EU warns it lags behind in global innovation race

The European Union said Tuesday it is facing an "innovation emergency" in science and industry and is still trailing far behind the United States and Japan.

To catch up and give the struggling European economy a boost, the EU Commission called for measures to promote private investment and more business involvement in the application of research results.

The EU's warning on innovation follows last week's call by President Barack Obama for a "Sputnik moment" of investment to create jobs and growth in the U.S. through scientific and industrial breakthroughs.

EU Science Commissioner Maire Geoghegan-Quinn welcomed Obama's stand and will spur on Friday's summit of EU leaders to take bold action.

"It shines a spotlight into innovation as being the engine for growth. That becomes an extra push when heads of state and government sit down on Friday" for meeting to plan the EU's science and research strategy.

The statistics are sobering for Europeans. For years, EU nations have been trying to catch up with the U.S. only to see the gap increase.

Based on a series of indicators from the EU, the United States was outperforming Europe by 49 percent last year, up from 45 percent in 2007. Japan has jumped to a 40 percent lead last year from 32 percent in 2006.

The Innovation Union scoreboard analyzes 25 research and innovation indicators ranging from new doctoral degrees to business R&D expenditure and licence and patent revenue.

"If Europe stands still, we will see the U.S. disappear into the distance, just as we feel emerging nations breathing our necks," Geoghegan-Quinn said.

First and foremost is Asia's emerging giant China. The EU said it has cut the lead of Europe from 61 percent in 2006 to 55 percent last year.

Overall, Geoghegan-Quinn said, "the EU share of world R&D expenditure has decreased by a fifth over 15 years."

When the EU's share of world R&D expenditure in the world still stood at 28.6 percent in 1995, it dropped to 23.4 percent in 2008. At the same time Asia overtook Europe, moving from 21.9 percent to 29.7 percent over the same period.

A willingness to pour money into research and an eye for the big breakthrough has already led the United States to dominate the Nobel prizes, but the impact cutting-edge innovation their pioneering spirit can just as well be felt in the economy.

"Innovation is as essential to a successful modern economy as water is to life, Geoghegan-Quinn said. "Growth and jobs depend on bringing research results to market. Our competitors have acted on this," but Europe is lagging.

Now the toughest task will be to convince member states to continue investing in innovation, whose impact may only be visible years down the line.

Yet Geoghegan-Quinn has confidence.

"A lot of member states have already decided to either maintain their spend on R&D or increase it even slightly," she said.

"If we are going to grow our way out of the present economic crisis, innovation, investment in research, education and technology is the way that we have to do that," she said.