EUROPE: Business investment healthier but problems remain

The European Commission is crowing over the fact that business investment in research and development by companies in the European Union is now rising at a faster rate than in the US, raising hopes that Europe might at last climb up the global technology table. The figures, contained in the EU's 2008 Industrial R&D Investment Scorecard, are significantly better than those of last year when US spending rose by almost twice as much as that in the EU.
They show an 8.8% rise in research investment by European firms this year compared with 7.4% in 2007 while the rate of investment growth for US corporations dropped from 13.3% to 8.6%.

For some years, Brussels has been calling for a higher level of business investment in research - an area where Europe has been below the rest of the world for some years now. But although the latest scorecard suggests improvement there are still problem areas, notably in the fact that EU companies are increasingly investing in research outside the EU.

This will hardly make Europe the global leader in technology by 2010, as called for in the EU's Lisbon strategy. The 2008 survey confirms that business R&D in the EU is still only 1% of GDP - barely half the ratio in the US.

On a company by company basis, the study shows that Nokia, Volkswagen and Daimler lead the European tables and rank as fifth, ninth and 10th position respectively in the world listings for investment. The US companies Microsoft, General Motors and Pfizer take the top three global positions. The oil and gas production sector leads other industries in terms of research investment growth. This rose by 22.9% according to the 2008 survey as companies sought to make better use of limited resources, the commission said.

alan.osborn@uw-news.com