Strategic Vision for Regional Development and European Integration: An Innovation Area in Central and South-East Europe

G. Fayl, I. Bilik, I. Hronszky, T. Kemény, É. Nagy, J. Pakucs, G. Pethes, and J. Veress

Issue: According to available competitiveness indicators, many of the candidate countries will trail behind the rest of the EU when they join the EU on May 1st 2004.

Relevance: The creation of an "innovation area" in central and south-east Europe will help the countries concerned catch up with their stronger partners in the European Union. An "innovation area" of this kind could be the outcome of a pro-active, trans-national education & science & technology & innovation cooperation strategy involving the regions of the new EU Member States. Whenever possible, the broadest European participation should be sought.

It is generally recognised that innovation is a precondition for economic growth. Innovation means creative development in terms of both production methods and organisation. It leads to enhanced productivity, and quality, and hence to more competitive products. Hence, innovation is a measure of competitiveness. A key feature of dynamic, sustained innovation is that it often leads to more and better job opportunities. Thus, it has the potential to improve living and working conditions and ensure the economic basis for high-quality public services. All these are significant contributing factors to ensuring a stable and prosperous society.

When looking for complementary measures to improve the innovation potential of the EU, the following should be kept in mind. Firstly, regional economies play an important role in the wider dynamics of innovation and economic growth. Moreover, the current trend towards globalisation necessitates new forms of cooperation, even between previously competing groups, in order to acquire and maintain competitive advantage at the global level. In this context, the enlargement of the EU should be considered as an important opportunity to increase Europe's role in the process of globalisation.

Direct cooperation between regions, regardless of national borders, offers the EU, and Europe as a whole, a novel and challenging possibility for more active participation in the globalisation process in a way that enhances its competitiveness. Regions with high potential for knowledge creation offer particularly attractive opportunities for such initiatives. These regions need to be home to good quality universities and/or public and private research centres. And these need to possess adequate complementarities in terms of human resources and research infrastructures. Moreover, appropriate micro- and small/medium size enterprises should be present in these regions or adequately close links exist to them.

Integrating Europe's innovation potential within a "European Innovation Area" will open the door to new opportunities. The process needs to be promoted both through individual institutions in the different countries as well as through developing trans-border regional areas cooperating with each other and the rest of the EU and Europe. In this way trans-border regional cooperation activities can achieve synergies of expertise that might otherwise not be realised.

Regional innovation systems based on open learning networks are potentially more flexible and dynamic than systems that confine learning and transfer of experience to individual companies or institutions. Regional learning networks can enable information flows, mutual learning and economies of scale (O'Doherty, Arnold, 2003). More and more attention is now being paid to the regions' own policies as a complement to the nation state's own regional policy, so regional authorities need to be brought into the process of economic and social cohesion (Horváth, 2002). However, this is not an automatic process and cannot be done without transferring certain responsibilities to the regions. Decentralisation would minimise unnecessary "red tape", and ideally avoid it altogether.

Optimal conditions should be created for cooperation at regional level to take place on a voluntary basis. To be most efficient, research centres and (in most cases micro- and small size) enterprises, including incubators, should cooperate directly, regardless of national borders (see Box 2). Whenever possible, the participants should take full advantage of the support mechanisms offered through the EU framework for cooperation between regions across national borders. These measures include relevant parts of the RTD Framework Programme, in addition to the Structural Funds (the main instrument to promote social and spatial cohesion within the EU).

With adequate public and private economic support, and sustained political endorsement, enhanced cooperation could evolve between regions in central and south-east Europe that fulfil the "complementarities" criteria alluded to above. For example, illustrative examples along the Hungarian border could include: (i) Miskolc / Kosice / Krakow; (ii) Debrecen / Cluj / Oradea; (iii) Szeged / Arad / Timisoara / Beograd / Novi Sad; (iv) Pécs / Zagreb / Ljubljana / Koper / Maribor; (v) Györ / Sopron / Vienna / Bratislava / Brno / Komarno, just to give a few of the possible examples.

It is significant that these countries have a long tradition in good, sometimes excellent, higher education and basic research. This tradition offers an outstanding opportunity to contribute to the achievement of the Lisbon- and European Research Area objectives. However, to date, the potentials of these resources have been somewhat underutilised. National borders have hindered cooperation, sometimes to the extreme. Another shortcoming is that most of these countries lack experience in efficiently translating promising research results into practical and marketable applications. More experienced countries and regions should offer much needed advice and support in this respect.

Trans-border regional cooperation of the kind suggested above could eventually lead to voluntary resource pooling and the coordination of research activities in fields of common interest. A current example of this development is the "Bonus" project, where organisations from eight countries around the Baltic Sea have decided to work together in the area of marine research (CORDIS-1, 2004). The countries involved comprise are four EU Member States (Denmark, Finland, Germany and Sweden) and four Accession Countries (Estonia, Latvia, Lithuania and Poland).

Box 2. Initiative to energise innovation potential

Early 2003, a group of experts suggested the establishment of an "innovation area" in central and south-east Europe. The experts came from various parts of civil society and they joined the initiative in a personal capacity. The group met several times in order to formulate their strategy and an action plan for the initiative.

The fundamental paradigm of this initiative is that full use of the innovation potential of the countries involved will help them to become strong partners in the European Union. This innovation potential in central and south-east Europe has existed throughout history, but has been under utilised because national borders have hindered cooperation, sometimes to the extreme.

The basic instrument of the initiative is active, voluntary cross-border regional level networking between universities, research centres and enterprises (above all, micro- and small-sized ones). Networks will be open to all relevant actors that interested both within and beyond national borders. Moreover, attention will be paid to initiatives with similar aims. This includes relevant parts of the "Central European Initiative" that is an integrated, government-level framework of dialogue, coordination and cooperation among its member countries in the political, economic, cultural and parliamentary fields. (CEI, 2004).

The intended outcome of this pro-active trans-national education & science & technology & innovation co-operation strategy is the creation of an "innovation area". This will emphasise trans-border regional co-operation among the new EU Member States (i.e. Czech Republic, Hungary, Poland, Slovenia and the Slovak Republic) and, whenever possible, be extended to regions in the Applicant Countries and other parts of Southeast Europe. Moreover, whenever possible, appropriate partners should be invited from regions in Austria, Bavaria, Greece and Italy. Networking with centres of excellence in Russia, Ukraine and Belarus might be useful.

This is an outline of an independent, non-partisan initiative. On the occasion of the first World Science Forum (Budapest, 10 Nov. 2003), the Hungarian Prime Minister Péter Medgyessy, expressed the need and his support for the initiative and urged for steps to make in this direction.

The importance of an "innovation area" in central and south-east Europe

Regional level cooperation between the new Member States and Applicant Countries in central and south-east Europe will be beneficial for all the parties concerned. As these countries face similar structural challenges during the current process of transformation and development towards market economies, they would be able to learn from each other's experience. Moreover, most of them need to gain more hands-on experience in relation to maximising results of knowledge production for wealth creation.

There are also several crucial economic reasons for the development of an "innovation area" in central and south-east Europe.

To perform optimally, the regions' economies need greater market-access. Goods and services from the new Member States will have to compete head-on with existing goods and services already complying with EU standards and regulations. The consumers' measurement criteria will include price, quality, knowledge content and after-sales service.

The main market development potential in Europe for the foreseeable future will be in both central and south-east Europe. EU and overseas companies are already aggressively targeting these markets as can be witnessed by their marketing efforts.

Trans-border, regional cooperation in central and south-east Europe could lead to an "innovation area" and thereby boost progress towards creating a knowledge-based economy and society in this part of Europe. Obvious proximity considerations resulting from such a regional "innovation area" would further enhance the potential of these countries to produce usable innovations. It would also help to integrate these countries more closely with the "European Innovation Area" as a whole.

It is reasonable to suppose that in the medium to long term it will be high knowledge-content, rather than low labour costs, that will attract further foreign investments to central and south-east Europe.

Furthermore, the establishment of an "innovation area" in central and south-east Europe would promote direct non-political dialogue in the region. We could also hope that growing trans-border cooperation will moderate nationalistic tendencies present in certain segments of society in some of these countries. Together with rising living standards, it could therefore help promote regional stabilisation and full integration with the EU.

However, the full benefit of such an "innovation area" will only be achieved if cooperation is completely open and does not exclude potential partners from beyond these countries' regions. Following on from this, the current initiative (see Box 3) is not an alternative to broader EU-level cooperation.

Policy approaches to promoting regional innovation

Against the background described above, the options available to the public authorities to promote regional innovation could include the following:

An encouraging development in the context of less-developed regions is the effort the EU is making to bridge the digital divide that separates the Balkans from the rest of Europe (see Box 4).

With support of EU funds, the pan-European high-speed research network, GÉANT, has recently been extended to the Balkan countries with the completion of the "South Eastern European Research and Education Networking" (SEEREN) project. This project has provided more than just technical connectivity. Bridging the digital divide that still separates the Balkans from the rest of Europe was one of the key aims of the project. To this end, the project consortium has been active in encouraging EU Member States to work together with researchers from Southeast Europe.

The extension includes Albania, Bosnia and Herzegovina, Bulgaria, Greece, the Former Yugoslav Republic of Macedonia, Romania, and Serbia and Montenegro. It improves online access for researchers, thus enabling full participation and integration of the Balkan research community in the European Research Area.

The network also provides connection to North America and Japan, while further links to the Latin American and Mediterranean regions will be operational shortly. (CORDIS-2, 2004).

Conclusion

Initiatives are needed to strengthen cooperation on education, science, technology and innovation between the countries and regions involved, as well as with other countries and regions of the European Research Area. However, such initiatives should not be understood as suggesting a universal recipe for promoting regional innovation capacity. The issue is more complex. Solutions must be found locally. Realising trans-boarder cooperation is a main policy challenge for regions in transition economies (Dory, 2002). Initiatives such as that described here can become an element in reinforcing the strategies of the regions in the central and south-east European countries.

Figure 1. The CEIA International Consortium

The backbone of the "innovation area" in central and south-east Europe is a pro-active trans-national cooperation strategy on education, science, technology and innovation. Its active promotion will eventually result in more and better jobs - an admirable and necessary objective. The challenges are clear, but so are the opportunities.

Keywords

European integration, innovation, knowledge creation, regional development, trans-border regional cooperation

Notes

1. This article represents the views of its authors and not necessarily those of their respective organisations.

2. http://europa.eu.int/comm/lisbon_strategy/index_en.html

3. The Central- and Eastern European Network (CEN) is a platform for informal dialogue among the Presidents of national Academies of Science from the countries in Central- and Eastern Europe. The Presidents participate in their personal capacity and do not represent their Academies as such. The initiative for the CEN was taken in 2003 by the European Academy of Sciences and Arts, and supported by the City of Vienna, in connection with the forthcoming enlargement of the EU.

References

Contact

Gilbert Fayl, European Academy of Sciences and Arts
e-mail: gilbert.fayl@pandora.be

About the authors