Innovation Budgets
October 13, 2007
The amount spent on R&D in 2006 by the European Union's top 1,000 companies investing in research was less than half that spent by the top 1,000 non-EU investors -- 121.1 billion euros ($170.83 billion) against 250.5 billion euros, the commission said in a recent annual study of corporate research and development (R&D) trends.
"The report shows that R&D investment by EU companies is still growing at a lower rate than their non-EU counterparts, a trend identified in every edition of the [survey] published to date," the commission said in a statement..
In 2006, European R&D investments grew by 7.4 percent, the highest rate in the last five years, but still below the 11.1 percent growth seen in other major economies, including the US and Japan, the study said.
"The positive upward trend seen in the last two years is encouraging, and leads me to believe our innovation strategy is back on the right track, but we must not allow ourselves to be complacent," said European Science and Research Commissioner Janez Potocnik.
Private influence
Germany's DaimlerChrysler, which changed its name to Daimler AG after the study was conducted, was Europe's highest scorer with 5.2 billion euros. Britain's GlaxoSmithKline ranked No. 7, and German engineering giant Siemens AG was at No. 8.
Pfizer, the world's largest drugmaker, was the world's biggest spender with 5.8 billion euros of its budget devoted to R&D in 2006.
About 55 percent of EU investment in R&D comes from private sources. The comparable figure is 63 percent in the US; in Japan 75 percent of R&D spending comes from businesses.
"We are only ever going to improve our R&D performance if more companies see the benefit of investing in research," Potocnik said.
Some positives for EU
European Commission officials stressed the positive elements of the survey, pointing out that the rate of growth had increased, that the EU leads the world in fixed capital investment, and that three EU companies were among the top 10 private investors in R&D worldwide.
Slower European growth in R&D-intensive fields, such as pharmaceuticals and computing, has led to less development spending in the 27-member EU, the report said.
EU companies involved in more traditional industries, such as car manufacturing, hold up well against their global rivals with five EU-based carmakers in the list of top-50 R&D investors compared with six from non-EU members.
But in the pharmaceuticals sector, nine non-EU companies -- two of them in Switzerland -- compete with only three EU companies in the top 50.
While there were 13 hi-tech companies based outside the EU in the top 50, including Microsoft, Samsung, Intel, Sony and IBM, only five EU companies made the list: Siemens, Nokia, Ericsson, Alcatel-Lucent and Philips, the report said.