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How Flanders blazes the R&D and innovation trail in Europe

Flanders’ innovation-driven economy provides everything your company needs to grow sustainably through top-notch research and development (R&D) in the heart of Europe. This is no coincidence, as private, public and academic players in Flanders go to great lengths to join forces and innovate together – often as clusters. In addition, the government of Flanders strongly supports business innovation through R&D tax incentives, while the local R&D-friendly tax system allows companies to recover part of their innovation investments.

A worldwide reputation for innovation

Few regions are as consistently ranked among Europe’s and the world’s finest innovation environments as Flanders is. But don’t take our word for it! Here are a few prominent examples: 

  • 3rd-best innovative system in the world (2020 ZEW Innovationsindikator) 
  • 2nd in Europe for the proportion of enterprises with innovation activities (2020 Eurostat Community Survey, published in 2022) 
  • 3rd in Europe for innovative SMEs collaborating with others (2022 European Innovation Scoreboard)
  • 2nd in Europe for R&D expenditure in business (2022 European Innovation Scoreboard)
  • 14th-most innovative economy around the globe (2021 Bloomberg Innovation Index)
Flanders in the innovation charts

Tap into some of the world’s most innovative universities

Flanders’ five universities – in Antwerp (UAntwerpen), Brussels (VUB), Ghent (UGent), Hasselt (UHasselt) and Leuven (KU Leuven) – are among the world’s most innovative and outstanding. Not only do they generate the majority of the region’s non-private scientific output, they also feature consistently in the top 100 of most-innovative universities published by international news firm Reuters.

  • KU Leuven is Europe’s most innovative university and number 7 worldwide (Reuters, 2019).
  • UGent is number 48 in Europe and 98 worldwide (Reuters, 2019).
  • VUB and UAntwerpen rank 59th and 93rd in Europe, respectively (Reuters, 2019).

Access top research centers and knowledge institutes

Flanders aims to be a pioneer in the European knowledge society and economy in a wide range of sectors by boosting its knowledge base and innovative potential. With this goal in mind, it’s no wonder that 4 cutting-edge strategic research centers are headquartered in the region. What’s more, Flanders boasts a variety of scientific institutes and R&D platforms.

Join Flanders’ innovation clusters for R&D in key domains

To boost Flanders’ competitiveness on a global scale, the region has established spearhead clusters. These unique groups of private companies, public organizations and academic institutes are supported in their collaboration goals for the long term through financing and support.

R&D tax credits and funding

In Flanders, your innovative company can benefit from an array of tax credits, grants and other tax incentives for your R&D investments.

  • Innovation income deduction – up to 85% of your company’s net innovation income is exempt from corporate taxation.
  • R&D investment deduction – up to 13.5% of the investment value (at once) or 20.5% on the annual depreciations (staggered).
  • R&D payroll tax incentive – up to 80% of payroll withholding tax paid on professional income for researchers and academic personnel can be recovered.
  • Structural grants and funding for R&D projects are provided through government agency Flanders Innovation & Entrepreneurship.
  • A special tax regime for inpatriates and inpatriate researchers.

Ambitious goals for transformative SDG-inspired innovation in Flanders

Flanders’ Advisory Council for Innovation & Enterprise (abbreviated as VARIO in Dutch) advises the region’s government and parliament on science, technology, innovation, industry and entrepreneurship policies. Primarily, the focus is on backing and bringing about transformative innovation using the United Nations’ sustainable development goals (SDGs) as a guiding compass. 

Flanders’ efforts in working towards and supporting these ambitions mainly concentrate on the domains of digitalization, circular economy, green public infrastructure and public transport, education and training, green energy as well as smart, sustainable healthcare. 

Belgium and Flanders: big R&D spenders

Innovation is big business in Flanders – and the figures confirm it. According to the Community Innovation Survey (CIS) by ECOOM, between 2018 and 2020, 75% of Flanders’ companies – both large and small businesses and across various industries – invested in product and/or process innovations. What's more, in 2020, Flanders spent no less than 3.6% of its GDP on R&D. According to 'Statistiek Vlaanderen', this puts the region in the number one position in Europe! 

Furthermore, Flanders is:

  • number 26 worldwide for gross expenditure on R&D (WIPO’s 2022 Global Innovation Index)
  • number 3 in Europe for R&D intensity measured as gross domestic expenditure on R&D (Eurostat’s 2021 Europe 2022 Indicators)

Did you know that researchers from Flanders…

  • … were the first to unravel the DNA sequence of a gene?
  • … were behind the conception of the first technology that introduces new genes in plants?
  • … developed leading medicines in pain management, anesthesia and schizophrenia treatment?
  • … developed leading tPA thrombolytic therapy for myocardial infarction?
  • … were the first to use stem cells in bone transplantation?
  • … approved ground-breaking new cell therapy for cartilage?
  • … created a lab-on-a-chip for early breast cancer discovery?