Presentation on theme: "Green Paper Towards a Common Strategic Framework for EU Research and Innovation Funding & Specific focus on EU financial instruments Jean-David MALO."— Presentation transcript:
1Green Paper Towards a Common Strategic Framework for EU Research and Innovation Funding & Specific focus on EU financial instrumentsJean-David MALODG Research and Innovation – Head of Unit C-03 “Financial Engineering”“Sophia Café” – Sophia-Antipolis, France, Monday 8 March 2011
2What is the Green Paper?Proposing major changes to future EU research and innovation fundingBringing together the FP, CIP and EIT into a Common Strategic FrameworkStandardising the rulesSimplification (single entry points, common IT platforms, etc)For the next EU Budget (to start in 2014)Seeking stakeholder views ahead of the Commission’s formal proposals (to be presented by end 2011)On the proposed changesOn the priorities and design of the Common Strategic Framework
3The context: Europe 2020 strategy Objectives of smart, sustainable and inclusive growthHeadline targets, including 3% of GDP invested in R&DIncludes the Innovation Union Flagship initiativeA strategic and integrated approach to research and innovation (from research to market, all forms of innovation)Putting in place the key conditions to make Europe attractive for research and innovationCommon focus to address major societal challenges and aiming at competitiveness and jobsEndorsed by February European Council (Heads of State)
4Innovation gap with US and Japan, emerging countries catching up EUPercentage gaps between EU performance (0) and other countries across 12 indicators. Other counties, such as India and Brazil, are developing fast.Source: Innovation Union Scoreboard
5EU R&D investment is lagging behind our main competitors Evolution of World R&D expenditure in real terms, PPS€ at 2000 prices and exchange rates,
7Positive benefits from FP7 (interim evaluation and other sources) Enables cross-border pooling of resources to achieve critical mass and diffusion of knowledgePromotes competition in research, thereby raising levels of excellenceOffers a wide range of training possibilities and enhances Europe’s research capacityProvides a way to deal with pan-European policy challenges and link to EU market frameworksRaises the international attractiveness of EU research and innovation
8But concerns about FP7 and other programmes (interim evaluations and other sources) Complexity - too many instruments and funding mechanisms, complex landscapeFurther simplification- less variation in rules, simpler audits and controls, avoid duplicate informationBetter strategy for innovation – how to commercialise results, generate impactsNeed to focus resources – with critical mass to address the grand challengesBroaden participation – new Member States, womenClearer agendas - driven by scientific, industrial, social objectives
9Scope of the Common Strategic Framework Bringing togetherThe 7th Framework Programme for research, technology development and demonstrationThe Competitiveness and Innovation Framework ProgrammeThe European Institute for Innovation and TechnologyAnd strengthening complementarities with the Structural Funds
10Why a Common Strategic Framework (1)? Simplifying the programmes:FROM different rules in each programme and initiativeTO more standardised rules across all initiativesFROM a large number of funding schemes within and between programmesTO a rationalised toolkit of schemes that are common to all programmesFROM multiple websites, guidance documents, applicationsTO common entry points, one stop shops, common IT platforms
11Why a Common Strategic Framework (2)? Greater impact:FROM fragmented calls where projects cannot go from one stage to the next (R&D, demonstration, market take up, etc)TO support for projects and organisations from research to marketFROM research results sitting on the shelfTO stronger support across the whole innovation cycleFROM different priorities in each programme and initiativeTO common strategic priorities, focusing on societal challenges, competitiveness and research excellence.
13Delivering on Europe 2020How can a Common Strategic Framework make EU funding more attractive and easy to access?How to cover the full innovation cycle: research to market?Where to act at EU level (and leverage other resources)?How to support joint programming between Member States?What between large vs small projects?What balance between standardisation vs flexibility in the rules?What measures of success?How to complement national, regional and Cohesion Policy funding?
14Tackling societal challenges How to focus on societal challenges?What scope for bottom up activities?What support for policy making and forward- looking activities?Role of the Joint Research Centre?How to involve citizens?
15Strengthening competitiveness How to take account of non-technological innovation?How to strengthen industry participation, including public private partnerships?What support for SMEs?Use of open schemes to support innovation?Use of financial instruments (equity, debt)?New types of support (public procurement, prizes)?Treatment of Intellectual Property Rights?
16Strengthening the science base and the European Research Area Stronger role for the European Research Council?EU support to improve Member State policies?Greater support to mobility and research careers (Marie Curie actions)?EU level support to research infrastructures?Priorities for international cooperation?Addressing obstacles to the European Research Area?
17A broad debate – next steps Addressed to all stakeholders:Key questions for design of the Common Strategic FrameworkDeadline for contributions by 20 May 2011:Online questionnaireSubmission of position papersInteractive blogNext steps:Major event to conclude consultation (10 June 2011)Commission proposals for next multi-annual financial frameworkCommission legislative proposals for the Common Strategic Framework (by end of 2011)
18European financial instruments for Research and Innovation: Post-2013 priorities and added value of future EU financial instruments
19Future EU financial instruments for Research and Innovation Trend at European level to make increasingly use of financial instruments for the next budgetary period (“Multiannual Financial Framework”, MFF)Advantages of EU financial instruments:Limited budget resources could be used (co-financing; risk-sharing or guarantees to mobilise private funding (« leverage effect »)Unless risks/ losses exceed expectations, EU budget resources could be “recycled” and reused for further projects (revolving funds)Flexibility to better meet the funding needs of target groups/ beneficiaries and address funding gaps in the market (rational for intervention)European Commission is currently discussing the future political priority areas where European financial instruments could be of added valueFuture EU financial instruments and their governance (guiding principles: streamlining, coherence, critical mass, mobilisation of private capital, delegation to Financial Intermediaries) need to be determined
20Future EU financial instruments for Research and Innovation “Financial instruments” as currently discussed mean: EU financial support measures from the EU budget in order to address a specific policy objective by way of loans, equity/ quasi-equity, guarantees or other risk-bearing instruments, possible combined with grantsFuture EU financial instruments should ideally address more than one policy area (“cross-flagship” approach), for instance Research and Innovation, and they should support particular EU policy objectives such as the SET PLAN (low carbon technologies) and the Digital Agenda (ICT/ Broadband investments)For Research and Innovation, a first outline of possible future financial instruments has been made in the “Europe 2020 Flagship Initiative Innovation Union” Communication of the EC (6 October 2010)
21Current EU financial instruments for RDI Risk Capital1CIP Resources (SME)2RSFF (SME / MidCap)Entrepreneur, friends, familyBusiness AngelsSeed/Early Stage VC FundsFormal VC FundsBank Loans and GuaranteesSeed / Start-Up PhaseEmerging Growth PhaseDevelopment PhaseFacility: High Growth Innovative SME Scheme (GIF), EcotechPurpose: IP financing, technology transfer, seed financing, investment readinessTarget Group: VC Funds, Business AngelsEIF Product: Fund-of-FundsCIP Guarantee schemesGrowth financing for SMEsFormal VC Funds, CLOsSME guarantees (loans, microcredit, equity/mezzanine, securitisationFP7 RSFFRDI financingSMEs/MidCaps, Banks, PE Investors (sub-investment grade)Loans (incl. Mezzanine), Funded Risk Sharing Facilities with Banks (Investors)Investment LoansMidCaps/Large Corporates/Public Sector Entities (investment grade)Loans, GuaranteesLater StageCounterparts34EIF EIB
22Future EU financial instruments for Research and Innovation Market/ funding gaps which could/ should be addressed through EU financial instruments for R&I are:Investment in knowledge transfer and start upsVenture capital for fast growing firms expanding on EU and global marketsRisk-sharing finance for investments in R&D and innovation projects and loans for innovative fast growing SMEs and mid-capsNext steps: Consensus on an integrated approach within the Commission, involvement of EU Member States (and EP), consultation of stakeholders
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