Work program 2024

Complementary to foreign knowledge-intensive investments, we must continue to focus on ambitious domestically-owned companies that have the potential to grow in the longer term into international ‘flagships’ This advisory process on the importance of International Ambitious Entrepreneurship for a small region like Flanders is in line with Recommendation 5 from Advisory report 28 ‘Foreign private investments in R&D and knowledge-intensive production (d.d. June 2022). Flanders itself, unlike innovative benchmark countries such as the Netherlands, Switzerland, Sweden has (too) few large multinational companies of its own. This advisory process also ties in with the pursuit of open strategic autonomy and technological sovereignty. VARIO will continue this follow-up advice to Advisory Report 28 early 2024.

In its Memorandum 2024-2029, VARIO emphasizes the importance of boosting our productivity growth in a sustainable and multidimensional way by focusing on innovation as well as entrepreneurship. Productivity growth has been declining in Flanders for two decades, more than in comparable economies. Productivity growth means that the 'input' of our economy (such as labour, capital and environmental elements) results in a greater 'output' (such as gross domestic product) due to higher efficiency. Low productivity growth leads, among other things, to limited wage growth and a delay in the improvement of pensions, health care and welfare. Higher productivity growth allows more financial resources to be generated, making new investments permanently possible, especially in innovation and infrastructure, to realize sustainable transitions. The decreased productivity growth already raises two questions in relation to innovation. Through which policy interventions can new technologies and innovations be deployed to increase efficiency and therefore productivity? And to what extent is the way in which productivity is measured today adapted to a knowledge environment, a context with increasing importance of digitalization, the use of artificial intelligence, circularity and greening, etc.?

New dynamics are at work in our society, in which commercialization and financial profitability on the one hand and social and ecological objectives on the other, i.e. profit and non-profit, have apparently come into conflict with each other. However, in its advisory report 20, VARIO already pointed out that profit and purpose are perfectly compatible. The impact of non-profit on innovation is already the subject of academic studies. In this new advisory process, VARIO wants to investigate whether companies that combine social and ecological objectives with financial profitability can be more and better stimulated and supported by the Flemish Government. In that context, the role of alternative business forms, such as Steward-Ownership, where company ownership is shared with employees and other stakeholders, will be discussed. These types of business forms can, for example, provide more stable and responsible business operations in the long run. It will also be examined whether other and/or new forms of financing are possible and appropriate, such as the use of financial resources from private individuals. This can also be generally interesting for start-ups and scale-ups.

There is tremendous dynamism and potential in many low- and middle-income countries. For example, there are great opportunities for economy, innovation and entrepreneurship in fast-growing countries on the continents of Africa, South America and Southeast Asia. Given the geographical proximity, Africa in particular comes into focus for Flanders. By concentrating more on cooperation with those fast-growing countries, we can strengthen both their and our own region. In its memorandum, VARIO already cites a number of ways in which this can be done concretely, but the council would like to elaborate further on this in an advisory process. The advisory process also ties into the broader theme of internationalization that is continuously on VARIO's radar: how Flanders can learn lessons from other regions in the world to further improve its own innovation system.