Chapter IV of the Commission's White Paper on Growth, Competitiveness and Employment recognizes the contribution of RTD to economic development in the European Union. The difficulty in increasing public funding should be offset by promoting investment in RTD on the part of the private sector and by augmenting the effectiveness of the projects and their contribution to transnational partnerships. Where EU RTD is concerned, there is a need for more emphasis on coordination of projects in addition to improving the dissemination and application of RTD results. In comparison with the US and Japan, the European Union spends proportionately less in research and technological development: 2% of GDP in the EU compared with 2.8% in the USA and 3% in Japan. There is also a wide diversity of research spending within each of the Member States. This White Paper identifies another weakness: the comparatively limited capacity to convert scientific breakthroughs and technological achievements into industrial and commercial success. In the telecommunications, transport and aerospace industries, European firms can point to a range of technological advances and successes. There is however, plenty of scope for the results of European research and technology to be translated into products which have a manifest impact on the competitive position of the European Community. The White paper also identifies the inadequate links between European universities and businesses and the lack of venture and risk capital for firms during the development phase. There is also scope for more coordinated RTD strategies between businesses, universities and public authorities, which is one area where the Japanese have shown strength. The EU must develop a focused strategy to identify market trends more accurately and prepare a better level of response to changes in market structure and orientation.