The urgent need to invest in key sectors of European economy

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV Media network.

Coordinated private, public and consciously European investment in research and infrastructure is needed to boost economic competitiveness, something which can be partly achieved via the EU budget, argues Dominique Ristori, an official at the European Commission.

Dominique Ristori is director-general of the European Commission's Joint Research Centre.

This commentary was first published in Confrontations Europe's monthly newsletter 'Interface'.

"Fresh investment in the key sectors of the European economy, such as the transport and energy sectors, is a leading priority in terms of promoting growth and creating new jobs. A recent report by the European Energy Markets Observatory estimated that investment in this sector will reach 1,000 billion euros in the next twenty years. Unless we develop smart gas and electricity networks, some member states could find themselves in a difficult situation.

Substantial investment is required in other areas, such as information and communication technologies (ICT), the environment, health care, agriculture and food safety. The automotive industry is also a key sector of the European economy.

It now needs to take a big technological step forward in order to ensure the development of the electric vehicles market. The aim is not only to reduce CO2 emission levels but also to make Europe's economy more competitive against the likes of China.

These investments lie within the framework of long-term projects and require appropriate legal and financial planning involving both the public and private sectors. It is therefore necessary to build a more in-depth dialogue between the European authorities and industry, in order to ensure that European funds are put to the most effective use.

However, the implementation of these large-scale projects requires more substantial effort in research and innovation. Although the level of research investment in the European Union has grown by 50% in real terms, the rest of the world has performed better.

In fact, over the same period, the total amount of real research investment increased by 60% in the United States, 75% in the four Asian countries with the highest density of knowledge (Japan, South Korea, Singapore and Taiwan) and 145% in the so-called BRIS countries (Brazil, Russia, India and South Africa). Consequently, the proportion of R&D work being conducted outside of Europe is growing rapidly.

In 2008, Europe accounted for less than one quarter of global R&D expenditure, as opposed to 29% in 1995. Increasing investment in research and innovation is one of the five priorities of the Europe 2020 strategy under the 'Innovation Union' initiative. On 29 June, the European Commission published its proposals for the next 'financial perspectives', i.e. the EU budget for 2014-2020.

Compared with the current budget (2007-2013), the European Commission proposes a nominal increase of 5%, resulting in a budget of 1,025 billion euros, i.e. 1.05% of European GDP. The proposed budget for the future framework research programme is 80 billion euros.

The president of the European Commission, Mr. [José Manuel] Barroso, has emphasised the impact that the EU budget, which is relatively small compared to the national budgets of the big member states, could have on the growth and competitiveness of Europe, as well as on its security and its international influence.

The Joint Research Centre (JRC) Directorate-General is the only body within the European Commission responsible for direct research and for providing scientific support for EU policies. As such, its seven institutes will play an important role in reaching the science and innovation objectives of the Europe 2020 initiative."

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