R&D expenditure in the EU remained stable in 2016 at just over 2 % of GDP – almost two thirds spent in the business sector

First estimate of R&R expenditure by Eurostat

In 2016, the Member States of the European Union (EU) spent all together over €300 billion on Research & Development (R&D). The R&D intensity, i.e. R&D expenditure as a percentage of GDP, remained stable at 2.03 % in 2016. Ten years ago (2006), R&D intensity was 1.76 %.

With respect to other major economies, R&D intensity in the EU was much lower than in South Korea (4.23 % in 2015), Japan (3.29 % in 2015) and the United States (2.79 % in 2015), while it was about the same level as in China (2.07 % in 2015) and much higher than in Russia (1.10 % in 2015) and Turkey (0.88 % in 2015). In order to provide a stimulus to the EU’s competitiveness, an increase by 2020 of the R&D intensity to 3 % in the EU is one of the five headline targets of the Europe 2020 strategy.

The business enterprise sector continues to be the main sector in which R&D expenditure was spent, accounting for 65 % of total R&D conducted in 2016, followed by the higher education sector (23 %), the government sector (112 %) and the private non-profit sector (1 %).

This information on Research and Development in the EU is published by Eurostat, the statistical office of the European Union. R&D is a major driver of innovation, and R&D expenditure and intensity are two of the key indicators used to monitor resources devoted to science and technology worldwide.

R&D intensity above 3% in Sweden and Austria

In 2016, the highest R&D intensities were recorded in Sweden (3.25 %) and Austria (3.09 %), both with R&D expenditure above 3% of GDP. They were closely followed by Germany (2.94 %), Denmark (2.87 %) and Finland (2.75 %). Belgium (2.49 %), France (2.22 % in 2015), the Netherlands (2.03 %) and Slovenia (2.0 %) registered R&D expenditure between 2.0 % and 2.5 % of GDP. At the opposite end of the scale, ten Member States recorded a R&D intensity below 1%: Latvia (0.44 %), Romania (0.48 %), Cyprus (0.50 %), Malta (0.61 %), Lithuania (0.74 %), Bulgaria (0.78 %), Slovakia (0.79 %), Croatia (0.84 %), Poland (0.97 %) and Greece (0.99 %).

Over the last ten years, R&D intensity rose in twenty-two Member States, with the highest increases in Austria (from 2.36 % in 2006 to 3.09 % in 2016, or +0.73 percentage points – pp) and Belgium (+0.68 pp). Conversely, R&D intensity decreased in six Member States and most strongly in Finland (from 3.34% in 2006 to 2.75% in 2016, or-0.59 pp) and Luxembourg (-0.43 pp).

Highest share of R&D spending in the business sector in Slovenia, Hungary and Bulgaria…

The main sector in which R&D was performed in 2016 was the business enterprise sector in all Member States, except Cyprus, Latvia and Lithuania (where the higher education sector was the dominant performing sector).

The highest shares of R&D expenditure performed in the business sector were observed in Slovenia (76 %), Hungary (74 %), Bulgaria (73 %), Ireland and Austria (both 71 %), Belgium and Sweden (both 70 %) as well as Germany (68 %). Over the last ten years, the share of R&D conducted in the business enterprise sector increased in twenty Member States, while it decreased in eight.

… in the government sector in Romania and the higher education sector in Lithuania and Portugal

For the government sector, the highest shares were registered in Romania (33%), Latvia (32%) and Luxembourg (30 %). The highest shares of R&D conducted within the higher education sector were recorded in Lithuania and Portugal (both 45 %), Latvia (44 %) and Cyprus (42 %).

Methods and definitions

Research and development, abbreviated as R&D, refers to creative work undertaken on a systematic basis in order to increase the stock of knowledge (including knowledge of man, culture and society), and the use of this knowledge to devise new applications.

Eurostat’s statistics on R&D expenditure are compiled using guidelines laid out in the Frascati Manual (2002 edition) published by the OECD. The transition to the 2015 edition has started in some countries. Statistics on R&D cover intramural expenditure, in other words, all expenditures for R&D performed by enterprises or institutions in every sector of the economy in the EU Member States.

R&D intensity for a country is defined as the total R&D expenditure as a percentage of gross domestic product (GDP).

The main analysis of R&D statistics is based on four institutional sectors of performance. These four sectors are the business enterprise sector, the government sector, the higher education sector, and the private non-profit sector. Expenditure data considers the research performed on the national territory, regardless of the source of funds.

Revisions and timetable

2016 data on R&D expenditure presented in this News Release are preliminary and might therefore be revised. Following national calendar for the transmission of data, updated figures will be published in March and November 2018