In order to become an innovation-led economy and a high-income economy, we need to identify and certify our innovative SMEs and companies so that we can foster and support genuine innovative SMEs because new innovative products and services are high-risk, long returns and SMEs and start-ups usually have little market access, and difficult to get no collateral financing. Once they are certified, innovative SMEs are given access to financing (soft loans – in OECD and Korea, innovative SMEs pay 2% deduction in interest rates), priority for government grants (in Korea, innovative companies can claim back 75% of R&D expenditure funded by the companies’ own funds), priority for government procurement of goods (in Korea, 7% of government goods are purchased from Innovative SMEs), Technology Assurance Purchasing program that guarantees purchase for the initial 3 years of new technologies developed by Innovative SMEs for large national top-down projects (e.g. High Speed Broadband HSBB). The procurement support programs provide market track-record for innovative SMEs to market to the global market. This is NOT an import substitution approach because the goal is to provide track-record to export/market to global customers.
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GRI –Government Research Institute and government Centres of ExcellenceThe business ecosystem must be created via government policies