The balance of power is far from equal South Korea being a superpower in innovation. For years, South Korea has been spending 4.5 percent of its GDP on research and development (R&D) as a result of which the country is the world leader in R&D spending. The majority of the most innovative countries (Sweden, Finland or Japan) spend between 3 and 3.5 percent on R&D, while average R&D spending in the European Union was just slightly over 2 percent in 2014.

The Visegrad Four countries are lagging far behind. Only the Czech Republic is close to the EU average; the current R&D spending of Hungary is around 1.4 percent and the remaining countries spend less than 1 percent of their GDP. A wide wage gap has emerged between researchers in the CE region and in the most developed countries and this is the reason why young talents are attracted to find employment abroad.

With the exception of the Czech Republic, the poor innovation performance of small and medium-sized enterprises (SMEs) can be identified as a common weakness in the region. In terms of percentage of SMEs with innovation performance, the Czech Republic (nearly 30 percent in the case of small and almost 50 percent of medium-sized enterprises) reaches the EU average; in Hungary the corresponding figures are 12 and 26 percent and the other two V4 countries are also at similar levels. What common strategy should be applied by the V4 countries sharing similar capabilities and interests and representing only an insignificant economic power globally, to be able to become catching-up innovation partners? Indeed, the unison of four poor persons will not lead to their common wealth.

The unprecedented amount of funds available to stimulate R&D and innovation (RDI) in Hungary and in the other V4 countries is a unique opportunity to seize; the total amount available from the EU and domestic funds in the period between 2014 and 2020 is HUF 1,200 billion. By 2020, 1.8 percent of Hungary’s GDP will be available for R&D, which is still well below the EU level. It is important that the V4 countries use the EU funds as complementary development resources and not instead of domestic subsidies in order to prevent the region moving further away from its competitors. ( Challenging is the fact that the regions most developed in terms of RDI will have access to a very limited amount of funds in the 2014–2020 programming period.)

Economies of scale also call for a more dynamic collaboration of the V4 countries in the field of science and RDI and there are opportunities for take-off. Synergies between research projects and business R&D and opportunities for the joint marketization of the results should be identified. Joint projects and a coordinated action would further enhance the region’s competitive edge presented by the outstanding performance at 22–23 percent of the GDP of the manufacturing industry in CE countries compared to 15 percent in the EU.

It is essential that researchers have access to the most advanced international infrastructures. As membership and subscription rates are extremely high, consortia should be established in order to share the costs as already demonstrated by various regional cooperation schemes. At the same time, the salaries of researchers should be raised to retain the best professionals in Hungary.

In cooperation, the countries concerned would be able to utilize their resources and catch up more efficiently. This is the way how the V4 countries can become strong partners in projects of the most advanced countries of the EU after 2020,when they will have to compete internationally for a larger proportion of available R&D funding. The V4 cooperation can take on a new dimension with the help of strategic innovation partnership.It is of major importance that the representatives of the V4 countries have the opportunity to discuss take-off opportunities for regional innovation and identify the toolsets and efficient incentives enabling a dynamic cooperation at the think.BDPST conference to be held in March 2016. A successful dialogue can boost further action and the international cooperation of the V4 countries can lead to R&D achievements that will shape our future.

Source: Világgazdaság, 01/21/2016, Page 12