VARIO-memorandum 2024-2029: Greater impact through excellence in innovation and entrepreneurship

Flanders is investing heavily in research and development (R&D) with as much as 3.65% of its GDP in 2021, making it the European frontrunner. To safeguard the private share, VARIO calls, among other things, for tax incentives to remain unabated. However, the public share remains below the targeted 1%. VARIO is asking for additional resources to allow the growth path to the 1% target to be sustained.
The impression from VARIO is that today the proportions for the Flemish R&D resources with a strong share for the bottom-up resources are sound. But that bottom-up share is slowly decreasing in favor of top-down. According to VARIO, it is essential that sufficient free bottom-up resources are maintained, both for companies and for knowledge institutions. VARIO asks that the resources at the FWO increase in order to be able to finance as many excellently evaluated project proposals as possible. A stable basis of investment resources rather than one-off ad hoc resources is also needed to enable a strong Flemish 'roadmap' for participation in international research infrastructures.
Flanders is performing very well in the European framework programs. That success could be extended even more in other European programs and initiatives, which go beyond R&I. VARIO notes that such other initiatives typically require a significant amount of co-financing from member states. As a region with limited financial leverage, a strategic framework for this would allow resources to be more concentrated.
The transition from university to industrial research requires TRL4-7 level funding. Therefore, provide continuity in the innovation landscape during the transition from FWO to VLAIO.

Flanders has a pronounced SME landscape. Give them low-threshold and transparent access to innovation. And strengthen funding for start-ups and scale-ups. An accessible, and sufficiently large portfolio of long-term investments could address the financing needs of start-ups and scale-ups and provide a form of risk management for small investors.

We observe a number of important developments at EU level, including state aid rules. VARIO stresses that we must be vigilant that R&D&I continue to play a prominent role in industrial policy. Creative destruction must not be feared and sufficient leeway must be given to new players. VARIO highlights the importance of technology and industry neutrality here.
VARIO asks to keep the Flemish (knowledge) ecosystem maximally internationally connected and open. After all, the trend towards de-globalization, regional/national thinking and protectionism is gaining importance, which would be a pernicious evolution for the prosperity and well-being of a small open region like Flanders. A free and open entrepreneurial climate is important. Continue to invest in Flanders' attractiveness for foreign R&D and knowledge-intensive investments.
As a small open innovation region, bet on ambitious international entrepreneurship. More specifically, VARIO is asking to focus on strengthening R&D and business dynamics of domestic ambitious and internationally oriented companies. VARIO therefore requests that 'internationalization' be viewed sufficiently broadly when supporting enterprises. Sustainability, in the broad sense of the SDGs, must be at the core of our companies and our government. VARIO asks the government to place more emphasis on its opportunities (rather than its obligations) to make our companies more competitive and future-proof,. Further, spreading knowledge about sustainable business models can inspire innovative entrepreneurs to pursue "purpose" and help policymakers design supportive policies and financial incentives.
The challenges we face in the context of transitions (climate, energy) are extremely complex and require the input of different actors, across sectors. VARIO therefore calls for continued commitment to collaboration within the innovation ecosystem. Finally, seek win-win cooperation on innovation in fast-growing low- and middle-income countries in Africa, South America and Southeast Asia, and thus see cooperation beyond development cooperation and humanitarian aid.

The path to the memorandum officially started in July 2023, with a workshop on scenario thinking.
Advice on science, innovation and entrepreneurship depends heavily on what society will look like in the future e.g. world trade, demographics, climate.... That cannot be predicted, especially in an era of constant change and uncertain evolutions. Nevertheless, it is possible to understand the key elements that will shape the future of science, innovation and entrepreneurship. To this end, VARIO organized a scenario thinking workshop.

Scenario thinking is a strategic tool to identify possible extreme future scenarios. Each of these scenarios is described in a consistent plausible vision of the future, and their consequences are estimated. The government can then anticipate what might happen by presenting a robust strategy in the face of it. The resulting background report helped inspire the recommendations in our VARIO-memorandum.