EU Innovation Gap Widens Amid Low Venture Capital Investment
The European Union is at risk of falling behind in innovation due to low venture capital investment, according to Isabel Schnabel, a member of the Executive Board of the European Central Bank. At the symposium on European competitiveness organised by the German Ministry of Economy, Schnabel pointed out that Europe lags behind the US and China in fields like biotechnology, telecommunications, artificial intelligence, and green technology.
The EU's patent numbers in these areas are significantly lower than those of its competitors, largely due to investment barriers. The EU has fewer talents and receives less public and private funding, with venture capital investment in new technologies amounting to only 1% of the US GDP in 2025, compared to 0.2% in the European Union.
The ECB is urging a change in course, citing the need for increased investment in innovation. The European Commission has introduced measures to retain start-ups and promote innovation, but these initiatives may not be enough to address the issue, given the current figures.