IP/07/1960

Brussels, 19^th December 2007

Research and innovation key to competitiveness of chemicals industry

To maintain the world leading position of the European chemical industry various measures should be taken, like a strengthening of innovation networks, increasing the spending in Research and Development (R&D), a better developing of human resources and improving information and communications. These measures are proposed in a first set of recommendations, done by the High Level Group on the Competitiveness of the European Chemicals Industry, yesterday at a meeting. The chemical industry is currently facing unprecedented challenges to maintaining competitiveness. The challenges include coping with increasingly costly energy and feedstock (mainly oil and gas), helping to mitigate global environmental pressures in particular from climate change and facing strong competition from emerging countries (e.g. China, Middle East and Russia). The chemicals industry is well placed to bring solutions to these problems and to exploit new opportunities. It provides innovations to most other industries and is a key component of value chains that end with the great majority of consumer products. To help the industry to overcome the present challenges and to exploit related opportunities, the High Level Group (HLG) however has made these first recommendations.

Commission Vice-President Günter Verheugen, responsible for enterprise and industry policy said: “Europe must retain a strong manufacturing base in chemicals, not only because of its own huge contribution to wealth and jobs, but also because of its ability to generate innovations throughout industry as a whole. We need to promote innovation and competitiveness to ensure that the chemicals industry will always have a strategic placer the EU’s economy.”

Science and Research Commissioner Janez Potočnik, who chaired the specific session of the High Level Group dedicated to research and innovation, said: "The future of the chemicals industry in Europe will depend ever more on its ability to innovate. Research plays a huge role in that. We are working with industry in a variety of ways to promote investment in research. Today's meeting will be another piece of the puzzle, which once completed will show a picture of a high performing, innovative and competitive chemicals industry in Europe."

The overall purpose of the HLG on the Competitiveness of the European Chemicals Industry, set up on 14 June 2007 by the European Commission, is to conduct a sound economic and statistical analysis of the factors determining the rapid structural change in the chemicals sector, and the competitive position of the European chemicals industry.

At its meeting on 18 December 2007, the HLG underlined that the numerous examples of best practice show that Europe’s chemicals industry and its strong research infrastructure are capable of meeting the innovation challenge. To address the challenges the sector is faced with, the HLG has formulated a first set of recommendations:

1. Strengthen innovation networks

• Industry, in cooperation with governments, should set up topical innovation networks to promote key strategic innovations and foster best practices knowledge exchange. One such network should deal with “energy and climate change”.
• Industry and public authorities at all levels should strengthen clusters which facilitate co-operation across sectors and across borders, with the aim of further stimulating and facilitating cross-cutting innovations throughout the value chain.
• As part of the further strengthening of existing networks, the European technology platform for Sustainable Chemistry (SusChem) should develop a wider mandate covering the full scope of innovation, and reaching out to an increasing number of Member States, regions and enterprises, in particular to Small and Medium Sized Enterprises (SMEs).

2. Increase quantity and effectiveness of research and development:

• The private sector should accelerate its efforts to speed up innovation. Companies are urged to upgrade their R&D plans, promoting "open innovation" schemes and extending corporate research programmes to medium- and long-term objectives.
• The public sector should provide effective support to the efforts of the private sector.

3. Developing our human resources should start in primary schools

• Member States should step up promotion of chemical and science education starting with the primary schools.
• Chemistry or/and chemical engineering faculties should define the profiles of new professions in cooperation with industry e.g. "product" engineers, toxicologists, nanotechnologists, and should develop new curricula to keep pace with the development of the chemicals sector.
• Industry should intensify efforts to forecast their requirements of human resources at various locations and regions. SMEs, which have comparatively greater difficulties in attracting essential skills, should be fully involved.

4. Improve information and communication

• The chemicals industry needs to develop a more effective dialogue with society based on mutual understanding and trust.
• The Commission and Member State authorities should improve communication with industry and other stakeholders to facilitate proper understanding and observance of regulatory requirements. The needs of SMEs should be especially considered in that context.
• The Commission should ensure that impacts on innovation and any further research needs are adequately addressed in impact assessments accompanying new legislative