Promoting catch-up innovations – the role of trade and investment

Michiko ENOMOTO Economic Cooperation and Integration Division/UNECE

Geneva, 31 May 2013

Why do we promote innovation?

Economic crisisEnvironmental challenges

Innovation and new technologies play a decisive role:economic and social development, economic growth, improved productivity and competitiveness, and improved quality of life.

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What is innovation?

Not only results of R & D…

But also implementation of new or greatly improved product (good or service), or process, new marketing method, or new organisational method in business practices, workplace organisation or external relations.

Definition (OECD Oslo Manual)

Kyrgyzstan and TajikistanInnovation landscape

Source: The Global Innovation Index 2012, INSEADSource: The Global Innovation Index 2012, INSEAD

Frontier innovations

Frontier innovations - new to world knowledge

Most take place in high-income countries

R & D in firms plays major role.

Catch-up innovations and technology absorption

Catch-up innovations – new to country/firm

To acquire, adapt and use existing knowledge---less costly and less risky than creating new

Successful emerging economies imported what the rest of the world already knew; improved it, and exported it in a form the rest of the world wanted

Strong absorptive capacity made this possible

Government as gardener

• Discovery and importing seeds • Access to information, diaspora, open trade

• Planting seed and growing plants • Joint ventures, FDI

• Watering • Financing

• Preparing ground = good absorption capacity• Good education, entrepreneurship, basic technological

literacy• Removing weeds

• Poor business environment• Improvement of the seed

• Catch-up innovation – R & D.

How to grow innovation plants?

How to foster catch-up innovations and to stimulate technology absorption?

Access: Open trade (imports)Information and Communication Technology policiesInternational collaboration in research networksDiaspora

Business facilitation: Ease of business, foreign direct investment, labour mobility.

How to foster catch-up innovations and to stimulate technology absorption?

Intellectual Property Rights legislation and enforcement

Public procurement, standards and regulations

Support for finance to early adopters/demonstrators.

How to increase absorptive capacity?

Empowerment of local human resources:

Education and life-long learning policies

Enterprise-based worker training, management and entrepreneurship training

Technical and vocational education and training.

How to increase absorptive capacity?

Facilitate network with global suppliers

Develop linkages to global value chains

Rule of law, contract enforcement, competition

Bankruptcy and re-entry facilitation

Policies to attract and retain talented workers.

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UNECE Innovation Performance Reviews

Policy recommendations

• stimulate innovation activity in the country• enhance innovation capacity • improve the efficiency of the national

innovation system

Follow-up and capacity-building activities to support implementation.

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Green technologiesUNDA project "Building the capacity of SPECA countries to adopt and apply innovative green technologies for climate change adaptation“

• How to integrate environmental concerns into innovation policies?

• How to mobilise the financing to introduce green technologies (PPP)?

• How to bring together all stakeholders to make changes?

Thank you!ありがとう

Michiko ENOMOTO (UNECE)

Michiko.Enomoto@unece.org