Report from the Commission - Annual Report on research and technological development activities of the European Union in 2007 [SEC(2008) 2380]
Date: 2008-08-18
Institutions: European Commission
Subjects: EU Member State, EU programme, activity report, applied research, innovation, research and development, research policy, technological change

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 18.8.2008 
COM(2008) 519 final 

REPORT FROM THE COMMISSION 

Annual Report on research and technological development activities of the European 
Union in 2007 

[SEC(2008) 2380] 

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REPORT FROM THE COMMISSION 

Annual Report on research and technological development activities of the European 
Union in 2007  

(Text with EEA relevance) 

1. 

INTRODUCTION 

This  Annual  Report  covers  developments  and  activities  during  2007.  It  has  been  prepared 
pursuant to Article 173 of the Treaty establishing the European Community1. 

The report is accompanied by a Commission Staff Working Document, which provides more 
detailed reporting and statistics. The main chapters are on the activities and results achieved in 
2007 and on developments in research and technological development (RTD) activities in the 
Member States of the European Union.  

2. 

POLICY DEVELOPMENTS: EUROPEAN RESEARCH AREA (ERA) 

Research,  and  more  broadly  the  knowledge  triangle  (research,  education  and  innovation), 
constitutes a cornerstone of the revitalised Lisbon strategy. European research policy attained 
its overall objectives for 2007 following the new impetus given to the development of the 
ERA, and the first year of successful implementation of the 7th Framework Programmes 
(EC and Euratom FP7). 

Advancing  towards  research  excellence,  raising  the  efficiency  and  effectiveness  of  the 
European  research  system,  increasing  the  openness  and  attractiveness  of  ERA,  as  well  as 
developing  a  strategic  partnership  with  Member  States  on  international  science  and 
technology (S&T) cooperation and a closer research relationship with neighbouring countries, 
encapsulate the medium to long term aims of EU research policy. 

In 2007, the Commission's main policy initiative in the field of research was the adoption of 
the  Green  Paper  "The  European  Research  Area:  New  Perspectives"2.  It  launched  a  wide 
institutional and public debate at EU and broader level on possible actions to accelerate the 
creation of an open, competitive and attractive European Research Area3. A key stakeholder 
event was jointly organised by the European Commission and the Portuguese Presidency of 
the EU in October 2007 in Lisbon, to debate the various ERA dimensions. The consultation 
and  public  debate  provided  strong  support  for  the  development  of  policy  initiatives  for  all 
dimensions  of  ERA,  as  highlighted  by  the  Green  Paper.  The  results  were  fully  taken  into 
account in the design and the preparation of the five key ERA initiatives planned in 2008: 1) a 
European  partnership  for  researchers;  2)  a  framework  to  help  Member  States  identify  and 

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“At the beginning of each year the Commission shall send a report to the European Parliament and the 
Council. The report shall include information on research and technological development activities and 
the dissemination of results during the previous year, and the work programme for the current year.” 
COM(2007)161 04.04.2007. 
http://ec.europa.eu/research/era/index_en.html 

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develop  joint  research  programmes  on  a  voluntary  and  "variable  geometry"  basis;  3)  an 
appropriate legal framework to facilitate the building and operation of pan-European research 
infrastructures; 4) a strategic European framework for international S&T co-operation; and 5) 
a Commission recommendation and a "code of practice" on the management of IPR in public 
research institutions. 

The  importance  of  ERA  can  also  be  drawn  from  evidence  of  Europe's  position  in  research 
given  in  the  EU  S&T  Key  figures  20074  publication.  These  data  highlight  the  need  for 
stronger  efforts  to  overcome  the  overall  stagnation  of  R&D  expenditure  (1.84%  of  GDP  in 
2005 and 2006) and to make progress towards the "Barcelona target" of reaching 3% of GDP 
spending on research by 2010. 

The sustainability of scientific human resources remains a key concern, especially due to the 
progressive ageing of the research labour force in many Member States. In EU 27, about 35% 
of highly qualified S&T workers were in the 45-64 year-old age group in 2006, compared to 
31% in the 25-34 age group. Another outstanding feature of the global scene is the ability of 
the  US  to  attract  talented  researchers  from  around  the  world.  In  2004,  25%  of  the  400,000 
foreign science and engineering workers in the US came form the EU. In 2007, actions taken 
under the EU strategy for mobility and career development of researchers have been actively 
pursued.  These  included  the  further  development  of  the  ERA-Link  initiative  to  network 
communities  of  European  researchers'  outside  Europe  (originally  in  the  USA  in  2006  and 
extended  to  Japan  in  2007),  as  well  as  the  voluntary  signing  of  the  European  Charter  and 
Code of Conduct for the recruitment of researchers by nearly 700 research organisations. In 
parallel,  the  Commission  and  the  Member  States  have  engaged  in  the  preparation  of  a 
renewed  and  reinforced  partnership  for  better  training,  career  and  more  mobility  for 
researchers.  

institutions  and 

Another  priority  is  the  achievement  of  excellence  in  research,  whether  privately  or  publicly 
funded,  as  it  is  of  crucial  importance  to  Europe's  competitiveness.  In  this  context,  in  April 
2007, the Commission adopted a Communication on "Improving knowledge transfer between 
research 
its 
accompanying guidelines offer operational guidance to public research institutions to improve 
the  management  and  exploitation  of  intellectual  property,  especially  in  the  context  of 
collaboration with industry. The European Council of June 2007 welcomed the initiative for a 
European  Charter  for  the  use  of  intellectual  property  from  public  research  institutions  and 
universities (IP-Charter) to improve the knowledge transfer between research and industry6. 

industry  across  Europe"5.  This  Communication  and 

3. 

EU RESEARCH AND TECHNOLOGICAL DEVELOPMENT ACTIVITIES 

3.1. 

Policy achievements 

In  order  to  progress  in  the  construction  of  ERA,  to  reduce  the  fragmentation  of  research 
activities in the EU and to boost innovation, several ongoing initiatives have been set up in 
the ERA context and within the specific FP7 framework.  

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http://ec.europa.eu/invest-in-research/pdf/download_en/keyfigures_071030_web.pdf 
COM(2007)182 04.04.2007. 
http://www.consilium.europa.eu/ueDocs/cms_Data/docs/pressData/en/ec/94932.pdf 
COM(2007)182 04.04.2007. 

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The  Commission  adopted  a  Communication  on  "Competitive  European  Regions  through 
Research and Innovation"7, to examine the scope for synergies between EU funding sources 
for  research  and  innovation  and  the  obstacles  that  tend  to  arise  in  achieving  them.  It 
encouraged improved coordination by the Member States and regions in the preparation and 
use  of  the  funds  and  the  diffusion  of  more  detailed  information  on  available  funding  and 
synergies, notably through the preparation of a Practical Guide to funding. 

The  Commission  also  presented  a  Communication  on  pre-commercial  procurement8  to 
promote public procurement in research and innovation, to raise awareness of the possibility 
to  procure  R&D  in  a  way  which  is  consistent  with  procurement  rules  and  which  does  not 
constitute state aid.  

A European Forum on Philanthropy and Research Funding has been launched as a platform 
to  explore  complementary  ways  of  funding  research  and  to  share  experience  in  the  area  of 
philanthropic funding of research9.  

Contribution to the ERA can also be underlined in the specific area of fusion energy. In this 
sector,  the  International  Thermonuclear  Experimental  Reactor  (ITER)10  is  a  prime  RTD 
policy initiative. A key milestone was achieved on October 2007 when the ITER Agreement 
entered  into  force,  following  ratification  by  all  seven  parties  (Euratom,  China,  USA,  India, 
Japan, Korea and Russia). Euratom has played a mayor role in the establishment of the ITER 
International  Organisation,  providing  financial,  organisational  and  personnel  support.  The 
European  Joint  Undertaking  for  ITER  and  the  Development  of  Fusion  Energy,  known  as 
Fusion  for  Energy,  was  also  established  in  2007.  Located  in  Barcelona,  it  will  manage  the 
EU's contribution to ITER.  

As part of FP7, the European Research Council (ERC) was established on 2 February 2007 
by a Commission Decision (2007/134/CE)11. The ERC is one of the most important novelties 
of FP7 as it provides support to world-class science by individual scientists and teams and it 
will be the first pan-European funding agency for frontier research in all fields of knowledge, 
from the humanities and social sciences, to the life sciences and the physical and engineering 
sciences.  

One  of  the  other  initiatives  which  form  part  of  a  broad  research  policy  strategy  is  the 
coordination of European Technology Platforms (ETPs). 34 of these are currently under way. 
The ETPs  have  increased efforts to implement their Strategic Research Agendas by tapping 
into  different  funding  sources,  including  national  sources.  The  Commission  organised  two 
seminars for ETP leaders, which allowed industry representatives to exchange best practices 
and to receive updated information on EU policy initiatives of relevance to their work. 

The  Joint  Technology  Initiatives  (JTIs)  are  other  major  innovations  included  in  FP7.  They 
provide for new partnerships between publicly and privately-funded organisations involved in 
research.  FP7  has  identified  a  first  set  of  six  research  areas  for  JTIs.  Four  of  the  legislative 
proposals  were  adopted  on  20  December  2007  by  the  Council,  after  having  consulted  the 
European  Parliament.  These  are  "Innovative  Medicine",  "ARTEMIS"  (on  embedded 

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COM (2007) 474 16.08.2007. 
COM(2007)799 14.12.2007 
http://ec.europa.eu/invest-in-research/policy/philanthropy_en.htm 
COM(2006)458 14.08.2006 
OJ L57 24.02.2007 

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intelligence systems), "Clean Sky" and "ENIAC" (on nanoelectronics components)12. In 2007, 
the  Commission  also  submitted  the  proposal  for  the  Fuel  Cells  and  Hydrogen  JTI  whose 
adoption is foreseen in 2008.  

While  JTIs  are  by  nature  long-term  public-private  partnership  in  industrial  research,  the  so 
called  Article  169  initiatives  are  designed  to  enhance  the  integration  of  national  research 
programmes.  Four  initiatives  were  identified  in  2007  in  FP7,  and  two  of  them,  "AAL"  (on 
ambient assisted living) and EUROSTARs (for research performing SMEs), are likely to be 
co-decided by Council and European Parliament by summer 2008. 

The  Risk  Sharing  Financing  Facility  (RSFF)  is  another  interesting  initiative  of  FP7.  It 
represents  a  new  facility  jointly  developed  by  the  EC  and  the  European  Investment  Bank 
(EIB) to provide loans for high risk research, technological development, demonstration and 
innovation  activities.  The  RSFF  was  launched  on  5  June  2007,  and  the  first  contract  was 
signed on the 10 July 2007. 

Moreover,  in  FP7  international  cooperation  has  been  opened  widely  to  the  participation  of 
third countries across the different Specific Programmes by including both geographical and 
thematic targeting. Organisations from more than 130 third countries have participated in the 
2007  calls  for  proposals.  Furthermore,  the  signature  of  the  association  instruments  with 
Switzerland,  Israel,  the  EEA/EFTA  States  (Iceland,  Liechtenstein  and  Norway),  Turkey, 
Serbia,  Croatia,  FYROM  and  Albania  during  the  reporting  period  signified  an  impressive 
enlargement  of  ERA,  in  which  researchers  from  37  states  are  enjoying  the  same  rights  and 
obligations  in  their  participation  in  FP7  research  projects.  Beyond  that,  the  renewal  of  the 
S&T  cooperation  agreement  with  India  and  the  launch  of  the  negotiations  on  a  S&T 
cooperation  agreement  with  New  Zealand  are  clear  signals  of  the  intention  of  the  EC  to 
further open its research to the world. 

An  important  achievement  at  European  level  was  the  political  agreement  reached  on  23 
November 2007, on the establishment of the European Institute of Innovation and Technology 
(EIT)13,  which  aims  at  an  improved  integration  of  all  parts  of  the  knowledge  triangle  on 
education,  research  and  innovation.  It  opened  the  track  to  the  finalisation  of  the  adoption 
procedure  and  to  further  progress  regarding  the  choice  of  the  seat,  the  designation  of  the 
Governing  Board,  the  funding  conditions  and  the  definition  of  the  themes  to  be  covered 
within the first Knowledge and Innovation Communities (KICs).  

Finally,  and  most  significantly,  research  is  now  firmly  embedded  in  the  wider  Lisbon 
Strategy.  In  its  Strategic  Report  of  December  2007,  the  Commission  concluded  that  efforts 
need to be identified to attain the 3% investment objective and this is something to be taken 
up in the National Reform Programmes. 

3.2. 

Implementation of Framework Programmes  

The 7th Framework Programme, with a total budget of over €  50 billion (Euratom FP7 € 2.7 
billion  for  5  years),  constitutes  a  key  tool  to  respond  to  Europe's  needs  in  terms  of  jobs, 
competitiveness,  sustainable  development,  to  meet  the  research  needs  of  other  Community 
policies, and to maintain leadership in the global knowledge economy. 

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OJ L30 04.02.2008 
OJ L97 09.04.2008 

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FP7  represents  a  substantial  increase  compared  with  the  previous  Framework  Programme 
(63% at 2007 prices), thus reflecting the high priority of research at EU level.  

2007  was  the  first  year  of  the  implementation  of  FP7.  More  than  23,000  proposals  were 
received  in  response  to  54  calls,  with  a  high  number  of  participants  (110,101).  After  the 
selection  procedure,  2,854  of  them  were  retained  for  funding  (involving  some  19,541 
participants).  

The ten Themes identified in the Cooperation programme reflect the key fields of knowledge 
and  technology  in  which  research  excellence  is  particularly  important  to  improve  Europe's 
ability to address the social, economic, public health, environmental and industrial challenges 
for  the  future.  In  total,  8,030  proposals  have  been  submitted  in  2007  and  more  than  1,000 
retained for funding.  

In the Ideas Programme, the first year of the ERC formal operation was characterised by the 
creation of management and organisational structures as well as the organisation of the first 
call of proposals, the "Starting Grants", designed to support researchers in the early stage of 
their  careers.  For  this  first  call  9,167  proposals  were  submitted,  showing  the  big  interest  to 
this new initiative. Almost 300 of them were retained for funding. 

The People programme supports a range of actions to  foster  the  training and networking of 
researchers,  career  development,  life-long  learning  and  industry-academia  partnership.  In 
2007, 4,195 proposals were submitted and more than 1,000 retained. 

The Capacities programme aims at developing the best possible resources and conditions for 
Europe's  research  community.  In  total,  1,753  proposals  were  submitted  for  the  different 
activities of the programme, and approximately 300 were retained. 

Regarding  the  Euratom  FP7,  57  proposals  were  submitted  on  nuclear  fission  and  radiation 
protection and 15 of them were retained for funding. 

Finally, concerning the FP6 implementation, even though FP6 was concluded at the end of 
2006, 975 contracts were signed during the course of 2007.  

4. 

4.1. 

DEVELOPMENTS IN MEMBER STATES AND APPLICATION OF THE OPEN METHOD OF 
COORDINATION 

The  Open  Method  of  Coordination  in  support  of  reaching  the  Barcelona 
objectives 

In the field of R&D, the Open Method of Coordination (OMC) was set up following the 3% 
action plan14. Following the positive results of the first two OMC cycles (2003-2006), CREST 
launched  a  third  cycle  in  October  2006.  CREST  Working  Groups  were  established  on  the 
coordination  of  the  Framework  Programme  and  the  Structural  Funds,  internationalisation  of 
R&D, policy mixes and R&D in services. The CREST meeting on 6 July 2007 at Director-
General  level  was  a  key  event  in  the  third  OMC  cycle.  It  was  devoted  to  a  discussion  on 
progress  towards  the  3%  target  and  priority  actions  to  develop  the  ERA.  A  fourth  cycle 
followed  in  December  2007  with  a  focus  on  universities,  industry-led  competence  centres, 

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COM(2003)226 04.06.2003 

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internationalisation  of  R&D  and  the  continuation  of  the  policy  mix  peer  review  exercise 
(carried out by Austria and Bulgaria).  

Complementing  the  work  in  the  CREST  Working  Groups,  CREST  carries  out  an  annual 
mutual  learning  exercise  based  on  the  National  Reform  Programmes  in  the  context  of  the 
revised Lisbon strategy. The 2007 exercise focused on the progress made on national public 
and  private  R&D  investment  targets,  obstacles  against  reforming  the  public  research  sector 
and strategies and challenges in opening the national research systems towards ERA. 

The  OMC-NET  scheme  was  developed  in  order  to  support  mutual  learning  and  policy 
coordination  activities  carried  out  by  more  limited  groups  of  Member  States  and/or  their 
regions  on  policy  issues  of  their  specific  interest.  A  new  call  was  launched  in  September 
2007. 

4.2. 

Trends in public and private research investment 

R&D intensity 

In  2006,  as  in  2005,  EU27  Gross  Expenditure  on  Research  and  Development  (GERD) 
amounted to 1.84% of GDP. Since 2000, the R&D intensity of EU27 has remained within a 
small one-decimal range: from 1.79% in 1996-98 to 1.88% in 2002. The stagnation of R&D 
intensity at EU27 level hides a more dynamic and contrasted picture at Member State level.  

The  less  R&D  intensive  Member  States  (the  new  Member  States,  Greece,  Portugal,  Italy, 
Spain, Ireland) have generally shown significant increases in their respective R&D intensities 
(these  increases  are  considerable  in  some  of  them,  especially  after  2003),  with  the  notable 
exceptions  of  Poland,  Bulgaria,  Slovakia,  and  Greece  that  have  worryingly  been  falling 
further behind. Whereas substantial increases in R&D intensity are easier to achieve starting 
from  very  low  values  typical  of  the  new  Member  States,  or  from  the  relatively  low  values 
seen  in  Ireland  and  Spain,  they  do  illustrate  that  R&D  intensity  can  increase,  even  under 
conditions of strong GDP growth. 

Among  the  more  R&D  intensive  Member  States,  only  Austria  and,  to  a  lesser  extent 
Denmark, have managed to make progress. R&D intensity in Sweden and Finland is already 
greater than 3% but remains below the targets they have set themselves at 4%.  

R&D intensity increases are thus almost exclusively observed in less intensive R&D Member 
States.  In  EU27,  progress  towards  higher  levels  of  R&D  intensity  is  therefore  mostly  a 
catching-up  phenomenon.  Figure  4.2  shows  progress  made  by  each  Member  State  over  the 
2000-2006 period (grey) against progress still to be made to reach its own target (blue).  

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Figure 4.2 R&D intensity - progress towards the 2010 targets (in percentage points)
in parenthesis: R&D intensity as a % of GDP in 2006 (*)

 Austria (2.51)

 Estonia (1.14)

 Czech Republic (1.54)

 Spain (1.20)

 Latvia (0.69)

 Lithuania (0.80)

 Ireland (4) (1.32)

 Denmark (2.43)

 Slovenia (1.59)

 Cyprus (0.42)

 Hungary (1.00)

 Romania (0.45)

 Germany (2.51)

 Portugal (0.81)

 Italy (1.09)

 Finland (3.37)

 Malta (0.54)

 Greece (0.57)

 France (2.12)

 Bulgaria (5) (0.48)

 UK (1.76)

 Poland (0.56)

 Netherlands (1.72)

 Belgium (1.83)

 Slovakia (0.49)

 Luxembourg (1.47)

 Sweden (3.73)

 EU-27 (1.84) (3) 

-1,0

-0,5

0,0

0,5

1,0

1,5

2,0

Percentage points

Progress made 2000- 2006 (1) 

Progress to be made 2006- 2010 (2) 

Source : DG Research 
Data: Eurostat, Member States 
Notes: (*) IT, PT, UK : 2005, AT, FI : 2007 

(1) IT, PT, UK : 2000-2005, AT, FI : 2000-2007; EL, SE : 2001-2006; HU, MT : 2004-2006. 
(2) IT, PT : 2005-2010; UK : 2005-2013; FR : 2006-2012; EL : 2006-2015; AT : 2007-2010; FI 2007-2011. 
(3) EU-27 does not include BG.  
(4) IE : The R&D intensity target for 2010 was estimated by DG Research. 
(5) BG has not set an R&D intensity target. 

This catching-up by the less R&D intensive Member States, together with progress in Austria 
and  Denmark,  do  not  make  much  impact  on  the  EU27  aggregate  R&D  intensity  given  the 
limited share of their GDP in the total EU27 GDP. In contrast, a block of old Member States, 
including France, UK, Germany and Italy, accounting altogether for a considerable share of 

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EU GDP, have not been able to increase their R&D intensities15. As a consequence, progress 
towards  the  3  %  target  of  EU27  has  so  far  been  limited.  It  must  be  noted  that,  even  if  all 
Member States reached their respective targets in 2010, EU27 R&D intensity in 2010 would 
then be 2.51%, below the 3% target set at European level. In other words, the targets set by 
Member States are not sufficient to reach the overall EU target of 3% in 2010. 

Sources of funds 

In  200516,  the  financing  of  GERD  by  government  amounted  to  0.63%  of  GDP,  by  business 
enterprise 1% of GDP, by abroad 0.16% of GDP and by other national sources (private non-
profit  and  higher-education  sources)  0.04%  of  GDP.  The  collected  statistical  data  do  not 
provide a breakdown public/private of the 'abroad' source of R&D funds, so the proportion of 
public/private sources of funds cannot be accurately monitored. 

Since  2000  a  majority  of  Member  States  (17  MS)  have  increased  the  intensity  of  their 
government's  direct  support  to  R&D  (funding  of  R&D  by  government  as  a  percentage  of 
GDP). This shows their commitment towards higher levels of R&D intensity. This increase is 
particularly  pronounced  in  most  of  the  catching-up  Member  States.  But  progress  of 
government  direct  funding  of  R&D  is  also  to  be  noted  in  Member  States  with  intermediate 
and  stagnating  levels  of  R&D  intensity  (France,  Belgium,  UK  and  the  Netherlands), 
especially  in  France.  This  progress  is  however  slightly  over-compensated  by  a  decreased 
intensity of business funding of R&D in these countries. 

The intensity of business enterprise support of R&D (funding of R&D by business enterprise 
as  a  percentage  of  GDP)  has  increased  almost  exclusively  in  Member  States  where  this 
intensity was low or very low (Estonia, Latvia, Cyprus, Portugal, Hungary, Czech Republic, 
Spain,  Slovenia,  Lithuania,  Bulgaria).  In  countries  with  high  levels  of  business  support  to 
R&D, such as Sweden, Finland, Germany and Denmark, the intensity of business enterprise 
support of R&D has either fallen (Sweden) or stagnated. The only exception is Austria. The 
same  holds  for  countries  with  average  levels  of  business  support  to  R&D  (UK,  the 
Netherlands, Belgium, Luxembourg, and France). All these Member States have not been able 
to increase their respective business R&D funding intensities. The intensification of business 
funding of R&D in the EU is above all a catching-up phenomenon. 

Investments from the Structural Funds are included in the relevant Eurostat statistics, and it is 
important to note the contribution of cohesion policy to the R&D investment intensity in the 
new Member States. The average contribution from the Structural Funds for the period 2004-
2006 was € 157.4  million, which  triggered an annua l average national investment of € 69.6 
million.  In  the  period  2007-2013,  such  investments  in  the  ten  new  Member  States  are 
expected  to  increase  to  an  annual  average  of  €  2.7  billion  (€  2.9  billion  including  Romania 
and Bulgaria).  

4.3.  Trends in research policies 

In  2007,  national  policies  for  R&D  continued  to  evolve  in  complex  policy  mixes.  With  the 
view of addressing key drivers of economic growth, Member States were building up policy 

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16 

The 11  Member  States with high or very  high  R&D  intensity  growth  account for only  16%  of  EU27 
GDP, whereas the 16 Member States with limited and negative R&D intensity growth represent 84% of 
EU27 GDP. 
Latest year for which the breakdown by sources of funds is available. 

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mixes by developing new strategies which cut across different ministries or by changing the 
institutional settings  used for R&D policy, such as mergers between  ministries  dealing with 
research, education, employment, trade and industry.  

Reforms in R&D policies have up to now been designed almost exclusively from a national 
perspective. As R&D systems are, however, increasingly interconnected, it is important that 
national  policymakers  take  explicit  account  of  the  European  perspective  in  their  national 
policies in order to maximise the benefits from synergies and spill-overs. This will increase 
the  effectiveness  of  national  systems  and,  in  the  context  of  the  ERA  initiative,  make  a 
significant  contribution  towards  developing  the  EU's  research  system  as  a  whole  to  be  a 
competitive  player  on  the  global  scene.  The  Commission's  2007  Strategic  Report  has  put 
special  emphasis  on  the  European  dimension  of  research  activities  carried  out  at  national 
level.  Member  States  are  expected  to  report  in  their  National  Reform  Programmes  on  how 
their strategies will contribute to the European Research Area. 

Member States continue to give special attention to increasing the quality of public research. 
In this context, institutional restructuring of the research performers is an ongoing process in 
several Member States, generally driven by the need to assure that public research performed 
in the respective countries can meet the highest standards on a world scale. 

To  stimulate  private  R&D  investments,  tax  incentives  for  business  R&D  continue  to  be  a 
major instrument for governments. Over the last years, fiscal incentives were introduced by a 
large  number  of  EU  countries,  while  others  reinforced  existing  schemes.  Member  States 
which  currently  do  not  have  such  schemes,  such  as  Germany,  Finland  and  Sweden,  have  a 
growing  interest  to  use  them  to  stimulate  R&D  in  SMEs  and  foster  co-operation  between 
public research and industry. Fiscal R&D incentives for labour social charges are in place in 
France, Belgium, the Netherlands and Spain. 

In the same context, the increasing role of cohesion policy in financing R&D can be clearly 
noticed, especially in some of the new Member States. The effective use of Structural Funds 
earmarked  for  research  and  innovation  is  an  important  opportunity  for  many  countries  that 
still have a low level of funding. 

5. 

OUTLOOK FOR THE FUTURE 

All  these  achievements  paved  the  way  for  2008,  the  second  year  of  implementation  of  FP7 
and a year of major new developments for ERA. 

The ERA Green Paper gave rise to the planning of the five ERA initiatives, which are being 
put  forward  during  2008.  Furthermore,  under  the  Slovenian  Presidency  of  the  EU,  "the 
Ljubljana  process"  will  be  launched.  Its  goal  will  be  to  create  a  long-term  shared  vision  of 
ERA  developed  in  partnership  by  Member  States  and  the  Commission,  with  broad  support 
from stakeholders and citizens. 

6. 

SOURCES OF FURTHER INFORMATION 

More  details  are  included  in  the  Commission  Working  Document  that  accompanies  this 
Report. For further information, the following are publicly available: 

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–  Annual  Monitoring  Reports  for  the  Framework  Programme  and  Specific  Programmes, 
which provide a concise, independent summary of the progress and quality of the measures 
taken to implement the programmes. 

–  Five-year  Assessment  Reports  which  examine  implementation  and  achievements  of 

Community research activities over the five previous years.  

–  Key  Figures  reports  published  each  year,  providing  a  set  of  indicators  to  take  stock  of 

Europe’s position in science, technology and innovation. 

–  Statistics  on  Science  and  Technology  in  Europe  (Eurostat):  statistics  on  R&D  budgets, 
R&D  expenditure,  R&D  personnel  and  patents  in  the  Member  States,  broken  down  by 
region. 

–  Studies and analyses published in connection with the Community RTD programmes and 

addressing issues specific to the fields of RTD which they cover. 

Most of these documents can be obtained or ordered from the Commission’s Internet sites: 

–  The Gateway to the European Union, EUROPA site: http://europa.eu/index_en.htm 

–  The  CORDIS  site  containing  comprehensive  information  on  the  RTD  Framework 

Programme: http://cordis.europa.eu 

–  The CORDIS site containing information on ERAwatch : http://cordis.europa.eu/erawatch/ 

–  The 

site 

the 
http://ec.europa.eu/dgs/research/index_en.html 

Commission’s 

of 

Directorate-General 

for 

Research: 

–  The site of the Commission’s Directorate-General for the Information Society: 

http://ec.europa.eu/dgs/information_society/index_en.htm 

–  The 

site 

Commission’s 
http://ec.europa.eu/enterprise/index_en.htm 

the 

of 

Directorate-General 

for 

Enterprise:  

–  The  site  of 

the  Commission’s  Directorate-General  for  Energy  and  Transport: 

http://ec.europa.eu/dgs/energy_transport/index_en.html 

–  The Joint Research Centre (JRC) site: http://www.jrc.ec.europa.eu 

–  The Eurostat site: http://epp.eurostat.ec.europa.eu/ 

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