1. RTD/E.2 Europe’s knowledge-based bio-economy (KBBE) Dr Ioannis Economidis Research Directorate-General European Commission DG RTD-E Biotechnology, Agriculture and Food

2. RTD/E.2 Towards 3 % of GDP The R & D spend as a percentage of GDP is an EU-wide issue. The average in 2000 was 1.8 % of GDP across Europe, compared to 2.9 % in Japan and 2.7 % in the US. Major steps are required in the EU to meet the Lisbon target of 3 % by 2010.

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5. The Bio-Economy The term “bio-economy” includes all industries and economic sectors that produce, manage and otherwise exploit biological resources (e.g. agriculture, food, forestry, fisheries and other bio-based industries); The European bio-economy has an approximate market size of over €1.5 trillion, employing more than 22 million people SectorAnnual turn-over (billion €) Employment (million) Data source Food8004.1CIAA Agriculture21015COPA-COGECA Paper/Pulp4000.3 direct (4 ind.) CEPI Forestry/Wood ind.1502.7CEI-BOIS Industrial Biotech.50 (est.)McKinsey* Total161022.1 * estimated to be around €100-160 million by 2010

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7. The Knowledge-Base Life Sciences and Biotechnology in convergence with other technologies.., …provides the knowledge-base for the sustainable management, production and use of biological resources… … provides new, safe, affordable and eco-efficient products … … supports competitiveness and sustainability of major European industries Examples: Advances in diagnostics have increased food safety and control of animal diseases (foot and mouth; BSE) Use of enzymes in industrial and household processes (washing powder), and in food production, have strongly reduced energy/water consumption and led to new “functional” foods.

8. RTD/E.2 Exponential increase in the amount of experimental data

9. RTD/E.2 « Long before we decide to stop using fossil fuels, costs will have already made the decision for us » KBBE – the major drivers: Sustainability and security of energy supply

10. RTD/E.2 Cereals : growth of world demand 2004 STOCKS are equivalent to 2 MONTHS consumption! Stock Trade Use Production 1000 1200 1400 1600 1800 2000 1974/751980/811984/85 1988/89 1992/93 1996/972000/01 2004/05 200 400 600 800 1000 Use = 1 982 Mt Production = 2 000 Mt Trade = 234 Mt Stocks = 364 Mt KBBE – the major drivers: Sustainability and security of food supply

11. RTD/E.2 The KBBE value chain Existing & New Bio-fuels Bulk Chemicals Bio-polymers Bio-materials Bio-specialities Standardised Feedstocks: (Carbohydrates, Proteins, oils, Ligno- cellulosics) Renewable Feedstocks Bioprocesses Bulk Fine Fossil resources

12. RTD/E.2 Bio-refineries Wood, Crops, Grasses Forestry or Agricultural Residues Animal or Municipal Waste Heat, Electricity, Fuels Bulk and fine Chemicals Biological raw Materials Food, Feed, Fibre Biochemical or Thermo-chemical Conversion Will be supported in two FP7 Thematic Priorities: Food, agriculture and bio-technology and Energy

13. RTD/E.2 Poly Lactic Acid (PLA): Bio-plastic made from corn (2003) Blair factory, Nebraska, USA : 140.000 t/year

14. RTD/E.2 Industrial Biotechnology is for real Large scale products of Industrial Biotechnology : Bio-ethanol : 30 million t/year Isoglucose : 15 million t/year Glutamate : 1.5 million t/year Citric acid : 1 million t/year Lactic acid : 250.000 t/year Acrylamide : 200.000 t/year Antibiotics : 30.000 t/year

15. RTD/E.2 SUPPLY AND DEMAND CHAIN INHIBITORS IN INDUSTRIAL BIOTECHNOLOGY supply chain In the supply chain the most serious inhibitors identified are: The need for reliable, large-scale supply of raw materials; Proven, full-scale capabilities of the biorefinery to process raw materials into products, and utilise biomass waste for energy generation; Bio-manufacturing is under-developed compared to other manufacturing industries; The education and training of the managerial elite to run a global industry.

16. RTD/E.2 SUPPLY AND DEMAND CHAIN INHIBITORS IN INDUSTRIAL BIOTECHNOLOGY demand chain On the demand chain side, the issues are: The ever-present need for innovation, and how to finance it; How to grow the many SME’s in the business; Need for incentives to make industrial biotechnology products more attractive and cost- competitive: green credentials are not enough.

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18. Knowledge Based Bio-Economy: European assets European bio-economy cannot compete on a global level by delivering only basic agricultural commodities, but needs to build on European strengths: excellent science, technology and industry base to deliver innovations; world leader in industrial enzymes and fermentations; world leader in innovative food technologies and products; strong in innovative animal breeding technologies; strong chemical and manufacturing industry base. many more farmers in new EU Member States

19. RTD/E.2 The presence of SMEs The industrial biotechnology industry has expanded rapidly in the last decade, and is characterised by a large presence of SME’s that rely heavily on R & D. A great many of these have no products on the market, and have few visible assets. Getting long-term commitment of large sums of money from the investor community is a demand chain inhibitor.

20. RTD/E.2 The presence of SMEs the SME’s have proportionately less time to educate their markets for new products. The business model whereby the SME’s, often from an academic origin, form strategic alliances with large established companies to share financial risk has emerged as the dominant model for the small industrial biotechnology company. Global governmental incentives are also being deployed and new ones being investigated, to improve the demand for their products.

21. RTD/E.2 Knowledge Based Bio-Economy: How to make it happen! Policy-makers, governments, industry, public and private research bodies, civil society to recognise that life science and biotechnology potential has to be carefully nurtured if it is to continue to grow; Establish a regulatory, institutional and societal environment supportive of the bio- economy; Demonstrate clear benefits for the consumer and the environment;

22. RTD/E.2 Knowledge Based Bio-Economy: How to make it happen! Incentives to exploit its benefits in terms of competitiveness, environmental compatibility and potential for rural development; Participants in the value chains – farmers, industry, regulators and consumers – need to pull together to make the bio-economy work.

23. RTD/E.2 Knowledge Based Bio-Economy: A complex policy environment! directly relevant: Research & Innovation; Common Agricultural Policy; Common Fisheries Policy; Forestry Strategy; agriculture and trade issues; Food safety regulations; Community Animal Health Policy; Environment and Health Strategies, Competitiveness; Consumer ; Regional and Energy (biomass) policies. others: transport, environment and biodiversity (climate change, waste, biodiversity,) education and training, employment, internal market (data protection, IPR), European neighbourhood policy;

24. RTD/E.2 Life Sciences and Biotechnology A Strategy for Europe Life Sciences and Biotechnology A Strategy for Europe COM(2002)27 - January 2002 How can Europe best attract the human, industrial and financial resources to develop and apply these technologies to meet society’s needs and increase its competitiveness? How can Europe deliver effective, credible and responsible policies, which deliver the confidence and support of its citizens? How can Europe best respond to the global challenges, develop its domestic policies with a clear international perspective and act internationally to pursue its interests?

25. RTD/E.2 Biofuels in the European Union A VISION FOR 2030 AND BEYOND Biofuels Research Advisory Council VISION By 2030, the European Union covers as much as one fourth of its road transport fuel needs by clean and CO 2 -efficient biofuels. A substantial part is provided by a competitive European industry. This significantly decreases the EU fossil fuel import dependence. Biofuels are produced using sustainable and innovative technologies; these create opportunities for biomass providers, biofuel producers and the automotive industry.

26. RTD/E.2 European Parliament resolution on the promotion of crops for non-food purposes A future for non-food crops Stresses the importance of increasing the support for research and development in non-food crop technology Stresses the need to carry out research to explore the economic, ecological and technical factors involved in selecting suitable crops Stresses the need for the integration of national research, development and testing of bio-materials at a EU level, particularly with regards to the establishment of an EU-wide research programme on technology for the conversion of biomass into energy, fuel and chemicals

27. RTD/E.2 European Parliament resolution on the promotion of crops for non-food purposes A future for non-food crops Calls for funding for research and rural development to be increasingly directed towards the more efficient and extensive use of organic waste from farming and forestry Calls for increased research funding for new economically efficient and sustainable technologies

28. RTD/E.2 Knowledge Based Bio-Economy: The role of research Focus on sustainable management, production and use of biological resources, through life sciences and biotechnology and convergence with other technologies; Realise opportunities (healthier food; cleaner bioproducts/-processes) and address challenges (increasing demand for bioresources); Technology platforms and other stakeholders’ fora for reflection on and development of research policy; Support to formulation and implementation of policies and regulations.

29. RTD/E.2 Research supporting the KBBE: Where are we in Europe? Up to now Creation of 7 industry-led strategic stakeholder groups (Technology Platforms) relevant to the KBBE A number of relevant networks of national funding agencies developing joint R&D programmes (ERA-NETs) Stakeholder conference (Sep 2005) The future A coherent R&D programme within the seventh EU research framework programme (2006-2013) bringing together food, agricultural and biotechnology research to support the KBBE EC-US activity in the area of plant based bio-products

30. RTD/E.2 Technology Platforms: Overall Concept The Stakeholders, led by industry, getting together to define a Strategic Research Agenda on a number of strategically important issues with high societal relevance where achieving Europe’s future growth, competitiveness and sustainability objectives is dependent upon major research and technological advances in the medium to long term. Framework to unite stakeholders around: A common “VISION” for the technology concerned Definition of a STRATEGIC RESEARCH AGENDA (SRA) IMPLEMENTATION of the SRA

31. RTD/E.2 Wide range of committed companies/organisations

32. RTD/E.2 Biofuels Sugars Renewable feedstock Specialty chemicals Bulk Chemicals Biomaterials Fossil fuel Plants for the Future Biofuels TP Innovative and sustainable use of forest resources Food for Life Collaboration with related TPs – Building the KBBE Non -Food Value Chain Food Value Chain

33. RTD/E.2 Belgium BIPIB RT Chemistry and Biotech Netherlands Kluyver Centre B-BASIC  NIIB Austria Kplus UK Pro-Bio Faraday CoEBio3 Germany BioProduktion IB platform Baltic region Inst. for Sust. Ind. Sweden IB Forum Finland IB Forum Switzerland WP IB KBBE activities in Member States Denmark SD project France Agrice Pôle Comp.

34. RTD/E.2 European attitudes to six applications of biotechnology

35. RTD/E.2 Support and opposition for six applications of biotechnology in 15 countries

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37. Keep in touch with research! General information - http://europa.eu.int General information on research - http://europa.eu.int/comm/research Information on research programmes - http://www.cordis.lu Info requests - research@cec.eu.int