Europe

1
Europes Strengths and Weaknesses in Key Science
and Technology Domains
Paraskevas Caracostas Advisor,  Science and
Society  Directorate, DG Research, European
Commission, Brussels
2
Europes Strengths and Weaknesses in Key Science
and Technology Domains

• Key Challenges for Europe
• Perspectives on Europes industrial
  specialization
• The science base
• SWOT analysis in key technology areas
• Conclusions

3
Key Challenges for Europe

•  Chindia 
• The next technology wave
• Global inequalities
• Economic Scenarios
• Environment/Energy
• Demography
• Future of Manufacturing
• Institutional Scenarios

4
Perspectives on Europes industrial
specialization

• A recent analysis of export market shares (see
  Eur. Comm., 2005c) shows that
• in terms of skill intensity, it is very clear
  that the EU does particularly well in the
  medium-high technology grouping, with a world
  export market share in excess of 20 which is
  substantially higher than its overall market
  share of 15-16. It is also a big world player in
  the medium-low technology sector although its
  share in this category is tending to decline over
  time. Its relatively poor showing in the high
  technology category to a large extent reflects
  its low market share in ICT related industries.
• In the overall world market for high technology
  goods, the US and south east Asia are dominant.
  While this dominance to a large extent reflects
  their particular focus on the ICT sector, their
  involvement in other high technology areas is
  also playing a role. Japan has the highest
  concentration in the medium and high technology
  sectors of any of the areas covered. Over 80 of
  Japans trade are in these groupings compared
  with less than 60 for the EU.

5
Perspectives on Europes industrial
specialization (2)
6
The Science base

• Compared to the US and Japan, the scientific
  capabilities of the EU are distributed evenly
  across all fields of science. The EU shows no
  strong specialisation or under-specialisation in
  any particular field. Conversely, the US is
  specialized in basic life sciences and
  multidisciplinary sciences and under-specialised
  in chemistry and engineering sciences Japan
  specialises in physics and astronomy but is less
  active in biological sciences, computer sciences,
  earth and environmental sciences, and mathematics
  and statistics.

7
USA
US scientists dominate in each of the 21 subject
areas of science
(Source Basu, 2004)
8
Strengths Weaknesses Opportunities Threats
analysis in key technology areas

• Pervasive Technologies
• Systemic Transition Technologies
• Emerging/Converging Technologies

9
SWOT analysis in key technology areas

• Pervasive Technologies/ICTs The EU is strong in
  a few sectors of ICT (mobile, services, embedded
  systems, microsystems, application software)

Europes revealed technological advantage in
various information society technologies,
1996-1998 (FISTERA, 2005)
10
SWOT analysis in key technology areas

• Pervasive Technologies/Biotechnology

At the end of 2004 the biotechnology industry in
the eighteen European countries surveyed by
Critical I (2006) Had 2163 companies (compared
to 2200 in 2003) Employed approximately over
96,500 people, including 42,500 in RD (96,000 in
2003 with 41,000 in RD) Spent about 7.6
billion in RD (7.6 billion in 2003) Generated
over 21.5 billion revenue (20.5 billion in
2003) Raised 1.1 billion in venture capital in
2004 (787 million in 2003) Raised a total of
2.1 billion through equity in 2004 (1.45
billion in 2003)
In 2004, the US biotechnology industry
Comprised 1991 companies (2003 1975) Employed
approximately 190,500 people (2003 170,500)
Spent 21 billion on research and development
(2003 20 billion) Generated over 41.5
billion of revenue (2003 nearly 40.5 billion)
Raised 2.5 billion in venture capital in 2004
(2003 2.2 billion) Sold an additional 5.3
billion worth of equity largely through the
public markets (2004 3.5 billion)
11
SWOT analysis in key technology areas

• Pervasive Technologies/Production
  Technologies/Materials

Source CM International, FUTMAN, 2003
12
SWOT analysis in key technology areas

• Pervasive Technologies/Production
  Technologies/Services

Today, in Europe there is a number of research
institutes which operate on high international
research standards in certain areas of service
research (for ex. service standardization,
service engineering and service work
design). Though, on the European level there is a
lack of centres of excellence which are able to
cover the broadness of service research
challenges in an interdisciplinary way as well as
to concentrate resources and know-how in order to
be able to shape the international discourse of
research. In Europe technology development, goods
production-oriented research and practice are
well connected. But to service research, such a
statement can be applied only on a limited scale.
It is necessary to raise the so far limited
readiness/tradition of service companies for
systematic research and development and for
participating in collaborative development
projects with science.
13
SWOT analysis in key technology areas

• Systemic transition technologies/Renewable
  Energy
• Europe as a whole (European Commission and its
  Member states) puts more public resources in non
  nuclear energy research than its competitors,
  especially in the area of renewable energies.
  Europe is relative weak in comparison with the US
  and Japan in moving forward with the most
  promising technologies such as hydrogen and fuel
  cell based technologies, while at the same time
  the European continent is leading in solar, wind
  and geothermal energy technologies.
• The US have been overtaking the EU in the gas
  turbine business, Japan is in the process of
  doing the same in the PV area and in the fuel
  cell domain where most of the industrial advances
  appear to be carried out in the US.
• There is a strong European base in fundamental
  science and technology areas of relevance to key
  energy technologies and in some areas, ambitious
  experiments and demonstrations are set up.
• Apart from wind where European industry has
  definitely taken the lead following its
  economical success, most of the minor
  technologies (solar thermal, geo thermal, ocean
  energy, etc) have still to materialise in terms
  of business success and significant contributors
  to the energy mix.

14
SWOT analysis in key technology areas

• Systemic transition technologies/Environmental
  Technologies
• Europe has a well recognised scientific
  competence in environmental research, as well as
  in research on the impact of socio-economic
  behaviour on the environment.
• In some important segments of general purpose
  technologies (e.g. miniaturised sensors, new
  materials, some segments of nanotechnology)
  European research and development is leading edge
  worldwide.
• In many fields of sectoral environmental
  technologies European firms are at the global
  forefront of technological developments, building
  on now almost thirty years of experience.

15
SWOT analysis in key technology areas

• Systemic transition technologies/Sustainable
  Mobility Technologies
• Europe possesses high scientific capacities in
  the majority of the disciplines concerned
  sciences engineering, mechanical engineering,
  civil engineering, mechanics of the fluids,
  electronics, acoustics, energetics, applied
  mathematics, signal processing
• There are large world leaders in the majority of
  the sectors cars and commercial vehicles,
  aeronautics, high speed trains, "complex" ships.
• A high technological level in the fields of
  motorisation, of electronics, of the tyres, of
  the particle filters
• high European standards inciting to innovation
  and a clear European policy (see European
  Commission, 2001,White Paper on Transport
  Policy).
• A beginning of a European mobilisation for
  hydrogen and the fuels of the future.

16
SWOT analysis in key technology areas

• Emerging Sciences Technologies/ Nanotech
• Europe is performing well in this emerging field
  both in terms of scientific production as in
  accounting for patents. The major challenge is to
  make the jump from an, by large, academic based
  activity to commercial applications, e.g.
  nano-electronics and medical applications.
• Europe is strong in the following sub-fields of
  nanotechnology
• Biomimetics (a major source of nano-innovations)
• Nanomaterials (nanoparticles, quantum dots, thin
  films)
• Nanoelectronics and computing
• Toxicology of nanoparticles, both in-vitro and
  in-vivo
• Nanophotovoltaics
• Nanosensor research and development
• Nanomedicine including diagnostics, tissue
  regeneration and targeted drug delivery

17
SWOT analysis in key technology areas

• Emerging Sciences Technologies/ Cognitive
  systems technologies
• Europe, which holds a large part of the
  responsibility and merit for launching cognitive
  science and fuelling it with some of its key
  insights, has of late been lagging behind the US
  and Japan, and must make a very resolute effort
  to catch up and remain in the lead, in the face
  of the increased level of competition brought
  about by China, which is giving cognitive
  neuroscience top priority.
• In some areas, such as robotics, neuroscience,
  psychophysics, statistical and dynamical models,
  logic, developmental psychology, pharmacology,
  linguistics, Europeans are in the lead or among
  the world leaders.

18
SWOT analysis in key technology areas

• Emerging ST/Complexity Sciences
• A new wave is originating in complex systems
  research that is shifting the IT technology
  needed to support the activities from algorithms
  to programming languages for interaction and
  concurrency. The main experts all over the world
  are in EU.
• For example in the field of bioinformatics, in
  concurrency theory, Europe is the leading edge of
  basic research and knowledge if compared to the
  USA, China or Japan.

19
SWOT analysis in key technology areas

• Emerging ST/Converging ST
• Scientific activity in Europe as measured by the
  number of publications is overall higher than
  that in USA and Japan in all of the convergent
  clusters, except in the case of Biotech ICT
  where USA has a slightly lead. In terms if
  scientific impact as measured by the normalized
  citation score, the USA however leads in all
  clusters with the possible exception of
  Nanotechnology ICT.

20
The Future of ManufacturingFUTMAN scenarios
(2003)

• Under the Local Standard scenario, allegiances
  unite behind collective public values and
  consumer attitudes, but congruence in policy is
  achieved, not at central European level, but at
  regional level. Influential local citizen action
  groups go hand-in-hand with a decrease in EU
  influence on global affairs. A hollowing-out
  occurs in those sectors of European industry
  which are prone to commoditisation.

• Under the Global Economy scenario, individual
  choice by consumers is preferred and the
  invisible hand of the market will best
  co-ordinate the policies necessary for economic
  development and technological innovation.
  Research and technology is regarded as a key
  ingredient into sustaining leading-edge progress
  in globalised markets, Europe lagging behind the
  USA in mission-funded RTD areas.

• The Focus Europe scenario combines a high degree
  of congruence in development and innovation
  policies with a highly individualised set of
  consumer preferences. At the macro level, this is
  a risky strategy, since Europes views and
  policies on sustainability are not shared by the
  United States and by the big economies of East
  Asia. European manufacturing rises to the
  challenge and carves out a world leading position
  in environmental technology.

• The Sustainable Times scenario contains a
  generalised acceptance at both citizen level and
  at the level of governance that sustainable
  development issues should be taken from the
  clouds of medium-term concerns and grounded in
  policies with immediate effect. Technological and
  organisational innovation bring about system
  changes and industry becomes an active mediator
  of sustainable development.

21
The economic scenarios of the Central Planning
Bureau (NL, 2003)

• The recent scenarios1 of CPB tend to show that
  a more integrated Europe as well as a globalised
  Europe score both higher in terms of
  efficiency/equity trade offs than a Europe of
  regions or a Transatlantic Europe but the
  first is more socially cohesive and
  environmentally sustainable but less economically
  effective than the second.
• 1 See Ruud de Mooij, Paul Tang, (2003), Four
  Futures of Europe, Central Planning Bureau, The
  Hague

22
Conclusions

• Strengthening Europes research identity
• To be more attractive, Europe needs a
  differentiation strategy, based on the strengths
  of its science, technology and industrial base.
  It must specialize and become the place for high
  quality, high innovative and value added
  services-products systems as the US is the place
  for computer software and microprocessors. And
  once the Union has decided around which
  objectives to mobilize its resources, the
  research, innovation and education efforts of
  member States, regions and business must be
  articulated and synergies enhanced internally and
  with other partner countries.
• The underlying concept for such a specialisation
  strategy could be  sustainable and qualitative
  growth . Its at the heart of the
  Lisbon-Göteborg strategy and it opens new
  spaces for technological organisational,
  institutional and social innovations.

23
Conclusions (2)
24
Conclusions (3)

• Recent policy messages
• EU FP7 European Technology Platforms and Joint
  Technology Initiatives - The First 6 Joint
  Technology Initiatives proposed by the EC
  Innovative Medicines Initiative, Nanoelectronics
  Technologies 2020, Embedded Computing Systems,
  Hydrogen and Fuel Cells Initiative, Aeronautics
  and Air Transport, Global Monitoring for
  Environment and Security (GMES)
• the Key Technologies expert group (European
  Commission 2005a) underlined the necessity for a
  strategy beyond Lisbon
• A strategy for transforming EU RD system needs
  to be based on a systemic approach integrating
  long-term and short-term strategies and the
  member states RD systems to obtain synergies and
  rationalise efforts
• The EU needs to introduce system innovations,
  i.e. combinations of radical technological and
  organisational/social innovations in many areas
  of economic activity, that allow reconciling
  economic, social and environmental objectives,
  values and beliefs.
• New EU Industrial Policy (2005) mixing
  horizontal/sectoral aspects
•  Aho Report  (2006)  A combination of supply
  and these measures (on regulation, standards,
  public procurement, intellectual property and
  fostering a culture which celebrates innovation)
  to create demand should be focused in large scale
  strategic actions. We identify several examples
  e-Health, Pharmaceuticals, Energy, Environment,
  Transport and Logistics, Security, and Digital
  Content. 

25
For more information

• http//cordis.europa.eu/foresight/kte_expert_group
  _2005.htm
• Thank You!