Rationale for Regions of knowledge Pilot action

1
Rationale for Regions of knowledgePilot
action

• Information Day
• Brussels, CCAB
• 24 July 2003

Dimitri CORPAKIS Head, Sector Regional Aspects,
DG RTD-A5.2 dimitri.corpakis_at_cec.eu.int
2
Structure of this talk

• About the Pilot Action Regions of knowledge
• A Knowledge era
• Players in the Knowledge based economy
• Role of the regions
• Strategies and their delivery issues
• Need for experimentation
• Regions of knowledge (KnowREG)

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About the KnowREG Pilot Action

• Introduced by the EP (2003 budget, budget heading
  B5-513) Pilot Project under the meaning of the
  Interinstitutional Agreement of May 6, 1999,
  between the Parliament, the Council and the
  Commission, on budgetary discipline and improving
  the budgetary procedure (OJEU C 172 of 18.6.1999,
  p.1)
• Not a part of the 6th Community RTD Framework
  Programme, separate from the Structural Funds and
  their Innovative Actions
• Total budget 2,5 MEUR
• Call for proposals to be published soon /
  Proposals on transnational / transregional basis

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KnowREG Objectives

• Pilot Project "Regions of Knoweldge" (code named
  KnowREG) will provide a demonstration and mutual
  sharing platform for technology development at
  regional level through sharing of experience,
  across European regions. Actions have to
  demonstrate a high degree of integration between
  technology and regional economic development by
  involving in a creative way local authorities,
  higher education institutions, research centres
  and the business community.
• KnowREG actions will provide blueprints and
  models that may be used by European regions. They
  may invest on the rich experience of the FEDER
  Innovative Actions or the Regional Innovation
  Strategies initatives (RIS/ RITTS, RIS etc.)
• The main objective would be to provide
  collaboration patterns on a transnational /
  transregional basis that would demonstrate the
  central role of knowledge in driving regional
  development.

5
A Knowledge era

• Todays advanced economies are knowledge-based
• Fast growing accumulation of and reliance on
  formal scientific and technical knowledge
  affecting all sectors of the economy, with ever
  higher ST content embedded in products and
  services and, as a consequence, need for more and
  better qualified human resources
• Availability of powerful technical means for the
  diffusion and use of knowledge, and for more
  efficient economic activity, thanks to
  information and communication technologies (ICT
  Global networks)
• Increasing pace of trade liberalisation and flows
  of goods and services, pushing world economies to
  focus on more knowledge-intensive activities.

6
The Lisbon roadmap

• The vision within 10 years (2010), Europe should
  become the most competitive and dynamic knowledge
  based economy and society in the world
• Sustainable development, together with
  quantitative and qualitative improvement in
  employment greater social cohesion improvement
  of the labour market better governance
  life-long learning and people mobility
• Through an Open method of co-ordination and
  benchmarking (as a continuous, mutual learning
  process)
• Barcelona European Council confirmed RTDI as a
  top priority for the EU (March 2002)
• Ambitious goal of 3 of GDP average investment in
  RTD set. Action Plan adopted, April 2003
• ERA became one of the cornerstones of the Lisbon
  strategy
• Strong message for Member States, the Regions and
  the ST community

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New policy impulses

• The Communication Investing in Research an
  Action Plan for Europe adopted 30 April 2003,
  providing a specific and coherent framework for
  action at national, regional and European level
  (COM(2003)226 final, 30 April 2003) focusing on
  the 3 Barcelona objective
• The Communication on the Role of Universities in
  the Europe of knowledge (COM(2003) 58 final, 05
  February 2003)

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Players in Europes knowledge economy

• Universities and Reserch institutions stand out
  as the main gateway to knowledge
• The business community contributes in a decisive
  way
• Knowledge is created and consumed by both
  parties, as exchanges intensify
• The economy is the end user but huge disparities
  remain between the Centre and the Periphery
  of Europe
• European Regions theatre of the action or active
  players?

9
Regions as drivers of economic development

• Economic research suggests that upgrading
  "knowledge" and increasing technology diffusion
  at regional level may prove one of the most
  efficient routes for economic growth.
• Regional Innovation systems may arise when a
  number of factors are in geographical proximity
• Proximity remains a powerful driver of
  intellectual, commercial and financial exchanges,
  despite the famous Death of distance
• regions are important because they form the
  spatial basis of "clusters (groupings of
  research and innovation operators), now again
  considered as the main drivers of regional
  development

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A rich regional research and innovation
landscape in Europe...

• existence of research and innovation policies at
  regional level /successful implementation of
  cross-border cooperation
• Universities, businesses, local authorities / ST
  parks gather in one place universities, RD
  organisations, multinationals, SMEs or
  laboratories // technopoles, provide support to
  regional ST growth
• However, a lot of fragmentation and
  un-coordinated eforts

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...But big regional disparities in RTD remain

• Second Cohesion Report, adopted Jan. 2001, as
  well as the Eur. Innovation Scoreboard (2002)
  identified persistent convergence issues
• Cohesion countries technology gap compared with
  advanced countries has widened
• Concentration is general (in expenditure, human
  resources and patent applications)
• Forthcoming enlargement brings additional issues

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RTD regional expenditure in the EU

• Source EUROSTAT 13/03/02

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High-tech patent applications per million of
active population (y 2000)

• Source EUROSTAT 13/03/02

14
Conflicting debate over convergence (Convergence
trends (I) )

• Between 1988 and 2003, Greece, Spain and Portugal
  recorded a gain of 12.1, 11.3 and 12.9 percentage
  points of GDP respectively in relation to the
  Community average.
• Between 1991 and 2001, the average growth of per
  capita GDP of the Objective 1 regions was 3.1
  compared to 2.1 for the EUR-15. If the regions
  of eastern Germany are excluded, the growth rate
  remains still higher than the average of EUR-15
  (2.5).
• An independent study, to be published soon, shows
  that, between 1988 and 1999, Objective 1 regions
  converged three times more quickly than regions
  of the Union

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Convergence trends (II)

• Cambridge Econometrics, using gross value added
  (GVA) data, confirm a higher growth rate over the
  same period in the Objective 1 regions (2.9 pa)
  in relation to the Community average (1.6 pa),
  the increase in productivity (efficiency/modernisa
  tion) explaining almost all of this performance.
• 9 regions, accounting for 16.3 million citizens,
  would no longer be eligible for the Objective 1
  after 2006, indicative of an important process of
  growth and convergence.
• The ex-post evaluations on assistance in the
  Objective 2 areas show that the areas eligible
  under this Objective create more jobs than those
  outside it.

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Despite convergence trends the knowledge based
economies diverge in the EU

• Europe is riddled with two-speed economies within
  its regions, resulting in a prosperity gap that
  has widened by 25 per cent, according to a recent
  study. The European Futures Report warns that the
  lack of large private-sector investment in
  research and development (RD) is hampering
  knowledge-based growth.
• Compiling a European Competitiveness Index based
  on knowledge-based sector activity such as
  employment, patents, RD expenditure and property
  rents, the study focuses on European regions.
• Divergence of knowledge economies across the
  continent is widening the gap with the US

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Regional variations in the EU expanding
prosperity gap

• The European Futures report - which is to be
  launched at the World Future 2003 Conference in
  San Francisco this week - finds that between 1994
  and 2000 the prosperity gap within Europe's
  nations increased by 25, measured by the level
  of inter-regional variation in the economic
  performance of Europe's nations.
• This divide in performance may suggest that
  Europe becomes less economically cohesive.
  Economies that suffered the biggest widening of
  their prosperity gaps appear to be Finland, the
  UK, and the Netherlands. In Finland, the economic
  gap between the nation's most and least
  prosperous regions increased by a massive 353 ,
  while the economic gap between the UK's regions
  has increased by 54 during the last decade.

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Bridging the Technology and Innovation Gap
(Building Capacity in the Regions)

• Unique experience makes the EU a world leader in
  the field
• EUR 135 Billion earmarked for Objective 1 regions
  from the STRF (2000-2006).
• Out of the 218 BEUR allocated for all regions
  under the STRF, 9 BEUR are effectively allocated
  to RTDI actions (2000-2006)
• Despite successful cases, significant delivery
  problems remain at regional and local level, as
  the operational routes to the knowledge economy
  are unclear or not sufficently understood

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A series of efforts at EU level

• Over the last decade, the Structural Funds and
  the RTD Framework Programme helped with
  initiatives that focused on
• analysis / assessment
• priority setting
• monitoring methodologies

• STRIDE
• RTPs
• RIS
• RITTS
• RISI
• etc.

..But delivery problems remain
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Globalisation challenges

• Locational choices for higher value sustainable
  economic investments are increasingly determined
  by market considerations (accessibility and
  economic framework conditions) rather than by
  public inducements and subsidies
• Regional policies need to understand the process
  by which international business functions spill
  over to lever up competitiveness in the
  indigenous business base

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What can be done to enhance regional capacity in
the knowledge economy

• Transform the economy into a learning one
• Establish coherent development strategies based
  on local comparative advantage / regional
  foresight
• Set up the appropriate framework conditions for
  RD and innovation
• Stimulate the take-up of new technologies
• Local partnerships emerge as leaders in this
  process. Universities may play there an important
  role

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Regions are mutually reinforcing the European
Research Area

• A new vision for European research, mobilising
  also the regional level
• Re-invent the European research landscape
• avoid 151 policy framework
• reduce fragmentation of effort
• improve use of scarce resources
• improve organisation of research
• move to a really European research policy
• mobilise all operators the Unions Institutions,
  the Member States, the Regions, the Public ST
  and the business RD communities
• build a new, lasting partnership

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What we are after activating regional research
and innovation clusters in Europe

• Combined efforts of different Commission services
  converge here
• DG Regional Policy (Innovative Actions,
  Operational Programmes)
• DG Enterprise (Regional Innovation Strategies,
  Regional Innovation Technology Transfer
  Strategies, RIS/RITTS, IRE Network, PAXIS-Regions
  of Excellence)
• DG Research Regional Dimension across several
  areas of the FP

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Examples of successful regional clusters in the EU

• Northern Finland Oulu University and VTT, acting
  as driving force of regional RTDI development,
  focused on electronics as a development sector. A
  public technology transfer company (OuluTech)
  created by those bodies and the state,
  instrumental in developing specialised clustering
  in the region.
• Bavaria (Germany) impressive regional clustering
  in the BioTech-Region München, focusing on
  biotechnology. München Martinsried, is one of the
  three BMBF sponsored BioRegio areas in Germany.
  The region hosts now more than 120 pharmaceutical
  and biotechnology corporations.
• Andalusia (Spain) showcase of Intra-regional
  RTDI clustering, where, under managing mentoring
  of the IAT (Instituto Andaluz de Tecnologia),
  several industrial clusters in the areas of
  aeronautics / transport, automotive and
  ship-building emerged from the local RITTS
  (Regional Innovation and Technology Transfer
  Strategy) project, involving about 100 innovative
  SMEs in various actions (INNOVA 100 scheme
  including transfer initiatives, joint research
  projects, targeted technology management/ audit
  seminars, product design).

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Need for experimentation still important

• A huge diversity of administrative and
  operational regional structures may accelerate or
  slow down capacity to act and capture the
  benefits of the knowledge-based economy and
  society. Know-how develops in this field in many
  different ways and with different speeds. But
  where local actors have been active, significant
  benefits have emerged.
• The current experimental action on Regions of
  Knowledge may provide important insights on
  different aspects of the routes that regions may
  follow to reach faster the Knowledge based
  economy.

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KnowREG Strands

• INTEGRATED REGIONAL TECHNOLOGY INITIATIVES
• Technology audits and Regional Foresight
• University driven actions for regional
  development
• Mentoring initiatives
• SUPPORTING MEASURES
• Workshops
• Conferences

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Net links

• http//www.cordis.lu/era/knowreg.htm (The Regions
  of knowledge Web page) (Not yet operational /
  untill the Call is published)
• http//www.cordis.lu/era/regions.htm (Regional
  Dimension of the ERA)
• http//www.innovating-regions.org/ (The IRE
  Network, Innovating regions in Europe)
• http//europa.eu.int/comm/regional_policy/themes/r
  esear_en.htm (Structural Funds and Research /
  Innovation)