Innovation, Digitization & Structural Change

By international comparison as well as compared to other EU policies, the EU’s Cohesion Policy evaluation system is far developed and institutionalized. This report analyses the remaining gaps and shortcomings in the Cohesion Policy evaluation system against principles established by the OECD and others and provides recommendations on how to further improve it.

Measures to promote technological sovereignty vary greatly from country to country and range from the promotion of R&D activities to subsidies for the construction of industrial plants. Systematic forecasting of technology trends would enable policy makers to deal with new technologies at an early stage and adapt policies and institutions.

The EU is losing the global innovation race. EU industry invests less than its peers in R&D, it lags way behind in software and artificial intelligence, and its pharmaceutical component is at risk. For over 20 years the same companies, mostly from the automotive sector, have dominated EU innovation activity. 

The outbreak of an unprecedented global health crisis about four years ago put the very foundations of our communities, economies and politics to the test. Policymakers had to learn and react fast to limit human and economic costs at the same time. This article highlights the importance of existing markets, technological features such as payments systems and economic decisions at the transactional level in combating the spread of a contagious disease while stabilizing aggregate economic activity.

Russia’s invasion of Ukraine in February 2022 led to gas supply in Europe dropping significantly, shaking the EU out of its complacency regarding energy procurement and consumption habits. The costs of going green on top of more expensive energy are putting a strain on European competitiveness, with higher energy prices hitting the chemical, steel and metal processing industries in countries like Germany, Spain or Poland particularly hard.