Commission President Romano Prodi has hinted that more money is to be made available at EU level for research and innovation. Speaking at the Economic Club of New York in the US on 3 November, Mr Prodi outlined the EU's innovation strategy and emphasised that neither the supply nor the demand side of innovation should be neglected. Central to supplying the human capital, knowledge and infrastructure necessary for innovation is financial resources, of which the Commission is well aware, acknowledged its President. 'Within the Commission, we have now started a debate on the future financial framework of the EU central budget. Our view is that the EU budget must better reflect the priorities - such as investing more in R&D [research and development] and education - to which the EU Heads of State and Government have committed themselves,' said Mr Prodi. Better use should also be made of loans from the European Investment Bank (EIB), so as to ensure the financial viability of longer term investments. 'But this is not yet enough,' added Mr Prodi. 'We must make sure that European companies are willing to seize the opportunities offered by a well-trained workforce. We must ensure that entrepreneurs are willing to transform the creativity of researchers into excellent investment opportunities - that is, into innovative and marketable products.' Mr Prodi argued in favour of the concentration of research, and referred to the benefits for all that would arise if 'the many excellent scientists working in the Union were given the opportunity to conduct their research in European centres of excellence.' Further concentration would be possible were public funding for research not determined by national borders, which Mr Prodi sees as justification for creating a European Research Area. Claiming that Europe 'could do even more', Mr Prodi also recommended considering the establishment of a 'European Research Agency'. The US National Science Foundation is a good example, he added. Mr Prodi outlined a number of initiatives currently being carried out at EU level in order to ensure that demand for innovation is present and sufficient. The Commission is investigating potential legislative measures which would support the risk capital industry. Possible actions include removing the obstacles currently deterring pension funds from investing in venture capital markets. The reorganisation of some European stock exchanges is also expected to promote publicly traded securities as an accepted and trusted means of financing young companies in Europe. Private equity investors will be more willing to provide funds if they have satisfactory exit opportunities. Ensuring a lower cost and efficient patent system is also crucial to encouraging innovation, continued Mr Prodi. It is hoped that the Community patent, agreed by Europe's Heads of State and Government in 2003, will fulfil these requirements. The Commission estimates that, when implemented, the new system will reduce the cost of applying for a patent by more than 50 per cent. The Commission President expressed his hope that the EU's innovation strategy will lead to faster growth in Europe. He expects the EU to achieve its potential growth next year or in 2005 at the latest.