‘Research and development investment will reap rewards’

EUROPE has the ideas, the experts, the companies and the markets but is losing out on creating millions of jobs and turning around its flagging economy, Commissioner Máire Geoghegan-Quinn said.

She is planning to prime the pump of future growth by bringing together all the elements and getting them to work together.

The former Fianna Fáil minister appealed to the Government not to cut research funds in the coming budget, but to invest in research and development as Finland did in its crisis and is now reaping rich rewards.

She has come forward with a sweeping programme to focus on creating and producing new products and services for specific areas such as healthy living, climate change and energy efficiency.

A key to kick-starting a more innovative economy is the area of public procurement – buying by local authorities and governments.

Ms Geoghegan-Quinn’s plan is to use this sector, which accounts for 17% of GDP, to spur growth in new ways of doing things and new products.

For instance if one city is interested in having a green, energy efficient public transport system, they could link up with other cities and regions throughout the EU with a similar interest.

“This would amount to a huge investment and make it worthwhile for a European company to come up with a product to meet their specifications and build it here,” she said, adding the EU market is the largest in the world.

There are obstacles to this happening including legal problems but the Commission’s proposal is to remove the bottlenecks and make such joint ventures possible.

But the EU is lagging behind the US that has public procurement programmes specifically targeted at encouraging innovation.

“I am not naive. I know there will be no miracles but we have no reason not to believe that Europe can have a sea change.

“It will be a long haul and my goal is to make a start,” Ms Geoghegan-Quinn said.

Europe spends less than 2% of GDP on research and development despite its target being 3%.

Europe’s spend is 0.8% of GDP less than the US and 1.5% less than Japan while Ireland’s spend is just 1.8% of GDP, Ms Geoghegan-Quinn said.

Spending 3% of GDP on research and development by 2020 could create 3.7 million jobs and increase annual GDP by €795 billion and create jobs for at least a million more researchers in the next decade, she added.

But the first hurdle will be to convince the leaders of the EU member states to invest and focus on achieving the goals of the commission’s new innovation programme, Ms Geoghegan-Quinn acknowledged, something they will debate at their December summit.


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