European Commission Commits $5.4B (US) toward Innovation

While Congress and the Administration are looking for ways to flatten or even reduce spending for research, entrepreneurship and innovation, leaders on the other side of the pond are committing hard currency to strengthening Europe's position in the global, tech-based economy.

In April, the Commission of the European Communities adopted a proposal to invest $4.2 billion Euros ($5.4 billion US) over seven years in the Competitiveness and Innovation Framework Programme (CIP).

The creation of the CIP first took root in 2000, when the Lisbon European Council set the objective of making Europe the most competitive and dynamic knowledge-based economy in the world. In 2004, in response to the council's renewed strategy on "delivering stronger and lasting growth and creating more and better jobs," the European Commission prepared an analysis that eventually led to the Framework Programme.

According to the commission, the CIP will bring together specific Community support programs critical to boosting productivity, innovation capacity and sustainable growth, while also addressing complementary environmental concerns. Funding will be divided among the framework's three specific programs beginning in 2007, which include:

• $2.6 billion Euros for the Entrepreneurship and Innovation Programme to promote eco-innovation, facilitate access to finance, and support investment in innovation activities;
• $802 million Euros for the ICT Policy Support Programme to support operational demonstrations of technological and organizational solutions to ICT-based services at the EU level; and,
• $780 million Euros for the Intelligent Energy-Europe Programme to support energy efficiency, new and renewable energy sources and technological solutions to reduce greenhouse gas emissions.

In addition to building upon successful existing programs, new elements also will be included, according to the commission. The elements consist of a risk capital instrument of high-growth and innovative companies; securitization of banks' portfolios of loans to small and medium-sized enterprises; an enhanced role for innovation and business support networks; demonstrators of technological and organizational solutions to European-ICT services; and a twinning program for policymakers.

The proposal for the framework program was adopted last month and will be transmitted to the council, the European Parliament, the European Economic and Social Committee, and the Committee of the Regions. More information is available at: http://europa.eu.int/comm/enterprise/enterprise_policy/cip/index_en.htm