The 'Key figures 2005 for science, technology and innovation' show worrying trends in R&D investment and innovation in Europe. Not only will the Barcelona target of increasing R&D spending from 1.9 to 3 percent of GDP by 2010 be missed, but the R&D intensity has actually been declining since 2000 and is now close to zero.
The figures show that whereas the EU R&D intensity is low and close to stagnation (1.9%) the United States devotes as much as 2.59% and Japan 3.15% of their GDP to R&D and China's R&D intensity (1.31% of GDP in 2003) has grown at the rate of 10% per year since 1997.
The main reason for the poor EU performance is the low levels of private sector funding (55.6% in the EU compared to 63.1% in the US and 73.9% in Japan). Further, the figures show that Europe is becoming a less attractive place to carry our research. EU companies' R&D expenditure in the US has increased much faster than investments by US firms in the EU. The net imbalance in favour of the US increased five-fold between 1997 and 2002.
The stagnation of business investment in R&D "reflects a lack of confidence among economic operators regarding investment in Europe" said the UNICE President Ernest-Antoine Seillière. "The problems which are at the root of this virtual stagnation in R&D expenditure in Europe are largely structural; they have to be remedied through far-reaching economic and regulatory reforms that restore investment-friendly conditions," he added.
EU Science and Research Commissioner Janez Potočnik referred to the 2005 figures as a "wake-up call" for Europe.
