becoming
less innovative and
no longer a hot bed of
invention, then we have
a problem in terms of
economic growth and
productivity.
further simplification of instruments and a
minimization of the administrative burden.
The Multiannual Financial Framework (MFF)
should at a bare minimum deliver concrete
benefits and stimulate competitiveness and
global trade. Integral to all of that is the
access to increased funding for research,
development and innovation and creating a
dynamic, mutually-beneficial environment
for businesses of all sizes in Europe to flourish
and grow.
The current MFF — the EU’s 7 year budget
— runs until the end of 2020. We expect the
Commission to put forward comprehensive
proposals for the post-2020 framework
and for the next generation of financial
programmes that will receive funding
sometime in May. While the MFF should of
course always match the EU’s priorities and
provide financial support to the regions,
towns and a multitude of sectors, if it is to
drive long-term growth, the next budget
should be focused on addressing key concerns
around productivity and job creation, as well
as have a renewed funding focus on the
digital economy, R&D and innovation.
Encouraging Closer Cohesion
and Collaboration
We shouldn’t expect policymakers to
carry the whole burden of addressing this
situation. Yes, we should encourage them to
reapply their foot to the pedal when it comes
to spending on innovation, but industry and
large multinationals also have an integral role
to play.
Firstly, by remaining committed to investing
in their R&D strategies, and by creating and
fostering diverse ecosystems with academia,
start-ups and SMEs. However, for ecosystems
8