How will things play out in 2008-09? Everyone seems reasonably cautious with good reason, seeing how the impact of the Global Financial Crisis on R&D spending will be impossible to ignore. Two choice quotes:

It is important to remember that 2007-08 was a boom year – it will be difficult to maintain this momentum through the global recession. — Senator Kim Carr, Innovation Minister

Given the likely reduction in R&D spending in 2008/09 and 2009/10, as a consequence of the Global Financial Crisis, there is real concern that our performance will decline. — David Gelb, KPMG National R&D Partner

The EU has been aiming for quite awhile to raise Europe’s R&D spending to 3% of its GDP by 2010, with 2% of that consisting of BERD. From their 2006-07 numbers, it looks like GDP on R&D is still stuck at 1.87% . Not a particularly good sign, seeing how 2010 is just around the corner.

Note: Europe’s 3% goal is known as the “Lisbon target”, and was driven by the strategic goal to turn Europe into the most competitive and dynamic knowledge-based economy in the world. It is named so because it was adopted by the European Council when it met in Portugal nearly a decade ago.