STIMULATING INDUSTRIAL INNOVATION FOR SUSTAINABILITY:
AN INTERNATIONAL SURVEY FOCUSED ON TECHNOLOGY
BELGIUM
Drs. Sandy Bosman (RAND Europe)
TABLE OF CONTENTS
1. INSTITUTIONAL CONTEXT/BACKGROUND.................................................................1
1.1. Political and economic context ..............................................................................1
1.2. Belgian industry profile .........................................................................................2
1.3. Institutional context ...............................................................................................3
1.4. Regional government (Flanders and the Flemish Community) .............................6
1.4.1. Policy context related to sustainable innovation in industry .........................9
1.4.2. Interaction of government with industry......................................................10
2. CLASSIFICATION OF POLICY INSTRUMENTS ...........................................................11
2.1. Instruments to stimulate sustainability in industry ..............................................11
3. SPECIFIC EXAMPLE PROGRAM DESIGN CHARACTERISTICS ...............................12
3.1. The HOBU-fund ..................................................................................................12
3.2. Specific projects conducted in Flanders ..............................................................13
i
1. INSTITUTIONAL CONTEXT/BACKGROUND
1.1. POLITICAL AND ECONOMIC CONTEXT
Belgium is a densely populated industrial country with about 10 million people inhabiting
just over 30,000 square kilometers. With few natural resources, Belgium must import
substantial quantities of raw materials and export a large volume of manufactures.
Additionally, it has developed a substantial services economy and broadly promotes tourism.
All of these make the Belgian economy unusually dependent on the state of the world
markets.
Given the fact that Belgium is a country characterized by strong regional and cultural
identities, any analysis of its system cannot escape the issue of the regional design. In an
effort to solve the problems between the two major linguistic communities in Belgium, in
1989 and again in 1993, the country was reshaped into a federation in which the authority on
a large set of policy matters is devolved in a complicated scheme. And the process of
federalization is still underway; for instance, in April 2000 it was announced that the federal
Ministry of Agriculture will hand over responsibilities to the Regions.
Since 1993, the country has been divided into three Regions: Flanders, Wallonia, and the
capital region of Brussels. Each Region has its own legislative (Council) and executive
(Government) bodies. Laws issued by the federal and the regional governments are
hierarchically of the same level and have also the same level of importance. Simultaneously
and overlaid upon the Regions, the country is divided into three Communities: Flemishspeaking, French-speaking and German-speaking. Flanders and the Flemish-speaking
Community are almost entirely coincident; however, the German-speaking Community is
found within Wallonia and the French-speaking Community is the dominant presence in the
Brussels Region. Generally, Regions are organized on economic principles and Communities
are organized around language and cultural principles. In Flanders, the Regions and
Community merged their administrative structures, providing one comprehensive entity for
the financing of research in the Flemish region and Dutch-language community. In Wallonia,
two different administrative systems co-exist with each having its own responsibility for
research funding. There is both a deep technology and economic gap among the three
Regions. Flanders is considerably better off than Wallonia or Brussels. Wallonia,
prosperous at the end of the 19th and beginning of the 20th Century, has been affected by the
decline of industrial activities that were the source its wealth.
The transition into a federal structure means that primary competence for science and
technology policy has been devolved. However, the Federal State retains important areas of
competence including: foreign affairs, defense, justice, finance, social security, important
sectors of public health and domestic affairs, etc. Since the summer of 1999 there is a socialdemocratic/liberal/green coalition in Belgium. However, this coalition does not govern all of
the Regions, so there is no unified orientation regarding sustainable development.
The main focus of this country report is on the Federal level and Flanders. These two were
selected because they are the most important in terms of the level of effort on research and
development, technology, and environmental issues. This does not imply that there are no
interesting projects to be found in other than in Flanders or on the federal level, but that these
are of lesser magnitude and—in the event—of lesser relevance to the larger project of which
this report is a part.
BELGIUM-1
1.2. BELGIAN INDUSTRY PROFILE
Industry in Belgium is mainly concentrated in the Flemish area in the north of the country,
although the government is encouraging further development in the southern region of
Wallonia. Contrary to Wallonia, in Flanders a tradition of small enterprises exists. The GDP
of Belgium is around 225 billion EURO, of which 150 billion EURO comes from private
industry. Flemish businesses generate 100 billion EURO of this amount, while Walloon
businesses and Brussels enterprises each contribute about 25 billion EURO.
The most important industrial sectors in Belgium are engineering, metal products, motor
vehicle assembly, processed food and beverages, chemicals, basic metals, textiles, glass,
petroleum, and coal. The largest firms in terms of R&D expenditures are, by Region:
• Flanders: Agfa-Gevaert, Janssen Pharmaceutica and Alcatel Bell.
• Wallonia: Smithkline Beecham, Fina Research and Shell Research
• Brussels: Solvay
The unemployment rate of 9 percent in Belgium is rather high for European standards, while
the economic growth of around 4 percent is above European average. Wallonia accounts for
much of the Belgian unemployment rate, and the disparity between it and the rest of the
country continues to grow.
R&D levels
R&D efforts in Belgium are relatively low compared to most other OECD countries, although
there is a substantial difference between the well-developed Flanders and the less developed
Wallonia. The share of government subsidized R&D in total R&D is low; in 1995, the public
funding of R&D with respect to GNP was 0.5% in Belgium, compared to 1% in France and
0.9% in Germany, United Kingdom and The Netherlands. That said, the Flemish government
has actively promoted investment in high-tech companies.
In Belgium, the business sector is by far the largest finance source and the largest R&D
active sector in the Belgian economy. In 1995, private sector expenditures contributed more
than 70% of domestic RTD funding. Most of the research was intramural1, largely in the
chemical, pharmaceutical and electronics sectors. In recent years, these expenditures have
risen considerably; in Flanders, the nominal increase between 1996 and 1997 was 15%,
followed by a further 7.8% in 1998.2
Flemish firms account for around two thirds of Belgian R&D investments against a quarter in
Wallonia and the rest in the Brussels region. Flanders has by far the largest number of private
firms (640) performing research activities. Then comes Wallonia with 222 private firms and
the Brussels Region with 116 firms.
In relative terms the Flemish government has put a higher priority on S&T policy objectives
and has formulated these objectives in a clearer way than the Walloon regional government.
For instance, the Flemish government has created a substantial number of interuniversity
laboratories in high-tech disciplines and intermediary organizations.
1 Overall, close to 90% of private funding went to intramural research. Low-tech industries funded relatively more
extramural research than high-tech industries.
2 Terlinck, Peter, Wim Meeusen, “De O&O-inspanningen van de bedrijven in Vlaanderen. Een perspectief vanuit
de enquete voor 1996-1997.” IWT Observatorium, Brussels, 1999.
BELGIUM-2
Belgian R&D efforts: in Million EURO)
Authorities
1994
Federal Government
0.43
Flanders/Flemish Community
0.40
French Community
0.26
Wallonia Region
0.07
Brussels Region
0.01
Total
1,17
1998
0.48
0.62
0.28
0.10
0.01
1.49
Source: Heeft België nog een Federaal Wetenschapsbeleid nodig?, by DWTC, 1999
In Belgium, science has been traditionally strongly connected with education. Since 1874,
basic research has taken place at universities. Belgium has 19 universities, covering the full
range of academic fields. About 29 percent of Belgian R&D is performed at universities.
Compared to other European countries, the educational level of the young population is
above average for mathematics but below average in science. There is a relative shortage of
university graduates in the natural and applied sciences.
Until recently the Belgian national innovation system has been principally focused on
traditional industrial activities, such as metallurgy, chemicals and textiles. Belgium has only
tried to enter R&D activities in the new high-tech fields when neighboring countries had
already started.
1.3. INSTITUTIONAL CONTEXT
The institutional context of Belgium with respect to stimulating sustainable technological
innovation in industry is complex, since many actors are involved at various levels. Moreover
the innovation system is currently changing.
Since 1980, specific allocation of responsibility over the three levels of authority has changed
a number of times. At first, this allocation was based on the type of research conducted;
basic research fell under federal authority while applied research fell under the competency
of regions and communities. Later, responsibility was allocated by actor; here the federal
authority lost power. But whatever the allocation scheme, in practice responsibility was
neither transparent nor perceived as workable.
The present allocation hands primary responsibility for all scientific research at whatever
stage of development to the Regions and Communities. The federal government may take
special initiatives in those areas that relate to matters covered by international agreements or
nationally important activities which go beyond the interests of a community or region. The
federal government remains responsible only for scientific research required for its own
activities and purposes (e.g., defense), research referred to by international and supranational
agreements, aerospace research and research conducted by a number of federal institutions.
Related to issues of sustainable development, the federal government has, for instance, the
authority to:
• establish environmentally friendly product norms
• formulate national energy policy
• organize industry, support to industry expansion, competition rules, industrial and
intellectual property etc.
BELGIUM-3
The Sectoral Centers of Collective Research have a special place in the Belgian R&D system
(including VITO, IMEC and the above mentioned Center for Nuclear Energy). These centers
are organized at a sectoral level which carry out research for the benefit of all companies
belonging to that sector. The funding of this research takes place on the basis of a
cooperative agreement between the federal government and the regions. 50% of the funding
is provided by the industries involved. Their objective is to meet the specific scientific and
technological research requirements of companies (mostly medium sized companies). The
main focus of these institutes is basic technological research and the introduction of new
technology in industry within specific industries.
The figure immediately below summarizes the current distribution of responsibilities with
regard to sustainability.
BELGIAN INSTITUTIONAL PROFILE
GOVERNMENT
Regions & Communities
Regions & Communities
Federal
Ministries
Federal Ministries
Brussels
Flanders
Wallonia
ADMINISTRATIVE ORGANISATIONS
ADVISORY COMMITTEES
International
Organisations
Industry
FINANCING ORGANISATIONS
B.I.C.
Research dep.of enterpr.
PRIVATE RESEARCH
Universities (19)
University interfaces
Autonomous University
Research Centers (24)
Technological guidance
Other HEIs (52)
Spin-off
HEIs
Science Parks/
incubators-E.I.C.
Brussels-Technopole
BRIDGING INSTITUTIONS
Central Services (24)
Public Research Institutions (20)
Scientific Institutions (46)
Subordinated Institutions (13)
Sectoral Centers of Collective Research (43)
Semi-Public Research Institutions (8)
Non-Profit Private
Institutions (13)
International Organizations established in Belgium (5)
RTOs
BELGIUM-4
RESEARCH INSTITUTIONS
The federal policy concerned with sustainable development can be divided between the main
policy and supporting policy. It is important to notice that sustainable development in
Belgium is an umbrella term for issues not only related to the environment, but also to
matters that have to do with poverty, social exclusion, and change of consumption patterns.
Moreover, at the regional level various departments are involved in the field of sustainable
technology and innovation issues. The Minister-President of the Flemish government is the
main responsible authority for the science policy of the Flemish Community.
As was mentioned in section 1.1, federalization has had its impact on the way responsibilities
related to technology policy are divided in Belgium. Since organizational change is still
underway and more and more responsibilities are being handed over from the federal to the
regional levels, the regions have gained a relatively strong position in the field of science and
technology policy. But the regions have to get used to their new responsibilities.
A substantial number of policy documents have been published the last two years which deal
(in)directly with issues of technology policy and sustainable development, both on the federal
and the regional level3. However, since the new Flemish government was elected in 1999, no
budgets have been yet submitted and therefore no large new programs in this field have been
launched in this period.
In the figure below, a more specified picture is given of the division of responsibilities of the
various authorities:
Flemish Community
IWT
Federal Government
FWO
Flemish
Universities
Private Sector
French Community
Walloon Region
Private Sector
NFRS
Walloon
Universities
Government +
Scientific and
Public Institutes
Federal government
Federal expenditures for R&D as part of total government expenditures have significantly
decreased in the last five years. In 1994, the federal government made almost 37 percent of
all government expenditures. The most recent figures (1998) indicate that this has dropped
below 33 percent. Funding has shifted to Flanders.
All resources mobilized by the federal state for scientific and technological activities are
grouped together functionally within the Interdepartmental Science Policy Budgetary
3 Such as The Federal Report Sustainable Development, On the Road to Sustainable Development, by the Task
Force Sustainable Development of the Federal Planning Agency, or MINA-2
BELGIUM-5
Program (PBPS). This program collects the proposed budgetary allocations to the various
federal ministries and agencies for centralized approval4.
The Office for Scientific, Technical and Cultural Affairs (Dienst voor Wetenschappelijke,
Technische en Culturele Zaken, DWTC) takes a central position regarding science policy
activities in the federal government. The DWTC provides by far the largest funds for R&D of
all federal financing institutions, approximately two thirds of the federal total.
The science policy tasks of the DWTC are essentially carried out at three levels:
1. mobilization of scientific and technical resources to support the Federal Authority in the
exercise of its powers and the definition of its policies;
2. management of the ten federal scientific establishments placed under the authority of the
Minister for Science Policy and co-ordination of their activities;
3. uniform implementation throughout the Kingdom of research actions and programs on
themes and questions of national or international scope.
The DWTC does not allow funding through free proposals. Funds are allocated based on the
research programs of universities. Researchers submit proposals in domains that are
determined by the government. DWTC has established one program in which universities
can determine research themes and can establish research networks. In these cases, DWTC
organizes external ex-post and ex-ante evaluation by foreign experts.
Within the federal government the most important financial contribution related to R&D
comes from the Department of Science, Technology and Culture (which took more than 64
percent of all federal subsidies in 1998 for its account). The federal departments of Economic
Affairs (13.5%), Agriculture (7%), and Development Affairs (6.4%) also manage substantial
R&D budgets at the federal level.5 By far the biggest part of the federal contribution goes to
the financing of research and technological organizations (RTOs such as the Center for
Nuclear Energy and the Sectoral Collective Research Centers) as well as to international
activities.
1.4. Regional government (Flanders and the Flemish Community)
The general support to industrial and technological research falls within the authority of the
regions. For instance the three Belgian regions are responsible for economic, energy (nonnuclear), environmental and transport matters. Here, we shall discuss only the region of
Flanders and the Flemish Community.
Similar to the PBPS at the federal level, the Horizontal Science Policy Budget Program
(HSPBP) centralizes and allocates responsibilities and funds for the Flemish Government.
Competence for RTD matters is spread across several ministers of the Flemish government
and departments of the Flemish Community. The science budget has grown significantly
between 1996 and 1999.
The Department of Science, Innovation, and Media (Department Wetenschap, Innovatie en
Media, WIM) is the central administrative unit for coordination and financing of scientific
research. Together with the Department of Education, they disburse almost 90% of the
HSPBP budget in Flanders. Through this, the Education department primarily finances
4 The Interministerial Science Policy Commission (ICWB) prepares an annual outline of the PBPS.
5 “Does Belgium require a federal science policy?,” Federal Office for Scientific, Technical and Cultural Affairs,
March 1999, p.4.
BELGIUM-6
various university institutions. Approximately 25 percent of this can be defined as basic
funding in the form of block grants. WIM uses other direct allocations (such as the Special
Research Fund [Bijzonder Onderzoeksfonds, BOF]), but also indirect financing through
intermediary funds.
These intermediary funds are used to finance basic, non-oriented research (e.g., FWO, see
below). By definition, basic non-oriented research is initiated by the research community
itself and is not restricted to selected research areas.
Industrial Research
For industrial research, the Ministry of the Flemish Community used two modalities: the
IWT, a fund through which requests for technological research support is awarded; and
FIOV, through which requests for programmed research in certain domains is financed (see
below). The latter mechanism was recently stopped and taken over by IWT.
A final way of allocation of research monies is through sectoral science policy. These are the
science and technology budgets falling under the competencies of other departments of the
Flemish Community of which the Environment and Nature Management Department is the
most important. For the Flemish community this means it has total competence for all
scientific activities, with the most important sectors being:
• fundamental non-oriented research
• research in the pre-valorization stage
• industrial and social research
• industrial and social valorization of the results of scientific knowledge and technological
expertise.
Two separate financing mechanisms have focused on promoting technological research in
Flanders. The Institute for the Promotion of Innovation by Science and Technology in
Flanders (Vlaams Instituut voor de bevordering van het wetenschappelijk technologisch
onderzoek in de industrie, IWT) supports and stimulates industrial research and technology
transfer in the Flemish industry. All companies established in the Flemish region (particularly
SMEs) could request IWT assistance in their projects and have IWT services at their
disposal. A second mechanism was the former Fund for the Promotion of Industrial Research
– Flanders (Fonds tot bevordering van het Industrieel Onderzoek in Vlaanderen, FIOV).
FIOV was used to fund research projects and technology advisory functions of the collective
centers, ad-hoc technology programs and the like. However, recently the FIOV was
discontinued and its tasks transferred to the IWT. This should result in stricter budgetary
follow-up and drastic simplification of procedures6.
IWT: The Flemish Institute for the Promotion of Research in Industry. In 1992 the
Flemish government created IWT, the Flemish Institute for the Promotion of Research in
Industry, which is responsible for the implementation of the Flemish Minister for Science and
Technology policy towards the industry. IWT is responsible for funding research with an
industrial focus. This concerns both research requested by companies and the management of
incentive programs with a technological content. With the adoption of a new law in 1999, the
tasks of IWT have been enlarged and clarified. In the near future, IWT will function as the
'one counter' for innovation support. This means IWT is given full power related to the
6 "Science, Technology and Innovation Information Guide 1999," Ministry of the Flemish Community, Brussels,
Belgium, 1999, p.53.
BELGIUM-7
stimulation of innovation in industry. The activities of IWT are not restricted to R&D in a
strict sense, but extend to transfer and distribution of technology and the analysis of global
trends in technology and R&D through IWTs research institute the Flemish Technology
Observatory.
IWT’s budget increased substantially over the last few years. The total budget was around
EURO 128 million in 1998 to EURO 157 million in 2000.
IWT has two main tasks, called its autonomous function and its advisory function,
respectively. The first is the financing of basic and applied R&D in companies and research
organizations. This is done on its own initiative with its own funds. The second is the
financing of specific programs on initiatives of Flemish authorities. For these applications
made by industry, the board of directors of the IWT formulates advice for the minister in
charge.
In the past some of IWT’s programs were specifically focused on environmental-technology
innovation. However, today these focused programs are taken out of IWT’s curriculum. An
important change has taken place in the way IWT deals with technology innovation issues.
Instead of focusing on environmentally friendly issues only, IWT tries to focus on projects
that cover a range of objectives at once. This implies that narrowly focused programs focused
on the stimulation of sustainable innovation in industry do not exist anymore. Applications
for IWT subsidies should be assessed on various criteria of which sustainability is just one of
the many. Thus, sustainable technology is an integral part of IWT’s technology policy on the
one hand, but on the other hand, no specific attention is paid to the environmental part of
technology development.
The IWT approach is to focus more and more on small and medium enterprises (SMEs). For
instance, since 1994 the SME Feasibility Studies have been introduced, which is focused on
the development of valuable innovation options with a budget of maximum of 25000 EURO.
The projects are subsidized up to a maximum of 60 percent.
Another project with an SME target is SME Innovation Projects, which is focused on
prototype development, demonstration projects and technological upgrading with a budget of
a maximum of EURO 372.000 (of which 35 percent can be subsidized).
VITO: Flemish Institute for Technological Research. Besides IWT, which is mainly
responsible for the distribution of the funding, Flanders has three research institutions
(RTOs) at its disposal, of which VITO (Flemish Institute for Technological Research) is the
research center which is most important with respect to topic of this study. VITO is involved
in carrying out R&D and services in three research fields:
• non-nuclear energy
• environment including bio-technology
• raw materials
• new materials
The subsidy of the government of Flanders to VITO amounts Euro 27 million.
AWI: The Administration for Science and Innovation. The Administration for Science
and Innovation (AWI), founded in 1990, has the general coordination of science policy as
one of its functions, both at the level of the Flemish Community and in the context of federal
BELGIUM-8
and international co-operation, together with tasks relating to studies, analyses and research
activities. AWI falls under the department of Science, Innovation and Media of the Flemish
Community and is entirely financed by the community.
Institutional profile, R&D performers and public budget allocation to S&T activities in
Belgium
Institutional
Profile
Policy
instruments
S&T policy,
formulation,
financing and
co-ordination
S&T Public
budget
allocation (1996)
RTOs
Evolution of
public budget
allocations to
S&T Activities
1989: 975 M
EURO
1996: 1325 M
EURO
Federal State
Tax Exemption
Capital
Allowances
Industrial
research centers
Flanders
Brussels-Capital
Region
Grants/subsidies
Refundable loans
Industrial
research centers
Assistance
Grants/subsidies
Refundable loans
Industrial
research centers
Assistance
Wallonia/French
speaking
community
Grants/subsidies
Refundable
loans
Industrial
research centers
Assistance
DGTRE
DGNOERS
OSTC
ASI
IWT
RIS
455 M EURO
Education: 0.7
Universities:0.5
RTOs: 4.2
R&D support:3
Intern. actions: 9.2
Other R&D credits:
0.7
IRE: 37
CEN:871
IBN: 26
CSRC:271
502 M EURO
Education: 9.5
Universities:2.6
RTOs: 3.3
R&D support:4.4
Intern. actions: 0.1
Other R&D credits:
0.9
VITO: 645
IMEC: 981
VIB: 1120
CSRC:125
10 M EURO
Education: Universities: RTOs: R&D support:0.4
Intern. actions: 0
Other R&D credits: 0
38.6%
32.8%
1.1%
27.5%
34.2%
38.8%
0.7%
26.3%
350 M EURO
Education: 8.1
Universities:1.8
RTOs: 0.6
R&D support:3.5
Intern. actions: 0
Other R&D credits:
0.3
ISSEP: 337
CSRC: 140
OSTC: Office for Scientific, Technical and Cultural Affairs, ASI: Administration for Science and Innovation (AWI), RIS:
Research and Innovation Service (SRI-DOI), DGTRE: Directorate-General for Technologies Research and Energy, DGNOERS:
Directorate-general for Non-Obligatory Education and Scientific Research (DGENORS)
Source IWT-Observatorium: The Flemish Innovation System: An external viewpoint. Page 14, CFS/STAT, 1996, UEST-Dulbea
calculations
1.4.1. Policy context related to sustainable innovation in industry
The implications of regionalization for the innovation system of Belgium have been twofold.
On the one hand decentralization of responsibilities has had an activating effect on the
regional government, since the regional governments are no longer restricted by the burden
of debt service as the Federal governments used to be. On the other hand it might be argued
that regionalization of national R&D policy in Belgium runs at the opposite direction of the
trends that can be observed on a larger European scale. In other countries centralization and
even internationalization of R&D efforts takes place.
BELGIUM-9
The regionalization process within Belgium has led to a situation in which the regions handle
technology policy issues. The federal government maintains its competencies to manage and
take initiatives for scientific research in support of federal policies and international
agreements or those topics that are beyond the concern of a single region and community.
Still, the regions are mainly responsible for industrial R&D. For instance, subsidies are
granted for basic industrial research and repayable loans for the development of new products
and processes. SMEs receive special attention under these subsidy arrangements.
Policymaking on sustainable development issues is in a transition phase. Both in the past and
in the present the Flemish government participated in initiatives related to the environment,
such as water purification, waste and energy-issues. As politics in Belgium and Flanders
have been undergoing significant change since the installation of the new government in
1999, the new governments have to find their ways in their new, but still changing roles,
responsibilities and new policy issues. Government officials are generally interested in
topics related to sustainable technology innovation, but no major projects have yet started.
Sustainable development in general is an important topic in Belgium, both on the federal and
regional levels. Sustainable development in this context includes environmental issues but
also social and economic ones. In 1997 a new Federal law was adapted related to the
coordination and organization of the federal policy concerning sustainable development. The
law prescribes the publication of three documents:
1. A bi-annual Federal Report related to sustainable development
2. An annual Federal Plan on Sustainable Development which is a policy plan consisting
of measures to bring about sustainable development. This plan is designed to stimulate
the effectiveness and coherence of policies related to sustainable development.
3. An annual report of the Interdepartmental Sustainable Development Commission
(ICDO). This report describes sustainable development related policy in various federal
government departments and public institutions.
1.4.2. Interaction of government with industry
There has been a shift in the way the Flemish government deals with pressure groups. In the
past lobby groups could take part in the political process rather easily . Moreover the
government used to have a strong control and enforcement role. However, during several
interviews people have indicated that this role of the government is changing. The
government takes one step back in certain cases to let the private sector prevail. This
development leads to ‘goal commitment’ (such as public private partnerships) between
government and the private sector. To prevent a few lobby groups in Belgium from getting
all the research monies for their own specific projects, the Flemish government decided to
shift from earmarking funds for specific targets and to create one overall budget, explicitly
calling for multi-domain projects.
BELGIUM-10
2. CLASSIFICATION OF POLICY INSTRUMENTS
2.1. INSTRUMENTS TO STIMULATE SUSTAINABILITY IN INDUSTRY
The Belgian federal and regional governments play a variety of roles related to the
stimulation of sustainable innovation field in industry. In terms of science and technology
policy instruments, some complementarities can be observed between the federal and the
regional governments. One major issue concerns the fiscal policy in favor of innovation.
The federal government is still the only authority which has responsibility over fiscal
measures. The regions are mostly competent for the direct support of firms’ R&D activities
through grants, subsidies and/or refundable loans. The main focus of the Flemish
government in environmental issues is on regulatory instruments. The possibilities of
economic instruments seem to be underestimated.
There are several bottlenecks in the Flemish region with respect to environmental policy. As
was said before, classical regulatory instruments are still used frequently with not always the
right outcomes. Regulation is in many cases too complex and not coherent, which leads to
problems in enforcement and application. Integration of monitoring of environmental policy
is non-existent, while at the same time the many initiatives of in scientific environmental
policy are not geared to one another.
Regulatory instruments. In the past, regulatory instruments were mainly used in a sectoral
way. Nowadays, much effort is put into a more integrated (over all sectors) and less
domineering way of formulating regulation
Economic instruments. Economic instruments can be divided into financial instruments and
market oriented instruments. Financial instruments are for instance levies, financial support
and fiscal measures. In the Flemish region the main focus is on levies, subsidies and
financial support, since taxes and other fiscal measures are not (yet) part of the regional
responsibilities. Examples of market-oriented instruments are tradable emission rights and
the development of liability regulation. These instruments should lead to market creation.
However, the potential of these market-oriented instruments is not yet been defined.
Fiscal instruments. Eco-taxes are a well-known fiscal instruments used in the Flemish
community. Other fiscal measures are investment deduction and VAT measures.
Communication instruments. Communication instruments such as public relations,
education, sensitization, and marketing are focused on the promotion of environmentallyfriendly behavior. Cooperation among various actors (such as governments, target groups and
intermediary organizations ) is an important condition for the successful use of
communication instruments
Co-operation with industry. Instruments such as environmental policy agreements,
environmental care systems and voluntary agreements with industry can strengthen the cooperation with the target groups. Environmental policy agreements (MBOs) between
industry and the government can be used in various environmental sectors. However, not
many initiatives have taken place in this field.
BELGIUM-11
3. SPECIFIC EXAMPLE PROGRAM DESIGN CHARACTERISTICS
The focus of this study is on programs that are intended to stimulate environmental-friendly
(technological) innovation in industry. Therefore, it is important to realize that the Belgian
government, whether at the federal or the regional level, has not (yet) developed any policy
programs that are directly focused on the stimulation of sustainable innovation in industry,
with a clear focus on technology.
On the one hand, programs can be distinguished that are directly focused on innovation in
industry, but the link with the environment is very often not made clear. On the other hand,
there are programs focused on the environment, but these have often nothing to do with
technological innovation in industry.
Since the institutional system of Belgium has undergone several substantial recent
reorganizations (and some departments are still in the middle of a reorganization process), it
has taken time and effort to define the responsibilities of the different actors involved.
Besides a significant delegation of authority from the federal to the regional and community
level, some new institutions, commissions and individuals have also been appointed to deal
with issues related to the environment, technology, science or industry. All this means that
Belgium has not yet been able to fully focus on policymaking in the specific area addressed
in the present project.
However, it is interesting to see that many programs are especially geared to support small
and medium enterprises (SMEs) in their technological development. However, as was said
before, there are no programs that are directly focused on sustainable technology
development. Our choice for closer examination, therefore, is that of a Flemish governmental
initiative which indirectly deals with the stimulation of sustainable innovation in industry: a
technology diffusion called the HOBU-fonds. We will also more briefly sketch a number of
specific projects conducted in Flanders.
3.1. THE HOBU-FUND
Objectives and themes
In 1996 the HOBU-fund was installed to promote and support technological research at
schools of higher education (not universities) in Flanders. The fund is coordinated by IWT.
The objective of the HOBU-fund is twofold. Firstly, the fund is supposed to stimulate to the
promotion and valorization of technology research done at Flemish schools of higher
education; this is accomplished by financially supporting technological research projects of
value to the economy or society. Secondly, the HOBU-fund provides a vehicle to keep SMEs
in touch with the latest technological developments.
Organization of program, project selection and management
Schools of higher education (mainly technology schools) submit plans to apply for subsidies
of the HOBU fund. The IWT makes use of a score-system to assess the various applications.
The two main assessment criteria are related to quality and the expected economic results of
the research. In 1997, the first HOBU-fund projects were subsidized for the total amount of
about 4.25 million EURO. In 1998 a second round of applications for the HOBU-fund
started. One important change was made from the first round. Instead of fully subsidizing
the costs of research, ten percent of the total was unfunded by HOBU, to be paid for by the
BELGIUM-12
industrial partners of the institutions of higher education. This was done to increase the
commitment of the industrial partners.
To be eligible for funding, a project should be relevant for a group of at least three
enterprises (preferably SMEs) which have to be actively involved in the project. The schools
search for technological opportunities and translate these into the working floor of companies
involved. An individual HOBU-project will last a maximum of 2 years and has a budget of
maximum EURO 310000.
In 1998, 25 percent of the accepted projects within the HOBU-fund addressed basic
technologies and another 20 percent addressed energy and environmental technology. The
remainder were not relevant to sustainability.
Hurdles
In 1998, the number of applications declined compared to 1997. Most of the applications
came from technical schools with strong research departments; IWT received no applications
from economics-oriented schools. This was regarded as a problem, as the focus of the
program was not intended to be so selective.
3.2. SPECIFIC PROJECTS CONDUCTED IN FLANDERS
Below a short overview is given of some policy programs supported by the Flemish
government and implemented by IWT or VITO.
Science policy with an economic focus (Wetenschapsbeleid Economische Finaliteit)
This program, funded at 233.56 million EURO, is focused on the financing of industrial and
societal research, varying from industrial basic research to the development of prototypes.
The objective of this program is to increase the technological base for the Flemish industry
(both on a short and longer term), to stimulate economic growth and employment
opportunities within Flanders. In order to reach these broad goals, technological research in
industry and a few core domains are supported, such as biotechnology, energy and the
environment). The program is supported through IWT and the FIOV (Fund for Industrial
Research Flanders); this latter is an intermediary acting as a vehicle for financing
technological research in industry.
BBT-EMIS-project (Best Available Technologies/Energy and Environment Information
System)
This project is a knowledge and information center supported by VITO. The BBT/EMIS
knowledge center has the task of collecting information on clean technologies, on energy and
on the environment, and making this information available in a user-friendly way to the
government, businesses and individuals. In most cases information is put on the internet.
PRODEM-project (Promotion and Demonstration)
From 1996 until 1999 a special subsidy was given to the project PROmotion-DEMonstration,
a research and advisory center for environmentally-friendly production and management
techniques. Altogether, the contribution of the Flemish government was 5.85 million EURO,
which was 60 percent of the total investment amount. European co-funding provided the last
40 percent. PRODEM was carried out by VITO and the main focus was on SMEs.
BELGIUM-13
Ecology Support program (Ecologie Steun)
Although there are no major programs going on in the Belgium in the field of promoting
sustainable technology, some relatively small programs can be found. For instance, Ecology
Support, which is focused on investments, was designed to promote savings of raw materials
and energy. This program subsidized 15 percent of the additional costs incurred by choosing
environmentally-friendly investments instead of cheaper alternatives. This, clearly, was not a
very strong incentive.
Ecodesign project
This project, carried out by VITO in cooperation with the private sector, is focused on
Flemish enterprises. Its main goal is to reduce the environmental impact of products from the
design phase onwards, in order to get economic advantages (decrease of costs, improvement
of company profile etc.). Its main instruments are subsidies and consulting services, focused
on product development. A project within the Ecodesign program consists of three stages:
1. Ecodesign audit (subsidy: 400 EURO for consulting costs)
2. Detailed ecodesign analysis (subsidy: EURO 2000 for consulting costs)
3. Implementation of eco-design (maximum of 50 percent of consulting costs)
Companies have the right to decide after each phase whether they will proceed to the next
phase or not.
BELGIUM-14
IV. POTENTIAL FUTURE CONTACTS
Below we present the addresses of the interviewees interested in the final report who might
take part in future activities (such as conferences) within this particular field.
Frank Demeyere, Adjunct-Kabinetschef, The Federal Cabinet of the Minister of Economy
and Scientific Research
De Meeussquare 23
B-1000 Brussels
Belgium
Tel: (+32-2) 5065752
Fax: (+32-2) 5144683
Marc de Win, Advisor-General, Federal Ministry for the Environment
Pachecolaan 19
B-1010 Brussels
Belgium
Tel: (+32-2) 2104200
Fax: (+32-2) 2104699
E-mail: marc.de.win@health.fgov.be
Rudy Nys, Adjunct-Kabinetschef, The Cabinet of the Minister-President, Flemish Ministry of
Finance, Budget, Foreign Policy and European Affairs
Martelaarsplein 19
1000 Brussels
Belgium
Tel: (+32-2) 5532911
Fax: (+31-2) 5532905
E-mail: rudy.nys@vlaanderen.be
Philippe Heyvaert, Cabinet of the Flemish Minister of Economic Affairs, Spatial Planning
and Media
Phoenixgebouw
Konig Albert II laan 19, 11e verdieping
1210 Brussels
Belgium
Paul Zeeuwts, President, IWT, Flemish Institute for the Promotion of ScientificTechnological Research in Industry
Bischoffsheimlaan 25
B-1000 Brussels
Belgium
Tel: (+32-2) 2230033
Fax: (+32-2) 2231181
E-mail: pz@iwt.be
BELGIUM-15