Transcript Prof. Edvins Karnitis Republic of Latvia

Knowledge-based Economy –
a Key Process
for Sustainable Development
Prof. Edvins Karnitis
Republic of Latvia
Paris,
February 19-22, 2002
Key indicators of the national economy
GDP growth rate, 2001 (estimated)
7.4%
Consumer price index, 2001
2.5%
Budget deficit as % of GDP, 2001
1.8%
Central government external debt as % of GDP, end 2000
8.0%
Foreign direct investments as % of GDP, 2000
5.7%
Position in global ranks
Progress of Latvia in global ranking (UNDP)
30
40
50
60
70
80
90
100
110
Human development index
Gross domestic product
Gross enrolment ratio
Life expectancy at birth
1994
1995
1996
1997
1998
1999
Development
Strengths
Opportunities
location in active region
liberal market economy
highly skilled labour force
interest of the society in education
strong banking sector
integration in European society
knowledge-based products
development of infrastructure
emergence of a middle-class in the
society
Weaknesses
Threats
modest economic potential
a lack of raw materials
grey economy, bureaucracy
educational system not oriented
towards industry needs
insufficient growth rate
small capacity of the country
a lack of investments
enlargement of EU does not occur
Stagnation
From vision to action
Long term
development of
national economy
Industry
National
program
Informatics
eLatvia
Schools
Innovation
E-business
E-procurement
Education &
research
E-governance
E-documents
Libraries
ID-cards
Emergence of a knowledge-based development
 Knowledge management – the Modus operandi on a national scale
 A man as an owner of knowledge becomes the key factor for economic
growth
 Unified development trends of the national economy, governance,
education, social policy and other sectors
 Reindustrialisation of traditional branches
 Development of knowledge-intensive branches:
high knowledge base of specialists, capacity of the education system
demand for products and international market niche that could be
conquered
high added value of goods and services
small consumption of energy resources and raw materials
Industrial clusters – competition & cooperation
(information systems, composite materials, forestry, engineering)
Synergy effect to increase competitiveness of the Latvia’s economy:
knowledge sharing and professional training for cluster participants
resource sharing policy and procedures, common technologies
reduction of various costs
joint R&D activities
common customers and/or distribution channels, joint marketing activities
forming the critical mass to enter foreign markets
Potential of the IT cluster
No. of companies in the IT cluster, end 2001
15
No. of programmers in the IT cluster, end 2001
1000
Contribution to GDP per employee of software industry as % of
average in the economy
695%
R&D and innovation
5th FP projects success rate, 1999-2001
27.5%
5th FP programme “Innovation & SMEs” projects success rate, 1999-2001
52%
5th FP financing from EC funds as % of Latvia’s contribution fee, 1999-2001 187%
Internationally acknowledged potential of Latvian fundamental and applied
research
Innovation -- strengthening links between the enterprises and universities
Improvement of key interfaces in the innovation system (education, research,
entrepreneurship, legislation, financing)
Encouragement of the creation and growth of innovative enterprises,
development of technological/business centres
Increase of the number of issued patents (biosynthesis, biotechnology,
pharmaceuticals, magnetohydrodinamics and plasma technologies, etc.)
Business in Internet environment
 E–business – integration of all types of commercial activities into the
Internet environment to increase competitiveness in the global scale:
establishing internationally harmonized ground rules
building trust among participants
maximizing benefits for all individuals
 Spread of various teleworking principles
 Electronic financial transactions and services
 Remote public services, both for individuals and businesses
 Electronic documents and identification cards as tools for remote
contacts and transaction services
Regional development
Weakness: unbalanced development:
economic, social, cultural differences
extra supported areas according to specific criteria
borderland – outskirts effect and cross border cooperation
a monocentric state
Diversification of economy -- condition for territorial development,
competitiveness of regions, growth of welfare level:
development of knowledge hubs: technological/business/industrial
centre + university/college + library/information centre
cities as the focal points of knowledge economy; knowledge,
information, social and culture centres for ambient rural areas
virtual enterprises and teleworking – the base for diversification of
economy in rural areas
General participation:
to enable everybody and every company
in every region
to promote formation, development, spread and introduction the basic
principles and processes of the information society and knowledgebased economy
to create opportunities for every citizen and business to participate
fully in the processes of information society and knowledge-based
economy
to promote the increase of welfare’s level and thus to encourage civil
harmony in the country, the economic and social cohesion
Cheaper, faster and secure connection
to ICT infrastructure
qualitative connection to telecommunications and data transmission
networks
installation of public Internet terminals in libraries, schools, municipalities
establishing the regulation of Internet domain and services, liability of
service providers
multisectoral regulatory body – Public Utilities Commission
Development of infrastructure (per 100 inhabitants), end 2001
Telephone main lines
30.6
Internet users
10.2
Digital lines as % of main lines
68.6%
TV sets
89.1
Mobile telephones
25.4
Personal computers
10.9
Cable TV subscriptions
24.5
Internet hosts
2.7
Satellite TV
10.1
Education and general information literacy
Accomplishments:
 the highest adult literacy rate in the world – 99.8% of age 15 and above, 1999
 accelerated informatization of learning processes in schools, end 2001:
designed electronic textbooks – 80 000 A4 pages
68% of total number of teachers has been trained in IT usage
number of primary and secondary level students per PC -- 21.7
obtaining the European Computer Driving Licence
Weakness:
insufficient contribution of universities toward the resolution of national priorities;
tertiary enrolment in technical and life sciences -- 16.5% of gross tertiary
enrolment, 2000/2001
insufficient training the highest-skilled specialists (master’s and doctor’s degrees)
Availability of information
Transnational information systems
Public and private sector
information systems
Libraries of state
significance
Regional library
Rural library
No. of public libraries per million population, end 2000
School library
432
Libraries with Internet connection as % of total No. of libraries, end 2001 15%
No. of licensed radio broadcasting programmes, end 2001
37
No. of licensed TV broadcasting programmes, end 2001
29
No. of licensed cable TV broadcasters, end 2001
37
Daily newspapers per capita, 2000
76
Public information processing and services
Accomplishment:
Development of mega-system – integration of public sector information systems:
quality of data
interoperability of all national information systems, data exchange
complex processing data from various components
united and user-friendly access to information
integration into the Transeuropean corporate telematic networks
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Knowledge economy and social factors
Gini index, 2000
0.34
Salaries of the employed in software industry as % of average salaries
177%
Tertiary graduated working age people as % of total working age, end 2001 19.4%
Tertiary graduated unemployment as % of total unemployed, end 2001
7.2%
Higher social and societal welfare level as a final target of co-ordinated policy
for economic and social development of the country and society
Investments in education -- important factor in increasing the quality of human
capital
The significance of culture; maintenance, development, functional perfection of
national language
Conjunction of social programs with national economic possibilities, increased
responsibility of every individual for himself/herself
Cabinet of Ministers
IS National Council
Coord. Board Informatics
Min. of Transport
Dep. of Informatics
National progr.
Informatics
Min. of Economy
eLatvia
E-business
Innovation
Min. of Education
Schools
Libraries
Min. of Culture
Min. of Finance
Min. of Interior
Min. of Justice
Procurement
ID cards
E-government
E-documents
E-regions and E-cities
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Information society:
informatization or innovation
Informatization:
Innovation:
traditional processes
advanced processes
quantitative changes
qualitative changes
awareness
opportunities
prompt benefit
maximum benefit
Transition model
Final model