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Belgium is a small EU economy and is very open to international trade and FDI. Its economy is strongly service-oriented and it has some internationally competitive technology sectors (e.g. pharmaceuticals and chemicals).
Hot Issues are major national STI policy priorities, as self-reported by countries in their responses to the OECD STIO 2014 policy questionnaire.
Improving overall human resources, skills and capacity building
While Belgium’s labour-force skills are reasonably strong (Panel 1s, t, v, w), the demand for engineers exceeds the number of graduates in certain areas. The federal government offers tax deductions to increase the employment of researchers, and it raised the deduction on the withholding tax on researchers’ salaries from 75% to 80% in July 2013. This tax incentive amounted to USD 759 million (EUR 630 million) in 2012, up from USD 675 million (EUR 560 million) in 2011. In 2012, Flanders launched the STEM Action Plan in combination with a science communication plan to increase the number of secondary and higher education students in STEM. Wallonia’s Beware Fellowships support researcher mobility and promote awareness of S&T among youth by supporting actors in the field.
Belgium has a sound science base and seven of the world’s top 500 universities. Universities and PRIs publish and patent actively (Panel 1b, c, p). Industry-science relations are good and the business sector finances a relatively high share of public R&D (Panel 1o). Transfer of knowledge is a major concern at all government levels. Commercialisation of research is a key part of the federal government’s strategy and resulted in USD 258 million (EUR 219 million) in tax deductions on revenues from commercialisation of patented inventions in 2010. The Brussels Capital Region (BCR) supports the creation of university spin-offs through financing and technology transfer offices. The Flanders Holding Company manages the Transformation and Innovation Acceleration Fund (TINA), with a budget of USD 235 million (EUR 200 million) in 2010. It provides risk capital financing for innovation projects and acts as “entrepreneur” and facilitator. Since 2012 the Spin-off Financiering instrument supports the setting up of spin-off companies from research results. Wallonia supports the technology transfer offices co-ordinated by the Agency for Technology Promotion. Its Technological Innovation Partnership encourages collaborative research, with new mechanisms (e.g. collective research calls) to improve collaboration by SMEs and research centres. It is launching a new Green Impulse Fund for young innovative companies.
Addressing challenges of STI globalisation and increasing international cooperation
Belgium seeks to create a favourable environment for business innovation and to attract foreign investment in R&D and innovation. It has a well-developed and productive science base and a strong international reputation in R&D in certain technological fields and in patenting (Panel 1f). Belgian STI activities are well integrated internationally (Panel 1q, r) and foreign affiliates account for more than half of BERD (Panel 2). Attracting inward FDI continues to be a major priority of the Belgian governments. To this end, they support national research infrastructures, active participation in international scientific and industrial research initiatives, and the integration of Belgian scientists in the European Research Area.
Each region has identified its own priority areas. There is some overlap. The BCR focuses on certain sectoral niches and on R&D and innovation to meet societal challenges. The priority sectors identified in the new BCR Innovation Plan are ICT, health care and the environment. Funding schemes have been prepared along with a cluster initiative to foster a growth ecosystem and critical mass in the priority sectors. The Flanders Policy Note 2009/2014 on Scientific Research and Innovation identifies similar priorities, and the Flanders 2011 Concept Note on Innovation Centre stresses the role of innovation in addressing grand societal challenges through thematic “innovation hubs”. Initiatives include the setting up of living labs and thematic initiatives (e.g. Energyville, ICleantech, a call for social innovation, the establishment of the Centre for Medical Innovation).<br />
Wallonia’s Research Strategy 2011-15 identifies priorities linked to societal needs; six sector-oriented clusters (pôles de compétitivité) were created with government support as part of the Marshall plan, updated to Marshall Plan 2 Green, to help raise competitiveness and stimulate innovation with initiatives for green technologies, health, energy and social innovation.Wallonia also has specialised life science and sustainable development funds. The federal level mainly targets the space sector; more than USD 240 million (EUR 200 million) a year go to the European Space Agency.
Improving the framework conditions for innovation (including competitiveness)
Belgium’s business environment and financing for entrepreneurship are at or slightly below the OECD median (Panel 1h, j). Innovative entrepreneurship has been integrated in the BCR’s research and innovation system. The BCR’s BRUSTART II fund targets small innovative companies, and its new VC fund supports “pre-commercial” research. BCR’s funding agency IMPULSE also provides support to young innovative companies for business planning, technical-economic monitoring, legal and financial matters, and search for partners. In Flanders, in addition to the TINA fund, the Vinnof fund invests in innovative growing companies and the ARKimedes fund invests in start-ups and fast-growing SMEs with innovation mezzanine, seed and early-stage funding. In Wallonia the public investment companies (Invests, Novallia) invest in spin-offs and start-ups. The Creative Wallonia Action Plan launched in 2011 aims to stimulate the creative economy and to support an innovation culture throughout the economy.
STI policy governance
Belgium is a federal country composed of three Communities (Flemish, French and German- speaking) and three regions (Brussels-Capital Region, Flanders and Wallonia). STI competences are distributed across all of these. The Communities are the main source of scientific research support, and the regions of innovation and business R&D support. Since 2010, greater intergovernmental co-operation on R&D and innovation has been discussed among all relevant policy actors and governments.
Many initiatives address global and societal challenges. In 2014 the BCR is developing Smart City Mobility in conjunction with innovative public procurement for transport. The Walloon Marshall Plan 2 Green emphasises environmental issues and industrial ecology, and in 2011 Wallonia launched a competitiveness cluster for green technologies, which supports several energy research programmes and launched the Employment-Environment Alliance to promote sustainable construction. Flanders’ two major measures are the Flemish Climate Policy Plan 2013-20 and the Flemish Second Energy Efficiency Action Plan (2011-16), which has adopted new energy standards, especially in construction and housing, aimed at building energy-neutral buildings by 2021. The federal level has focused on societal challenges by launching BRAIN, an important research programme.
The development of research and innovation in SMEs is a policy priority at the federal as well as the regional level. SMEs have received a wide range of support for improving their innovation capabilities (training, consultancy, funding, business angels, etc.). The federal government has increased the reduction on the advance tax payment for all research and technical staff in young innovative companies from 50% to 75%. In addition to instruments for SMEs such as the SME Wallet and the innovation voucher, BCR has developed new instruments in conjunction with EU initiatives aimed at SMEs. In Flanders, support for innovation in SMEs reached a record 58% of total direct innovation support for businesses in 2013. Recent initiatives include Sprint projects, which target large companies that conduct middle-large development projects, or VIS-trajecten IV aimed at “innovation-follower” companies. The Walloon government’s overall budget for direct support of business R&D and innovation increased by more than 70% over the last five years to USD 144 million (EUR 120 million) in 2013. Novallia is a USD 53 million (EUR 46 million) scheme that promotes SMEs’ innovation projects via loans at fixed interest rates. Wallonia has also developed several schemes to promote research and innovation in SMEs through theWalloon Small Business Act and CreativeWallonia Plan.
Discussions were launched in all regions in 2011 on a “smart specialisation strategy” to reshape innovation policy instruments and governance. The BCR innovation plan (2013-20) is aligned both with the EU’s Strategy 2020 and with the region’s smart specialisation strategy. The Flemish government launched several calls in 2012-13 to stimulate demand-driven initiatives, such as proposals for key enabling technologies, for testing the trajectories of a cluster- oriented policy, and for projects from co-operating businesses to develop a roadmap for a new industrial entrepreneurship. Cluster policy is the backbone of Wallonia’s smart specialisation strategy, which focuses on innovation and creativity, greening, internationalisation, and SMEs.