Knowledge and Innovation for Africa s Development

Transcription

1 Knowledge and Innovation for Africa s Development Priorities, Policies and Programmes John Mugabe Prepared for the World Bank Institute March

2 Contents 1. Development Trends, Priorities and Prospects Economic Trends and Prospects Investment and Industrial Activity Poverty Reduction Strategies and Development Frameworks National Science, Technology and Innovation Systems An Analytical Framework National R&D Priorities and Capacities Research and Development (R&D) Priority Setting Public Expenditure on R&D Institutional Arrangements for public R&D Policy Instruments for R&D National Innovation Capacities National Innovation Policy Regimes and Agencies Private Sector R&D and Innovation Activities Technological Readiness and Innovation Capacity Tertiary Education, Skills Development and Research Productivity University-Industry Collaboration Intellectual Property Protection Technology Support and Regulatory Agencies Financing Technological Innovation: Institutional Arrangements Characteristics of National Systems of Innovation Regional and International Initiatives Science, Technology and Innovation in Regional Economic Treaties Regional Programmes and Institutions Efforts of the African Union and NEPAD The African Development Bank s Strategic Focus European Union-Africa Science and Technology Cooperation United Nations Initiatives Support from Bilateral Donors and Private Foundations The World Bank s Strategic Focus and Support Overall Assessment Seizing the Grand Opportunities Investing in Science and Engineering Skills Designing Innovation Policies National Innovation Agencies Building Funding Institutions and Instruments Strengthening Private Sector Participation Filling the Infrastructure Gaps Political Leadership Promoting Grassroots and Rural Innovations Legislative and Regulatory Issues Regional Strategic Initiatives Building Capacities for Innovation Policy Development Potential SADC Research and Innovation Priorities Supporting Local Technological Entrepreneurship Designing a SADC Regional Innovation Strategy An Alliance for Funding Regional Innovation Activities SUMMARY OF KEY RECOMMENDATIONS CONCLUSIONS...47 SELECTED BIBLIOGRAPHY

3 Executive Summary Africa is today confronted by grand opportunities for economic transformation and development. First, macroeconomic and political conditions in most of the continent are becoming more favourable to economic change and growth. Most African countries have experienced impressive economic growth in the past five years or so. 1 Foreign direct investment (FDI) inflows to the continent have increased. Trade between Africa and Asia is growing. Conditions for private capital investment are more favourable today compared to twenty years ago as most economies have been opened up and investment climates improved. There are few political and civil conflicts in Africa today compared to the situation in the 1970s and 1980s. Though the pace of democratization may be slow, there is political liberalization taking place in most of Africa. 2 Second, there is a wide range of new technologies available for increasing the productivity and diversity of African economies. The stock of knowledge and related innovations available to African countries is growing. Technological diversity and convergence make it relatively easy and cheaper to access and apply knowledge to add value to Africa s natural resources. For example, information and communication technologies have converged with biotechnology to create bioinformatics that makes it possible to improve biodiversity and mineral prospecting in Africa. The application of biosystematics and bacterial leaching will enable oil producing African countries to export high value oil products. Technological developments associated with mobile telephony make it possible move or transfer capital to rural areas and across most of Africa in seconds. Technology is breaking barriers to capital access and movement. Third, Africa has more institutional diversity today compared to twenty years ago. There is a growing private sector with a diverse range of industrial firms small and large engaged in various economic activities in many countries. African economies have many private enterprises co-evolving with public ones. Transnational corporations have increased their presence and activities in the continent over the past decade. Governments are no longer the main or sole agents of economic activities. There is also growth in numbers and diversity of knowledge, financial and technical institutions in the continent. Most African countries have public and private universities, technical and vocational training institutes, research institutes, standards and regulatory agencies, and commercial and development banks. There are at least 10 academies of sciences, numerous Non- Governmental Organizations (NGOs) and hundreds of think-tanks of different kinds on the continent. These are vehicles for producing and applying knowledge for Africa s development. There is a growing determination by many African countries to improve and/or develop their institutions for scientific research and promote technological innovation. This is manifested in the ongoing efforts by countries to review their R&D organizations, formulate new research and technology policies, and in many cases, design science and technology strategies. Some of these efforts are receiving international support in the forms of funding and technical assistance. Fourth, there is a renewed focus on intensifying and accelerating regional economic integration. African countries are integrating their economies through institutional arrangements such as the Common Market for Eastern and Southern African States (COMESA), East African Community (EAC), Economic Community of West African States (ECOWAS) and the Southern African Development Community (SADC). Regional economic integration makes it possible for the countries to pool their economic diversity and assets together and build bigger markets as well as trading blocs. It is also an important mechanism for assembling resources for the production of regional public goods. The EAC created the East African Science and Technology Council in In 2008 SADC established a desk dedicated to science and technology and adopted a protocol to promote cooperation in science and 1 See AfDB/OECD (2008), African Economic Outlook. African Development Bank and the Organisation for Economic Co-operation and Development. The first section of this study provides an overview of economic growth and investment trends in selected African countries. 2 See Economic Intelligence Unit (2008), Economic Intelligence Unit s Index of Democracy The Economist and Economic Intelligence Unit. 3

4 technology. In 2005 ECOWAS designed a framework for common science and technology programmes. COMESA has been implementing programmes to harmonize regulatory measures for biotechnology and ICT development. These are indicative or examples of what countries can do through regional economic integration to foster technological innovation. 3 Fifth, many African leaders and the international community are increasingly recognizing that science, technology and innovation are critical for the transformation of economies, reduction of poverty, attainment of the Millennium Development Goals (MDGs) and integration of the continent into the global knowledge economy. For example, in January 2007 African leaders dedicated their African Union (AU) Summit to discussing ways of promoting the application of science and technology for development. Through the AU and the New Partnership for Africa s Development (NEPAD) a high level council of ministers of science and technology was established in 2003 and since then a number of framework programmes have been developed. Regional development agencies such as the African Development Bank and international institutions such as the World Bank and the United Nations Educational, Scientific and Cultural Organization (UNESCO) have designed frameworks to guide their support to Africa s scientific and technological development. These efforts may increase financial resources for research and innovation activities in Africa. In addition to the above developments a growing number of African countries are adopting new national development frameworks, poverty reduction strategies, and human development plans. There are also efforts to imitate and adapt development strategies of the Newly Industrializing Countries (NICs) of Asia and Latin America. Some African countries are creating new institutions for research and innovation. These efforts are part of their determination to transform their economies and attain higher levels of development. This study reviews science, technology and innovation priorities, policies and programmes of African countries. 4 It also examines regional and international initiatives for promoting science, technology and innovation in Africa. While commendable efforts are being made a lot more needs to be done to enable the continent to seize the grand opportunities. It shows that African national systems of innovation and related efforts of promoting economic transformation suffer from or are constrained by the following limitations: Many African countries are not technologically ready to seize opportunities presented by rapid scientific and technological developments and the globalization of economies. Recent assessments show that the levels of technological readiness and innovation capacities of African countries are very low compared to the rest of the world. 5 Current investments in R&D are largely focused on research projects of short-term nature with a limited focus on building and/or improving infrastructure for R&D. As a result R&D institutions (mainly laboratories) of most African countries are of low quality when compared to those of middle-income countries and the rest of the world. 3 See Juma, C., and Serageldin, I., (Lead Authors) (2007), Freedom to Innovate: Biotechnology in African Development. Report of the High-level Panel on Biotechnology of the African Union and the New Partnership for Africa s Development; and Mugabe, J. Regionalism and science and technology development in Africa in Louk Box and Rutger Engelhard, eds., (2006), Science and Technology Policy for Development: Dialogues at the Interface. Anthem Press, UK for detailed analysis of how regional integration can be used to promote technological innovation for development. 4 The study focuses on the following countries Angola, Botswana, Democratic Republic of Congo, Ghana, Kenya, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Rwanda, Seychelles, Swaziland, South Africa, Tanzania, Uganda, Zambia and Zimbabwe. 5 The analysis and discussion on technological readiness, quality of R&D institutions, industry-university collaboration, and national innovation capacity are largely based on World Economic Forum (2007) The Global Competitiveness Report ; UNDP (2001), Human Development Report 2001: Making New Technologies Work for the Poor; UNIDO (2005), Industrial Development Report 2005: Capability building for catching-up; and UNCTAD (2008), World Investment Report 2008 and other research being done for a forthcoming book Mugabe, J., (forthcoming), Building Links: Science, Innovation and Public Policy in Africa. 4

5 Existing science and technology policy instruments have put excessive emphasis on measures for funding and organizing scientific research. They do not adequately cover measures for the promotion of innovation, including technology prospecting, procurement, diffusion and application. Most African countries rely on implicit innovation policies. Few have explicit innovation policies. National capacities for science, technology and innovation policy-making are weak. Most countries do not have budgets for policy research and analysis as well trained persons to conduct research for policy. Many countries tend to organize science, technology and innovation policy-making as isolated events not processes. Such events are often not part of national economic development policy processes and practices. Just a few African countries have institutions dedicated to funding public R&D and promoting technological innovation. In very few countries is private sector funding of R&D to a significant level. Few governments have or are instituting policies and laws to encourage private sector to fund public and generally innovation-oriented R&D. Industry-university (generally with public R&D) collaborations are few and weak in most of the countries. There is a mismatch between science and technology policies on the one hand and development goals on the other. Science, technology and innovation programmes are not well aligned with overall poverty reduction and economic development aspirations of most African countries. Poverty Reduction Strategy Papers (PRSPs) of most of the countries only make passing reference to science, technology and innovation. African countries are facing severe skills shortages in science and engineering fields. Skills demands of transnational and local private companies and even public enterprises are not being met in many African countries. In addition, science and engineering curriculum of universities and polytechnics tends to be irresponsive to industry s needs. Regional and international science, technology and innovation programmes of institutions such as the African Union, NEPAD, the African Development Bank, the World Bank, and UNESCO are not well coordinated in such ways as to add value to the building of national and regional systems of innovation. Regional science and technology programmes of SADC, AU and NEPAD are largely focused on R&D, with little emphasis on technological innovation. To transform their economies African countries should focus on measures that will improve their technological readiness, enlarge technological capabilities to innovate, improve the quality of their institutions of knowledge (mainly R&D and higher learning), and generally build stronger and dynamic national systems of innovation. They should seize the grand opportunities to address the challenges outlined above. This requires both political and administrative leadership from governments, particularly the executive and legislative branches to champion the building of systems of innovation and the promotion of technological innovation for poverty reduction, economic growth and competitiveness. The first section of the study starts off by reviewing economic growth trends of selected African countries over the past five years or so. It discusses trends in foreign direct investment, growth of industrial activity, and extent to which the growth trajectories are stimulated by investments in knowledge and innovation, and whether these trends are leading to the reduction of poverty and the attainment of the Millennium Development Goals (MDGs). Its main conclusion is that current economic growth performance is not significantly reducing poverty and leading to the achievement of MDGs. It is largely based on export of traditional natural resource-based and low value commodities by African countries. Most of the countries are not economically and technologically competitive in the global system. Section two focuses on programmes for R&D and related knowledge institutions. It is an attempt at assessing the quality and productivity of R&D programmes and institutions. Based on the 5

6 Global Competitiveness Index 2007 and a number of other recent assessments, the section concludes that Africa s R&D institutions are of low quality and not productive enough to stimulate technological innovation and economic transformation. Generally, R&D systems of the countries are not qualitatively growing and relevant to national imperatives of economic change and development. The section also provides an overview of the characteristics strengths and weaknesses of African national systems of innovation. Based on global competitiveness scores and index generated by the World Economic Forum and other recent research, the section discusses technological readiness and performance of the countries in terms of intensity of industry-university collaborations, FDI-technology transfer links, different kinds of policy instruments and practices to promote innovation, institutional arrangements and linkages for technological innovation and learning, science and innovation policy gestation, and the generation and use of intellectual property. Section three is an overview of regional and international initiatives that have been established to support the building and strengthening Africa s science, technology and innovation systems. It discusses priorities and relevance of some of the regional and international projects and programmes developed or are being promoted by institutions such as the Regional Economic Communities (RECs), the African Union, NEPAD, the African Development Bank, bilateral and private foundations, the European Union, the United Nations and the World Bank. The fourth and last sections make recommendations focusing on measures that will strengthen Africa s technological readiness and capacity to innovate. Section four puts emphasis on building national capacity for innovation policy-making; using regional integration to build and pull engineering capabilities together for cross-border or multi-country infrastructure and innovation projects; promoting technological entrepreneurship by supporting collaboration between business schools and R&D institutes; promoting the establishment of national innovation agencies; devoting more resources to improving and/or building infrastructure for R&D; measures to national, regional and international organizations on ways and issues to improve their focus on and support to science, technology and innovation for Africa s development. Section five is devoted to regional strategic initiatives that SADC and donors may wish to focus on. The study argues that fundamental challenges to building explicit science and innovation policies and related organizations for Africa s development are related to limited conceptual understanding of what constitutes innovation particularly technological and institutional and the kinds of policies that are required to promote it in Africa. There is confusion between those measures that are aimed at promoting research (whether basic or applied) and those for promoting innovation for development. This confusion can be easily discerned from numerous policy statements and programmatic initiatives of African governments and donors. Building a good understanding of the concept of technological innovation and how it takes place (and its impacts on economies) in national socio-economic systems is likely to enable African countries governments to improve the quality of their science, technology and innovation policies and related programmes. Countries are likely to focus much more on building systems of innovation if their policy-makers have a good understanding of what constitutes technological innovation. The study reviews science, technology and innovation and their relationships to economic change and development of African countries. One of the approaches to changing traditional R&D policies is to insist that science and innovation priority setting be integrated into or be explicitly evolving from African countries poverty reduction and economic development aspirations and programmes. In other words, R&D policies should not find isolated and independent expression from poverty reduction and overall economic change goals. Measures to promote technological innovation and the production of knowledge for development should be embedded in national economic and security institutions e.g. central banks, ministries of finance, ministries of defence, ministries of foreign affairs and others. Science and innovation policies are likely to have greater effect if they are integrated into or properly aligned 6

7 with the broader efforts of national growth and preservation. The study suggests that in order to build more momentum for science, technology and innovation activities in Africa, institutions such as the World Bank and development partners should focus increasingly on those programmes that inspire countries to focus on technological innovation the introduction and diffusion of technologies into local and national socio-economic systems. The current global financial crisis may be a source of pessimism regarding future growth of African economies and the extent to which countries will stay focused on missions to reduce poverty and attain the MDGs. The crisis may result in reduced development assistance and FDI to Africa. This may have implications for investments in development generally, and in infrastructure and social programmes in particular. Government spending on R&D may be reduced in some African countries. This will contradict aspirations for self discovery and articulation. However, it is precisely in times of social and economic crises that governments should be devoting more and more attention to innovation technological and institutional. According a recent study by the Economist Intelligence Unit many companies see innovation as the way to protect their profit margins and build competitiveness. Companies will preserve and articulate themselves if they focus more and more on innovation. For example, Google and Amazon are planning to increase their 2009 budgetary investments in capability building in order to sustain or build sustain their firms capabilities to innovate in the current financial downturn or crisis Development Trends, Priorities and Prospects 1.1 Economic Trends and Prospects Africa recorded impressive economic growth in the past five years or so. Between 2001 and 2006, economic growth on the continent averaged 5 percent of gross domestic product (GDP) annually (see table 1). In 2006 Sub-Saharan Africa as a whole registered 5.7 percent growth and was expected do even better in 2007 and The continent had some of the fastest growing economies in the world in the recent past. For example, Angola s economy grew by an estimated 19.8 percent in The net oil exporting African economies (for example Angola) experienced higher rates of growth than the net oil importers. 6 The Economist Intelligence Unit (2008), The Innovators: How successful companies drive business transformation. The Economist Intelligence Unit, The Economist. 7 AfDB/OECD (2008), African Economic Outlook. African Development Bank and the Organisation for Economic Co-operation and Development. 7

8 Table 1: Real GDP Growth Rates, for selected African countries Country (e) 1 Angola Botswana D R Congo Ghana Kenya Madagascar Malawi Mauritius Mozambique Lesotho Namibia Rwanda Seychelles South Africa Swaziland Tanzania Uganda Zambia Zimbabwe *2007 figures are estimates Source: AfDB/OECD (2008) Africa Economic Outlook The impressive economic growth experienced by Sub-Saharan Africa is largely accounted for by increased flows and accumulation of capital. Foreign direct investment (FDI) flows to the region increased during the past five years. Net private capital inflows increased from US$26.5 million in 2005 to US$42.1 million in Foreign direct investment flows increased, mainly from Asia with China and India s investments and Saudi Arabia from the Middle East. The flows were largely attracted by Africa s natural resources. Most of the FDI is concentrated in the minerals and oil sectors in a few countries. High commodity prices also accounted for a large share of the growth experienced by the countries. International prices for metals, ore and minerals increased by 178 percent between 2000 and Prices for agricultural commodities such as maize, sugar and cocoa also increased during the past five years. In 2007 African export of goods and services increased by 15.2 percent. There was also intensification of Africa-Asia trade between 2000 and Africa s exports to China and India increased considerably during that period. For example exports to China amounted to US$ 19.5 billion in These mainly comprised of oil, timber and cotton. Improved macroeconomic conditions, debt forgiveness to a number of African countries, increased aid, private sector development, increased tourism receipts and increased government investment in infrastructure also stimulated economic growth in the African countries. Good governance, fewer political conflicts and integration of economies may also have contributed to the good economic performance of the countries. 8 UNECA (2008), Economic Report on Africa 2008, p. 3. United Nations Economic Commission for Africa, Addis Ababa, Ethiopia. 9 UNECA (2008), Economic Report on Africa 2008, p. 28. United Nations Economic Commission for Africa, Addis Ababa, Ethiopia. 10 UNECA (2008), Economic Report on Africa 2008, p. 33. United Nations Economic Commission for Africa, Addis Ababa, Ethiopia. 8

9 On the whole, conditions for capital flow and accumulation have been favourable to most African countries. However, the economies are still erected on very shaky foundations: overreliance on natural resources, raw agricultural exports, a large pool of unskilled labour, and external aid. Botswana has been one of the fastest growing economies in Africa mainly because of exports of diamond. Ghana s relatively good growth rates are due to increased export of gold and cocoa. Kenya s recent growth has been powered by export of horticulture and tea as well as good performance of nature-based tourism. These and other African economies are vulnerable to fluctuations in international trade and prices of commodities. 1.2 Investment and Industrial Activity Africa s industrial base is relatively weak. The share of industrial manufacturing in GDP has been small in most African economies. It has been below 10 percent growth of GDP for most of the 19 countries of this study s focus. For example, in 2006 manufacturing accounted for just about 3.5 percent of Botswana s GDP. In Zambia growth in manufacturing was only 3.4 percent in Most of the countries compete based on natural resources and unskilled labour. Their companies are not able to internationally compete because they sell basic products or commodities. In short, the economies are not really competitive globally. 12 There are significant disparities or unevenness in FDI flows and industrial activities across Africa in general and among the 19 countries of this study s focus. In 2007 Africa as a whole attracted a record US$ 53 billion of FDI. 13 Most of this FDI targeted the extraction of natural resources: for example, oil in Angola, diamonds in Ghana, timber and minerals in the Democratic Republic of Congo (DRC), gold in Ghana, nickel in Madagascar, aluminium in Mozambique, and copper in Zambia. FDI in manufacturing focused on chemicals and pharmaceuticals in South Africa, and textiles in Mauritius and Lesotho. There were some FDI flows to infrastructure projects, mainly telecommunications and railways in Kenya, and telecommunications in South Africa. 14 Technology transfer is one of the most important contributions that FDI can make to African economies and the building of their endogenous technological capabilities. FDI can be a source of both hard (e.g. machinery) and soft (e.g. information and managerial practices) technologies. Transnational companies that are largely associated with FDI can contribute to the enhancement of host country s system of innovation by technological upgrading of local companies or firms through technological spillovers. 15 The contribution of FDI to the enhancement of a host country s system of innovation depends on the existing absorptive capacity (comprising of human skills, infrastructure, level of entrepreneurship, existence of companies and quality of policies) of the country. It depends on the existence of a dynamic national system of innovation. This comprises of pro-innovation processes, institutions of good quality, existence of innovation oriented private sector, availability of skills in technology fields, a culture of entrepreneurship, and generally technological readiness. Foreign direct investment is not significantly transferring technologies to African enterprises and economies. The Global Competitiveness Report scoring and ranking on FDI and 11 AfDB/OECD (2008), African Economic Outlook. African Development Bank and the Organisation for Economic Co-operation and Development. 12 Competitiveness defined as the set of institutions, policies and factors that drive productivity and therefore set the sustainable current and medium-levels of economic prosperity. See Blanke, J. Assessing Africa s Competitiveness in a Global Context in World Economic Forum (2007), 13 UNCTAD (2008), World Investment Report 2008, Transnational Corporations and the Infrastructure Challenge, p.xvii. United Nations Conference on Trade and Development, Geneva. 14 UNCTAD (2008), World Investment Report 2008, Transnational Corporations and the Infrastructure Challenge. United Nations Conference on Trade and Development, Geneva. 15 UNCTAD (2007), The Least Developed Countries Report 2007: Knowledge, Technological Learning and Innovation for Development. United Nations Conference on Trade and Development, Geneva. 9

10 technology transfer places many African countries below the first half on the competitiveness list. For example of the 128 countries surveyed and ranked, Angola is ranked 80, Botswana 85, Lesotho 116, Madagascar 86, Malawi 63, Mauritius 74, Mozambique 77, and Zimbabwe 123. Kenya, Uganda, Namibia and South Africa are in the first top A recent study of science and innovation system of Ghana concluded that FDI was not contributing significantly to technology transfer to local enterprises and public institutions. 17 The countries are also not generating and growing significant industrial activity and technological dynamism. Industrial output per capita of most of the countries is low and not growing significantly to motor economic change and growth. UNIDO (2005) developed an industrial-cumtechnological advance (ITA) index. 18 Based on the ITA index, Sub-Saharan Africa as a whole is ranked below other developing regions of the world. 19 Singapore and Malaysia were the first and second ITA leaders respectively in If we take Malaysia as a reference country, most Sub-Saharan African countries scored below it in terms of ITA in 1990 and (See table 2 below). According to the UNIDO ITA index, in 2002 South Africa, Zimbabwe and Lesotho were top leaders. Table 2: Industrial-cum-technological advance (1990 and 2002) Country ITA index ITA index Malaysia Angola Botswana Ghana Kenya Lesotho Madagascar Malawi Mauritius Namibia Rwanda Seychelles South Africa Swaziland Tanzania Uganda Zambia Zimbabwe Source: UNIDO (2005), Industrial Development Report 2005, p World Economic Forum (2007), The Global Competitiveness Report Hamsphire, Palgrave Macmillan. 17 Mugabe, J (2008), A Review of Ghana s Science, Technology and Innovation System. Report Prepared for the United Nations Conference on Trade and Development (UNCTAD), Geneva. 18 Industrial-cum-technological advance index measures technological content of industrial activities of an entire economy. 19 UNIDO (2005), Industrial Development Report 2005: Capability building for catching-up p United Nations Industrial Development Organization, Vienna. 20 We use Malaysia as a reference country because many the 19 countries of that this study focuses on aspire to become like it become middle income countries. Many of the African countries have bilateral economic, trade and technical cooperation with Malaysia. 10

11 In 2002 Sub-Saharan Africa (excluding South Africa) accounted for only 0.74 percent of the total share of world industrial output. 21 Over the past five years the region s share of industrial output has stayed below 1 percent. The recent surge in FDI has not enlarged industrial activities and manufacturing capabilities of the countries. 1.3 Poverty Reduction Strategies and Development Frameworks The high economic growth and increased FDI flows to the African countries have not had a dent on poverty they have not stimulated poverty reduction in a pronounced way. Growth... has not yet led to substantial employment generation, particularly in the formal sector. At the same time, vulnerable groups such as the aged, youth and people with disabilities also face challenges in participating in Africa s economic recovery. 22 Recent reviews and assessments show that most of the countries are unlikely to meet many of the MDGs. Poor health continues to be a major constraint to Africa s economic transformation and development. Infectious diseases such as malaria, HIV/AIDS, cholera and tuberculosis are a big burden. These diseases are undermining growth and productivity of many economies. However, progress at reducing the burden is slow. Access to health care is still limited and many health systems are weak. Food insecurity and malnutrition threaten millions of Africans in the region. Environmental degradation, water and energy insecurities, and climate change continue to be major threats to African economies. Many African countries have designed and adopted Poverty Reduction Strategy Papers (PRSPs) and other development frameworks such as Vision 2020 for Ghana and Vision 2030 for Kenya. The PRSPs describe structural, social and macroeconomic policies and programmes to reduce poverty and promote economic growth. DRC, Ghana, Kenya, Lesotho, Madagascar, Malawi, Mozambique, Rwanda, Tanzania and Zambia have adopted PRSPs. Other countries have similar frameworks for poverty reduction and economic development. For example, Mauritius has a Country Strategic Opportunities Paper (COSOP) of A recent review by UNCTAD shows that Least Developed Countries (LDCs) of Africa have not adequately integrated science, technology and innovation considerations into their PRSPs. 23 Treatment of science, technology and innovation in PRSPs is weak. Tanzania and Uganda identified investing in science and technology as a priority. Mozambique s PRSP recognizes the role of technological development in poverty reduction and economic growth. The PRSPs generally identify priorities in poverty reduction and economic development. All the PRSPs of DRC, Ghana, Kenya, Lesotho, Madagascar, Malawi, Mozambique, Rwanda, Tanzania and Zambia have identified improving literacy and increasing investments in education as a key priority. They also identify improving health systems, investing more in building road infrastructure, improving water quality and its provision to households, and enhancing agricultural research for food security as priorities as well. The PRSPs do not identify specific technological interventions they need to make in order to achieve their poverty reduction and economic growth goals. Generally, most of the countries do not explicitly integrate science, technology and innovation considerations into their economic policies and plans. One of the few exceptions is Kenya. Kenya s Vision 2030 devotes attention to science, technology and innovation. It puts emphasis on measures to strengthen national scientific and technological capabilities for regional and global competitiveness. The framework outlines priority science, technology and innovation programmes. These include programmes to strengthen science and technology institutions by improving their infrastructure and equipment; developing a highly skilled human resource base with emphasis on 21 UNIDO (2005), Industrial Development Report 2005, p UNECA (2008), Economic Report on Africa 2008, p. 7. United Nations Economic Commission for Africa, Addis Ababa. 23 UNCTAD (2007), The Least Developed Countries Report 2007: Knowledge, Technological Learning and Innovation for Development. United Nations Conference on Trade and Development, Geneva. 11

12 increasing the number of scientists and engineers; enhancing awareness of the role of science, technology and innovation in poverty reduction and economic growth; and improving policy and institutional coordination. African countries give different emphasis to science, technology and innovation in their poverty reduction strategies and economic development plans. Most of them have organized science, technology and innovation mainly around R&D programmes and institutions. Their economic policies and programmes do not focus on specific technological areas or provide explicit measures for promoting innovation. The common approach is to set poverty reduction and economic development priorities separately from priorities in advancing the development and application of science, technology and innovation. Essentially, science, technology and innovation priorities and programmes tend to be delinked from economic and human development policy frameworks. Future initiatives in countries must focus on the linkages between PRSPs and STI policies, strategies and programmes. 2. National Science, Technology and Innovation Systems 2.1 An Analytical Framework The concept of a national system of innovation has gained currency and is now widely used in academic and policy circles. It is used to study technological performance and innovative capacities of countries. A national system of innovation is a network of institutions that are organized through linkages to relate to each other as elements of a collective system of knowledge creation and use as well as the technologies they use. 24 It is about interactive activities of institutions in order to generate and use new products, processes and organizational practices. The main institutional actors in the national system of innovation are universities, public R&D institutes, policy-making bodies and the government in general, private enterprises, financial institutions such as commercial banks, and technology support agencies. Understanding the linkages among the institutional actors involved in innovation activities or processes is crucial to improving a country s technological and economic performance. Linkages in a national system of innovation usually take different forms including joint research projects among public institutes, and joint technology development and transfer activities between public and private sector institutions, exchange and mobility of scientists and engineers, technology licensing agreements, and sharing of information and technology infrastructure. Assessing the performance of a national system of innovation entails tracing the various institutional links and measuring the intensity of the interactions among various knowledge producers and economic actors. The interactions are supposed to be continuous and characterized by positive feedback. The linkages and interactions among the various institutions in a national system of innovation are purposefully stimulated and nurtured by public policies and various incentives that government puts in place. Public policies pertaining to intellectual property protection, competition, FDI, taxes, mobility of scientists and engineers, and technology regulation and licensing influence the evolution and growth of a national system of innovation. The performance of national systems of innovation is also influenced by political, economic and social conditions. Open and democratic political systems are likely to encourage the search for new information, introduction of new knowledge and promote learning capabilities. 25 Institutional linkages and interactions, including positive feedback and generally exchange of information, tend to flourish in countries where policies and political practices encourage open dialogue and debate. 24 OECD (1997), National Innovation Systems, p.9. Organisation for Economic Co-operation and Development, Paris. 25 Lundvall, B.-A., et. al. (2002), National systems of production, innovation and competence building, Research Policy 31(2002) Elsevier. 12

13 National systems of innovation are open systems. 26 They are characterized by in-flow and outflow of information, skills and technology. The main activity in the national systems of innovation is learning which involves interactions between people, and between institutions. The learning is interactive, characterized by positive feedback. The feedback takes place between economic firms and consumers; between R&D institutions and industry; between R&D institutions and financial ones; between policy-making bodies and R&D institutions; between policy-making institutions and private firms; and between education and training institutions and industrial firms. The capacity of countries or economies to innovate is also dependent on existing physical infrastructure and how that infrastructure is used. 27 Infrastructure defined to include laboratories for scientific research or R&D, electricity, and telecommunications and connectivity is critical for industrial firms in countries to design and develop new products and processes or even to use existing technologies. The state of infrastructure influences the quality of institutions for producing and applying knowledge. The World Economic Forum has identified infrastructure as one of the pillars of economic competiveness of countries. 28 Thus in assessing national systems of innovation attention should be paid to the state of infrastructure. This study also puts emphasis on other important aspects of innovation systems. These include research and innovation priorities, policies for R&D and innovation, quality of scientific research institutions, public and private sector investment in R&D, protection of intellectual property, institutional linkages particularly university-industry collaborations, availability and utilization of skills in science, engineering and entrepreneurship fields, existence and use of technology standards and regulatory agencies, and nation s participation in regional and international programmes. The next sub-section focuses on R&D the knowledge production parts of national systems of innovation. It deals with R&D priority setting, institutions for R&D, funding of R&D and related institutions, and then policy instruments for promoting R&D. 2.2 National R&D Priorities and Capacities There are a number of studies and reviews of national research and development (R&D) systems of the 19 focus countries. 29 There are also new initiatives to conduct national R&D surveys. For example, NEPAD is supporting most of these countries to conduct surveys. Individual countries have also initiated activities to set their R&D priorities and formulate related science and technology policies. These efforts vary from one country to another. Some countries (for example Botswana, Mozambique, Mauritius and South Africa) have already outlined R&D priorities in their science and technology strategies or plans. Others (e.g. Ghana and Kenya) have R&D priorities in draft science and technology policy documents. Some countries (e.g. Swaziland) recently launched national R&D priority setting and policy formulation exercises Research and Development (R&D) Priority Setting The countries have different traditions of and/or approaches to R&D priority setting. In many cases there are no organized national R&D priority setting processes. Priorities of R&D seem to emerge from political statements. For most countries R&D priorities are often set by or at the level of 26 Lundvall, B.A, (1992), Introduction, p.2-13 in Lundvall, B.A., editor (1992), National Systems of Innovation: Towards a Theory of Innovation and Interactive Learning. Pinter Publishers, London. 27 Juma, C., and Yee-Cheong, L., (2005), Innovation: Applying Knowledge in Development. Earthscan, UK. 28 See World Economic Forum (2008), The Global Competitiveness Report World Economic Forum, Geneva. 29 See for example SARUA (2008), A Baseline Study on Science and Technology and Higher Education in the SADC; and UNESCO (2005), State of Science and Technology Training Institutions in Africa. 13

14 individual research institutions based on the institutions anticipation of funding from national governments or international donors. R&D priorities are also set within sectors such as agriculture and health, and at the level of individual departments or ministries. There have been efforts to set R&D priorities in specific technology fields such as biotechnology, nanotechnology and nuclear sciences. In the area of biotechnology, for example, most of the countries have identified needs and set R&D priorities. National biotechnology R&D priority setting exercises have been undertaken in Ghana, Kenya, Namibia, South Africa, Uganda, Tanzania, and Zimbabwe in the past five years or so. It is not clear to what extent these exercises have influenced the direction of research and funding decisions. Some of the countries have general frameworks that outline broad priority areas of R&D. For example, Mozambique s 10 year Strategy for Science, Technology and Innovation outlines health, energy, mineral resources, agriculture, construction, and marine sciences and fishing as the country strategic R&D areas. It identifies biotechnology and ICTs as technological fields that the country will focus on. South Africa has its R&D priorities in a number of policy documents and strategies. The country s priorities are contained in the National Research and Development Strategy (2002), the National Biotechnology Strategy for South Africa (2001), the Ten-Year Innovation Plan (2007) and other policy documents. The degree of sophistication of R&D priority setting varies from country to country. In some countries priority setting is done through stakeholders meetings or consultations. This largely involves getting scientists, NGOs, business representatives and government officials into workshops to identify national R&D priorities. In some cases background studies may be prepared for the workshops. Stakeholders meetings or workshops are the most common approach of R&D priority setting in most of the countries. A few countries (for example South Africa and Botswana) deploy techniques or exercises such as technology foresight and technology needs assessments in their R&D priority setting efforts. Despite the differences in approaches to R&D priority setting there a number of common areas that have been identified by the countries. In the area of agriculture, all the 19 countries have for a long time identified crop breeding (with emphasis on cereals) and livestock diseases research. Ghana has been putting emphasis on research to improve varieties of cassava in order to increase its capacity for industrial starch production. Ghana, Kenya, Mauritius, Mozambique, Seychelles, South Africa and Tanzania have over many years identified research on the conservation and use of marine resources as a priority. A growing number of the countries are starting to identify agricultural biotechnology as a priority. These include Botswana, Ghana, Kenya, Namibia, Malawi, Mozambique, Mauritius, Rwanda, South Africa and Zimbabwe. Some of these countries have even identified specific crops and/or traits on which biotechnology R&D should focus on. For example, Mauritius has identified sugarcane while Zimbabwe tobacco and cereals. Research in energy is also identified as critical by most of the countries in their science and technology plans. However different countries put different emphasis on different aspects of energy research. For example, Ghana, Kenya and South Africa have put emphasis on nuclear and atomic energy areas as R&D priority. Seychelles and South Africa are investing in research on hydrocarbons. Research aimed at improving the development and application of solar energy technologies is listed by most countries as one of their R&D priorities. Botswana, Ghana, Namibia, South Africa, Tanzania and Zambia have set R&D priorities in the minerals and mines sector. Namibia and South Africa have minerals research strategies that focus on promoting the application of biotechnology techniques such as bacterial leaching to improve mining. Botswana, Ghana, Tanzania and Zambia put more emphasis on increased use of existing technologies and more investments in geological studies as their main priorities in minerals and mining related R&D. 14

15 2.2.2 Public Expenditure on R&D Statistics or data on public expenditure on R&D in the countries is scanty. Most of the countries do not have institutions and/or programmes that undertake R&D surveys and collect data on R&D expenditure. National statistics offices do not seem to have a focus on surveying or collecting statistics on expenditure on R&D. Of the 19 countries, South Africa has the most advanced institutional and programmatic activities on R&D surveys. It has the Centre for Science, Technology and Innovation Indicators of the Human Sciences Research Council (HSRC) that is specifically funded by the Department of Science and Technology (DST) to undertake R&D and innovation surveys on a frequent basis. There are various attempts at collecting statistics on R&D expenditure in the countries. The United Nations Educational, Scientific and Cultural Organizations (UNESCO) Institute for Statistics conducts R&D surveys in some of the countries. NEPAD is supporting Angola, Ghana, Kenya, Lesotho, Malawi, Mozambique, Uganda, Tanzania and Zambia to undertake R&D surveys with emphasis on collecting data on expenditure on R&D. Estimates of public expenditure on R&D for some of the SADC countries have been generated by studies such as SARUA (2008). These show that none of the countries expends at least 1 percent of its GDP on R&D. According UNESCO (2007) R&D intensity in Sub-Saharan Africa (excluding South Africa) is less than 0.3 percent. Table 3 below provides an overview of public R&D expenditure in the 19 Sub-Saharan African countries. It is based on different sources and different years. Table 3: Public Expenditure on R&D as a % of GDP Angola N/a Botswana 0.4% (2005) DRC 0.5% (2005) Ghana 0.3% (2007) Kenya N/a Lesotho 0.1% (2004) Madagascar 0.2% (2005) Malawi N/a Mauritius 0.5% (2005) Mozambique 0.2% (2002) 30 Namibia N/a Rwanda N/a Seychelles 0.4% (2005) South Africa 0.9% (2005) Swaziland N/a Tanzania 0.35% (2005) Uganda 0.2% (2005) Zambia 0.0% (2005) Zimbabwe N/a Sources: SARUA (2008), UNESCO (2007) Ghana s Science and Technology Profile; and UNESCO Institute for Statistics In comparison to the rest of the world in 2000 Africa as a whole accounted for less than 1 percent of the world s expenditure on R&D. Asia accounted for 30.5 percent, North America Government s contribution to gross domestic expenditure on R&D was only 34.7 percent percent of the expenditure was accounted for by foreign sources particularly bilateral and multilateral donors and foundations. (downloaded on 14 January 2009) 15

16 percent, Europe 27.2 percent and Latin America and the Caribbean for 2.9 percent of the total world expenditure on R&D. 31 It is important to note that for most African countries data on public expenditure on R&D is not disaggregated enough to tell us much about the relevance, quality and effectiveness of research projects or activities that get funded. It is also too aggregated and it is not easy to discern how resources are allocated across R&D areas. However, there is a general observation that the limited expenditure on R&D to a large extent is on small research projects and staff salaries in the institutes. In many countries a very small portion of the R&D expenditure is directed to building or improving infrastructure such as laboratories and buying international journals for libraries. Institutional arrangements for funding public R&D in the 19 countries vary from one country to another. Most of the 19 countries do not have active funding agencies and tend to allocate R&D funding in the operational budgets of sectoral ministries and departments. Countries that have dedicated R&D funding agencies or are in the process of establishing such institutions include South Africa (the National Research Foundation), Ghana (Science, Technology and Research Endowment Fund established in 2008), Zambia (Science and Technology Development Fund established in 1997), Uganda Rwanda (National Research Fund) and Kenya (National Science, Technology and Innovation Fund announced in 2007). It is in South Africa that the research funding agency the NRF is well established and resourced. South Africa also has other funding mechanisms specific for innovation activities. It has the Innovation Fund and the Technology for Human Resources in Industry Programme (THRIP) as instruments for funding innovation-oriented research Institutional Arrangements for public R&D Most African countries have created institutions for R&D. Universities and other institutions of higher learning also conduct R&D in addition to their core business of education and training. A baseline study of science and technology conducted for SARUA in 2008 provides a good profile of R&D institutions in 14 SADC countries. 32 UNESCO has also commissioned or undertaken surveys that provide profiles of R&D or related institutions in Africa. 33 These studies or profiles are mainly regional in coverage and do not discuss specific institutions in the different countries. There have been a number of more detailed specific reviews of some countries science, technology and innovation systems. 34 These regional and national reviews show that all 19 countries have various institutional arrangements for science, technology and innovation in general and R&D in particular. Some countries have concentrated their R&D activities in universities. Examples of such countries are Angola, Botswana, Lesotho, Mauritius, Mozambique, Namibia, and Swaziland. Some countries have sectoral R&D activities concentrated in public research institutes. For example, in Kenya health R&D is largely concentrated in the Kenya Medical Research Institute (KEMRI) with little government funded activities in national universities. Other countries (for example South Africa) have R&D efforts spread across universities, public R&D institutions and private sector. In Ghana most of the 31 UNESCO (2004), A Decade of Investment in Research and Development (R&D): 1990 and UIS Bulletin on Science and Technology Statistics Issue No. 1, April SARUA (2008), A Baseline Study on Science and Technology and Higher Education in the SADC Region. Southern African Regional Universities Association, Johannesburg. 33 In particular see UNESCO (2005), State of Science and Technology Training Institutions in Africa. United Nations Educational, Scientific and Cultural Organization and the African Network of Scientific and Technological Institutions, and UNESCO (2008), Regional Report on Sub-Saharan Africa: A Study of National Research Systems by Johann Mouton. 34 See for example UNCTAD (2008) Science, Technology and Innovation Policy (STIP) Review of Angola ; Mugabe, J., (2008), A Review of Ghana s Science, Technology and Innovation System ; and CSIR (2005), Botswana National Research, Science and Technology Plan. Prepared for the Ministry of Communications, Science and Technology, Botswana. 16

17 R&D activities are concentrated in the Council for Scientific and Industrial Research (CSIR) and a few other research institutes. Of the 19 countries Ghana, Kenya and South Africa have the highest concentration of relatively large public R&D institutions and universities. Ghana has seven public universities (three of these have a focus on scientific R&D) and more than 15 research institutes. Kenya has seven public universities (most of them with faculties of science and some related R&D activities) and at least seven public R&D institutes. It hosts headquarters and laboratories of the International Centre for Agro forestry (ICRAF), the International Livestock Research Institute (ILRI) and the International Centre for Insect Physiology and Ecology (ICIPE) as well as several regional research programmes. South Africa has the highest concentration of R&D institutions and R&D-performing universities in Sub-Saharan Africa. It has seven large science councils with numerous research institutes and 22 public universities of which five are dedicated to scientific research and technology. The country also has specialized national laboratories or facilities that are managed by the National Research Foundation. It hosts the African-component of the International Centre for Genetic Engineering and Biotechnology (ICEGB), the African Institute for Mathematical Sciences (AIMS) and the Southern Africa Biosciences (SANBio) Hub of NEPAD. The public R&D institutions of the 19 countries have different capacities and are of different qualities. Some of the countries (for example South Africa) institutions are relatively well endowed with funding, equipment and researchers. South Africa s scientific research institutions are ranked at par with Hong Kong s. The Global Competitiveness Report 2007 ranked 128 countries based on their quality of their scientific institutions. The ranking is based on an executive opinion survey undertaken in The scoring is 1 to 7; with 1 where there are no scientific institutions and 7 for countries with institutions that are the best in their fields internationally. Generally Sub-Saharan African countries that were scored are ranked low. Of the 19 countries that this study focuses on 14 were covered by the opinion survey. South Africa and Kenya are first and second respectively in terms of the quality of their scientific research institutions. Table 4 provides a compilation of scoring and ranking of 14 African countries based on the quality of scientific research institutions. Table 4: Global competitiveness executive opinion survey of quality of scientific research institutions GCI Country Score/7 Rank/128 Rank in this group 36 Angola Botswana Kenya Lesotho Madagascar Malawi Mauritius Mozambique Namibia South Africa Tanzania Uganda Zambia Zimbabwe Sources: World Economic Forum (2007), The Global Competitiveness Report DRC, Rwanda, Seychelles and Swaziland were not covered by or assessed in the global competitiveness report 36 Democratic Republic of Congo, Ghana, Rwanda, Seychelles and Swaziland were not covered the survey or included in the survey results undertaken by the World Economic Forum 17

18 The state of R&D infrastructure in African institutions of science and technology training, mainly universities, was reviewed and is well described in a UNESCO 2005 report. 37 The report s main findings include the following: only a few universities in Africa are in a position to boast of quality scientific journals in their libraries; few university staff have access to computers in their offices (even in computer science departments); many of the libraries in African universities do not have computers and are not computerized; and in old universities the age of equipment is about a quarter of a century old. The report establishes that engineering schools or institutes at the universities are the ones most lacking in equipment compared to those for basic sciences. Its overall conclusion is: the reported average age of laboratory equipment is too high (11.6 years for basic sciences and 15.8 years for engineering sciences). Significant changes in laboratory technology have occurred in the last 10 years. Hence African institutions are clearly lagging behind their counterparts in other continents in the area of experimental science Policy Instruments for R&D African countries have different policy instruments for promoting scientific research. A growing number of countries use explicit policies written in dedicated science and technology policy documents or frameworks in order to govern R&D activities and institutions. These tend to be articulated in legislation e.g. Kenya has Science and Technology Act of 1977 (amended in 1980), plans and strategies e.g. Botswana s National Research, Science and Technology Plan(2005) and Mozambique s Science, Technology and Innovation Strategy (2006): 10 Years Horizon, and in white papers e.g. South Africa s Science and Technology White Paper of Some countries have multiple policy framework documents. For example, in addition to the National Research, Science and Technology, Botswana has the Science and Technology Policy (1998). South Africa has the National Research and Development Strategy (2002), and the Ten-Year Innovation Plan (2007) in addition to the white paper. Angola, Democratic Republic of Congo, Madagascar, Mauritius, Seychelles and Swaziland do not have dedicated science and technology policy frameworks but have explicit policies scattered in sectoral policy documents such as national plans for agriculture, national health policy, energy plans and strategies, ICT plans, etc. Trade and industrial policy documents, annual national budget statements, investment policies and legislation, and intellectual property protection legislation also tend to contain explicit policies for R&D in most of the countries. All the 19 countries agricultural plans have policies for promoting R&D. Countries such as Botswana, Ghana, Kenya, Mozambique, Namibia, Mauritius, Seychelles and South Africa have measures for promoting R&D in their ICT plans. There are similarities among the dedicated science and technology policy frameworks of the countries. All of them put emphasis on goals of strengthening national public R&D institutions by improving infrastructure, improving coordination of institutions, building and/or strengthening collaborations between public R&D institutes with private companies, increasing investments in R&D, promoting science and technology education and raising public awareness, and increasing and retaining numbers of scientists and engineers. Some (e.g. Kenya s Science and Technology Act as amended in 1980, and Tanzania s Science and Technology Act of 1986) of the policy frameworks create institutions for coordinating science and technology and committees to provide leadership in specific fields of R&D. African countries can also rely on a wide range of implicit policies to promote R&D and science and technology in general. These include tax regulations, customs and excise duties, immigration laws, fiscal policies, foreign affairs policies, industrial policies, health regulations, environmental impact regulations, and import and export regulations. There is no systematic review or assessment 37 UNESCO (2005), State of Science and Technology Training Institutions in Africa. United Nations Educational, Scientific and Cultural Organization and the African Network of Scientific and Technological Institutions, Nairobi. 38 UNESCO (2005), State of Science and Technology Training Institutions in Africa, p

19 of how well African countries use implicit policies to promote R&D. A case-based review of the use of implicit policies may be useful to inform efforts aimed at integrating science and technology considerations into national economic policy frameworks. It may also be useful to guide reform or for the design of science and technology policies. Some of the countries have embarked on national processes of developing explicit science, technology and innovation policy framework. Angola s government has been working with UNCTAD to review its implicit policies and institutional landscape in order to identify gaps. In 2006 Swaziland was supported by UNESCO to hold national stakeholders consultations to identify R&D priorities and establish a science and technology policy-making process. Ghana (since 2004) and Kenya (since 1998) have been investing in various studies and events to review and reform their current science, technology and innovation policies. Uganda has the support of the World Bank through the Millennium Science Initiative to reform its policies and establish a new institutional set-up for science, technology and innovation. 2.3 National Innovation Capacities In studying African systems of innovation most of the attention has been paid to R&D components or aspects and not much has been done to build information on innovative capacities of the countries. Essentially studies and reviews have been undertaken on the scientific knowledge production parts of African systems and not much focus has been given to how the knowledge is turned into products, processes and services in the economies. There are very few comprehensive surveys of African national systems of innovation. UNCTAD recently commissioned reviews of Angola and Ghana s national systems of innovation. However, these are mainly snapshots and do not adequately focus on linkages and the nature and productivity of industrial firms. OECD and the Government of South Africa have invested in conducting reviews of South Africa s system of innovation, and the Department of Science and Technology has in the past commissioned innovation surveys at the firm level. Statistics or data on innovative capacities of African countries is scanty National Innovation Policy Regimes and Agencies Most Sub-Saharan African countries do not have explicit national innovation policy frameworks. 39 Many of the countries use implicit innovation policy measures which are often outlined in trade and industrial policies. They do not have coherent policy regimes or instruments that are specifically dedicated to the promotion of technological innovation. Of the 19 countries it is only South Africa that has a national innovation policy regime. In 2007 the South African Department of Science and Technology adopted a Ten-Year Innovation Plan that is erected on the concept of national systems of innovation. The Innovation Plan has specific measurable targets to be attained by 2018, It lays emphasis on building a strong skills base of scientists, technicians and engineers; increasing the country share of global patents; tripling South Africa s share of research publications in internationally peer-reviewed journals, expanding its energy infrastructure with more than 50 percent new capacity from nuclear plants and clean coal technologies, and increasing the commercialization of research results by providing specific funding instruments. A national Technology Innovation Agency (TIA) is being established to spearhead the implementation of the Innovation Plan. In Mauritius innovation policy measures are integrated into legislation for trade, commerce and industrial development. The Industrial Expansion Act of 1993, the Mauritius Accreditation Service Act of 1998, and the Small Enterprises and Handicraft Development Authority Act of 2005 are the main carriers or sources of innovation policies in that country. Ghana has taken a similar approach 39 Wolf, S., (2007), Encouraging Innovation for Productivity Growth in Africa. African Trade Policy Centre (ATPC) and the United Nations Commission for Africa. 19

20 and integrated its innovation policies into the investment, industrial and trade policy frameworks. It uses a wide range of instruments to promote technological innovation. These include the Trade Policy of 2003, the Ghana Investment Promotion Centre (GIPC) Act of 1994, Free Zones Act, 1995 (Act 504), the Technology Transfer Regulations, 1992 (LI 1547) contained in the Official Gazette of the Republic of Ghana dated the 18th December 1992, and the Environmental Protection Agency Act, 1994 (Act 490) in the Official Gazette of the Republic of Ghana dated 30th December Often there is no policy coherence and focus on promoting technological innovation. The Least Developed Countries (LDCs) in the group of 19 tend to rely mainly on old industrial policies to promote technological innovation. These countries are Angola, Democratic Republic of the Congo, Lesotho, Madagascar, Malawi, Mozambique, Rwanda, Uganda, Tanzania and Zambia. Their industrial policies do not directly aim at promoting entrepreneurship and innovation in manufacturing and services. They focus mainly on tariff protection, subsidies and prohibitions on certain kinds of technology transfer. 40 However, many of the African LDCs are reviewing and reforming such policies to promote private sector development and FDI flows. An increasing number of Sub-Saharan African countries are starting to review and reform their science and technology policies to focus more on measures that are aimed at promoting innovation. Botswana, Ghana, Kenya and Uganda have ongoing policy reform efforts. Ghana has a draft 2004 science and technology policy document. This draft still fails to articulate specific and explicit innovation policy measures. 41 There is a tendency to just attach the word innovation to science and technology and then claim to have a focus on technological innovation. It is crucial that policy reform efforts are based on a clear conceptual understanding of innovation and innovation processes. Majority of the African countries do not have national innovation agencies organizations to spearhead and coordinate the promotion of technological innovation. They rely on traditional science and technology ministries or departments, and in many cases such ministries or departments cover other sectoral areas such as education. Often these multi-focus ministries tend to give little attention to R&D and innovation objectives. In the case of Ghana, for example, science and technology has been moved from one ministry to another too frequently, and is often treated as an add-on to the core mandates of those ministries Private Sector R&D and Innovation Activities The African countries are increasingly recognizing the critical role that private sector plays in R&D and technological innovation. Most of them are continuously reforming their policies and laws in order to create conducive environments for private sector development and participation in national development. Some countries are also creating policy and legislative measures to promote private sector investment in R&D. Such efforts include strengthening of intellectual property protection laws and institutions, providing tax relief to companies that spend certain portions of their budgets on R&D, and establishing science and/or innovation parks. Most of the 19 countries have various forms of intellectual property protection laws and/or are members of regional intellectual property organizations. There are no rigours empirically-based assessments or analyses of the effect of the laws and related institutions in terms of stimulating or promoting private sector R&D and innovation activities. However, anecdotal evidence shows that some countries such as Kenya and South Africa have attracted R&D activities of some foreign agricultural and pharmaceutical biotechnology companies. Monsanto has some R&D investments in both countries. 40 UNCTAD (2007), The Least Developed Countries Report 2007: Knowledge, Technological Learning and Innovation for Development. United Nations Conference on Trade and Development, Geneva. 41 See Mugabe, J (2008), A Review of Ghana s Science, Technology and Innovation System. A Background Study Prepared for the United Nations Conference on Trade and Development, Geneva. 20