The Tánaiste, Ms Harney, yesterday called for a new EU initiative to support focused scientific research.

Addressing an EU conference on Europe's Search for Excellence in Basic Research, in Dublin, Ms Harney warned that Europe was lagging behind the US in the global competition for technological and scientific talent.

Comparing the EU and the US, she said that a clear gap had emerged between the two in terms of investment in research and development (R&D).

She pointed out that the US private and public sectors spent €40 billion more than the EU on R&D in 2001, while six years previously the gap had only been €15 billion.

Ms Harney said that lower business spending in the area was to blame for 80 per cent of the shortfall. In addition, she said, there were an estimated 400,000 European science and technology graduates working in the US, 90,000 of whom were employed in research.

"The question therefore arises as to whether there is a need for a specific EU initiative designed to stimulate the quality of basic research," she said. "I believe we should move quickly and with determination to develop such an initiative."

She added that particular areas should be prioritised for funding.

Ms Harney said that both the EU as a whole, and its member-states, needed to re-examine their procedures for transforming research into commercial applications. "Any fundamental review of EU R&D strategy must involve industry at an early stage," she said.

Ms Harney argued that European universities had a lot to learn from their US counterparts in this area. She pointed out that the most successful US third-level institutions understood that partnership with industry was vital in terms of getting access to private-sector funding and expertise.

The conference was a result of the Lisbon Agenda, an agreement to increase the level of scientific research in the EU through co- operation between the member-states.

It opened yesterday and its findings will be presented today. Participants dealt with issues such as the gap between the EU and the US, and whether it is affecting European enterprise and competitiveness.

One of the Government's stated goals for the State's Presidency of the EU is the re-invigoration of the Lisbon Agenda.