(AGENPARL) – mar 07 marzo 2023 Corporate Use
https://www.eib.org/en/press/all/2023-094-eib-investment-report-2022-2023-eu-firms-are-less-likely-to-innovate-or-adopt-new-technologies-than-their-us-peers
PRESS RELEASE
2022-094-EN
8 March 2023
EIB Investment Report 2022-2023: EU firms are less likely to innovate or adopt new technologies than their US peers
– Europe must act now to address structural challenges.
– Investment volumes in Europe are not sufficient to meet net-zero targets.
– Productive investment in Europe is 2% of GDP less than in the United States (and has been for over a decade).
– Firms’ investments are hampered by uncertainty, skills shortages, and energy costs.
Europe must raise productive investment spending significantly if it is to keep pace with global competition and meet net-zero goals, according to the EIB Investment Report 2022-2023. The gap in productive investment between the EU and the US is nearly 2% of GDP, a lag that has persisted for more than ten years. The EIB Investment Report — an annual publication based on the EIB Investment Survey answered by around 12 500 businesses across Europe — shows that the share of firms engaged in innovation dropped last year compared to 2021. Businesses named uncertainty, skill shortages and high energy costs as the major constraints on investment.
“Europe’s future depends on our ability to transform and embrace the digital and green transitions. This calls for bold investment in both the public and the private sectors. However, uncertainty, driven by unpredictable policy and market conditions, is proving to be a barrier to investment decisions,”said EIB Chief Economist Debora Revoltella ahead of the report’s release, at the inaugural EIB Forum in Luxembourg. “The opportunity of the green transition cannot be missed. Europe can leverage on its innovation lead in many green technologies and should further exploit the potential of the EU single market, reducing administrative hurdles for investment and addressing gaps in skills.”
Data from the EIB Investment Survey show that EU firms are less likely to innovate or adopt new technologies than US firms. This is a persistent gap, exacerbated by the pandemic, when firms in Europe proved less likely to transform than those in the United States.
“The Investment Survey data showed that the European underinvestment in innovation as well as machinery and equipment could compromise Europe’s ability to compete in the long term, and this is even more true for businesses in cohesion regions,” commented Lilyana Pavlova, Vice-President at the EIB. “We need a targeted support. The number of venture capital funds with €200 million to 500 million to invest is three times greater in the US than in Europe. If Europe is going to be competitive, this must change now. To address the continent’s venture capital lag, the European Investment Bank Group [has just launched](https://www.eib.org/en/press/all/2023-056-launch-of-new-fund-of-funds-to-support-european-tech-champions) with a number of EU member states the European Tech Champions Initiative. The necessary resources must be mobilised quickly and, on an EU-wide scale, with the express goal of mobilizing private investment.”
Green investment by companies advanced in 2022, following a dip during the pandemic. However, the outlook for corporate investment to tackle climate change is mixed, dampened by administrative barriers and uncertainty. EIB analysis of the drivers of firms’ green investment suggests that this uncertainty may partially outweigh the incentives created by higher energy prices.
While Europe is trailing behind the United States in digital innovation, green technologies are a field in which the European Union has remained an innovation leader. In patenting green technologies, Europe’s main strengths lie in transport, smart grids, and wind energy. Still, its current edge could be under threat.
Global competition around green technologies are intensifying, particularly with the US Inflation Reduction Act and China’s growing focus in this area. While Europe has been a leader in green innovation so far, it must continue to build on that position by seizing opportunities created by its single market. Clear policy frameworks, a level playing field within Europe, investment in skills, and conscious efforts to maximise the complementarity of public and private investment activities will all play a role.
Skills are crucial in the digital and green transitions. 69% of municipalities polled by the EIB stated that they lack the environmental and climate assessment skills needed to advance green investments. Despite policy support, regional cohesion is also at risk, with less developed regions in Eastern Europe relatively more exposed to a combination of stressors. Addressing local capabilities, fiscal constraints and regulatory hurdles will be especially decisive for the successful implementation of the Recovery and Resilience Facility.
Governments must preserve and strengthen incentives for a greener, better integrated single market that is well shielded from turbulence, while also delivering policies that reduce uncertainty and enable firms to invest.
EU members are addressing energy security from vastly different starting points
Like geopolitical uncertainty and migration, the energy shock tends to affect Central and Eastern Europe more than other EU regions. The amount of energy used relative to GDP tends to be higher in CEE. For example, the energy intensity of the Czech Republic’s output was twice that of Germany in 2019, and Bulgaria’s was more than four times that of Italy. In part, this reflects the region’s specialisation in energy-intensive production. In addition, production and buildings in these areas are less energy efficient. Energy-intensive industrial production declined by more in CEE from January to September 2022 than in the rest of the EU.
Because fuel mixes and dependence on Russian energy vary considerably between EU members, the same energy shock has different implications for European economies. Fuel mixes result from resource availability, geographic position, economic structure and national energy policy. For example, the share of solid fuels (hard coal, lignite and coal products) was highest in Poland (40%) and the Czech Republic (30%), while Estonia has a unique mix with peat and peat products accounting for 52%. The share of petroleum products stood out in Cyprus (87%) and Malta (86%), as well as in Luxembourg (60%). Natural gas accounted for more than 30% in the Netherlands, Hungary, Ireland, Croatia and Romania. France had the highest nuclear share (41%), followed by Sweden (25%), Slovakia (25%), Bulgaria (24%) and Slovenia (23%). Generally, countries that were less dependent on fossil fuels had a mix of nuclear and/or renewables, including Sweden, France and Denmark.
Refugees from Ukraine are providing a welcome injection of new workers into the labour market
Ongoing immigration from Ukraine is likely to increase the labour supply significantly in the Czech Republic, Poland and Estonia, and throughout the EU primarily in the services sector. Based on the size of the refugee population relative to their host countries, as well as the historical activity and historical employment rates for refugees, the OECD (2022) estimates that refugees from Ukraine are likely to increase the EU labour supply by 0.5% by the end of 2022, with larger increases expected in Poland (+2.1%), the Czech Republic (+2.2%) and Estonia (+1.9%). Most adult refugees are women.
Refugees are highly qualified. According to UNHCR (2022b), which surveyed 4 900 refugees between mid-May and mid-June 2022, half are university-educated (vs. 29.5% of adults in the European Union), and an additional one-quarter of refugees have technical or vocational education. Three-quarters were working before they left Ukraine, primarily in education, trade and healthcare.
In several European countries close to the conflict area, labour markets were very tight when the conflict erupted. Throughout much of the region, unemployment was extremely low. For example, only 2.4% of people aged 15 to 74 were unemployed in the Czech Republic, 2.9% in Germany and 3% in Poland. In Slovakia, migrants are filling jobs in trade and services that would otherwise have remained unoccupied.
Background information
About the EIB Investment Report
The EIB Investment Report is the annual flagship report of the European Investment Bank. Designed to serve as a monitoring tool, it provides a comprehensive overview of the developments and drivers of investment and its finance in the European Union. The report combines internal EIB analysis with the results of collaboration with leading experts to explain key market trends and give a more in-depth look at a particular thematic focus. The 2022-2023 edition reflects the EU economy’s resilience to repeated shocks and its capacity to renew itself, delivering on the promise of productive public and private investment. It incorporates the latest results from the [annual EIB Investment Survey](https://www.eib.org/en/about/economic-research/surveys-data/investment-survey.htm), covering the answers of some 12 500 firms across Europe to a broad spectrum of questions on corporate investment and investment finance, as well as a survey of EU municipalities.
Press contacts

Testo Allegato:
PRESS RELEASE2022-094-EN8 March 2023EIB Investment Report 2022-2023: EU firms are less likely to innovate or adopt new technologies than their US peersEurope must act now to address structural challenges.Investment volumes in Europe are not sufficient to meet net-zero targets. Productive investment in Europe is 2% of GDP less than in the United States (and has been for over a decade).Firms’ investments are hampered by uncertainty, skills shortages, and energy costs.Europe must raise productive investment spending significantly if it is to keep pace with global competition and meet net-zero goals, according to the EIB Investment Report 2022-2023. The gap in productive investment between the EU and the US is nearly 2% of GDP, a lag that has persisted for more than ten years. The EIB Investment Report — an annual publication based on the EIB Investment Survey answered by around 12 500 businesses across Europe — shows that the share of firms engaged in innovation dropped last year compared to 2021. Businesses named uncertainty, skill shortages and high energy costs as the major constraints on investment. “Europe’s future depends on our ability to transform and embrace the digital and green transitions. This calls for bold investment in both the public and the private sectors. However, uncertainty, driven by unpredictable policy and market conditions, is proving to be a barrier to investment decisions,” said EIB Chief Economist Debora Revoltella ahead of the report’s release, at the inaugural EIB Forum in Luxembourg. “The opportunity of the green transition cannot be missed. Europe can leverage on its innovation lead in many green technologies and should further exploit the potential of the EU single market, reducing administrative hurdles for investment and addressing gaps in skills.”Data from the EIB Investment Survey show that EU firms are less likely to innovate or adopt new technologies than US firms. This is a persistent gap, exacerbated by the pandemic, when firms in Europe proved less likely to transform than those in the United States. “The Investment Survey data showed that the European underinvestment in innovation as well as machinery and equipment could compromise Europe’s ability to compete in the long term, and this is even more true for businesses in cohesion regions,” commented Lilyana Pavlova, Vice-President at the EIB. “We need a targeted support. The number of venture capital funds with €200 million to 500 million to invest is three times greater in the US than in Europe. If Europe is going to be competitive, this must change now. To address the continent’s venture capital lag, the European Investment Bank Group has just launched with a number of EU member states the European Tech Champions Initiative. The necessary resources must be mobilised quickly and, on an EU-wide scale, with the express goal of mobilizing private investment.” Green investment by companies advanced in 2022, following a dip during the pandemic. However, the outlook for corporate investment to tackle climate change is mixed, dampened by administrative barriers and uncertainty. EIB analysis of the drivers of firms’ green investment suggests that this uncertainty may partially outweigh the incentives created by higher energy prices. While Europe is trailing behind the United States in digital innovation, green technologies are a field in which the European Union has remained an innovation leader. In patenting green technologies, Europe’s main strengths lie in transport, smart grids, and wind energy. Still, its current edge could be under threat.Global competition around green technologies are intensifying, particularly with the US Inflation Reduction Act and China’s growing focus in this area. While Europe has been a leader in green innovation so far, it must continue to build on that position by seizing opportunities created by its single market. Clear policy frameworks, a level playing field within Europe, investment in skills, and conscious efforts to maximise the complementarity of public and private investment activities will all play a role. Skills are crucial in the digital and green transitions. 69% of municipalities polled by the EIB stated that they lack the environmental and climate assessment skills needed to advance green investments. Despite policy support, regional cohesion is also at risk, with less developed regions in Eastern Europe relatively more exposed to a combination of stressors. Addressing local capabilities, fiscal constraints and regulatory hurdles will be especially decisive for the successful implementation of the Recovery and Resilience Facility. Governments must preserve and strengthen incentives for a greener, better integrated single market that is well shielded from turbulence, while also delivering policies that reduce uncertainty and enable firms to invest. EU members are addressing energy security from vastly different starting points Like geopolitical uncertainty and migration, the energy shock tends to affect Central and Eastern Europe more than other EU regions. The amount of energy used relative to GDP tends to be higher in CEE. For example, the energy intensity of the Czech Republic’s output was twice that of Germany in 2019, and Bulgaria’s was more than four times that of Italy. In part, this reflects the region’s specialisation in energy-intensive production. In addition, production and buildings in these areas are less energy efficient. Energy-intensive industrial production declined by more in CEE from January to September 2022 than in the rest of the EU.Because fuel mixes and dependence on Russian energy vary considerably between EU members, the same energy shock has different implications for European economies. Fuel mixes result from resource availability, geographic position, economic structure and national energy policy. For example, the share of solid fuels (hard coal, lignite and coal products) was highest in Poland (40%) and the Czech Republic (30%), while Estonia has a unique mix with peat and peat products accounting for 52%. The share of petroleum products stood out in Cyprus (87%) and Malta (86%), as well as in Luxembourg (60%). Natural gas accounted for more than 30% in the Netherlands, Hungary, Ireland, Croatia and Romania. France had the highest nuclear share (41%), followed by Sweden (25%), Slovakia (25%), Bulgaria (24%) and Slovenia (23%). Generally, countries that were less dependent on fossil fuels had a mix of nuclear and/or renewables, including Sweden, France and Denmark.Refugees from Ukraine are providing a welcome injection of new workers into the labour marketOngoing immigration from Ukraine is likely to increase the labour supply significantly in the Czech Republic, Poland and Estonia, and throughout the EU primarily in the services sector. Based on the size of the refugee population relative to their host countries, as well as the historical activity and historical employment rates for refugees, the OECD (2022) estimates that refugees from Ukraine are likely to increase the EU labour supply by 0.5% by the end of 2022, with larger increases expected in Poland (+2.1%), the Czech Republic (+2.2%) and Estonia (+1.9%). Most adult refugees are women. Refugees are highly qualified. According to UNHCR (2022b), which surveyed 4 900 refugees between mid-May and mid-June 2022, half are university-educated (vs. 29.5% of adults in the European Union), and an additional one-quarter of refugees have technical or vocational education. Three-quarters were working before they left Ukraine, primarily in education, trade and healthcare. In several European countries close to the conflict area, labour markets were very tight when the conflict erupted. Throughout much of the region, unemployment was extremely low. For example, only 2.4% of people aged 15 to 74 were unemployed in the Czech Republic, 2.9% in Germany and 3% in Poland. In Slovakia, migrants are filling jobs in trade and services that would otherwise have remained unoccupied.Background informationAbout the EIB Investment ReportThe EIB Investment Report is the annual flagship report of the European Investment Bank. Designed to serve as a monitoring tool, it provides a comprehensive overview of the developments and drivers of investment and its finance in the European Union. The report combines internal EIB analysis with the results of collaboration with leading experts to explain key market trends and give a more in-depth look at a particular thematic focus. The 2022-2023 edition reflects the EU economy’s resilience to repeated shocks and its capacity to renew itself, delivering on the promise of productive public and private investment. It incorporates the latest results from the annual EIB Investment Survey, covering the answers of some 12 500 firms across Europe to a broad spectrum of questions on corporate investment and investment finance, as well as a survey of EU municipalities.Press contactsKatarina Karmazinova | k.karmazinova@ext.eib.org | tel.: +421 730 156 873Nikos Chrysoloras | n.chrysoloras@eib.org | tel.: +32 473 13 4760Serena Sertore | s.sertore@eib.org | tel.: +352 437 970 859Website: wwww.eib.org/press | Press Office: +352 4379 21000 — press@eib.org