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R&D spending in Central Europe still increasing but more support needed from authorities
2 July 2018
Deloitte Central Europe publishes new report looking into factors affecting companies’ R&D spending decisions in the region
The effectiveness and clarity of the incentives system dedicated to research and development (R&D) conducted by companies, and the ability to easily identify the R&D activities that are eligible for tax incentives and grants are amongst most important factors influencing BERD (business expenditure on R&D) in Central Europe.
This conclusion results from a Deloitte Central Europe survey designed to support the analysis of current trends and to identify the major obstacles in the way of greater investment in R&D. This year’s survey had respondents from 329 companies in nine countries across the region (Croatia, the Czech Republic, Estonia, Hungary, Lithuania, Poland, Romania, Slovakia and Slovenia) and is presented in the Deloitte Central European Corporate R&D Report 2018.
“While the innovativeness of an economy is highly linked to its direct R&D spending, a country's success in innovation is also influenced by indirect financing of R&D through incentives,” said Dinu Bumbacea, Consulting Partner-in-Charge Deloitte Romania.
In terms of R&D spending, the survey shows that slightly more than a half of respondents (52%) predict that their companies will spend more on R&D in the near future (the next one to two years) than in 2017, an increase of seven percentage points (pp) since the last survey in 2016. The pro-innovation approach appears to be even stronger when we consider the longer term. Roughly two-thirds (67%) of the surveyed companies are planning to increase their R&D expenditure during the next three to five years (a 10 pp increase over the previous edition of the survey).
Other key findings include:
- Similarly to the last survey, company secrets policies (67%) were the most commonly used means for companies to protect their IP; 12% of companies in the region use no form of IP protection at all.
- Similarly to 2016, companies see the availability of diverse support (63%) and skilled researchers (62%) as the main drivers that could cause them to increase their R&D investment.