With a view to the Ukraine war and the consequences of the corona pandemic, Germany's chemical-pharmaceutical industry is warning of stagnating spending on research and development.

"We are currently facing a situation that has never been so stormy and risky - and in its simultaneity never demanded so much of our innovative ability," said Thomas Wessel, Chairman of the Research, Science and Education Committee of the German Chemical Industry Association (VCI ), in a press conference on Wednesday.

burden on budgets

Soaring costs and constantly deteriorating returns have weighed on research budgets over the past two years.

In the previous decade, these had grown by an average of five percent annually.

But this trend ended in the pandemic year 2020. In 2021, the pharmaceutical and chemical industry invested around 13.2 billion euros in research.

For the current financial year, the association now expects expenses for applied research activities to remain constant at best.

"Germany continues to lose attractiveness as a location for innovation," said Wessel.

Factors such as insufficient state subsidies, sluggish approval processes and regulatory projects for industrial emissions are responsible for this.

In addition, around two thirds of the companies surveyed by the VCI assessed the current political framework conditions for research as either negative or very negative.