1. Fostering Innovation and competitiveness in the Outermost regions of the European Union European Week of Regions and Cities Brussels, 10 October 2006 Louis Lengrand Restructuring for the knowledge society

2. 2 Foreword Outermost regions have several features in common but mostly, they share art. 299§2 of the Treaty Outermost regions have several features in common but mostly, they share art. 299§2 of the Treaty Quite tricky, for the sake of a talk or paper, to consider them as a homogeneous entity : Quite tricky, for the sake of a talk or paper, to consider them as a homogeneous entity : –Always refer to extremes or exceptions is time consuming and one loses the global picture –At the same time, always refer to the average facts or figures can be both tedious and misleading Will try and convey a balanced feel of the situation Will try and convey a balanced feel of the situation

3. 3 Part 1: New development strategies required Structural handicaps and cultural backgrounds have historically led to quite dependent economies Structural handicaps and cultural backgrounds have historically led to quite dependent economies Environmental constraints: remoteness, insularity, small size, difficult topography and climate Environmental constraints: remoteness, insularity, small size, difficult topography and climate Economies relying on few specialised and frequently vulnerable activities: agriculture, tourism, other traditional activities Economies relying on few specialised and frequently vulnerable activities: agriculture, tourism, other traditional activities Social and cultural factors: low education, immigration (particularly for Canaries and French Guyana), emigration, low women activity rates, etc. Social and cultural factors: low education, immigration (particularly for Canaries and French Guyana), emigration, low women activity rates, etc. New development strategies seek to address those regions strengths and potential, based on spill-over effects New development strategies seek to address those regions strengths and potential, based on spill-over effects Natural resources Natural resources Strategic geographical position and export potential Strategic geographical position and export potential Collaborative work between industry and research Collaborative work between industry and research

4. 4 Part 1: New development strategies are required (2) New strategies are taking into account a changing environment New strategies are taking into account a changing environment –International competition is increasing –How sustainable is the position of the outermost regions in the enlarged European Union? –A new mentality heading towards sustainable growth and international trade is emerging in the private and in the public sectors New incentives and behaviours emerge New incentives and behaviours emerge –Public and private stakeholders see opportunities in European initiatives: structural funds, FP programmes, etc. –National and regional authorities encourage new initiatives: clusters, networks, etc.

5. 5 Part 2: Strengths and opportunities In this context, outermost regions base their development on: In this context, outermost regions base their development on: –The valuation of their strengths and natural potential –The reduction of their constraints effects –The improvement of their economic independence For a better utilisation of natural resources For a better utilisation of natural resources –Outermost regions are the only European areas that provide such a rich biodiversity –Traditional agriculture and agro-food industries can integrate more added-value in their production –Besides the agro-food sector, there is a potential for the utilisation of natural resources in other industrial activities –Tourism is shifting towards higher standards of quality and provides new services related to the biodiversity

6. 6 Part 2: Strengths and opportunities (2) The existence of an environment favourable to research and innovation The existence of an environment favourable to research and innovation –These regions are now endowed with the fundamental infrastructures (Research, education, IT, etc.) –A genuine innovation mentality is emerging and collaborative works are being launched involving universities, national research centre and enterprises Specific research areas of excellence are emerging Specific research areas of excellence are emerging –Specific characteristics have stimulated research in some specific areas (meteorology/astronomy, volcanology, tropical diseases, etc.) –Research is more and more applied and tends to maximise the exploitation of natural resources and sustainable development (construction, energy, agro-products, etc.) –Towards a systemic and integrative approach, which covers for the not invented here syndrome

7. 7 Part 3: How to support these changes and to foster competitiveness Improving research and innovation networks Improving research and innovation networks –Outermost regions need to benefit from the European fundamental research outputs –Local research has to focus on the adaptation and integration of these knowledge and technologies –Such applied research is only efficient if the private sector collaborates with research centres –The commercial exploitation of new technologies requires training for production, setting-up, maintenance, etc. The role of public intervention The role of public intervention –Enhance technology transfers though international networks, local knowledge transfer offices, joint research participations (FPRD - collaborative projects), –Facilitate education and training by improving infrastructures and multiplying education programmes as well as life-long learning (ERDF, ESF) and mobility (ERASMUS, Leonardo, etc.)

8. 8 Part 3: How to support these changes and to foster competitiveness (2) Regional cooperation and insertion Regional cooperation and insertion –Besides vertical cooperation between the EU, the member states and the regions, cooperation between outermost regions themselves is necessary, considering similarities of needs and research topics –Outermost regions have to improve their institutional and economical relationships with their nearby environment Achieving the export potential Achieving the export potential –Increase the identity of the Outermost regions and the visibility of the regional excellences (labelling, territorial marketing, etc.) –Support SMEs commercial activities by pooling prospects costs, assurance, etc. –Targeting specific markets in function of the goods or services provided (EU, USA, Caribbean Islands, Latin America)

9. 9 Part 4: Success stories Sectoral initiatives Sectoral initiatives –A successful global political support : renewable energy in Guadeloupe –Launching a cluster: agro-food industry in la Réunion –An research area of excellence: astronomy in the Canary Islands Regional cooperation Regional cooperation –RUP plus: strengthening cooperation between the Outermost Regions –INTERREG III-B Caraïbes –INTERREG III-B Océan Indien –INTERACTT: an Interregional Action for Technology Transfer designed to develop aquaculture in the outermost regions

10. 10 Conclusion In terms of Competitiveness and Innovation indexes, it can hardly be said that the outermost regions already belong to the top league In terms of Competitiveness and Innovation indexes, it can hardly be said that the outermost regions already belong to the top league However, niches of excellence have developed and innovation is at play However, niches of excellence have developed and innovation is at play It could be argued that the challenge today is more about enhancing competitiveness than to foster innovation It could be argued that the challenge today is more about enhancing competitiveness than to foster innovation Two regions have already left the G7 of the poorest regions of former EU 15. The other 8 are on their way Two regions have already left the G7 of the poorest regions of former EU 15. The other 8 are on their way