Title: Challenges for R&I policy-making in Germany
Digital economy and society: Germany ranks only in an intermediate position with regard to exploiting opportunities from digitalization. Efforts are under way to improve digital infrastructure (5G strategy), digital education as well as eGovernment with substantial potential for improvement.
Start-up ecosystem: The number of entrepreneurs in Germany continues to decline, partly due to promising career opportunities for potential entrepreneurs in established firms given the strong labour market. Recent policy changes and developments for the increased availability of venture capital, favourable tax regulations and the establishment of a dedicated stock market segment as an exit option for early stage investors hold much promise to improve entrepreneurship in Germany.
Strengthening innovation in established firms, particularly SMEs: While overall business expenditure for R&D show strong growth rates, innovation activity has become increasingly concentrated in large firms and medium-high tech manufacturing sectors, especially automotive production. Major policy initiatives have been put in place to strengthen existing R&D policies favouring SMEs. R&D investments of SMEs have improved in 2015 which may signal a trend reversal. Political discussion has returned to considering R&D tax credits which would have the potential to foster R&D investments broadly with comparatively low administrative costs.
Resource availability for excellent science system: The German science system has significantly improved its ambition for differentiation and excellence following the joint initiative of Federal and State (Länder) governments, e.g., the Initiative for Excellence. These joint initiatives have large potential but require strategic decision-making. The Excellence Strategy and the Programme for the Support of Young Scientists hold much promise. However, it remains unclear whether they are sufficient to create attractive career opportunities for excellent researchers in Germany.