EU's innovation performance still needs improvement, but there are encouraging signs for the future

Brussels, 16 th December 2002

The 2002 European Innovation Scoreboard, published today by the European Commission, reveals that the innovation performance of the European Union is still low in comparison with the US and Japan, despite encouraging trends in several areas.

The gaps in business R&D investments and high-tech patenting, already diagnosed in 2001, persist and reinforce concerns for the future of technology-based innovation in the EU. For the first time, the scoreboard presents not only the innovation performance of Member States, but also that of the Candidate Countries and the regions.

European Commissioner for Enterprise Erkki Liikanen said: "Innovation has to be on the top of the agenda of an enlarging Union if the EU is to meet its goals of becoming more competitive as defined by Member States at the Lisbon European Council. Urgent action is needed to boost innovation in the EU regions, Member States and the Candidate Countries. This year the scoreboard provides policy makers and the business community with many more examples to learn from the best. The Commission will also draw lessons from the scoreboard and present a new communication on innovation policy early next year."

The European innovation scoreboard is a benchmarking instrument requested by the Lisbon European Council in 2000 as part of its strategy for the EU to become the most competitive knowledge-based economy in the world by 2010. Focusing on high-tech innovation and using new data for 13 statistical indicators on human resources, the creation of new knowledge and innovation finance, outputs and markets, the scoreboard reveals the strengths and weaknesses in innovation of each Member State and of the EU as a whole. It also provides trend results and shows the main changes since 2001. Comparative figures are available for the United States and Japan for ten of the indicators. The innovation scoreboard is the statistical tool of the wider European Trend Chart on Innovation, which also includes the collection and analysis of innovation policy measures and trends in the Member and Candidate States and benchmarking to identify good practices that can help boost innovation.

Encouraging Trends

In comparison with the US and Japan the current innovation performance of the EU lags behind. The only significant EU lead is that over Japan in home Internet access, starting from equal positions in 2001. The US is ahead of the EU in seven areas, most significantly in the share of manufacturing value-added from high technology, high tech patents and the share of working population with post-secondary education.

The trends in the indicators show marked improvements for the EU as a whole and suggest that it may be catching up with its main global competitors (see table 1). The EU has made better progress than Japan in all areas. Performance in the EU has been improving faster than the US for five out of the eight comparable indicators and most significantly for home Internet access.

While the EU and the US show equal declines in public R&D investments, the EU's growth in high technology patenting and business R&D investment remain insufficient to catch up with the US.

The 2002 innovation scoreboard reiterates the message that the world's leading countries in innovation are found in the EU (see table 2). The smaller northern economies, such as Finland, Sweden, Denmark and the Netherlands retain their positions as the leading innovators in the EU. The only large economy in the first group is the UK. Austria, Belgium, Germany, France and Ireland are in the second group of middle range innovators. Southern Europe, which represents the third group, is rapidly catching up.

EU's Regional Innovation Leaders

At regional level the scoreboard presents for the first time the top-10 EU regions in innovation performance: Stockholm (S), Uusimaa (Suuralie) (FIN), Noord-Brabant (NL), Eastern region (UK), Pohjois-Suomi (FIN), Ile-de-France (F), Bayern, (D), South Eastern region (UK), Communidad de Madrid (E), and Baden-Württemberg (D) (see attached graph).

Candidate Countries' Innovative Potential

Many Candidate Countries perform favourably for: working population with post-secondary education, employment in high-tech manufacturing, spending on information and communication technologies and the amount of inward foreign direct investment. Weaknesses are in the rate of employment in high-tech services, private R&D investment, patenting and the level of Internet access, where none of the Candidate Countries exceeds the EU average.

The innovation capacities of the Candidate Countries are concentrated mainly in those among them that have already developed explicit national innovation policies, notably Estonia, the Czech Republic and Slovenia. Hungary, Lithuania and Malta are also among the innovation leaders in the group.

The scoreboard also found that Candidate Countries still lack reliable innovation data. This weakness has to be addressed by their governments as it is hindering effective policy decisions.

The full text of the Innovation Scoreboard is available at:

http://trendchart.cordis.lu/

and

http://www.cordis.lu/scoreboard

Table 1. Trends in innovation performance (% change)NoIndicatorEU [Tables]

DN: IP/02/1885 Date: 16/12/2002