Developing innovation & technology acceleration in Poland

Ryszard Białecki, Silesian University of Technology

Gliwice, Poland

Poland in the last 25 yearseconomy

Poland

Surface area 312 685 km2

6th in EU-2870th in the world

Population38,6M

6th in EU-2829 in the world

GDP$513 billion (2013 WB)

6th in EU-2824 in the world

GDP pro capita$23,275 (2013 WB)

22th in EU-2846 in the world

1.8 1.6 2.1 2.3 2.3 2.73.6 4.1 4.1 4.5 4.3 4.5 5 5.2 5.7

6.68

9

11.2

13.9

11.312.3

13.412.7

13.4

19

89

19

90

19

91

19

92

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

GDP pro capita after 1989 in k€

increased by 760% in 22 years , average 31% a year

Source: GUS

inflation rate

1990 1995 2000 2005 2010 2013

585.80%

27.80% 10.10% 2.10% 2.60% 0.90%

Source: GUS

Ease of doing business, rank out of 189

Strong correlation between entrepreneurship and innovation

Source The World Bank

Barriers to entrepreneurship - reduced v 50% within last 10 years

PL CZ SK HU DK FIN S

45

75

49 54

5 12 14

social cost, unemployment

Poland

Source: Eurostat

social cost, people at risk of poverty or social exclusion

Source: Eurostat

Poland

Economic crisis in Europe did not dampen the ongoing convergence.

Poland has weathered the crisis better than any other country in Europe. It remains the only EU economy that avoided a recession in 2008-2010

Poland’s income levels are rapidly converging with the EU-15 income levels, reaching historically unprecedented highs.

Source: POLAND ENTERPRISE INNOVATION SUPPORT REVIEW: FROM CATCHING UP TO MOVING AHEAD. The World Bank

rapid, radical and effective reform in the economy

111 days shock therapyimplemented rapidly and decisively lower social costs

Sources of success

massive burst of entrepreneurship

economic barriers lifted1989-91 number of SMEs grew from 572k to 1.5M general spirit of enterprise – driving force

Poland in the last 25 yearshuman capital

Secondary education PISA tests, rank of Polish studentssignificant progress

Source Program for International Student Assessment, OECD

2325

99

1310

Science Math reading and writing

2006

2012

12.9

22.3

40.7

48.9

53.8

51.8

1990

1995

2000

2005

2010

2012

Human capital; gross enrolment ratio

Source: A. Matras-Bolibok, P. Bolibok: Evolution of Human Capital in Transition Economy, The case of Poland

Institutions of higher educationuniversities and equivalent

1990 120 public2010 453 total, 321 private IHE

2324 2300

4400

59175367

4938

1990 1950 2000 2005 2010 2011

doctor degrees conferred

Source: GUS

dynamics much lower than students

Human resources % of population aged 25-64

Source Jan Gmurczyk, Innovation of Polish economy, Present state and recommendation InstytutObywatelski 2014, in Polish

PL UE-28 Region Nordic

89.6

76.5

88.881.7

4.510

5.6

27.6

having completedtertiary education

participating in LLE

SOCIAL SCIENCES, ECONOMY, LAW37.6%

SERVICES8.5%

AGRICULTURE1,7%

SCIENCE8,3%

HUMANITIES AND ART.9,0%

HEALTH AND SOCIAL WELFARE7,6%

Human capital; fields of studies 2013

SOCIAL SCIENCES, ECONOMY, LAW37.6%

SERVICES8.5%

AGRICULTURE1,7%

SCIENCE8,3%

HUMANITIES AND ART.9,0%

HEALTH AND SOCIAL WELFARE7,6%

EDUCATION 11,2%

TECHNOLOGY16,0%

16.0%

8,3%

37,6%

8,5%

9,0%

7,6%

11,2%

Source: Higher Education in Poland 2013. Ministry of Science and Higher Education

Human capitalemployment in R&D sector

employment dropped

Innovation level of Polish economy

EU-28 Innovation Ranking

POLAND

Source: Innovation Union Scoreboard 2014

Poland innovation performance • slightly improved (0.9%) between 2006 and 2013 • relative performance to the EU declined from 54% in

2007 to about 50% in 2013.

Relative weaknesses • Non-EU doctorate students, • PCT patent applications • License and patent revenues from abroad.

Relative strengths • Non-R&D innovation expenditures • Youth with upper secondary level education.

High growth • Community designs, • Community trademarks • R&D expenditures in the business sector.

Strong declines • Innovative SMEs collaborating with others,• New doctorate graduates, • SMEs innovating in-house • Sales share of new innovations.

Source: Innovation Union Scoreboard 2014

1615.3

12

10.510.310.29.5

8.1 8.1 7.8 7.8 7.57.1 6.8

6.25.8

5.4 5.3 5.2 5.2 4.9 4.8 4.64.1

3.6 3.5 3.4 3.1 2.82.4 2.2 1.9

IC FI DK

LU NO FR SE PT

AU

UK BE

GE SL IR ES SP CZ

SW NE LT SK HU

GR IT HR PL

BG LV MA TR CR

RO

Researchers (FTE) per thousand labor force,

Source: DG Research and Innovation Monitor human resources policies and practices in research(LOT 1 Part 1) The Researchers Report 2012 Scorecards

0 1 2 3 4

FIN

SE

DK

CZ

HU

SK

PL

UE-28

business

gov. high. ed., non-profit

R&D expenditure % GDP

Total R&D expenditure in Poland increased from 0.6%GDP (2008) to 0.9%GDP (2012), mainly due to government involvement

Source Jan Gmurczyk, Innovation of Polish economy, Present state and recommendation InstytutObywatelski 2014, in Polish

Structural funds for innovation support , €10 billion 2007-2013

• research infrastructure significantly enhanced

• did not trigger a significant breakthrough in innovation level

• venture capital and public R&D infrastructure mainly from public funds. Limited impact on private R&D investment

• R&D-intensive foreign direct investment only 4.5% of total business R&D spending (HU 13%, SK 21%)

Non-R&D innovation

expenditures

Venture capital investments

PL 182 55

CZ 122 11

SK 115 lack of data

HU 71 32

DK 91 111

FIN 90 116

SE 113 166

Innovation investments by enterprises segment (EU-27=100)

Source Jan Gmurczyk, Innovation of Polish economy, Present state and recommendation Instytut Obywatelski 2014, in Polish

other measures of innovation

PL EU-28 NORDIC REGION

patent applications to the European Patent office per million inhabitants 9.9 79.1 236.1 13.3

% of high tech export in total export 5.9% 11.60% 9.90% 13.9%

% of innovative enterprises employing at least 10 persons 27% 47% 58% 39%

Source Jan Gmurczyk, Innovation of Polish economy, Present state and recommendation InstytutObywatelski 2014, in Polish

0

20

40

60

80

100

120

140

160

PL Cz SK HU DK FIN SE

other measures of innovation% of innovative SMEs collaborating with others

EU-27=100

Source: Jan Gmurczyk, Innovation of Polish economy, Present state and recommendation Instytut Obywatelski 2014, in Polish, after Innovation Union Scoreboard 2013

3,167

1138 1138

146585

657

270 221

9

25

Public HEItotal

univerisities universitiesof technolgy

universitiesof economy

Private HEI

income fromresearch

income fromteaching

structure of income in HE

Diagnosis• competitive advantage of Polish companies resulted from

cheap labor force, not capital intensive investments in development of new technology

• institutional infrastructure supporting innovation system Fragmentation Unevenly distributed strategy and implementation (5

agencies and ministries) managing 22 innovation support programs.

Regions own innovation support initiatives.

• risk-averse selection for public funding favoring large and mature firms and medium-low technology industries

• lack of venture capital

• limited number of SMEs involved in new technologies

• international corporations seldom locate R&D centers in new EU countries

• low population of research staff

• brain drainage (salaries)

• HE atomized, teaching - main source of income

• Innovation funding – technology absorption rather than breakthrough innovation

• research staff reluctant to be involved in commercial activities

Measures taken to enhance innovationStrategy for innovation and efficiency of the economy, 2013 Ministry of Economy.

Objective 1 Adjustment of the regulatory and financial environment to the needs of innovative and efficient economy

Objective 2 Stimulating innovation through increase in knowledge and work efficiency

Objective 3 More efficient use of natural resources and raw materials

Objective 4 Enhanced internationalization of Polish economy

Budget allocation

Council of Ministers (April 8, 2014) adapted the Enterprise Development Program, which is an integral part of theNational Smart Specialization Project

HEALTHY SOCIETY1. medical engineering technologies, including biotechnologies, medical2. Diagnosis and treatment of lifestyle diseases and personalized medicine3. Production of medicinal productsAGRI-FOOD bio-economy, the forest-TREE AND ENVIRONMENTAL4. Innovative technologies, processes and products of the agri-food and forestry-wood5. Healthy food (high quality and performance of production)6.Biotechnologiczne processes and specialty chemicals and environmental engineeringSUSTAINABLE ENERGY

7. High efficiency, low-emission and integrated systems of production, storage, transmission and distribution of8. Smart and energy efficient building9. Environmentally friendly transport solutions

NATURAL RESOURCES AND WASTE MANAGEMENT10. Modern technology sourcing, processing and use of natural resources and the production of substitutes11. Minimize the generation of waste, including unfit for processing and use of materials and energy waste (recycling and other recovery methods)12. Innovative technologies of water treatment and recovery and reducing its consumptionINNOVATIVE TECHNOLOGIES AND INDUSTRIAL PROCESSES (ACCORDING HORIZONTAL)13. The multifunctional materials and composites with advanced features, including nanoprocesses and nanoproducts14. sensors (including biosensors) and intelligent sensor networks15. Smart grids and geo-information technologies16. Electronics based on conductive polymers17. Automation and Robotics processes18. Optoelectronic systems and materials

• 2007 - establishment of National Center for Research and Development budget €1.1 billion↑ , applied research

• 2009 – establishment of National Science Center Budget €202M, fundamental research

• NCRD – financial schemes where contribution from business reaches 50% and the coordination is with the industrial partner

• amendment to the bill on Higher Education - Intellectual Properties Rights with individual researchers

• creation of a network of technology parks

• 2009 – establishment of National Science Center Budget €202M, fundamental research

• NCRD – financial schemes where contribution from business reaches 50% and the coordination is with the industrial partner

National Center for Research and Development

commissioned 2007, implementing agency of the Minister of Science and Higher Education.

AIMstrengthen cooperation between Polish business and scientists and promote the commercialization of the research results

ALSO intermediary for operational programmes financed by structural funds : • Innovative Economy, • Human Capital • Infrastructure and Environment, ADDITIONALLY grants• European Economic Area• Norwegian Financial Mechanism

National Center for Research and Development

Budget 2013€1.1 billion – direct Ministry contribution € 0.24 billion – entrepreneur own contribution€ 5.2 billion – total served project

59 calls for proposals, 844 contracts

2014 increase by 20%

National Center for Research and Development

2009-14 in billion €

0.11 0.12

0.61

1.10 1.07

1.27

source: NCRD Annual Report

Other 15 projects with the greatest potential funded

GRAF-TECH program. Bundle of graphen projects

Prof. Włodzimierz Strupiński, first in the world industrial method of production of graphene plates, patented in 2010.

Nano Carbon started commercial production and sales in December 2013.

• Ceramic composites with graphene• Epitaxial growth of graphene on metallic surfaces • Graphene magnetic field sensors with industrial applications • Graphene pastes and inks for printing conductive paths• Graphene coating of sprockets and plain bearings •

•

•

Public-private support for commercialization of R&D results with the participation of capital funds.

innovation centers in Poland

technological parks, incubators, technology transfer centers etc.

Gliwice,a successful and innovation friendly city

Gliwice – seat of Silesian University of Technology

Cracow

Warsaw

Gliwice

A1A4

www.polsl.pl

Vienna

Berlin

Kiev

• Population: 190k

• part of 2.5 M conurbation

• Member of World

Technopolis Association

• Successful

transformation into high

tech region- 300k jobs

lost in mining

• SUT enrolment 30k

• numerous R&D institutes

• unemployment 7.8% vs

14.0% country average

Jan. 2014)

Gliwice - life cycle of innovation

Scientific Technological Park Technopark Ltd

Joint venture of City of Gliwice, SUT and Katowice Special Economic Zone

2011 – National Leader on Innovation

2012 – National Best Municipal Corporation

3- 4 years incubation at Technoparkmoving to Nowe Gliwice Ltd– city owned

mobile and console applications Nintendo, 3rd best sold IPAD application in US

Microsoft GOLD Independent Software Vendor

Financial Times – second best Special Economic Zone in Europe and 11th in the world

Special Economic Zone

17.5 jobs 65 enterprises€1.7 billion investments