ERNST & YOUNG SRL

  |  2013-05-16

Moving Europe forward - Innovating for a prosperous future

With Ernst & Young’s latest Eurozone Forecast predicting a contraction of 0.5% in 2013, a figure that repeats the 0.5% fall witnessed in 2012, it is clear that the European economy is not yet out of the woods. Far from it. And it is equally clear that only a revival of the capacity to innovate can bring Europe back on a track of global competitiveness.

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This is why innovation has become a key policy issue in the past few years, and this is why the EU has dedicated a number of initiatives to innovation, including most notably the Innovation Union strategy within the Europe 2020 agenda.

 

Over the past year, the EU has devoted significan’t efforts to advance the Innovation Union agenda, and also in the development of a more top-down industrial policy, one fit for the age of globalization. At the same time, key initiatives such as the Knowledge and Innovation Communities (KICs), coordinated by the European Institute of Innovation and Technology (EIT), have demonstrated a significant potential to mobilize innovation in Europe. However, recent weeks have been dominated by the debate on the EU budget for the 2014–2020 multiannual financial framework. The tension between calls for austerity and the need for growth has produced an undesirable cut in the budget allocated to infrastructure (the Connecting Europe Facility (CEF)) and also a reduction (admittedly, from a very ambitious initial proposal) in the budget allocated to the Horizon 2020 program for research and innovation.

 

What is beyond doubt is that public funding of research and development has remained the dominant way of funding innovation in the EU, and this — based on available data — seems to be part of Europe’s innovation problem. This report will look at ways to improve the value for money of public R&D funding, and at the same time creating a more favorable environment for private funding of innovation

 

Voices from the frontline

 

Mixed perceptions

We asked 680 business leaders whether their perception of innovation policy in the EU had improved or deteriorated. Their responses were mixed: 38% thought it had improved against 18% who thought it had deteriorated. Southern European companies suffering from a lack of private spending are much more enthusiastic about the role of the EU (96% in Greece, 89% in Italy). In northern and western parts of the continent, the national level is deemed more effective to conduct innovation policy (50% and 41%).

 

 

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