More targeted policies could boost Luxembourg innovation, says OECD


25/04/2015– Improved governance and more targeted policies to stimulate business R&D could help Luxembourg strengthen innovation as a driver of sustainable growth, increased productivity and higher standards of living, a new OECD report says.


Following a period of rapid growth and change in the country’s innovation environment, in which public spending on R&D increased from €137M in 2007 to €326M in 2014 (an increase of 238%), Luxembourg now boasts two leading-edge research centres of excellence on biomedicine and IT security, which play an important role in attempts to diversify the economy, which continues to be heavily dependent on the financial sector. 


To consolidate this progress, the OECD’s Review of Innovation Policy: Luxembourg 2015 recommends the country now enhance co-ordination across ministries and agencies and strengthen linkages between public research centres and the University of Luxembourg.  The report encourages the country to introduce a national innovation strategy that ensures public investments in research contribute to the government’s goals to diversify the economy, increase social well-being, and improve sustainability. 


The country should also work to foster innovation in the business sector, the report argues.  Mechanisms to promote private sector innovation should be better aligned with national research priorities, public support to business R&D should be made more competitive, and the impacts of innovation policy should be better evaluated.


“Luxembourg has shown decisive leadership in recent years by significantly expanding public investment in the research and innovation system, and substantially reforming its organisation and governance,” said OECD Deputy Secretary-General William Danvers, presenting the report in Luxembourg today. “The challenge now is to link these many promising initiatives better together and orient them strategically so that they contribute even more to the government’s objectives to strengthen growth and improve standards of living.”


 Luxembourg Innovation Graph


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