China nears EU's spending on R&D

China is just two years away from catching up on Eur-ope's level of spending on research and development, according to a study published yesterday.

Competitors such as China, Japan and South Korea had substantially boosted the share of gross domestic product they spend on R&D while the European Union had since the mid- 1990s failed to ramp up investment in research.

Presenting the warning in a European Commission paper on science and innovation in the Union, Janez Potocnik, EU research commissioner, said the EU's public and private sectors needed to work together to bolster spending.

"There are more and more opportunities for businesses to invest in R&D outside Europe," he added. "The landscape is changing fast - we need to change with it. We cannot go on as we are."

The study by the European Commission underlines the continued head-bashing in parts of the 27-country EU over how to increase R&D spending, seen as essential to boosting economic growth and competitiveness.

The most recent figures, for 2005, show that the EU spent 1.84 per cent of GDP on R&D, substantially less than the US and South Korea. Japan led international funding for research, at 3.18 per cent.

China's figure was 1.34 per cent - but it is rising fast and forecasts show it will catch up with the EU by 2009 unless the union starts to bump up investment.

However, the report did not paint an entirely gloomy picture. It showed that Finland and Sweden were the two EU member states to spend more than the union's target of 3 per cent of GDP on research. Germany, Denmark and Austria were also big investors in R&D, while the UK and the Netherlands were hovering around the EU average.

Mr Potocnik warned that Europe faced particular weakness in securing private-sector funding, with only 45 per cent of research money coming from businesses compared with about two thirds in the US.