Speech by the Minister for Enterprise, Trade and Innovation, Batt O’Keeffe TD, at the ‘Delivering Innovation: EUROPE 2020 Strategy’ seminar

European Commission Representation Office, Dublin

24 June, 2010

Ladies and Gentlemen.

I am very pleased to be with you this morning to speak to you on delivering Innovation in the context of the EUROPE 2020 Strategy.

I want to especially thank the Commission Representation office in Dublin, Martin and his team, for this kind invitation and to welcome our other speakers and guests.

It is a very opportune time to speak to you on the EUROPE 2020 Strategy coming so soon after its formal adoption by the European Council last week.

The adoption by the Heads of Government of this new strategy is a significant contribution towards developing new directions and focus for the European Union.

The challenges have increased for Europe to drive competitiveness and innovation as robustly as its global competitors.

In that regard, Europe 2020 commits to mobilising EU funding and policy instruments, including the common agricultural policy and cohesion policy, in promoting smart, sustainable and inclusive growth so that job creation can be optimised and better labour market and societal outcomes achieved for Europe’s citizens.

The Europe 2020 Strategy aims to create an environment for closer co-ordinated action across the EU at institutional and member state level.

Each member state will now have to prepare a national reform programme outlining the policies and measures to be taken in pursuit of the objectives of the strategy, including progress on the five headline targets.

Work is continuing on the development of relevant national targets in each member state.

This will now be finalised in the autumn in ongoing dialogue with the Commission and the EU presidency as part of the preparations for developing the national reform programmes.

More effective monitoring and surveillance processes and greater national efforts will help to make Europe 2020 more successful than its predecessor, the Lisbon Agenda.

Europe 2020 has a greater clarity of purpose than its predecessor.

The new strategy is firmly focused on restoring competitiveness and increasing productivity.

The Government fully supports the core elements of the new strategy.

These include strong references to research, development and innovation; the completion and implementation of the single market; employment activation measures, up-skilling and training; a low-carbon green technology economy; sustainable use of resources including the development of agriculture and food resources; and increased access to world markets to maximise the advantages of globalisation.

These objectives are broadly consistent with the Government's national strategy, ‘Building Ireland’s Smart Economy’.

During the negotiation and consultation phases, Ireland argued strongly that the important contribution of the agriculture and food sector must be recognised and embraced in the Europe 2020 Strategy.

Supported by other member states, Ireland was successful in having this addressed by the European Council.

Our aim now is to have the agriculture and food sector included as a specific action point under the Commission’s proposed flagship ‘new industrial policy for the globalised era’ due to be published in the autumn.

As a significant competitiveness issue, the Internal Market and its delivery on the ground will be a key component of economic recovery in Europe.

Actions that build on and improve how the Internal Market operates and functions in a practical way for consumers and businesses have become even more important and will be critical to our planned recovery.

Following the recent Report by former EU Commissioner Monti, we look forward to contributing to the discussions and proposals from Commissioner Barnier on the re-launch of the Internal Market.

The confirmation by the European Council of the five EU headline targets including innovation, research and development is welcome.

Setting ambitious research and development targets in terms of expenditure, such as the EU target of 3pc of GDP, will help us to prioritise and drive our investments in research and development.

However, the big challenge, at both European and national level, is to ensure that the money invested in knowledge and research will translate into innovation and ultimately more competitiveness and high-quality jobs.

The link between research and enterprise is being strengthened in the EU’s research and development framework programme.

The role of industry-led technology platforms will be influential in the design of the programme.

In my recent discussions in Brussels with Commissioner Geoghegan-Quinn and Vice-President Tajani, we agreed about the need to be able to define the added value of our investments in research and development in a more practical and outcome-focused way.

That is why I very much welcome the work initiated by Commissioner Geoghegan-Quinn on the development of complementary impact or outcome indicators in addition to the headline 3pc target.

We need to pursue an approach where our research investment supports the competitiveness of European industry and where science and innovation is impacting positively on all aspects of our lives.

Specific initiatives are also in place to stimulate small to medium-sized enterprises (SME) participation in the programme.

Community funding schemes and initiatives do not need to be complex if we are serious about improving SME access to EU and international markets.

We have taken steps in Ireland to develop better interaction between research and innovation through an Industry-led research network scheme operated by Enterprise Ireland.

We have Centres for Science, Engineering and Technology (CSETs) which help link scientists and engineers in partnerships across academia and industry.

In building the smart economy and to increase business and societal returns, a comprehensive approach to innovation policy and development must continue.

This involves a more open and collaborative approach to innovation through supporting infrastructures for sharing knowledge and research.

By applying a broad-based innovation policy across all of our industrial sectors we can spur the growth of markets for innovative products and services.

To do this, we need to develop strong demand-side policy instruments such as better regulation, standards and public procurement supporting innovation and the development of more competitive solutions.

If we continue to adopt the approach of trying to identify future trends in demand for goods and services, we will be on the right track.

For Ireland, developing markets and sectors with strong export potential and growing enterprise activity need to be prioritised.

Ireland has a track record of building on our skills and talent to focus on individual sectors.

We have had significant success in sectors such as food, ICT, pharmaceuticals and biotechnology.

The big challenge is in finding ways to bridge the gap between the next generation of new enabling technologies and the market success of new innovations.

The key role of international trade and investment generating growth for Europe and the world as a whole should be central to the implementation of the Europe 2020 Strategy.

International links, through expanded trade and investment, will not be increased unless Europe achieves the necessary growth in services and in other high value-added services.

We must also ensure that SMEs and entrepreneurs are centrally involved.

Access to finance is critical.

I am examining how we can quickly implement the recommendations for an Innovation Fund, increased Business Angel Funds and a new Seed Capital Scheme recommended in the Innovation Taskforce Report.

At the European level however, the fragmentation of the venture capital market needs to be tackled.

We will support EU initiatives which address issues of scale and other barriers to attracting top-tier venture capital funds.

This is particularly important in the case of small economies like Ireland.

The Report of the Innovation Taskforce, ‘Innovation Ireland’, is of course a timely contribution to the Government’s plan to lay the foundations for future economic growth.

I recently appointed an Intellectual Property (IP) Implementation Group.

The group has been charged with developing and realising the intellectual property related recommendations of the Taskforce Report and a detailed Intellectual Property Review conducted by Forfás for my Department.

The development of an IP strategy will help Ireland maximise the return on public investment and support the commercialisation of Irish research and development.

Ireland is seeing the first signs of recovery here at home and in our main international markets.

The Government’s strategy is to drive economic recovery through increased productivity and export-led growth.

We must continue to formulate and implement appropriate policy responses to deal with both short-term and longer-term priorities.

We will develop the national reform programme and relevant targets in that context.

Thank you.

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For further information please contact:

Bernard Mallee, Press Adviser to Minister Batt O'Keeffe, Department of Enterprise, Trade and Innovation, on Tel: +353 1 631 3944, Mobile: +353 87 9173022, Email: bernard.mallee@deti.ie