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Tech Sector Sees High R&D Growth
by Winter Casey
Some of the highest growth in research and development spending by top global companies in 2006 was in the technology hardware, equipment, computer and software services sector, according to research released Friday by the European Commission.
The analysis, which evaluated data from top global companies, found that technology equipment R&D spending increased by 13.1 percent in 2006 and R&D spending in computer services jumped by 13.2 percent.
The 2007 EU Industrial R&D Investment Scoreboard, which is published annually by the commission, found that the IT, pharmaceuticals and biotechnology sectors experienced the highest R&D investment intensity over the last year. The fixed line telecommunications sector experienced very little R&D intensity, which the commission defined as the ratio between R&D investment by a firm and its net sales.
The study found that the world's top four R&D investors -- Pfizer, Ford, Johnson & Johnson, and Microsoft -- are all from the United States. The scorecard also found that the top 1,000 R&D investors in the European Union increased their spending by 7.4 percent in 2006 but the top investors outside the EU increased their R&D investments by 11.1 percent.
The United States also has more companies among the scoreboard's top 50 R&D investors than the European Union. Most of the top companies investing in R&D in the European Union are from the automobile and pharmaceuticals sectors, while most of the top non-EU companies investing in R&D are in IT-related sectors, pharmaceuticals and biotechnology, the report found.
The commission, the EU's regulatory arm, said the report shows that R&D investment by EU companies is still growing at a lower rate than their non-EU counterparts. The report, however, did find that EU-based companies increased their R&D investment in 2006.
EU Science and Research Commissioner Janez Potocnik spoke optimistically about the findings.
"The positive upward trend in R&D investment seen in the last two years is encouraging, and leads me to believe that our innovation strategy is on the right track," Potocnik said in a statement. "But we must not allow ourselves to be complacent -- quite the opposite: We should reinforce the positive measures already taken to consolidate and improve private investment in R&D."
A European Commission spokeswoman said the report does not show whether EU companies that are spending more on R&D are doing so in the EU or elsewhere, therefore it is not yet known how this research could affect the EU's overall R&D gross domestic product. Sales figures for the companies that have upped their investment in R&D have increased in the EU, she said.
In the EU "there is an environment that is increasingly conducive to investing in R&D," the spokeswoman said.
But in addition to Friday's research on R&D investment by corporations, the commission has previously reported that total European R&D spending as a percentage of GDP has decreased over the past decade while countries such as China, Japan and South Korea have increased such spending. The United States also continues to spend more than Europe on R&D and has a larger high-tech sector, the report found.
In January, a commission report found that European tech investments represent about 20 percent of total R&D spending, while it represents 30 percent in the United States. The commission said that according to the latest figures, which are from 2005, overall research spending in the European Union represents 1.96 percent of GDP. Research spending is at 2.59 percent of GDP in the United States and 3.12 percent in Japan.
The European Union has said its goal is to invest 3 percent of the area's GDP in R&D. The EU spokeswoman said the EU also is aiming to have two thirds of R&D GDP spending come from the private sector and one third from the government.
China Attempts To Control TV, Movie Content
China's broadcast watchdog has asked censoring institutions and TV drama and film producers to cut back on smoking scenes in movies and on television, the Xinhua News Agency reported Friday.
The Beijing-based non-profit organization, Think Tank Research Center for Health Development, said a recent TV series aired too many smoking scenes and that 36 percent of Chinese TV dramas made in the past two years showed actors smoking in an average of 30 scenes.
The State Administration of Radio Film and Television said rampant smoking scenes in TV shows "reflect the producers' weak awareness of smoking control."
The agency acknowledged "that as there is no effective laws and regulations on smoking control in China. A ban on smoking scenes lacks [a] legal basis," Xinhua reported.
Last month Reuters reported that China had banned "sexually provocative sounds" on television. "Sexually suggestive advertisements and scenes showing how women are influenced into a life of crime are detrimental to society," the radio and film administration said.
"Commercials containing sexually provocative sounds or tantalizing language as well as vulgar advertisements for breast enhancement and female underwear are banned, effective immediately," the agency added.
The watchdog also prohibited titles including the names of "sex-related drugs, products or medical institutions."
In other news, China has cut the import tariffs on audio and video products and other electronic publications, China Daily reported Tuesday.
The government reduced the import tax from 17 percent to 13 percent on recorded cassettes, compact and digital video discs, and floppy discs on Sept. 15, the paper reported. The decision is aimed at encouraging imports of these products to reduce China's trade surplus.
Costa Rica OKs Trade Pact With U.S.
Costa Rica narrowly passed a free trade agreement with the United States this week, according to news reports.
Reuters said Costa Rica was the only country to hold a referendum on the U.S.-Central American Free Trade Agreement, which Congress approved in 2005.
In response to the news, U.S. Trade Representative Susan Schwab said in a statement Monday that the United States looks forward to working with the government of Costa Rica on the implementation of the agreement.
"The United States welcomes the outcome of the Costa Rican referendum on the free trade agreement that Costa Rica signed with the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua, and the United States," she said.
But the Alliance for Responsible Trade argues that "U.S. intervention, corruption, and the realities of an internationally financed campaign led to the passage" of the agreement.
Lori Wallach, director of Public Citizen's Global Trade Watch division, said in a statement that the votes opposing the deal in Costa Rica debunk "the claim that these pacts are motivated out of U.S. altruism to help poor people in trade partner countries, given that many of the people in question just announced that they themselves don't want this kind of trade policy."
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