Raising the productivity and competitiveness of European businesses through technology. Boosting national economies on the international market, and strengthening the basis for sustainable prosperity and employment.


An interview with Pedro de Sampaio Nunes: How to fight the European innovation paradox (part 1)

date of publication > 12-August-2014

Innovation is a priority for Europe to be competitive in the world economy. Nevertheless, to make it work a new market-oriented approach is fundamental. A conversation with Pedro de Sampaio Nunes, Head of EUREKA Secretariat published in the latest edition of The New European.

While emerging from the crisis, Europe has struggled to regain its global competitiveness. Can Europe get back to growing again?
Europe is losing ground in an ever more competitive global environment, where emerging economies are rapidly deve­loping. In this context, traditional industries in developed countries are under a lot of pressure: technological change is making factories and offices in the world more efficient and more productive. To survive, business has to evolve.
To win the competitiveness battle, Europe needs a strong manufacturing base and highly performing related services. Europe’s future growth will only come from new industries that create new products and processes.
European economy still has good fundamentals; the problem is essentially that European companies have an historical deficit in creating and selling innovative products. This is what has generally been referred to as the “European innovation paradox”. There is a big gap between research and the market. Despite recognised, top-level scientific strengths, Europe performs poorly in capitalising on its disco­veries. This is an historical issue: for instance, Europe discovered the technology behind MP3 and plasma TV. But then other companies abroad took the discoveries, developed them and now are the leaders of the sector.
 Europe’s future growth will only come from new industries that create new products and processes.
Therefore, it is fundamental for the EU to start supporting companies in their efforts to increase their market share in the global economy. The only way is to create a “free innovation market”, abandoning some prefixed ideas and putting all technology in competition. Innovation should be done, in our view, in a business-shaped way. We must all act like start-ups, with the ambition to take to the market, in the simplest way, a product that people will want and need.
Concerning the “European innovation paradox” you referred to, what are the main reasons for this Europe-wide gap?
One of the first and immediate reasons that may come to mind for that is that innovation policy is too complicated. Spread across innumerable public programmes, support to innovators is now curbed by complex decision making chains, which has resulted in large amounts of public money being deployed by an unprecedented number of decision makers, agencies and ad hoc institutions.
But the underlying cause is the current lack of an ecosystem favourable to innovation. What is missing is a general mentality looking at innovation as a positive thing and a market-oriented vision. The factors that contribute to such a lack are many and interconnected. Broadly speaking, though, companies and governments have to understand that, while the costs of innovation are steep, a much higher price is to be paid for not innovating. As countries place greater emphasis on their capacity to innovate, their economic success will increasingly be determined by how this innovation potential will be leveraged.