2021 EU industrial R&D investment scoreboard remains strong in ICT, health and ecology

Despite the difficult overall economic environment in 2020, EU companies have increased investment in research and development (R&D) in the health and ICT services sectors, according to the new edition of the EU Industrial R&D Investment Scoreboard, published today. The EU remains at the top for green patents for high-value technology and green patents in energy-intensive industries, reflecting its transformation towards climate neutrality.

In particular, EU-based companies increased R&D investments in the health (10.3%) and ICT services (7.2%) sectors, albeit at a slower pace than US and China-based companies. However, overall R&D investment by EU companies has declined for the first time in ten years, mainly due to weaker R&D in the automotive and aerospace and defence sectors. In 2020, EU-based companies reduced their total R&D investment by 2.2%. US and Chinese companies increased their total R&D investments by 9.1% and 18.1% respectively. US and Chinese based companies have expanded their share of R&D in certain sectors during the coronavirus crisis, such as health (US: 17.9%; China: 30.7%), ICT services (US: 12.4%; China: 21.2%) and ICT producers (US: 7.8%; China: 11.5%).

Although the pandemic boosted the fast-growing ICT and health services globally, it hit other sectors hard, such as automotive (-4.3%) and aerospace and defence (-17%). The automotive sector is the most important sector of R&D investment in EU companies, which contributed to the overall R&D decline. Nevertheless, 14 EU companies are among the top 50 of the world's top 2,500 R&D investors.

Mariya Gabriel, Commissioner for Innovation, Research, Culture, Education and Youth, said: "Investing in R&D is essential for European industry to lead the green transition, excel in the ICT sector and lead the new wave of profound technological innovations. The Industrial R&D investment scoreboard clearly shows where we need to increase our efforts, calling on us to invest now for the future".

Globally, industrial R&D investment has proved resilient in the coronavirus crisis. In 2020 it continued to grow, by 6%, for the 11th consecutive year. In contrast, 2020 saw significant declines in fixed asset investment, net sales and operating profits. The overall positive trend in R&D investment indicates that companies are looking ahead and preparing for recovery by maintaining or increasing R&D, even though they have had to cut other expenses and their revenues have declined.

The importance of the ICT, health and automotive sectors in global R&D competitiveness is illustrated by the fact that the aggregate R&D of these three sectors has more than doubled since 2010 and, in particular, that of ICT services has tripled. When it comes to the ranking of business investment levels, the ICT sector is consistently at the top of the table, highlighting the increasing digitisation of the global economy. In 2020, the top five positions are in the digital sector.

The dual green and digital transition is expected to increase the R&D performance of EU companies and reinvigorate the industrial base, in line with the priorities of the EU industrial strategy and the European objectives of strengthening innovation ecosystems and fostering relevant policies.

Context

The Commission has published the EU Industrial R&D Investment Scoreboard every year since 2004. The 2021 edition of the Scoreboard includes the 2 500 companies that invested the largest amounts in R&D in the world in 2020. The Scoreboard data, taken from the latest published company accounts, includes key indicators on the 2,500 parent companies and more than 800,000 subsidiaries that allow analysis of companies' economic and innovation performance. These companies, based in 39 countries, each invested at least 36.5 million euros in R&D, totalling 908.9 billion euros. The 2021 scoreboard of total R&D is equivalent to approximately 90% of global business-financed R&D. The sample consists of 401 companies. The sample consists of 401 EU-based companies, representing 20.3% of total R&D in the sample, 779 US companies (37.8%), 597 Chinese companies (15.5%), 293 Japanese companies (12.2%), and 430 companies from the rest of the world (14.2%).