11 July 2023

Flanders, a region known for its vibrant innovation landscape, continues to prioritize and invest in science and innovation. In 2022, the Flemish government allocated a total budget of €3.1 billion for science and innovation, reflecting a 3.6% decrease compared to the previous year. With a robust ecosystem that fosters collaboration among private, public, and academic entities, Flanders offers a fertile ground for companies seeking sustainable growth through innovation. 

Unveiling Flanders’ Strong Commitment to Research and Development 

Supported by a government committed to promoting business innovation and a favorable tax system, Flanders provides the ideal environment for companies to recover their investments in innovation. In this article, we will explore why Flanders stands out as a leader in R&D and innovation in Europe, and how partnering with FI Group can unlock your company’s strategic business plan. 

Steady Growth in Science and Innovation Budget 

From 2009 to 2022, the budget for science and innovation in Flanders experienced a significant increase of 76%. This demonstrates the region’s commitment to fostering research and development activities that drive economic and societal progress. 

Flanders consistently ranks among the top innovation environments in Europe and the world. Let’s look at some notable rankings: 

These accolades highlight Flanders’ commitment to fostering a culture of innovation and its remarkable success in doing so. 

Focus on Research and Development (R&D) 

The majority of government funding for science and innovation in Flanders is allocated to research and development (R&D). In 2022, €2 billion was dedicated to R&D, making it the largest category. The second-largest allocation goes to education and training, with €937 million, while scientific and technological services receive €150 million. This highlights the importance placed on R&D as a key driver of innovation and progress in Flanders. 

To enhance Flanders’ global competitiveness, the region has established spearhead clusters. These clusters bring together private companies, public organizations, and academic institutes with a shared focus on collaboration, innovation, and long-term growth. Through financial support and ongoing assistance, these clusters create fertile ground for R&D collaboration in key domains. By joining these clusters, companies can leverage collective expertise, exchange knowledge, and unlock new business opportunities. 

Emphasis on Targeted Research

Since 2002, the share of “targeted research” in the overall government budget for science and innovation has consistently exceeded that of “non-targeted research.”

  • Targeted research aims to achieve specific economic or societal goals;
  • while non-targeted research is driven by scientific ambition and curiosity. 

In 2010, the share of targeted research stood at 59%, which decreased to approximately 50% in 2015 and 2016. However, in subsequent years, the share of targeted research started to rise again. As of 2020, the shares of targeted research (55%) and non-targeted research (45%) have remained relatively stable. This balanced approach ensures a focus on both practical applications and fundamental scientific exploration. 

  • Flanders is home to five prestigious universities that are at the forefront of innovation. These universities not only contribute significantly to the region’s scientific output but also rank among the most innovative universities worldwide. 
  • Flanders strives to be a pioneer in the European knowledge society and economy across various sectors. The region is home to four cutting-edge strategic research centers and numerous scientific institutes and R&D platforms. By tapping into this network, companies gain access to top-notch research facilities, expertise, and resources that fuel innovation and drive competitive advantage. 

Flanders’ Outperforms EU27 Average 

Flanders’ commitment to R&D funding surpasses the average of EU countries for which data is available. In 2020, Flanders allocated 0.82% of its GDP to R&D, exceeding the European Union’s average of 0.65%. Germany leads the pack with 0.96%, while Latvia and Ireland recorded the lowest shares at 0.24% and 0.22%, respectively. This highlights Flanders’ dedication to investing in science and innovation to drive economic growth and societal progress. 

Flanders demonstrates its commitment to innovation through substantial investments in R&D. According to the Community Innovation Survey (CIS), 75% of Flanders’ companies across industries invested in product and/or process innovations between 2018 and 2020. Impressively, Flanders allocated 3.6% of its GDP to R&D in 2020, securing its position as Europe’s leading region in R&D spending. Additionally, Flanders ranks 26th worldwide for gross expenditure on R&D and 3rd in Europe for R&D intensity

R&D Tax credits 

Flanders offers a range of tax credits, grants, and incentives to support companies in their R&D endeavors. These include: 

These incentives make Flanders an attractive destination for companies looking to maximize their R&D investments and drive innovation. 

Flanders has established itself as a leader in R&D and innovation in Europe. With stable growth in the science and innovation budget, a focus on targeted research and a thriving ecosystem that fosters cooperation between different actors, Flanders continues to attract companies pursuing sustainable growth and innovation.

By investing in R&D, companies can benefit from tax breaks and subsidies, access high-quality research facilities and collaborate with leading universities and research centres. All this contributes to Flanders’ position as an attractive and thriving hub for innovation.

With FI Group as your trusted partner, you can navigate your way through the changing landscape of R&D funding and make the most of the incentives available.

Yvette Poumpalova 

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