Competitiveness and sustainability are the keys to the long-term future of the Union's economy. They entail the capacity of citizens, enterprises, regions, nations and the European Union to generate and use the knowledge, science and technology of tomorrow, in high-quality goods, processes and services, and in new and more efficient organisational forms. By strengthening the innovative capacity of the European industrial system and by fostering the creation of businesses and services built on emerging technologies and new market opportunities, European R & D helps EU countries face the major challenges of society, in particular employment. In parallel, research into sustainable mobility and environmentally and consumer friendly processes, products and services may contribute to improving quality of life and working conditions.
The promotion of sustainable development in Europe is not possible unless economic objectives relating to technological development, competitiveness and growth are reconciled with societal goals such as quality of life, employment, security, health and a high quality environment. Moreover, improving the quality of life of European citizens and disconnecting economic growth from environmental degradation contributes to European competitiveness and employment. For instance, the need for energy equipment suppliers and operators to effectively respect the environment is vital both for strengthening their global competitiveness and for creating new jobs, such as in the water industry, renewable energy technologies, rational use of energy and reuse of resources. These are some of the objectives of the seventh framework R & D programme.
The individual and collective expertise of European researchers is a considerable asset. However, scientific research takes place in a strongly competitive worldwide environment and compared with its main competitors, the EU has a relative shortage of researchers, a high fragmentation and duplication of research effort and a certain isolation of research teams, particularly in the peripheral and less-favoured regions of the European Union. Three Member States (the Federal Republic of Germany, France and the United Kingdom) account for three quarters of total R&D expenditure in the European Union, and regional differences are very marked.
The research and technological development powers vested in the EU, particularly since the 1990s, have provided a basis for raising the competitiveness of European undertakings, notably small and medium enterprises. The participation of SMEs in all R & D activities is stimulated and encouraged by the European framework-programme. Their important potential to contribute to the innovation process is fully recognised. Activities related to innovation and participation of SMEs are given a particular emphasis in all specific programmes to help bridge the gap between research results and their effective exploitation in potential applications by the business and policy-making sectors. However, by comparison with performance elsewhere, the relative weakness of private-sector investment in R & D within the Union is striking. More effort is needed to strengthen the interactions between public research bodies and industry.
Europe has established a leading R & D role in many areas, notably nuclear safety, thermonuclear fusion, telecommunications' technologies and biochemistry. The Joint Research Centre, in particular, plays a principal role in various subjects such as climate change, bovine spongiform encephalopathy, genetically-modified organisms, the safety of chemicals, nuclear forensics and cybersecurity. This role must be sustained and remain at the cutting-edge. In other areas improvements are needed for the future benefit of society, as well as the business and industrial sectors. The development of new concepts such as eco-industry, transport intermodality, new generations of aircraft and other means of transport, and innovative approaches to the integration of new technologies will help to generate a strategic vision of research in all industrial sectors throughout Europe and to prepare European industry for the challenges of the 21st century. It is essential to increase knowledge in order to achieve the objectives of the strategy 'Europe 2020' [see section 7.3]. Investing in knowledge is the best way for the European Union to foster economic growth and create more and better jobs, while at the same time ensuring social progress and environmental sustainability. Europe must promote the "knowledge triangle": producing knowledge, diffusing it through education and applying it through innovation.
Innovation is still handicapped in Europe by the dispersion of research efforts and by the difficulty of translating the results of these efforts into new products and services. To promote innovation and, therefore, the competitiveness of European business, the legal and regulatory as well as the tax environment should be improved. Technologies targeted on major industrial priorities reflecting the needs of industry as it endeavours to innovate must be developed alongside the traditional research programmes. At the same time it is important to improve the acceptance of science and research in the business community with the objective of creating a favourable environment for research and technological development, and in particular for participation in activities carried out under European framework programmes. The right conditions for R & D need to be developed - in particular by businesses - so the EU can move towards its R & D investment target of approaching 3% of GDP.
The creation of a "European research area" requires a major contribution by the European institutions, encouraging an enhancement of efforts and improved coherence between the various programmes at national and regional level focused on those objectives that can only be achieved at EU level, such as: developing framework programmes, monitoring progress, communicating information, fostering best practice, improving the legal framework, dismantling barriers to research mobility and facilitating research networks.