Although the U.S. remains the global leader in research and development (R&D) funding, recent data indicate that critical technologies will be developed on an equally strong global basis, with no one country dominating.

Global research and development (R&D) spending is expected to increase 4 percent in 2010 to $1,156.5 billion from $1,112.5 billion spent in 2009, according to the 2010 Global R&D Funding Forecast from independent R&D firm Battelle and R&D Magazine.

The report, published in December, determined that the increase in spending would mostly be fueled by China and India. Spending by both China and India is expected to drive a 7.5 percent increase in Asian R&D. In China, the country’s 16 percent R&D funding increase this year follows its trend of aggressive increases that often exceed 20 percent. Even Japan, the second-largest R&D spender in the world, is falling behind the level of spending by China and India.

“Even while China and India saw dampening impacts from the global recession, at no time did their growth rates actually go negative,” report co-author Martin Grueber said in a statement. “The pace of their R&D growth just slowed, but it will heat right back up as we head into 2010.”

Meanwhile, the European Union continues to fall behind emerging Asian nations in overall R&D spending. Between 2008 and 2010, the EU fell from 24.9 percent to 23.2 percent in terms of the global R&D share. Europe is forecast to increase spending by only 0.5 percent, to $268.5 billion, in 2010.

Although emerging economies are driving global R&D growth, Japan, China and India are a distant second, third and fourth place in funding behind the United States.

According to the National Science Board’s (NSB) recently released Science and Engineering Indicators 2010, U.S. R&D expenditures are 40 percent greater than the total for all EU-27 countries combined.

In 2010, U.S. R&D spending is forecast to rise to $401.9 billion, 3.3 percent higher than in 2009.

U.S. industrial R&D funding is expected to increase 2.85 percent, to $260.3 billion, over 2009′s $253.1 billion. The sector comprises 64.8 percent of the nation’s R&D funding. Overall, industrial R&D performance is forecast to rise 2.8 percent to $283 billion in 2010, up from $275.3 billion in 2009, but still not reaching the $289.1 billion of R&D performed in 2008.

Federally funded R&D is estimated to rise 4.24 percent to $114.1 billion, compared to $109.5 billion in 2009. Federal funds for federally performed R&D, while increasing in current dollar terms by 1.7 percent to $28.3 billion in 2010, have been steadily declining as a share of overall U.S. R&D over the past three decades. As a share of total U.S. R&D, federally funded R&D is expected to increase slightly in 2009 and 2010 to just over 7 percent.

Academic funding of R&D is expected to increase just over 5 percent, from $11.1 billion in 2009 to $11.7 billion in 2010. Academic R&D performance is forecast to reach $58.3 billion in 2010, an increase of 6.37 percent over $54.8 billion in 2009.

Nonprofit organizations are expected to provide nearly $12.6 billion, a growth rate of 2.84 percent. Overall, research performed by nonprofit institutions is forecast to reach $16.3 billion in 2010, a 2.48 percent increase over $15.9 billion in 2009.

Finally, R&D support from other forms of government (i.e., state and local entities) is expected to decline by 1.35 percent to $3.28 billion, due to the extreme fiscal pressures state and local governments have been facing — and are forecast to face for some time.

Top R&D Drivers of the Future
Rapidly growing sectors in U.S., Japanese, Indian and Chinese research extend across virtually the entire energy field, from renewable energy and oil exploration technologies to superconductivity and nuclear generation, according to Plunkett Research.

“While energy and environmental technologies are expected to be developed on an equally strong global basis, with no particular country dominating, the U.S. should be able to maintain a strong lead in the development of new technologies due to its existing strong infrastructure, massive R&D spending and strong intellectual property base,” R&D Magazine explains.

Based on survey results from a broad pool of R&D technology leaders, Battelle and R&D Magazine forecast that the following fields would be the top technology drivers of the future:

• Energy/Environmental — Due to continued significant R&D investment, the U.S. is expected to hold its lead in technologies involving carbon sequestration, smart grid and clean coal/zero-emission technologies over the next five years.
• Health and Biosciences — Current U.S. leadership will view targeted drug delivery, medical biotech and automated diagnostics/surgical methods, as a high priority. Research indicates that stem cell, personalized medicine and nanotech will drive expanded research funding.
• Defense and Security — Although the U.S. is expected to continue occupying leadership positions over the next five years in Autonomous Unmanned Vehicles, stealth technologies and chem/bio sensors, other countries could begin to encroach on U.S. dominance over the next five years.

In response to the global recession, nearly $2 trillion in economic stimulus funds were created by a number of countries, among them the U.S., Japan and China. A significant portion was related to R&D, according to R&D Magazine. These R&D stimulus funds, released in early 2009, “will likely be distributed for research projects that carry over into 2010, 2011 and even 2012,” the publication says.

The full 2010 R&D Funding Forecast report, as well as commentaries on the findings, can be accessed HERE and HERE.

Earlier

R&D Overhaul in the Downturn

2009 Global R&D Outlook

Resources

2010 Global R&D Funding Forecast
by Martin Grueber and Tim Studt
Battelle and R&D Magazine, Dec. 22, 2009

Battelle – R&D Magazine Report Shows Emerging Economies Drive Global R&D Growth
Battelle, Dec. 22, 2009

R&D Giant Ascendant
R&D Magazine, December 2009

Reinvigorating India’s R&D
R&D Magazine, December 2009

Emerging Economies Drive Global R&D Growth
by Martin Grueber and Tim Studt
R&D Magazine, Dec. 22, 2009

Federal R&D: The Stimulus Hangover
by Martin Grueber and Tim Studt
R&D Magazine, Dec. 22, 2009

Re-Emerging U.S. R&D
by Martin Grueber and Tim Studt
R&D Magazine, Dec. 22, 2009

Science and Engineering Indicators (2010)
National Science Board, Jan. 15, 2010

National Science Board Releases Science and Engineering Indicators 2010
National Science Board, Jan. 15, 2010

Industry Research: Engineering & Research
Plunkett Research

2010 Global R&D Funding Forecast: An Overview
by Martin Grueber and Tim Studt
R&D Magazine, Dec. 22, 2009

Re-Emerging U.S. R&D
by Martin Grueber and Tim Studt
R&D Magazine, Dec. 22, 2009