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The EU: The "Innovation Union"

Posted by: Mark Marich on October 11, 2010 Source: Policy Dialogue on Entrepreneurship

Last week, the European Commission proposed an innovation strategy that aims to improve conditions and access to finance for research and innovation in Europe, and to remove bottlenecks which stop ideas reaching the market. The “Innovation Union” is a key element of the Europe 2020 Strategy for a smart, sustainable and inclusive economy.

The new strategy focuses on major areas of concern for citizens such as climate change, energy and food security, health and an ageing population. The challenges identified include lack of finance, fragmented research systems and markets, under-use of public procurement for innovation and slow standard setting. In terms of R&D investment, the EU plans to meet the Europe 2020 target of increasing it to 3 percent of GDP, which is expected to create 3.7 million jobs and increase annual GDP by up to €795 billion by 2025. One million extra researchers will be needed.

Some interesting elements in the Innovation Union are:

  • European Innovation Partnerships to mobilize stakeholders – European, national and regional, public and private - to step up R&D, coordinate investment, speed up standards and mobilize demand. The Commission will provide “seed corn” funds to attract stakeholder funding. A pilot Partnership on active and healthy ageing will be launched by early 2011, and more partnerships will follow on areas such as energy, “smart” cities and mobility, water efficiency, non-energy raw materials and sustainable and productive agriculture.
  • Data. The Commission has assembled 25 indicators in an "Innovation Union Scoreboard" and a checklist of the features of successful innovation systems. A new indicator will be developed on the share of fast-growing innovative companies in the economy. The Commission will also support an independent ranking system for universities.
  • Measures to improve access to finance. The Commission will propose a cross-border venture capital regime, work with the European Investment Bank to scale up EU schemes like the Risk-Sharing Finance Facility and appoint a leading figure to strengthen cross-border matching of innovative firms with investors.
  • Existing research initiatives will be stepped up. The Commission will propose measures to complete the European Research Area – a legal requirement under the Lisbon Treaty - by 2014. This involves improving coherence between European and national research policies, cutting red tape and removing obstacles to researchers' mobility, such as the lack of transferability of pension rights. It also involves efforts to maximize open access to results of publicly-funded research.
  • Modernization of Europe's intellectual property regime. Agreement on the EU Patent would save business €250 million a year. The Commission will in 2011 make proposals for a European knowledge market for patents and licensing.

More information about the innovation strategy is available here.

Category:  Growth & Poverty 

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