Description:Investing in science, technology and innovation is a key factor in driving sustainable economic growth. As a small open economy, it is imperative we have a world-class innovation eco-system that attracts R&D, facilitates the growth and scale of indigenous firms and encourages innovative activity in less intensive sectors.
Implication(s):Ireland has taken significant steps over the past fifteen years in order to become a more knowledge and innovation-intensive economy. However, according to the European Commission’s 2015 Innovation Union Scoreboard, Ireland remains an innovation follower and we continue to lag well behind world leaders like Finland, Germany and the Netherlands. Becoming an innovation leader will require a significant increase in both public and private investment.In 2006 Ireland agreed to the Europe 2020 target – to increase total R&D investment to 3% of GDP by 2020. During this crisis, this target was reversed to 2% of GDP
Current Position:In 2006 Ireland agreed to the Europe 2020 target – to increase total R&D investment to 3% of GDP by 2020. During this crisis, this target was reversed to 2% of GDP. Given that the economy is now showing strong signs of recovery, Government should be more ambitious and increase this target to 2.5% of GDP by 2020.
This target can be reached through a combination of public and private industry funding. The government should be prepared to spend 0.8% of GDP (€1.9 billion) on R&D by 2020 and industry should finance the remainder. This investment is crucial if we want to increase economic productivity, boost competitiveness, attract and maintain high quality jobs and find solutions to key life, social and environmental problems. Innovation leaders like Denmark and Finland have public investment in R&D that is twice the rate of Ireland’s. Cutting back may provide short-term fiscal relief, but will damage the foundations of long term growth and competitiveness.
The forthcoming strategy for science, technology and innovation 2015-2020 should include a commitment to increase R&D investment to 2.5% of GDP by 2020.
R&D Spending by Government
crease R&D investment to 2.5% of GDP by 2
Last Updated: 11/20/2015