Knowledge-based Economy
By Federico Mayor Zaragoza

President of the Foundation for a Culture of Peace
Former Director-General of UNESCO


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At the 2000 Lisbon Summit, the chiefs of state and government decided to convert the European Union (EU) into "the world's leader in knowledge-based economy." Alarmed by Europe's loss of competitiveness in the manufacturing and commercial sectors, the decline in the number of European patents, the "delocalization" of companies to the east and their laboratories to the west and, above all, the exodus of young talent to the United States, they resolved to give a concerted boost to research and development (R&D) throughout Europe. In Barcelona a year later, they set the goal of increasing the approximately 1.9% of the GDP currently invested in R&D to the 3% of the United States and Japan.

The figures speak for themselves:

-The percentage of highly-cited scientific studies in the U.S. is 1.64% of the total; in Japan it is 0.59%, and in the EU only 0.25%.

- Of the 101 Nobel Prizes awarded in chemistry, medicine and physics in the last fifteen years, 68 went to the Americans, while only 23 were awarded to Europeans.

- At present, the ratio of researchers with respect to the total working population is much higher in Japan and the United States (9.3 and 8.1 per 1000 workers, respectively), compared to the 5.4 per 1000 of the former fifteen European member states.

- In training new researchers, the EU-Fifteen surpass the United States and Japan (0.56 new PhDs in science and technology per 1000 inhabitants in the European Union vs. 0.48 and 0.24 in the U.S. and Japan, respectively). But Europe encounters serious problems to retain the best of them, to offer them adequate opportunities, and to attract competent scientists from other parts of the world. In order to be truly competitive, we must copy the United States, not only with regard to its investments in R&D and its capacity for practical implementation of knowledge reflected in patent registrations and innovative formulas, but also in its recruitment of university professors and scientific researchers in general.

These are the principal situations and tendencies that must be revised. To do so, if we really wish to reach the goals set for 2010, it is imperative to be very precise with the figures and percentages for each of the European countries. Accuracy and transparency must be strictly applied when separating the percentages devoted to R&D from those of other items in the budget, such as the acquisition and technological development of military materiel. Without commenting on the necessities that Spain may have today in that regard, it is clear that such expenditures should not be charged to the percentage devoted to R&D. The same applies to the private sector's participation: frequently investments that are classified as "development" are really installations and equipment for analysis, verification and quality control, etc.

If the European Union doesn't want to relinquish the role it should play on the world stage - which is not only economic, but is also economic - it must take political decisions of a great magnitude, and with great haste. It would have been better to have taken such decisions based on prospective studies, after listening to the many voices of those who have argued for the need to promote basic research. It would particularly have been better to take those decisions based on social objectives and ideological and moral principles. But these decisions have been prompted by the forces that have the greatest power of persuasion in a world of short-term interests and short-sighted governments: by economic imperative. Nevertheless, we must take advantage of the occasion so that while gaining in competitiveness, Europe can put its own stamp on the world, and in a few years contribute to benefit the entire planet, with a new vision of development from a strengthened Europe.

As President of the ERCEG (European Research Council Expert Group), on December 15, 2003 I presented a report entitled "The European Research Council: A Cornerstone in the European Research Area" to the Danish Minister of Science, Technology and Innovation, Mr. Helge Sander, who as President of the European Union's Council of Ministers for Competitiveness, had invited me a year earlier to preside a group of experts with a view to exploring the possibilities of promoting all dimensions of basic science throughout the European area and providing the EU with the competitiveness it lacks.

The ERCEG proposals can be summarized as follows:

1) The establishment on the part of the European Union of a European fund to promote high-quality basic research and a Council to administer it. It should provide support for Europe's best groups of universities and scientific institutions, to increase the knowledge base that influences economic, industrial, cultural and social development, thus favoring the European Union's competitiveness and capacity for innovation in all of its dimensions.

2) To achieve the necessary impact, for the first 3-5 years the fund must have at least two billion Euros at its disposal. These European Union funds will be included in the "financial perspectives" of the next six-year framework program (the seventh, from 2007-2012).

3) Autonomy: the Council should operate with full autonomy with regard to all scientific and academic matters, including financing policy.

4) To fulfill its functions, the Council will use already-existing European institutions. Since universities are the natural recipients of a significant part of the funds for basic research, they must be prepared to meet this challenge, which can provide so many benefits.

5) Simultaneously, it is imperative to reinforce relations between academic and scientific institutions and corporations, so that the specific objectives of the 2001 Barcelona Declaration can be met. In university circles it is vital to learn the ways of business. For that reason the corporation-university combination is particularly relevant. Because entrepreneurs know how to judge the right moment to "do business." I like to underscore that risk without knowledge is dangerous, but knowledge without a capacity for risk is useless. Therefore scientific policy must be made at the highest levels of government in each country - and the European Union - because the EU's multi-faceted structure (academic, scientific, business, health, agricultural, environmental, marine, etc.) doesn't allow for divisions.

Europe cannot limit itself to commercial objectives. It must be a lighthouse, it must encompass the world as a whole (China, India, Latin America, Africa). And it must be a watchtower.

According to the Royal Spanish Academy, "knowledge" is the "action and effect of knowledge, understanding, intelligence, natural reason, notion, science and wisdom". I mention all of these meanings since as a Catalan, I know that "coneixement" is more frequently identified with wisdom than with knowledge: behavior that is sensible, lucid, serene. I believe that it is absolutely imperative for the splendor of Europe for us to keep this meaning closely in mind when we speak of a "knowledge-based economy."

Although we are reluctant to admit it, there has been a collective acceptance of an economy that increases differences rather than mitigating them. In early September of this year the United Nations warned that due to a lack of political will, none of the eight Millennium Objectives are being met. The first sought to reduce by half the two-thousand million people who survive on one dollar a day. Through privatization it was thought that public monopolies could be avoided. Today, through a process of concentration and "megamergers", we are faced at the national and international level with financial entities, which control all types of companies and supplies, including basic materials that the state should guarantee. Concerning R&D in Spain, Professor Joan Guinovart wrote not long ago that "it is now the politicians' turn." Politicians and parliamentarians, representatives of all citizens, who hear "the new clamor of the masses" to which the great Jose Angel Valente referred in "Sobre el tiempo presente".

We need an economy based on ethical reference points, with contributions from all ideologies, and not guided by the short-sighted and, frequently, by the devious plans of the "market". An economy that facilitates creativity and, thus, promotes the "human tension" necessary for the true expression of cultural diversity, which is the wealth of nations and the principles that unite them, their strength. An economy that has set its sights, very specially, on the future, that is, on its youth, on the generations that are marching just a step behind us. The fantastic technological development achieved will be of no avail if disenchantment and alienation take root in those who should be the protagonists of the world's stages in the next decades, in the course of history. Invest everything needed so that parents, professors and society as a whole may care, one by one, with "special love" for our children, adolescents and youth. There can be no better investment. They and none other must be the top priority of the knowledge-based economy from this day forward.

An economy based on knowledge and on "coneixement" for a great global development plan, which will give rise to the economy of that other possible world that we long for. Thus, the 21st century may finally be the century of the people. The century of genuine democracy. Of young people rescued from indifference and from the dark horizons that we offer them today. For that great leap from the reason of force to the force of reason, investing more in education, justice, health, housing... Investing, above all, in what is our hope in times of trouble: the talent and creative capacity of each unique human being. In well-educated people who determine their own destiny. Who know how to applaud or dissent, according to their own opinions. And to act accordingly, and not guided by the omnipresent and single-minded power of the mass media, which seeks to convert us into melancholy actors playing roles written by others. An economy of solidarity, so that menacing fists can forever be transformed into an out-stretched hands.



Federico Mayor Zaragoza created the Foundation for a Culture of Peace, and served as its President. In December 2002 he was appointed to the Chair (presidency) of the European Research Council Expert Group. His political posts have been: advisor to the President of the Government (1977-78), Minister of Education and Science (1981-82) and deputy in the European Parliament (1987). In 1987, Professor Mayor was elected director general of UNESCO, and re-elected for a second mandate in 1993.

The Foundation for Culture of Peace:
http://www.fund-culturadepaz.org/
The European Research Council Expert Group:
http://www.ercexpertgroup.org/


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