R&d
Upcoming SlideShare
Loading in...5
×
 

R&d

on

  • 298 views

 

Statistics

Views

Total Views
298
Views on SlideShare
298
Embed Views
0

Actions

Likes
0
Downloads
18
Comments
0

0 Embeds 0

No embeds

Accessibility

Categories

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

R&d R&d Presentation Transcript

  • Promoting R&D in Ecuador U-I-R Collaboration and Supportive Instruments for R&D Hosaeng Rhee & Yoocheul Song Fernando Rosero (SENESCYT) Center for International Economic Studies
  • Contents1. Introduction2. Ecuador’s current status: NIS and incentive measures for R&D 1) R&D competitiveness of Ecuador 2) National Innovation System of Ecuador 3) U-I-R R&D collaboration in Ecuador 4) R&D incentive system in Ecuador 5) Priorities in resolving the problems and bottlenecks3. Korea’s experiences: U-I-R collaboration and non-tax/subsidy measures 1) Economic Development and the role of S&T in Korea 2) U-I-R R&D collaboration in Korea: How to facilitate communication and cooperation? 3) Other instruments to promote R&D in Korea with a focus on non-tax/subsidy measures4. Implications and policy suggestions 1) Implications of the Korean experiences 2) Policy suggestions 2
  • 1. Introduction Why innovation? NIS: What do we need for R&D promotion? Snapshots: Ecuador and Korea, where have we been? Ecuador is up to … Focus of the KSP Ecuador 2012 on R&D 3
  • 1. Introduction Why innovation? • Innovation: technologies or practices that are new to a given society (World Bank 2010) - Technologies or practices that are being diffused in that economy or society - Dissemination and use important • Why promote innovation? - Main source of economic growth - Improve productivity - Foundation of competitiveness Generates positive externalities and improves welfare Government interventions are needed to promote R&D. • Innovation capabilities important for both developed and developing countries - Developing ones: need ways to achieve broadly inclusive growth and innovation to benefit their many poor and not simply a narrow elite 4
  • 1. Introduction Why innovation? How Innovation Contributes to Growth: A Comparison of Ghana and the Republic of Korea, 1960–2005 Source: World Bank (2010), Innovation Policy: A Guide for Developing Countries World Bank (2007), Building Knowledge Economies: Advanced Strategies for Development. Note: TFP = total factor productivity 5
  • 1. IntroductionNational innovation system: What do we need for R&D promotion? National Innovation System Human and Institutional Capabilities and Global S&T Environment Capacities of Each Actor (universities, industries, research institutes) of the NIS to carry out R&D related activities, need to Government be secured and enhanced. Research Collaboration among major actors of the Universities Institutes NIS needs to be promoted to facilitate generation, transfer and commercialization of new technologies Industries Financial Financial institutions’ active role needs to Institutions be encouraged to help promising R&Ds Other related with financial resources for development Actors and commercialization of new technologies. 6
  • 1. IntroductionNational innovation system: What do we need for R&D promotion? Government as a gardener Components of National S&T Policy • Government can facilitate the articulation and implementation of innovative initiatives, since innovators need basic technical, financial, and other support. Legal • Government can reduce obstacles to innovation in Framework regulatory and legal frameworks. • Government-sponsored research and development (R&D) structures can respond to the needs and demands of surrounding communities. S&T Promotion Policy • The educational system can help form a receptive and Organizations Programs creative population. Need a governance system of S&T polices 7
  • 1. IntroductionNational innovation system: What do we need for R&D promotion?U-I-R R&D collaboration, what & why? What? Purpose Collaboration Activities R&D Joint research, commissioned research, dispatched research, invited research Accreditation for engineering education, student-specific education, student Training & Education OJT & intern, employee retraining, scholarship for employee Technology transfer between university and institute, breaking technological Technology Transfer & bottlenecks in the industry field, sharing research facilities, operating Production Support incubating center Personal Exchange Networking & exchange among researchers, holding joint seminars Why? related to the purpose and barriers of UIR collaboration The U-I-R relation plays a critical role in making R&D investment effective as well as efficient. • Each actor’s limited knowledge and resources - More resources required to produce globally competitive products - Traditional in-house R&D is not enough often • Open and collaborative innovation is more effective than closed ones. - Cost of innovation cheaper and innovation process often quicker with collaboration - Quality of innovation often diverse and better with collaboration • Collaboration with global players often ensures cross licensing and global standard setting 8
  • 1. IntroductionNational innovation system: What do we need for R&D promotion?U-I-R R&D collaboration, what & why?Barriers Fundamental barriers coming from the differences of information, financial and human resources, S&T knowledge and capability. - Industry: relatively enough financial and human resources, not enough creative ideas - University: recent knowledge, not enough field knowledge. Need to have coordinators who understands all three sides of U-I-R to promote UIR collaborationSuccess factors Success factors Essential elements - Actors’ capabilities and screening Mutual benefit - Continuous monitoring and information accumulation - Density and cost-effectiveness of communication Communication - Design and implementation of an effective way of communicating - Vision provider and coordinating organizations Coordinator - Coordinator’s expertise and incentives - Agreement on how to share gains Binding contract - Monitoring system to control opportunistic behavior - Spatial proximity (Cluster) Ongoing relationship - Compatibility of interests Source: Baik and Cho (2008), “Developing a new model for cooperation among SMEs, Universities and Research institutes” 9
  • 1. Introduction Snapshots: Ecuador and Korea, where have we been? GERD/GDP ratio in Latin America, 2007 (%)Source: UNESCO Science Report 2010 10
  • 1. Introduction Snapshots: Ecuador and Korea, where have we been?GERD by source of fund, 2002 and 2007 GERD by source of fund (%) 2002 2007 Business Higher Private Not Business Higher Private Not Government Abroad Government Abroad enterprise education non-profit specified enterprise education non-profit specified Korea 72.2 25.4 1.6 0.4 0.4 73.7 24.8 1.0 0.3 0.2 Japan 74.1 18.4 6.5 0.7 0.4 77.7 15.6 5.6 0.7 0.3 Germany 65.5 31.6 0.5 2.4 67.9 27.7 0.4 4.0 US 65.2 29.1 2.7 3.0 67.3 27.0 2.7 3.0 Brazil 45.0 53.3 1.7 44.7 52.9 2.4 Russia 33.1 58.4 0.3 0.1 8.0 28.7 64.7 0.5 0.2 5.9 India 19.3 76.5 4.1 29.6 66.0 4.4 China 60.1 29.9 1.9 8.0 70.4 24.6 1.3 3.7 Vietnam 18.1 74.1 0.7 6.3 0.8 Indonesia 14.7 84.5 0.2 0.7 Ecuador 17.4 69.3 4.0 1.2 4.2 4.0 21.5 58.1 3.9 3.3 7.0 6.2 Colombia 29.1 22.5 39.3 1.9 7.2 27.2 37.7 25.6 5.4 4.1 Chile 33.2 54.6 0.4 0.3 11.3 45.8 44.4 0.8 0.3 8.7Source: UNESCO Science Report 2010 11
  • 1. Introduction Snapshots: Ecuador and Korea, where have we been?GERD by performing sector, 2002 and 2007 GERD by performing sector (%) 2002 2007 Business Higher Private Business Higher Private Not Government Government enterprise education non-profit enterprise education non-profit specified Korea 74.9 13.4 10.4 1.3 76.2 11.7 10.7 1.5 Japan 74.4 9.5 13.9 2.1 77.9 7.8 12.6 1.7 Germany 69.2 13.7 17.0 70.0 13.9 16.1 US 70.0 12.1 13.4 4.5 72.6 10.6 12.9 3.9 Brazil 40.0 20.6 38.9 0.1 40.2 21.3 38.4 0.1 Russia 69.9 24.5 5.4 0.2 62.9 30.1 6.7 0.3 India 19.3 76.5 4.1 29.6 66.0 4.4 China 61.2 28.7 10.1 72.3 19.2 8.5 Vietnam 14.5 66.4 17.9 1.1 Indonesia 14.3 81.1 4.6 3.7 96.2 Ecuador 11.4 33.5 11.4 43.7 21.5 58.1 3.9 3.3 13.2 Colombia 25.8 3.0 53.1 18.0 22.7 5.7 52.4 19.3 Chile 35.8 11.0 38.8 14.3 46.2 10.2 32.0 11.6 Peru 10.7 31.7 47.7 11.4 29.2 25.6 38.1 7.1Source: UNESCO Science Report 2010 12
  • 1. IntroductionSnapshots: Ecuador and Korea, where have we been? Gross Expenditure on Research and Development in Korea, 1964-2004Ecuador’s Private share 80 Ecuador’s 0.25 GERD/GDP Source: Ministry of Science and Technology 13
  • 1. IntroductionEcuador is up to …• Transformation of production matrix: Export of low value-added, primary commodities High value-added and quality, energy efficient and environment friendly production and products, high quality employments Need technological innovations• Inclusive development : Need for mechanism to encourage MSMEs’ to develop and commercialize technologies - Incubating innovative entrepreneurs - Assisting MSMEs’ innovation and commercialization activities• Yachay typical form of U-I-R collaboration = high-level universities + research centers + companies How to induce Yachay to carry out innovative activities for transformation of production matrix? 14
  • 1. IntroductionFocus of the KSP Ecuador 2012 on R&D The Ecuadorian government’s request for the KSP Ecuador 2012: • U-I-R R&D collaboration mechanism to facilitate communication and cooperation among the major actors of the NIS • Non-tax/subsidy measures to promote R&D Diagnosis of Ecuador’s NIS: Current status and bottlenecks U-I-R R&D collaboration system: How to facilitate communication and cooperation among actors of the NIS Incentive measures to spur R&D: With a focus on non-tax/subsidy instruments (measures or institutions) Implications and policy suggestions 15
  • 2. Ecuador’s current status National Innovation System and Incentive Measures for R&D Fernando Rosero (SENESCYT) R&D competitiveness of Ecuador National Innovation System of Ecuador: Current status and bottlenecks U-I-R R&D collaboration in Ecuador: Current status and bottlenecks R&D incentive system in Ecuador: Current status and bottlenecks Priorities in resolving the problems and bottlenecks 16
  • 2. Ecuador’s current status(1) R&D competitiveness of Ecuador• Ecuador is performing low regarding factual results based on R&D High Tech exports / manufacture exports, (%) 2009 R&D investment as % of GDP, 2007 Source: CEPAL 2010x 17
  • 2. Ecuador’s current status(1) R&D competitiveness of Ecuador Global investment in R&D in absolute and relative terms, 2002 - UNESCO 6000 Researchers per million population • Compared to other countries, Ecuador´s 5000 Japan GERD and number of researches is modest. 4000 Russia France Germany 3000 Korea 2000 1000 China Indonesia Chile Brazil Colombia 0 Vietnam India Peru 0 0,5 1 1,5 2 2,5 3 3,5 4 Ecuador GERD as % of GDP(2002) GERD: Gross Expenditure on Research and Development Source: UNESCO Science Report 2010 18
  • 2. Ecuador’s current status(1) R&D competitiveness of Ecuador Global investment in R&D in absolute and relative terms, 2007 - UNESCO 6000 Researchers per million population Japan • Compared to other countries, Ecuador´s 5000 GERD and number of researches is modest. Korea 4000 France Germany Russia 3000 2000 1000 China Brazil Indonesia Colombia Chile Vietnam 0 India 0 Peru 0,5 1 1,5 2 2,5 3 3,5 4 Ecuador GERD as % of GDP(2007) Source: UNESCO Science Report 2010 * Vietnam: 2002, Indonesia: 2002/2005, Chile: 2002/2005 19
  • 2. Ecuador’s current status(1) R&D competitiveness of Ecuador• Ecuador contribution to regional R&D investment as of 2008 was only 0.54% of total. Latin America and the Caribbean R&D Investment (In US$ Million) 2006 2008 2009 Argentina 1.059,8 1.721,0 1.846,5 Brazil 10.978,8 18.390,6 18.929,2 Colombia 230,3 344,4 361,9 Costa Rica 97,0 118,8 159,1 ECUADOR 60,8 140,7 n.a. México 3.601,3 3.837,1 3.485,3 Latin America and 17.208,9 26.027,3 26.907,9 Caribbean Source: Source: RICYT, http://www.ricyt.org 20
  • 2. Ecuador’s current status(1) R&D competitiveness of Ecuador • Ecuador´s GERD as percentage of GDP (2008) is 0.25%: about two and half times below the regional average of 0.65% 4 3,5 3 2,5 2 1,5 1 0,5 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Ecuador Brazil Middle income Korea, Rep. Source: World Bank DatabaseSource: RICYT, http://www.ricyt.org 21
  • 2. Ecuador’s current status(1) R&D competitiveness of Ecuador• Ecuador´s R&D influencing factors are low. Showing a slightly increase during 2012. Innovation 6,00 5,00 4,00 Brazil 3,00 2,00 Ecuador 1,00 Business Technological 0,00 sophistication readiness Japan Korea.Rep Vietnam High education and training Innovation index of the Global Competitiveness Report : WEF 22
  • 2. Ecuador’s current status(1) R&D competitiveness of Ecuador• Ecuador´s R&D influencing factors are low. Showing a slightly increase during 2012. Total Expenditure for R&D as % of GDP, 2008 10 High-Tech Exports as % of Private Sector Spending Manuf. Exports, 2009 8 on R&D (1-7), 2010 6 Patents Granted by Science and Engineering USPTO / Mil. People, avg Enrolment Ratio Ecuador 4 2005-2009 (%), 2009 Korea, Rep. 2 Brazil 0 Malaysia S&E Journal Articles / Researchers in R&D / Mil. Mil. People, 2007 People, 2009 University-Company Royalty Payments and Research Collaboration (1- receipts(US$/pop.) 2009 7), 2010 Royalty and License Fees Firm-Level Technology Receipts (US$/pop.), 2009 Absorption (1-7), 2010 Innovation indicators in the KAM (Knowledge Assessment Methodology): World Bank 23
  • 2. Ecuador’s current status(2) National Innovation System of EcuadorHistorically Ecuador shows isolated efforts generated by national institutions such asacademia, private enterprises and government looking to launching a nationalinnovation system.Government• Starting 2008, a larger and better government allocation of R&D funds and initiatives: Long term impacts.• SENESCYT developed the National Research Policy developed in 2012: big changed yet… results to come. next page• Only by 2012 government is joining state efforts to invigorate R&D toward a change in national productive matrix. • Government has not found a way for strong linkages between Academia-Government and Industries.  24
  • 2. Ecuador’s current status(2) National Innovation System of Ecuador National Research Policy developed by SENESCYT A. Restructure the National Research System 1.1 Restructure management models of Public Research Institutes 1.2 Recovering scientific production capacity of actors of CTIS System 1.3 Creation of the National System of Researchers B. Foster integration of National Research System actors 2.1 International recognition of researches with empowerment of researchers. 2.2 Encouragement and recognition of Intersectoral Network of Science and Technology C. Promoting Scientific research focused on productive matrix change 3.1 Funding of programs and projects for selective import substitution 3.2 Funding of scientific researches to generate value-added products to diversify exports 3.3 Funding of researches that allow optimize access, coverage and quality of services and improve decision making in the context of risk management. 3.4 Development of Basic Researches in strategic areas as a central focus of research. 3.5 Development of Social Science Researches with emphasis in History, History of Culture and Arts as a tool for knowledge dialogue. 25
  • 2. Ecuador’s current status(2) National Innovation System of Ecuador Universities • During 2008, only 1,187 university professors (3.6% of total) included research activities on their working schedule (CONEA, 2009)  • 2012: radical changes in the Ecuadorian university system: 14 out of 67 universities were stepped out. They didn´t meet basic R&D requirements. • Universities have autonomy to operate and to partner. However, they have to spend at least 6% of its budget to fostering own R&D capacities. • Traditionally, funding research projects at small scale.  • Universities working at low to none degree linked to industries.  Industries • Private companies showed a “low to none support of innovation activities with the exceptions of petroleum and the shrimp and food industry.” (Ponce, 2011) • Only 3,124 out of 500,000+ Ecuadorian enterprises invested in R&D during year 2009, totaling US$ 231.65 million. (Source: INEC) • Industries require to define efforts: Basic R&D or applied R&D. • SMS industries struggle powering R&D: Finance and cultural reasons. 26
  • 2. Ecuador’s current status(2) National Innovation System of Ecuador Research Centers • Starting 2011 key changes (budget allocation and management) in public research centers focused on foster R&D. • Activities of 11 Public RC reorganized in 2012: research lines re-defined in order to meet national goals. • No formal tracking of private RC activities / outcomes  • Public Research Centers used to work at low to none degree linked to local industries.  Other institutions? • Financial institutions, other promotion organizations …. S&T Policy governance? 27
  • 2. Ecuador’s current status(2) National Innovation System of Ecuador Final Ideas • SMB put low efforts on R&D: - Their products requires low innovation; - National market is price-oriented more than quality-oriented; - Culturally SMB don’t leverage on their peers in order to improve their products. • Ecuador don’t have priorities to bring up technological demands: Government promotes changing the productive matrix, however, still doesn’t determines what intensity (High-medium-low) and which sectors (besides traditional ones). There are some hints on which sectors the Government wants to bet (petrochemical, nanotechnology, etc), yet, there’s no evidence on which sector the private sector would like to consider. That could be dangerous since national efforts can take different paths. • Since 92% of private R&D investment is made by large enterprises, the main target of Ecuador’s innovation policy should be Small and Medium size business (Micro are too little to invest) • It seems natural that transfer of technology will come to Ecuador as imitation or internalization of foreign technologies more than generating new tech R&D investment shows low levels. 28
  • 2. Ecuador’s current status(3) U-I-R R&D collaboration in Ecuador • Scarce R&D process demand from companies toward academia and vice versa. • Partnering with academia does not come naturally to Ecuadorian companies. Even more, just a few large companies have developed their own research centers. • Industries: Restricted fund allocation toward R&D. • Limited qualified human resources in R&D 0.46 researchers per every thousand of economically active population. (Source: RICYT) 29
  • 2. Ecuador’s current status(3) U-I-R R&D collaboration in Ecuador Problems that delay promotion of U-I-R R&D collaboration Low added value in goods and services produced NEED of R&D to improve products. • Need to strength essential capabilities of each R&D actor • Define Ecuador´s level of technology to develop: per industry, per actor. • R&D developed by academia guided by different motivators than those of companies. Advances not linked to industrial needs. • Environment not suited to scientific and technology entrepreneurs. • Lack of mechanisms (concrete/efficient) to make actors work together - No communication tools among players of national R&D system: They don´t know each other. • Lack of legal framework supporting and promoting R&D activities. • Low leverage of national networking capacities and international network assistances. 30
  • 2. Ecuador’s current status(4) R&D incentive system in Ecuador• No financial (Venture Capital, Tax exemptions) or non-financial (Public recognition, etc.) solid incentives for U-I-R to strongly engage in R&D.• National finance system does not support R&D initiatives: solutions focused to regular financial customers.• Ministry of Industries have support SMEs activities specially focused on development more than in research. Initiatives supported quality and manufacturing process. 31
  • 2. Ecuador’s current status(5) Priorities in resolving the problems and bottlenecks• Ecuador shows a lack of information/data regarding R&D including key element when allocating resources, defining policies and assessing impacts. Survey on innovation• Create legal framework to foster and engage R&D activities: Governance for R&D system.• Strengthen each R&D actors capabilities (Within / Among).• Find ways to generate linkage between different players of Ecuadorian innovation system. Government still looking to build a National System that encompasses all potential actors.• Create effective mechanisms to put actors working together in R&D initiatives.• Develop strong instruments to increase low national R&D level.• Need to have a national focus on which technology to develop: High, Medium, Low Tech. 32
  • 3. Korea’s experiences U-I-R collaboration and non-tax/subsidy measures Economic development and the role of S&T in Korea • Increase in technology intensity • Statistics on Korea’s R&D • Development strategies and S&T policies – Characteristics U-I-R R&D collaboration in Korea: How to facilitate communication and cooperation? • Evolution of U-I-R R&D collaboration in Korea • Mechanisms to facilitate U-I-R communication and cooperation Other instruments to promote R&D in Korea: focus on non-tax/subsidy measures • Chronology of major policies – Characteristics • Non-tax/subsidy measures: Technology Certification, Demand-based support, Guarantee 33
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Increase in technology intensity Top 10 Leading Industries in Korea’s Manufacturing Sectors 1970s 1980s 1990s 2000s 1 Food & beverage Textile & apparel E&E products E&E products 2 Textile & apparel Food & beverage Automobile Chemicals 3 Chemicals Chemicals Food & beverage Automobile 4 Automobile E&E products Chemicals Basic metal 5 Paper & printing Basic metal Textile & apparel Food & beverage 6 Non-metallic Automobile Basic metal Machinery mineral products 7 Coal & petroleum Coal & petroleum Non-metallic Textile & apparel refinery mineral refinery products 8 E&E products Non-metallic Machinery Fabricated mineral products metal products 9 Machinery Paper & printing Paper & printing Paper & printing10 Basic metal Machinery Fabricated Coal & petroleum metal products refinery All manufacturing All manufacturing All manufacturing All manufacturing (% of GDP) (% of GDP) (% of GDP) (% of GDP) Source: Bank of Korea, National Accounts and Statistical Yearbook, various issues. Note: Shares are of manufacturing value-added total. E&E = electrical and electronics. 34
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Increase in technology intensity Korea’s Top 10 Exports: Evidence on Industrial Upgrading 1960s 1970s 1980s 1990s 2000s1 Iron Ore Textiles Textiles Electronics Semiconductors2 Tungsten Ore Plywood Electronics Textiles Computers3 Raw Silk Wigs Iron and Steel Footwear Automobiles Products4 Anthracite Iron Ore Footwear Iron and Steel Petrochemical Products Products5 Cuttlefish Electronics Ships Ships Ships6 Fruits and Wireless Live Fish Vegetables Synthetic Fibers Automobiles Telecomm equipment7 Iron and Steel Natural Graphite Footwear Metal Products Chemicals Products8 Plywood Tobacco Plywood General Machines Textiles Products9 Rice Iron and Steel Fish Plastic Products Textile Fabrics Products10 Electronics Home Bristles Metal Products Electrical Goods Containers Appliances 35
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Increase in technology intensity Technology-intensive exports in Korea (% of manufactured exports)(%) 40,0 35,0 30,0 Korea, Rep. 25,0 Ecuador Lower middle income 20,0 Low income 15,0 Upper middle income 10,0 5,0 0,0 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 * High-technology exports: products with high R&D intensity, such as aerospace, computers, pharmaceuticals, scientific instruments, and electrical machines Source: World Bank Database 36
  • 3. Korea’s experiences(1) Economic development and S&T in KoreaStats on Korea’s R&D 1965 1970 1975 1980 1985 1990 1995 2000 2003 2006 R&D expenditure 2.1 10.5 42.7 282.5 1,237.1 3,349.9 9,440.6 13,848.5 19,068.7 27,345.7 Government 1.9 9.2 30.3 180 306.8 651 1,780.90 3,451.80 4,663.20 6,632.1 Private Sector 0.2 1.3 12.3 102.5 930.3 1,698.90 7,659.70 10,387.20 14,326.60 20,631.3 Gov’t vs. Private 90:10 88:12 71:29 64:36 25:75 28:72 19:81 25:75 25:75 24:76 University R&D NA 0.4 2.2 25.9 118.8 244.3 770.9 1,561.90 1,932.70 2,721.9 Gov’t Res. Inst. R&D NA 8.9 28.1 104.5 367.2 731 1,766.70 2,032.00 2,626.40 3,497.1 Corporate R&D 0.2 1.3 12.3 81.4 751 2,374.50 6,903.00 10,254.70 14,509.70 21,126.8 R&D/GNP 0.26 0.38 0.42 0.77 1.58 1.95 2.51 2.40 2.63 3.23 Manufacturing Sector R&D NA NA 16.7 76 688.6 2,134.70 5,809.90 8,584.90 12,400.68 19,025.8 Percent of Sales NA NA 0.36 0.50 1.51 1.96 2.72 2.17 2.64 2.88 Number of Researchers 2,135 5,628 10,275 18,434 41,473 70,503 128,315 159,973 198,171 256,598 Gov’t Research Inst. 1,671 2,458 3,086 4,598 7,542 10,434 15,007 13,913 14,395 16,771 Universities 352 2,011 4,534 8,695 14,935 21,332 44,683 51,727 59,746 65,923 Private Sector 112 1,159 2,655 5,141 18,996 38,737 68,625 94,333 124,030 173,904 R&D expenditure 967 1,874 4,152 15,325 27,853 47,514 73,574 86,568 96,223 120,308 per researcher (1,000won) Researcher per 0.7 1.7 2.9 4.8 10.1 16.4 28.6 34 41.4 53.1 10,000 Population Number of Corporate 0 1 12 54 183 966 2,270 7,110 9,810 13,324 R&D Centers * Unit for R&D expenditure ~ Manufacturing Sector R&D: trillion won * Korea’s GDP in 2006: 908 trillion won or 952 billion US$ (current LCU or US$) Source: Ministry of Science and Technology 37
  • 3. Korea’s experiences(1) Economic development and S&T in KoreaStats on Korea’s R&D Gross Expenditure on Research and Development in Korea, 1964-2004 Source: Ministry of Science and Technology 38
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Development of the Korea’s National Innovation System Periods Development of the Korean National Innovation System • Beginning of scientific education 1960s • Beginning to build S&T infrastructure • Establishment of government-sponsored research institutes • Technical, scientific and further education Ecuador is 1970s • Establishment of Daeduk Science Town • Beginning of industrial R&D trying to • Promotion of key technologies through National R&D Program carry out 1980s • Activation of industrial R&D these tasks • Mass production of high-qualified R&D personnel all together. • Expansion of S&T related ministries • Promotion of academic R&D potentials • Expansion of R&D resources and their efficient utilization 1990s • Introduction of regional innovation policies • Introduction of National S&T Council (NSTC) system Source: Chung, S. (2006), Technology and Management 39
  • 3. Korea’s experiences (1) Economic development and S&T in Korea Development strategies and S&T policies: Changes in Government Innovation Policy Development Major policy Science and Human resources goals directions technology (S&T) development Build a production - Expand export-oriented - Build scientific - Decrease illiteracy base for export- light industries institutions’ legal and - Establish a national1960s oriented administrative frameworks infrastructure - Mobilize domestic and industrialization foreign capital Build a self-reliant - Promote heavy and - Set up a scientific - Increase vocational growth base chemical industries infrastructure: training1970s - Build social overhead specialized S&T - Increase engineering- capital institutions, Daeduck major college Graduates Science Town Expand Technology- - Conduct industrial - Promote R&D and private - Expand the higher intensive Industries rationalization research centers education system1980s - Decrease export subsidy - Develop national R&D - Develop semiskilled and expanding import programs human resources Liberalization Promote high-tech - Support technology Promote R&D programs on - Develop highly skilled innovation development highly advanced human resources in1990s - Build an information technologies strategic fields: IT, BT etc. Infrastructure - Develop lifelong learning systems Refer to the Appendix for more explanation.
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Development strategies and S&T policies: Changes in Government Innovation Policy S&T Leadership Technology Catching-up Institutional Building 1962 1966 1967 1971 1981 1982 1987 1991 1992 1997 2004 2008 20111st 5-Year Ministry of S&T National R&D Financial CrisisEconomic (MOST) Program (NRP) StandingPlan NSTC MEST& MKE Korea Institute of S&T Technology Development • Information and (KIST) Promotion Act Communication R&D Program (ICRP) Deputy Prime • Highly Advanced Minister of National Project MOST (OSTI) (HAN) Source: Jang, Y. (2011), “Evolution of Korean STI Policies” Refer to the Appendix for more explanation.
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Development strategies and S&T policies: Governance (late 2000’s) President PACEST National S&T Policy & Presidential Council on Education, S&T Coordination MOSF NSTC Ministry of Strategy National S&T Commission B and Finance P Ministerial S&TPolicies/ Planning MEST MKE Other ministries B P B P S&T programs/ R&D mgmt planning/ NRF KIAT/KEIT agencies evaluation B P KRCF ISTKPerforming S&T Korea Research Council Korea Research Council program for Fundamental S&T for Industrial S&T Universities/ GRIs/Firms MEST: Ministry of Education, S&T MKE: Ministry of Knowledge and EconomyNote : P and B denote policy and budget respectively NRF: National Research Foundation KIAT: Korea Institute for Advancement of Technology KEIT: Korea Evaluation Institute of Industrial Technology
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Development strategies and S&T policies: GRIs • Leading Player for Korean Innovation Independent non-government organizations with government’s financial supports Operating under the GRI Laws and civil laws Conduct about Half of Public R&D Investments KIST, the First GRI, was established in 1966 with help of USAID 27 (13 under KRCF & 14 under ISTK) S&T GRIs (as of 2011) • Role Shifting Absorbing & Internalizing imported foreign technology (1970s) Modifying imported technology/ Developing domestic technology (1980s) Advancing catching-up technology (1990s) Focusing on Endogenous Technology (2000s~ ) Major Function: Providing Needed Technology to Industries Source: Jang, Y. (2012), “Korean STI Strategies for National Development”, Presentation for the Ecuadorian Delegates Refer to the Appendix for more explanation. 43
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Development strategies and S&T policies: GRIs 1945 1960 1966 1970 1980 1990 2000 KIGAM KIST 1948 1966 KRIBB KITECH KISTI 1985 1989 1991 KAERI KORDI KFRI 1959 1973 1976 KOPRI KBSI KIOM KICT 1987 1988 1994 1962 ETRI KRRI 1976 1996 KIT 1982 NFRI NTMS 1996 2005 KASI KRICT KFRI 1974 1976 1987 WKIMCHI KRISS KIMM KIER 2010 1975 1976 1977 KARI 1989 KIMS 2007 Source: Jang, Y. (2012) Refer to the Appendix for more explanation.
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Development strategies and S&T policies - NRDP National R&D Program by Stages Formation stage (1982-84) Take-off stage (1985-1990) Maturing stage (1991 ~ ) Objective Internalization of Development of Creative research Foreign technologies Core technologies Future-oriented research Planning No planning: Bottom-up Based on loose Long -term plan R&D planning Technology foresight Main actors Government R&D Main: GRI Main: GRI, Institutes (GRI) Minor: Universities with increased role of and Industries universities and industries Source: Ministry of Science and Technology(1997), Thirty Year History of Science and Technology, Republic of Korea Korea’s Industrial Technology Policy: 80% of Government’s total R&D budget spent on NRDP National R&D Infrastructure Institutional Incentives Programs & Diffusion Support Objectives To develop generic To enhance intermediary To nurture GRI and to To induce/assist private industrial technologies functions and to fill the gap strengthen GRI’s research enterprises’ technology among innovation actors capabilities development activities Tools Ministries’ R&D - Research personnel Funding for GRI’s - Tax-exemption programs - Technical information operational expenses and - Financial support - Coop. R&D facilities own research projects - Subsidy for technology - Regional R&D centers etc development Effects On To expand To facilitate diffusion and to To bring up helper/partner To strengthen industry’s Industry knowledge/technology make better industry’s use of for industry’s technology own technological pool for industrial use technologies development capabilities Source: KDI(2009), Models for National Technology and Innovation Capacity Development in Turkey 45
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Development strategies and S&T policies – S&T HRD S&T HRD Policy in Korea 1960s 1970s 1980s 1990s 2000s Policy Paradigm Duplicative Imitation Creative Imitation Innovation Goal Nurturing Nurturing engineers Nurturing highly Nurturing world-class Nurturing creative of technicians for heavy & chemical qualified engineers scientists and scientists for frontier S&T HRD for light industries Industries for technology- engineers for frontier industries Policy intensive industries industries Policy • Organized mid & • Established • Established S&T • Strengthened • Systemized S&T Measures long-term plans and government research-oriented cooperation gifted student of laws for HR research institutes university between industry, education S&T HRD • Established • Attracted highly • Funded highly academy and GRI • Fostered woman Policy “Technical High qualified Korean qualified students • Supported for world S&T human School System” scientists & for studying class professors resources • Established “The engineers from overseas • Scholarship to • Supported whole Science and foreign countries students in master career paths of S&T Technology and doctoral degrees human resources Agency” KDI(2012), Strengthening Uzbekistans National Innovation System 46
  • 3. Korea’s experiences(1) Economic development and S&T in Korea Development strategies and S&T policies – Characteristics • Imitation Internalization Generation, Low-tech High-tech stage by stage • S&T HRD policies’ focus moved from craftsmen to technician and then to engineers in line with each stage of economic development • Very active role of the Government Research Institutes to meet the technological needs of the industries • At the early stage, focus on industrial and applied R&Ds • As universities’ R&D capabilities improved, university-industry collaboration became active for incubation of technology holders and small businesses. • The National R&D Programs have played a very influential role in internalizing foreign technologies, developing core and frontier technologies. • 47
  • 3. Korea’s experiences(2) U-I-R R&D collaboration in Korea Evolution of U-I-R R&D collaboration in Korea Mechanisms/measures to facilitate U-I-R collaboration: • Categories of the Government Policies • Communication facilitation mechanisms/measures 48
  • 3. Korea’s experiences(2) U-I-R R&D collaboration in Korea Evolution of U-I-R R&D collaboration in Korea Characteristics Main contents1960s Starting to develop • Focus on policies for nurturing manpower such as security of scientific technical industrial HR manpower, enhancement of skill level of workers, security of skilled manpower etc • Enactment of the ‘Act for Promotion of Industrial Education, ’the ‘Engineer Act,’ the ‘Vocational Training Act’ etc1970s Building up capacities • Conversion of role of KIST as the core main agent of joint R&D of major actors of the • Enactment of the Technology Development Promotion Act for acceleration of NIS development of Korea’s own technologies - Establishment of the 5 major government-supported research institutions and so on1980s Full-scale progress of • Full-scale support through the national R&D business U-I-R collaboration • Construction of the foundation for strengthening of U-I-R collaboration led by the government • Enactment of the Act for Nurturing Industrial Technical Research Union for the support of cooperative research1990s Government-led • Independent and dispersive promotion of national R&Ds by each department promotion of U-I-R • Promotion of construction of regional foundation R&D • Establishment of Techno Park, regional cooperative research centers etc2000s Vitalization of • Designation and expansion of U-I cooperation universities university-industry • Acceleration of commercialization of R&D and strengthening of Technology Business cooperation Incubator function of colleges • Enactment of the Science Technology Basic Act, the Act for Acceleration of Technology Transfer, the Patent Act, the Act for Acceleration of Industrial-educational Education and Cooperation, the Basic Act for Development of Human Resources etc Source: KDI(2012), Technical Engineering Education Model of Korea Polytech University(KPU) 49
  • 3. Korea’s experiences(2) U-I-R R&D collaboration in Korea Evolution of U-I-R R&D collaboration in Korea • U-I-R R&D clusters Daedeok Innopolis, Gwanggyo Technovalley, Pangyo Technovalley, Ansan Science Valley etc • Technology Business Incubator (TBIs) in universities • The Korea Polytech University’s industrial-education cooperation system KPU: established in the industrial complex for industrial-educational cooperation - About 90% of the enterprises in the industrial complex where the university is located are SMEs with sales of less than 10 billion won and 50 or fewer employees - SMEs’ urgent need to develop products, technologies through industrial-educational cooperation KPU’s Partner company system: an industrial-educational cooperation system with a unified network Professors and students of university and local enterprises participate together Regional base for partner companies Support tailored to local industry Connecting education, research and employment Diverse cooperative activities such as organic exchanges of information, joint technical development etc between SMES and the university 50
  • 3. Korea’s experiences(2) U-I-R R&D collaboration in Korea Mechanisms/measures to facilitate U-I-R collaboration Communication facilitation mechanisms in Korea Coordinating institutions • University and Industry Cooperation Center (UICC) in universities/colleges Korean version of Industry Liaison Office (ILO) Technology Licensing Office under the UICC for technology transfer and commercialization • Technology Business Incubators (TBIs) in universities/colleges and industrial complexes Improving the survival rate of new enterprises that can provide more employment opportunies Assisting micro-small and small enterprises with technological capabilities to develop technologies and products right before and after start of business Transfer or commercialization of technologies developed by universities Providing in-company training opportunities for students 51
  • 3. Korea’s experiences(2) U-I-R R&D collaboration in Korea Mechanisms/measures to facilitate U-I-R collaboration Communication facilitation mechanisms in Korea Coordinating institutions - Technology Business Incubators (TBIs) R&D Prototypes Commercialization Technological, Financial, Managerial Assistance Sharing of facilities and equipments • Technology incubation as well as Business incubation supported by various assistances • Around 280 TBIs in 2011 • 80% of the TBIs established and run by universities with the rest run by the central government and various municipalities - University TBIs: Financial assistance from the government for construction and operation of the TBI • Spaces, facilities and equipments provided with preferential terms • Technical consulting services to resolve difficulties in R&D • Assistance for grants and preferential loans • Consulting on management and marketing, provision of market information 52
  • 3. Korea’s experiences(2) U-I-R R&D collaboration in Korea Mechanisms/measures to facilitate U-I-R collaboration Communication facilitation mechanisms in Korea Coordinators • U-I-R Coordinators As a Korean version of the industry relations coordinator Identify, develop and maintain external relationships, primarily with companies to further the university’s researches; Promote the university’s capabilities, coordinate faculty interactions with companies; Increase the number and/or value of industry research contracts, and assist small businesses • Technology Coordinators Technology experts mostly in GRIs as the Technology Coordinators Financed by the Korea Research Council for Industrial Science & Technology that administers 13 GRIs on industrial technologies SMEs with technological difficulties apply for short and mid-term projects Technological experts in the GRIs are assigned to the SMEs selected, and help the SMEs resolve technological difficulties 53
  • 3. Korea’s experiences(2) U-I-R R&D collaboration in Korea Mechanisms/measures to facilitate U-I-R collaboration The partner company system by the Korea Polytech University: Main characteristics Tailored education University Professors Students Assistance Partner companies sharing brains and latest equipments Companies Industrial complexes University - enterprise - One tutor professor for each company - Regular meetings of all partner companies reporting their performances network - Technology Exchange meetings - Technical guidance and advice: Tutor professor and students’ participation University enterprise - Sharing of expensive equipments on favorable terms - Provision of information on new technologies through the web system Cooperation - Employee training courses tailored to the needs of companies - Maintenance education and training of the employed - Opportunities for students’ field practice in companies: 8 credits or more Businesses University - Field experts invited to lecture as adjunct professors Cooperation - Partner Companies’ Scholarship - Participation in curriculum improvement through survey Source: Korea Association of Industry, Academy and Research Institute (2011), No Innovation, No Future 54
  • 3. Korea’s experiences(2) U-I-R R&D collaboration in Korea Mechanisms/measures to facilitate U-I-R collaboration The partner company system by the Korea Polytech University: Performances categories Outcomes of industrial-educational cooperation 2009 Number of partner • Launch of the partner company system in Feb 2002 companies • 1000 companies in May 2002 Cooperative • About 3,000 companies as of 2011 exchange Manpower Business incubation Business incubation for 20 companies through the 29% exchange Technical Business Incubator (2007) 46% Operation of the courses of 748 CEOs for 14 terms since 2002 Technical industrial technologies for exchange CEOs 25% Education for workers Commissioned education for 539 workers as of 2007 commissioned from businesses Sales of Excellent Partner Companies Re-education for workers 327 workers in 2001; 5,439 in 2002; 2,463 in 2003; (109 representative partner companies) of businesses 3,301 in 2004; 2,166 in 2005; 2,483 in 2006 7000 Technical development and Support through the research centers in industrial- directions educational cooperation, cooperative research centers, TRITAS, consortiums of industrial and university etc 6000 Special lectures for CEOs • 9 lectures in 4 departments in 2005 of partner companies • 11 lectures in 4 departments in 2006 5000 Participation as adjunct 222 persons, including engineers of enterprises etc professors 4000 Participation in field About 10,000 persons in 7,000 companies practice of students 3000 Others Scholarship of partner companies, opening of (bil. Won) 2005 2006 2007 2008 equipments for experiments and researches etc Source: KDI(2012), Technical Engineering Education Model of Korea Polytech University(KPU) 55
  • 3. Korea’s experiences(3) Other instruments to promote R&D in Korea: focus on non-tax/subsidy measures History of Tax/subsidy measures to promote R&D Examples of non-tax/subsidy measures • Technology certification: NET mark • Demand-based R&D support • Technology guarantee: Kibo Technology Fund 56
  • 3. Korea’s experiences(3) Other instruments to promote R&D in Korea: focus on non-tax/subsidy measures History of Tax/Subsidy measures to promote R&D in Korea Before 1970s 1980s 1990s 1970s 73 74 76 77 78 79 81 82 84 86 91 92 R&D Technology Development Reserve Funds System Investment Tax credit or special depreciation for investment in equipment to develop technology and manpower Promotion Duty abatement or exemption on goods for academic research Tax credit for technology and manpower development expenses Tax exemption for real estates of private enterprises’ affiliated research centers Tax exemption for research devices and samples Duty abatement or exemption on goods for research Technology Deduction and exemption of the corporate tax for the foreign investment accompanied by technology requisite Transfer Reduction and exemption of tax amount Promotion on technology transfer income Income tax exemption for foreign technologists Technology Provisional special consumption tax rate for technology commodities Commercialization Reduction and exemption of tax for Promotion start-up venture SMEs Source: KDI(2009), Models for National Technology and Innovation Capacity Development in Turkey 57
  • 3. Korea’s experiences(3) Other instruments to promote R&D in Korea: focus on non-tax/subsidy measures Examples of non-tax/subsidy measures: Technology Certification: NET, NEP Certification on New Excellent Technology, New Excellent Product since 1993 • Government’s certification on newly developed technologies and products to promote technology and product innovation, especially by SMEs • Incentives Government’s priority purchases of NEP-certified products Government’s priority purchases of products made by the NET-certified technologies Assistance for marketing Preferential credits for SMEs trying to commercialize certified technologies Preferential treatment of certified SMEs in applying for government R&D projects Tax deduction of capital investment for commercialization of the NET-certified technologies etc 2006 2007 2008 2009 2010 2011 NEP NET NEP NET NEP NET NEP NET NEP NET NEP NET Applied 314 594 387 450 359 360 330 327 344 237 303 185 Certified 80 189 110 168 110 120 114 98 119 64 107 59 Ratio (%) 25.5 31.8 28.4 37.3 30.6 33.3 34.5 22.9 34.6 27.0 35.3 31.8 58
  • 3. Korea’s experiences(3) Other instruments to promote R&D in Korea: focus on non-tax/subsidy measures Examples of non-tax/subsidy measures: Demand-based R&D support Purchase guarantee of new products developed according to the pre-specified demands • Promoting R&D and product development of SMEs by securing demands in advance • Demands for new products are specified by public organizations or private large companies Selection of the SME that will carry out R&D and product development Purchases guarantee of the new products developed by the SMEs selected for the projects • The government or the large companies support part of R&D and product development costs. Demands by the public organizations: government 75%, SMEs 25% Demands by the private large companies: government 50%, the private large company 25%, SMEs 25% Usually 1~2 years of project period with the government’s maximum support of about ½ mil. $. • Successful R&D and product development purchase the product by the demander If successful, the SMEs pay back 10~20% of the government support If not successful with moral hazard problem, return in full of the government support • In practice since 2003, success cases accumulating 59
  • 3. Korea’s experiences(3) Other instruments to promote R&D in Korea: focus on non-tax/subsidy measures Examples of non-tax/subsidy measures: Kibo Technology Fund • Providing credit guarantees to facilitate financing for new technology-based enterprises • Promoting growth of technologically strong Small and Medium Enterprises (SMEs) and venture businesses Kibo Technology Fund’s Major Services • Guarantees for monetary liabilities to financial institutions Technology • Guarantees given to innovation-leading SMEs Guarantee • Technology Appraisal Guarantees • Adoption and utilization of the Technology Appraisal Certification System Technology • Feasibility Assessment of Technology Appraisal • Comprehensive Technology Appraisal Technological and Managerial • Business Consultation Advisory Service • Support for Company Restructuring and Technology Transfer Management of Guarantee • Investigation of Debtor’s Properties • Subrogation Payments Defaults and Claims • Legal Procedure for Debt Collection 60
  • 3. Korea’s experiences(3) Other instruments to promote R&D in Korea: focus on non-tax/subsidy measures Examples of non-tax/subsidy measures: Kibo Technology Fund Supervision & Contribution Government of Capital Funds 1. Application for Loans 2. Consultation and Application for technology Guarantee KTF Contribution of 3. Credit Investigation and Evaluation Capital Funds 2 3 4 5 4. Approval of technology Guarantee 5. Issuance of a Letter of Guarantee SMEs, 1 Financial Venture Enterprises 6 Institutions 6. Provision of Loans Capital Fund Formation and its Performance of the Kibo Technology Fund (unit: billion won) 2006 2007 2008 2009 2010 Guarantee Outstanding (A) 11,150 11,245 12,593 17,144 17,426 Contributions 809 608 595 1,401 459 Government (600) (200) (157) (720) - Financial Institutions (209) (408) (438) (681) (459) Capital Funds (B) 1,152 1,446 1,729 2,695 2,813 Guarantee Utilization Ratio (A/B) 9.7 7.8 7.3 6.4 6.2 * The Fund turned from loss to surplus from operation in the late 2000s. Source: Kibo Technology Funds (http://eng.kibo.or.kr) 61
  • 4. Implications and policy suggestions Synopsis: Ecuador’s current status in R&D Implications of the Korean experience for R&D promotion in Ecuador Policy suggestions: R&D promotion by U-I-R collaboration Policy suggestions: Non-tax/subsidy incentive measures to spur R&D 62
  • 4. Implications and policy suggestions(1) Synopsis: Ecuador’s current status in R&D • Ecuador’s NIS is about to emerge still with problems that needs to be resolved. Not so widespread culture for willingness to carry out R&D Not enough capabilities and capacities of each actor of the NIS Not so much tendency for the actors to collaborate and cooperate with each other Not enough financial and non-financial supportive measures and mechanisms Not firmly established legal framework on S&T governance, R&D promotion etc • Ecuador just introduced R&D policies to improve R&D capabilities of universities and GRIs. (not enough capacities, mostly basic researches) Survey on innovation expected to be done by the first half of this year • It looks like Ecuador is trying to catch them all in R&Ds. Trying to catch them all from high-tech to low-tech at the same time Trying to catch them all from basic to applied or industrial R&Ds at the same time Trying to carry out technology imitation, internalization and generation all together 63
  • 4. Implications and policy suggestions(2) Implications of the Korean experiences: Observations • R&D is risky in nature, costs money, but, creates extensive positive externalities. There exists decent rationale for government to intervene the NIS actors activities with carrots and sticks. Need to introduce financial and non-financial assistances that can encourage especially SMEs to get involved in R&D and help holders of promising technologies in establishing new enterprises and commercializing their products successfully. • Need to identify reasons why enterprises, whether large or small, are not willing to pay attention to R&D for whatever level of technologies Lack of competition in domestic markets?  Protection of domestic markets? Not enough protection of the IPRs? Not enough incentive measures? 64
  • 4. Implications and policy suggestions(2) Implications of the Korean experiences: Observations • Need to determine priorities in sequence for R&D and S&T-HRD The current situation of Ecuador regarding R&D, seems to correspond to that of around 1970’s in Korea. Nevertheless, Ecuador looks like targeting development of all levels of technologies and S&T-HRs. - Which sectors first? - What level of technologies and S&T HR first? • Reform measures on universities and GRIs are in the right track to strengthen the NIS actors’ capacities. - Sticks have to come with carrots for more R&D activities. • The capability and the role of GRIs should be strengthened. - Establishment of GRIs that can meet the industries’ technological demands so as to induce industries to participate in collaboration of R&Ds 65
  • 4. Implications and policy suggestions(2) Implications of the Korean experiences Suggestions on Ecuador’s general policy direction on R&D A. Promotion priorities and right incentives • Priority setting and concentration: Policy plan on what to promote first - which sector for R&D, what level of tech., how much applied tech., what kind of S&T HR • Incentive measures and mechanisms that are conducive to the priorities in R&D B. The role of GRIs • Diversification of GRIs to meet the industrial needs on technologies • Enough support and strict evaluation - Financial support for GRIs (also for universities) needs to be based on self-help to meet technological needs of industries C. S&T policy coordination system – Governance system • Cross-cutting nature of S&T and innovation need to have coordination system established • The coordination body needs to take the lead in administering R&D promoting measures and mechanisms 66
  • 4. Implications and policy suggestions(3) Policy suggestions on the KSP Agenda: R&D promotion by U-I-R collaboration A. Partner company system and the Technology Innovation Park (TIP) • Can be applied to high-level universities, especially those in the City of Knowledge • The TIP can facilitate collaboration between high-tech universities and technology- intensive small enterprises - Need to train and invite experienced U-I-R coordinators B. Technology business incubators • Can be applied to high-level universities along with the partner company system • Also, the major local municipalities with many enterprises can provide TBIs to help newly established ones survive and grow in the markets. 67
  • 4. Implications and policy suggestions(3) Policy suggestions on the KSP Agenda: Non-tax/subsidy measures to spur R&D A. Certification of new technologies and products • Can play an important role in encouraging SMEs to develop new technologies by providing certified technologies with various financial and non-financial incentives For the certification to be effective, government’s incentives to provide demands for the technologies/products and reduce cost burden have to be combined with publicity effects. B. Purchase guarantee of new products for pre-specified demands • Can facilitate SMEs R&D by resolving marketing problem at the initial stage May be combined with cost-sharing by the government • Can facilitate industry-industry (or large-small companies) cooperation C. Technology guarantee fund • Can play an important role in encouraging financial institutions to provide loans to promising high-level technologies by reducing risks involved in the loans. At the early stage, can be applied to manufacturing technologies of priority industries Need well-established technology appraisal capacities Consulting and advisory services to help the guaranteed survive and succeed in the markets 68
  • Thank you.
  • AppendixEconomic development and S&T in Korea Development strategies and S&T policies: Changes in Government Innovation Policy Expand Expand heavy Expand Promote Transition Major Direction of exp-oriented and chemical tech-intensive high-tech to knowledge- Industrial Policy light industries industries industries innovation based economy Factor-driven Stage Development Stage Investment-driven Stage Innovation-driven Stage Cheap labor Sources of Manufacturing capability competition Innovative capability Scientific Scientific R&D and Leading Role in New Challenges Institution Infrastructure Private Research Strategies Area Building Setting Lab Promotion - MOST/KIST - GRIs - NRDP - Enhancing university S&T Role of - S&T promotion act - Daeduk sci. town - Promoting private Research capability Government - 5-year economic - R&D promotion act research labs - Promoting co-op plan includes S&T - KAIST: highly - Promotion of research qualified personnel industrial R&D - Policy coordination - GRI restructuring Innovative Capability of Private Sector Source: KDI(2012), Toward Knowledge-based Economy of the Kingdom of Saudi Arabia 70
  • AppendixEconomic development and S&T in Korea Development strategies and S&T policies: Changes in Government Innovation Policy 1960s • Industrial Policies • STI Policies - Import-Substitution Industries - Establish Scientific and Technological (Textiles, Plywood, etc.) Infrastructure (e.g., KIST) - Expand Export-oriented Light Industries - Initiate S&T Education (e.g., KAIS) (export subsidy, preferential financing) - Promote Foreign Technology Imports - Five-Year Economic plans - Strategically Adjust to the Need for Economic - From Agriculture to Labor-intensive Development Light Manufacturing Industries - Establishment of Ministry of S&T (MOST) Source: Jang, Y. (2012) 71
  • AppendixEconomic development and S&T in Korea Development strategies and S&T policies: Changes in Government Innovation Policy 1970s • Industrial Policies • STI Policies - Expand Heavy & Chemical Industries - Expand Technical Training (e.g., machinery, shipbuilding, chemicals, - Improve Institutional Mechanism for Adapting marine science, electronics, electricity) Imported Technology (GRIs) - Shift Emphasis from Capital Imports to - Invite eagerly Korean Scientists trained Technology Imports overseas - Strengthen Export-oriented Industrial - Promote Research Applicable to Industrial Competitiveness Needs - Foster Chaebols - Promote Imports of Foreign Technology (e.g., Samsung, Hyundai, LG) (imitation, reverse engineering, imports of capital goods) Source: Jang, Y. (2012) 72
  • AppendixEconomic development and S&T in Korea Development strategies and S&T policies: Changes in Government Innovation Policy 1980s • Industrial Policies • STI Policies - Economic Slowdown / Trade Imbalance - Reluctant to TT from Advanced Economies - Declining Competitiveness in Labor- - Pressure on Strong IPR intensive Industries - Independent Innovation - Economic Liberalization - Develop and Acquire Top-level Scientists and - Transform Industrial Structure to Advanced Engineers and Balanced Form - Perform National R&D Projects Efficiently - Expand Technology-intensive Industries (e.g., NRP, IGTDP, AEECTP, ICRP) - Encourage Human Resource Development - Promote Industrial Technology Development and Improve Productivity of Industries - Promote Collaborative R&D - Promote SMEs (San-Hak-Yun) Source: Jang, Y. (2012) 73
  • AppendixEconomic development and S&T in Korea Development strategies and S&T policies: Changes in Government Innovation Policy 1990s • Industrial Policies • STI Policies - Promote Adjustment of Industrial Structure - From Imitation to Indigenous Innovation and Technical Innovation - Realign National R&D Projects - From Imbalanced to Balanced Growth - HAN Project (Long-term, Large-scale) Strategy - Strengthen Demand-oriented Technology - Promote Efficient Use of Human and Other Development System (industry-neutral & Resources technology-oriented) - Improve Information Network - Internationalize R&D Systems and - Information Technology (e.g., Computer, Information Networks Semi-conductor) - Construct S&T Infrastructure - Basic Research at Universities Source: Jang, Y. (2012) 74
  • AppendixEconomic development and S&T in Korea Development strategies and S&T policies: Changes in Government Innovation Policy 2000s • Industrial Policies • STI Policies - Searching Sustainable Growth based on - New Growth Engines (Bio, Nano, IT) Technology Innovation - Develop Regional Innovation Clusters - Select and Concentrate - Decentralization of R&D Authorities but - Differentiated Strategies for Major Emphasis on Coordination Industries, Future Strategic Industries, and - Long-term Vision for S&T Development Manufacturing-related Service Industries (Vision 2025) - Regional Development - Five-Year S&T Principal Plan - Entrepreneurships (Venture Capital, - Efficiency of Gov. R&D Investments NASDAQ) (Evaluation Emphasis) - Globalization (FTAs with Chile, U.S., EU, - National Technology Road Map (NTRM) China) - Private Sector-led NIS Source: Jang, Y. (2012) 75
  • AppendixEconomic development and S&T in Korea Development strategies and S&T policies: GRIs governance President NSTC Prime Minister MEST MKE Others KRCF NRCS ISTK 26 13 14 Policy GRIs GRIs Inst. Source: Jang, Y. (2012) 76
  • Appendix Economic development and S&T in Korea Development strategies and S&T policies: GRIsGRI under ISTK GRIs under KRCF• KIGAM: Korea Institute of Geoscience and Mineral • KAERI: Korea Atomic Energy Research Institute (1959) Resources (1948) • KIST: Korea Institute of S&T (1966)• KICT: Korea Institute of Construction Technology (1962) • KORDI: Korea Institute of Ocean S&T (1973)• KERI: Korea Electrotechnology Research Institute (1976) • KASI: Korea Astronomy and Space Science Institute• ETRI: Electronoics and Telecommunications Research (1974) Institute (1976) • KRISS: Korea Research Institute of Standards and• KRICT: Korea Research Institute of Chemical Science (1975) Technology (1976) • KRIBB: Korea Research Institute of Bioscience &• KIMM: Korea Institute of Machinery and Materials (1976) Biotechnology (1985)• KIER: Korea Institute of Energy Research (1977) • KOPRI: Korea Polar Research Institute (1987)• KIT: Korea Institute of Toxicology (1982) • KBSI: Korea Basic Science Institute (1988)• KFRI: Korea Food Research Institute (1987) • KARI: Korea Aerospace Research Institute (1989)• KITECH: Korea Institute of Industrial Technology (1989) • KISTI: Korea Institute of S&T Information (1991)• KRRI: Korea Railroad Research Institute (1996) • KIOM: Korea Institute of Oriental Medicine (1994)• KIMS: Korea Institute of Materials Science (2007) • NFRI: National Fusion Research Institute (1996)• WKIMCHI: World Institute of Kimchi (2010) • NIMS: National Institute of Mathematical Sciences (2005) Source: Jang, Y. (2012) 77
  • AppendixEconomic development and S&T in Korea Development strategies and S&T policies: GRIs Source: Jang, Y. (2012) 78
  • AppendixPartner Company System - Korea Polytech University Creation of win-wing cooperative culture between industry and university Vision through full fledged industry-education cooperation Connecting Network Hub Goals Making partner companies amounting to 5,000 leading companies in local Industrial complexes Partner Company Supporting Center Industry- Professors Industry- Industry- Education Engineering SMEs Connecting Education Division Education Cooperation House Supporters Industry and Cooperation Meeting Cooperation Connecting University Meeting Programs Center - Maintaining Close Industry-Education Cooperation Strategies - Research, Education and Exchange with Partner Companies • Establishment of technical visions of enterprises connected with local strategic industry and construction of technical development system • Construction of industry-industry innovation network based on exchanges between divisions and types of business • Intensification of internal innovation capability through reeducation of workers and nurturing and supplying professional technical talents 79