Transcript Was there a national strategy to promote industrial development

IMPORTANCE OF
TECHNOLOGY IN THE
DEVELOPMENT OF A
COUNTRY:
Can underdeveloped countries
afford not to have a global
competitive industry?
By Edgar Sánchez-Sinencio
Analog and Mixed-Signal Texas A&M University
1
“ Technological artifacts are products of
an economy, a force for economic growth,
and a large part of everyday life.
Technological innovations affect, and are
affected by, a society's cultural traditions.
”
Source:
http://en.wikipedia.org/wiki/History_of_technology
2
KNOWLEDGE AN ECONOMICS FORCE FOR GROWTH
In Soft revolution, knowledge is replacing physical resources
as the main driver of economic growth. The OECD calculates
that between 1985 and 1997 the contribution of knowledgebased industries to total value added increased from 51% to
59% in Germany and from 45% to 51% in Britain.
The best companies devote at least a third of their
investment to knowledge-intensive intangibles such as R&D,
licensing and marketing.
Universities are among the most important engines of the
knowledge economy. Not only do they produce the brain
workers who man it, they also provide much of its backbone,
from laboratories to libraries to computer networks.
3
Background
 Queen Victoria’s Diamond Jubilee,held in
London on June 22,1897
 The grandest fest: attendances included 46,000
troops and 11 colonial prime ministers.
 She ruled over a quarter of the world’s
population and 20% of its territory
 The empire was all connected by latest marvel
of British technology, the telegraph, and
patrolled by the Royal Navy, which was larger
than the next two navies put together.
4
Background (continues)
 “Why was Great Britain at the top and
not China, which was the world’s
technological leader for about thousand
years, between A.D 500 and A.D. 1500?
 “Britain’s advantages were marked by a
combination of social, political, and
geographical factors. British society was
relatively free and politically stable.
Scientific thinking was dynamic.”
5
Background (continues)
 “ It was said; well, here we are on top of the world,
and we have arrived at this peak to stay there

•


forever!
“The world is now flat” and other players have
surged.
US has replaced the British Empire
Of the world’s 20 top universities, 18 are American
How about other players, China, India and the
former Soviet Union?
They are poorer, hungrier and have a good number of
well trained people, they will compete with US for a
slice of the pie.
6
Background (bad news for USA)
 A Goldman Sachs study concludes that by
2045, China will be the largest economy in the
world, replacing the United States.
 What current problems exist in the US industry
world dominance?
 The National Academy of Sciences,
Engineering and Medicine reported that the “
scientific and technical building block of our
economy leadership are eroding at the time
when many nations are gathering strength”
7
Background (Bad news for USA)
 China and India combined graduate 950,000 engineers
yearly. US produces 70,000 engineers per year. How many
are educated to work for transnational companies?
 More people in the USA will graduate in 2006 with
sports-exercise degrees than electrical engineering
degrees.
 USA is loosing interest in the basics-math,
manufacturing, hard work, savings and becoming a
postindustrial society that specializes in consumption
and leisure
8
Background (Good news for USA)
 The USA invests 2.6 % of its GDP on higher
education, compared with 1.2% and 1.1%
in Europe and Japan, respectively.
 US remains by far the most attractive
destination for students, nearly 30 % of
the total number of foreign students
globally.
 The US economy is excellent at taking
technology and turning it into a product
that people buys.
9
Background (Good news for USA)
 The USA has the most flexible labor laws in the
world. The easier it is to fire someone in a dying
industry, the easier it is to hire someone in a rising
industry that no one knew would exist five years
earlier.

“Flexibility to quickly deploy labor and capital
where the greatest opportunity exists,and the
ability to quickly redeploy it if the earlier
deployment is no longer profitable, is essential in
a flattening world” Note the current low
unemployment rate in the USA is one of the lowest
in the world, around 4.6%
10
Global Competition
 China and India represent a 2.3 billion people
with a significant number of highly skilled
engineers with low salaries in comparison with
Western standards.
 USA’s top 1% of earners now receive 16% of all
income, up from 8% in 1980.
 How the USA become competitive and leading
research in the world, what was the driving force
behind that?
 The challenges to which US responded were: a)
in 1950 the Soviet Union’s launch of the Sputnik
satellite, b) in 1980 Japan was growing to become
the technologically and economical dominant
superpower of the future.
11
USA Companies are transformed to
transnational companies !
 For example HP currently has nearly 143,000
employees in 178 countries. It is the largest
consumer technology company in the world
and in Russia, Middle East,South Africa and
Europe.
 Very few non-USA companies are truly
transnational.
12
Let us study how successful
countries developed their
industries and education
Is there an strategy to become
an industrial power country?
What are the key elements to
accomplish these goals?
13
China PRC
Scientists born in China won four Nobel Prizes in Physics.
Science and technology have long preoccupied China's leaders; indeed,
the People's Republic of China's third and fourth generations of leaders
come almost exclusively from technical backgrounds—both Jiang Zemin
and Zhu Rongji were trained as electrical power engineers—and
have a great reverence for science. Hu Jintao was trained as a hydraulic
engineer.
Deng Xiaoping called it "the first productive force." Distortions in the economy
and society created by Communist Party of China rule traditionally
has hurt Chinese science, according to some Chinese science policy experts.
Before the 1990s, the Chinese Academy of Sciences, modeled on the
Soviet system, placed much of China's greatest scientific talent in a large,
under-funded apparatus that remains largely isolated from industry.
However, as a result of Chinese economic reform, most Chinese scientific
institutions have been encouraged to commercialize their activities, and
Chinese scientists have increasingly begun to go into business
http://en.wikipedia.org/wiki/Science_and_technology_in_China#Communist_Party_of_China_oversight
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• Chinese university undergraduate and graduate enrollments
more than doubled in the decade 1995 - 2005.
• The revival of a research in PRC universities has already
given the universities the edge in the number of most cited PRC
papers in the Science Citation Index.
• The average age of Chinese researchers at the Chinese Academy of
Sciences has dropped by nearly ten years between 1991 and 2003 as
the older generation retired and younger researchers, many educated
in the United States and other foreign countries, took their place.
The Communist Party of China Central Committee and the State
Council, on May 6, 1995 issued the 'Decision of the Central Committee
of the Communist Party of China and the State Council on the
Acceleration of Progress in Science and Technology'. The 'Decision'
set the goal of overall (both public and private) to attain Chinese R&D
spending equivalent to 1.5 % of GDP by the year 2000. It urged
scientific academies and institutes of higher education to set up high
tech companies. The 'Decision' noted that science and technology are
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the chief forces of social and economic development.
“ Girls , when I was growing up, my parents
used to say to me, Tom, finish your dinner
people in China and India are starving. ‘ My
advice to you is: Girls, finish your homeworkpeople in China and India are starving for your
jobs”
Bill Gates said: “The Chinese have risk taking
down, hard work down, education, and when you
meet with Chinese politicians, they are all
scientists and engineers. You can have a numeric
discussion with them-you are never discussing ‘give me a one-liner
to embarrass [my political rivals] with.’ You are meeting an
intelligent bureaucracy.
http://www.nsfc.gov.cn/e_nsfc/desktop/nsfc2004.aspx@tabindex=448&modelid=257.htm
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China needs her students back
•
The number (in ‘000 )of Chinese students has grown
1985
1995
2000
2002
2004
2
5
8
20
25
“ trained talent is the yeast that transforms a society and
makes it rise” was said by Singapore’s city-state elder statesman
Source: The battle for brainpower, The Economist October 7th 2006
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• McKinsey calculates that in 2003, US had far more
young engineers who were capable of working for
Multinational companies than China-540,000
against 160,000
• The sum of China’s total exports and imports amounts
to around 70% of its GDP, against only 25 to 30% in India
and US. In 2007, China will account for nearly 10% of
world trade, up from 4% in 2000
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Taiwan is a barren rock in a typhoon-laden sea, with virtually no
natural resources and it has the third largest financial reserves in the
world.
Brief Summary about her technological development
1.What is the GDP in 1980 and in 2005?
1980 GDP: $41.423 Billion
2005 GDP: $345.105 Billion
From http://www.econstats.com/weo/C157V019.htm
Population: 22.6m Adult literacy: 96.1
2. Was there a national strategy to promote her industrial development?
Strategy changes through stages on industrial development.
At the current stage of enhanced industrial technology capability
and phased-out substantial government support, as well as ever-intense
global competition, the strategy of forming an industry-directed research
consortia (ASTRO) has been adopted in the hope of integrating industrial
R&D resources, accelerating the uptake of R&D, promoting technology
exchange, accumulating long-term technology capabilities, stimulating
Collaborative research among up-/downstream sub-industries and boosting
overall industrial competitiveness.
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3. Is there a strategy to promote startup companies?
Government grants, low interest loans, technology development and
transfer, angel funds are tools commonly employed.
4. What is the percentage of the industrial output of the semiconductor industry?
about 10% GDP.
5. How many engineers are produced per year in your country?
From ministry of education statistics, about 90,000.
6. Who are the leaders that promo the industrialization in your country?
Chief of Executive Yuan, Minister of Economical Affairs,
Council for Economic Planning and Development, National Science Council,
Private sectors.
7. Another important factors in the industrial development and university
cooperation in your country?
The government has sought to integrate scientific and technological
resources, elevate academic standards, strengthen industrial technology, and
support innovation.
Innovation index 6.06 second best (USA has 6.41)
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INDIA
Key issues:
Indian Institute of Technology History
The history of the IIT system dates back to 1946 when a committee was set
up by Hon'ble Sir Jogendra Singh, Member of the Viceroy's Executive Council,
Department of Education, Health and Agriculture to consider the setting up of
Higher Technical Institutions for post war industrial development in India.
The 22 member committee headed by Sri N.R.Sarkar, in its report,
recommended the establishment of four Higher Technical Institutions I
n the Eastern, Western, Northern and Southern regions, possibly on the
lines of the Massachusetts Institute of Technology, USA, with a number of
secondary institutions affiliated to it.
The committee also felt that such institutes would not only produce
undergraduates but they should be engaged in research, producing research
workers and technical teachers as well. The standard of the graduates should
be at par with those from first class institutions abroad. They felt that the
proportion of undergraduates and postgraduate students should be 2:1
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• NASSCOM estimates that in 2001-04 some 25,000
Indian techies returned home, and the number is rising
rapidly.
• 68% of Indian executives living in the US were looking
for opportunities to return home, and 12% had already
decided to do so.
1.
What is GDP of India in 1980 and in 2005?
GDP recorded in USD-Billions, based on Purchasing-Power-Parity [1]
1980 => 434.28 2005 => 3602.89
[1] http://www.econstats.com/weo/C075V013.htm
22
Brief summary about the technological developmen
in India
2.
Was there a national strategy to promote industrial
development?
Two Stages of Economic Reforms [2]:

The pro-business measures of 1980, initiated by Gandhi’s (Indira
and Rajiv) removed price controls and reduced corporate taxes.

The economic liberalization of 1991, initiated by then Indian prime
minister P. V. Narasimha Rao and his finance minister Manmohan
Singh. It removed restrictive license policies, initiated
disinvestments and ended many public monopolies. It also
facilitated the foreign direct investment in many sectors including
infrastructure and technology.
[2] http://en.wikipedia.org/wiki/Economy_of_India
23
Brief summary about the technological development
in India
3.
Is there an strategy to promote start up companies?
Some Incentives [3]

Setting up of Special Economic Zones (SEZ) in the country
with a view to provide an internationally competitive and
hassle free environment for exports.

Giving early tax incentive to technological companies.

Relaxing rules about Foreign Direct Investment in certain
sectors.
[3] http://www.sezindia.nic.in/
24
Was there a national strategy to promote industrial
development?
India's industrial economy continues to invest heavily in advanced
technology initiatives such as digital communications and space
research.
India's energy requirements are met by oil, most of which is imported
despite the growth of indigenous production and hydroelectric
schemes, mostly based amid the powerful northern rivers. Mining is
a relatively small sector, but does produce iron ore and cut diamonds
for export. India's main industrial development has been in
engineering, especially transport equipment (a major export earner),
iron and steel, chemicals, electronics and textiles.
Economic reforms have been underway since the beginning of the
1990s, under which trade has been liberalized, the public sector
scaled back, and state-owned industries privatized. These reforms
were developed with and approved by the IMF, which has supplied
substantial credits to India.
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Key Strategies and reforms taken by the government in 1991:
- The reservation of many areas of economic activity for the state was
abolished.
- The restrictions on the inflow of foreign capital and technology transfer
were significantly relaxed. Foreign participation in companies up to
51% was permitted automatically in 34 industries. Clearance for higher
levels or in industries outside the 34 were processed speedily, and
foreign equity inflows jumped rapidly after 1991.
- The restrictions on the large industrial houses (designed to curb
monopoly) were significantly relaxed, and large companies became
able to expand existing units and construct new ones.
- Quantitative restrictions on imports of raw materials, intermediates and
capital goods were abolished. Considerable restrictions on the import
of consumer goods remained, although by 1995 an increasing number
were being put on Open General License, albeit subject to tariffs.
26
Is there an strategy to promote start up companies?
Technopreneur Promotion Programme (TePP)
Introduction
As a new initiative during 1998-99, the Ministry of Science & Technology
has launched a novel programme, known as ‘Technopreneur
Promotion Programme (TePP)’ jointly operated by the Department of
Scientific & Industrial Research (DSIR) under its plan scheme
Programme Aimed at Technological Self-Reliance (PATSER) and the
Department of Science and Technology (DST) under its Home Grown
Technology Programme (HGTP) of Technology Information
Forecasting and Assessment Council (TIFAC) to tap the vast existing
innovative potentials of the citizen of India.
Objectives
To promote and support untapped creativity of individual innovators
To assist the individual innovators to become technology based
entrepreneurs
To assist the technopreneur in networking and forge linkages with other
constituents of the innovation chain for commercialization of their
developments.
27
Is there an strategy to promote start up companies?
Activities
The activities under TePP includes providing financial support to selected
& screened Individual innovators having original ideas for converting
them into working models, prototypes etc.
The assistance under TePP includes to undertake the activities like,
R&D / engineering consultancy,
Small equipment, tools etc.
Raw Material / Accessories (for prototype/process trials),
Fabrication cost (for prototypes)
Patent guidance and support
Manpower
Testing & Trials
Any other relevant costs
TePP support to the innovators is limited to 90% of the total cost of the
project & remaining 10% is to be borne by the innovator/inventor.
Software Technology Parks of India (STPI) are also helping to promote
start-ups.
28
How many engineers are produced per year in your
country?
According to the All India Council for Technical Education, India
produced 401,791 engineers in 2003-04, 35 per cent being
computer engineers. In 2004-05, the number of engineering
graduates increased to 464,743, of which 31 per cent were
computer engineers.
Compared to India and China, the United States produces only
70,000 engineering graduates every year. All of Europe produces
just 100,000.
India currently has 113 universities and 2,088 colleges, many of
which teach various engineering disciplines. Engineering
colleges in the country have been growing at 20 per cent a year,
while business schools have grown at 60 per cent.
(Engineering education: Can India overtake China? George Iype | June
09, 2006)
29
Recent news from India 2007
•
Cellular phones pay about 5 US cents per minute. Special phones for
illiterate people use special codes so they can dial with one button. It
costs 10cents per minute to dial from India to US. From Internet to a USA
phone is 1.7 cents per minute, access to broadband cost $5 US per
month.
• GSM is the dominant standard but new local standard are being
proposed.
• India has the largest railway network in the world, one of the primary
means of transportation for long distances for people and cargo.
• It has 3 (10) domestic airlines in 2005 (2007)
• The Medical tourisms as well as Dental tourism continue growing.
•Very cheap medical cost, i.e, $500 brain surgery and hospital.
• Initial salaries for undergraduate, MS and Ph D are $8K-10K, $10K$12K, $15K-$18K , respectively.
• After 8 years salaries could reach $40K ( for management ladder)
30
Who was the leader (s) that promote the industrialization in
your country?
J. R. D. Tata (1904-1993) – Most famous industrial pioneer of
modern India. Father of Indian civil aviation. He founded
India's first commercial airline, Tata Airlines, in 1932, which in
1946 became Air India, now India's national airline. Tata
directed the Tata Group of Companies, with major interests in
many industries in India, including steel, engineering,
hospitality and electrical companies.
G. D. Birla (1894-1983) – Founded BITS, Pilani. In
collaboration with Caesar, an American friend, he set up an
Aluminum Plant 'Hindalco'. He also started many educational
Institutions. To his credit go many temples, planetariums and
hospitals. During the decades of 70's and 80's, The Birlas
were among the topmost Industrial Houses of India.
31
Another important factors in the industrial development
and university-industry cooperation in your country?
Traditionally, this used to be a niche area involving
government educational institutions and government projects
in the past…
With the liberalisation of the economy in the recent years,
there are more such cases involving private industrial
establishments and universities as well.
e.g. OLAB in BITS is a semiconductor R&D lab and is the first
campus based VLSI Design facility in India.
http://eetimes.com/news/semi/showArticle.jhtml;jsessionid=ASETUTI3TRYL4QSNDL
OSKHSCJUNN2JVN?articleID=18402777&_requestid=394263
Texas Instruments sets up second development facility in India
(proximity to IIT, Chennai).
http://www.networkworld.com/news/2006/071306-ti-sets-up-seconddevelopment.html
32
4. What is the percentage of the industrial output of the
Semiconductor industry?
Direct Impact of Semiconductor Technology Driven Industries on
Output of Indian Economy [4]-[5]:
14.25 billion USD => 2% of GDP =>6.8% of industrial output
[4] Economic data from ISA,Frost and Sullivan
[5] http://www.answers.com/topic/list-of-countries-by-industrial-output
5. How many engineers are produced per year in
India?
284,000 in 2005 [6]
6.
Who was the leader (s) that promoted the
industrialization in India?
No single leader, venture capitalists or individual investors though
some pro- business policy makers are highlighted in Q-2
33
[6] http://www.sunmediaonline.com/indiachronicle/infotech.html
Brief summary about the technological development in India
7. Other important factors in the industrial development and
university-industry cooperation in your country?
Industry growth in IT sector seems to be mainly driven by low-cost
Outsourcing and availability of large English speaking engineering
workforce. University Industry relation is still weak in IT sector. [7]
[7]
http://www.hindu.com/edu/2006/09/04/stories/2006090400580100.htm
Observe that the driving force for industrial growth, in India, has been
private companies and local natives returning from abroad and
putting ideas, creativity and money.Recently the government is
adding strength and efforts for this economical growth
34
SOUTH KOREA
Korean GDP between 1970 and 2005
GDP
900
800
700
billion $
600
500
400
300
200
100
0
1970 1975 1980 1985 1990 1995 2000 2005 year
Innovation Index : 7th, 4.62
35
Korean national strategy to
promote industrial development
The major national strategy is “ Select and Concentrate”
“Growth Engine”
Background: Korea has
• very limited natural resources
• limited financial resources
• small domestic market
• small land
• highly educated human resources
Can not invest for every field.
Strategy:
• Select major fields that is suitable for Korea
• Invest all the national resources for the selected fields
• Concentrate and speed-up
• Globalization : be the world best in the selected field in 10 years
• Success in the selected field will ‘power’ other fields in the future
Now, this philosophy has been spread over almost everything
and been being a part of Korean culture
36
The percentage of the industrial
output of the Semiconductor industry
 GDP per head $12,690
 Electronics product
 2003: 23% of GDP, 40% of total export
 Semiconductor
 2001: 5% of GDP, 15% of total export
Current : even higher
37
TOP UNIVERSITIES IN LATINAMERICA
2006
World Ranking
UNIVERSITY OF SAO PAULO
112
UNIVERSITY NACIONAL AUTONOMA DE MEXICO **110
STATE UNIVERSITY OF CAMPINAS
192
UNIVERSITY
CHILE MAKE MEXICAN 230
HOW
CANOF WE
TECNOLOGICO DE MONTERREY
374
UNIVERSITIES
MORE COMPETITIVE
UNIVERSITY OF BUENOS AIRES
376
FEDERAL UNIVERSITY OF SANTA CATARINA
342
FEDERAL UNIVERSITY OF RIO DE JANEIRO 366
FEDERAL UNIVERSITY OF RIO GRANDE DO SUL
379
2
1
3
4
7
8
5
6
9
11
PONTIFICAL CATHOLIC UNIVERSITY OF
RIO DE JANEIRO
539
PONTIFICAL CATHOLIC UNIVERSITY OF CHILE
UNIVERSITY OF GUADALAJARA
12
15
?
572
692
http://www.webometrics.info/top200_latinamerica.asp
** UNAM has been ranked among the best 100 universities in the world by another ranking
organizations
38
Top Universities Distribution by Continent
CONTINENT
Top 200
USA & Canada
Europe
Oceania
Asia
Latin America
Middle East
Africa
118
67
6
5
3
1
Distribution by Country
RANK
1
2
3
4
5
6
7
8
13
20
COUNTRY
United States of America
Germany
Canada
United Kingdom
Netherlands
Australia
Sweden
Switzerland
Brazil
Mexico
Top 500
228
209
23
23
9
7
1
Top 200
101
25
17
13
8
6
6
4
2
1
Top 500
201
51
27
40
10
19
10
8
5
2
http://www.webometrics.info/Distribution_by_Country.asp
39
Spending per student, 000,PPP
20
18
16
14
12
10
8
6
4
2
0
pre-primary
primary
lower secondary
upper secondary
Tertiary
United
States
Japan
European
Union
40
Source: OECD
41
What are some potential solutions to create (HT)
High Technology industry in developing countries?
Background
 A maquiladora (or maquila) is a factory, that imports
materials and equipment on a duty- and tariff-free basis
for assembly or manufacturing.
 The maquila must be a temporary step towards
developing high technology. It is not a final solution.
 An own foundry of semiconductor is not needed to
develop HT.
 Many successful semiconductor companies are fab less
42
Indicators about Mexico
1/10
15th largest country 1,973,000 sq km
The economy
• Economic freedom index 2.89 ( > 50 world position)
• GDP per head $6,050 (61 world position)
• GDP per head in purchasing
Power parity (USA=100) 23.8 (~ 75 world position)
Human development index 80.2 ( 51 world position)
Origins of GDP
% of total
Agriculture
4.0
Industry, of which:
26.4
Manufacturing & mining 19.5
Services
69.6
43
Indicators about Mexico
Total expenditure on R&D % of GDP 2002
1. Israel
4.66
2. Sweden
4. Japan
3.12
6. USA
29. Brazil
1.04
31. Spain
43. Venezuela 0.45
44. Mexico
4.27
2.64
0.95
0.41
Largest market capitalization $m, end 2003
1 USA
14,266,266
15 South Korea
2 Japan
3,040,665
19 Brazil
6 Canada
893,950
27 Mexico
329,616
234,560
122,532
Most tourist arrivals ‘000
1 France
75,048
3. USA
41,212
8. Mexico
18,665
2. Spain
4. Italy
38. Brazil
51,830
39,604
4,091 44
Indicators about Mexico
Largest tourist receipts $m
1. USA
64,509
3. France
37,038
14. Mexico
9,457
2. Spain
12. Canada
17. Japan
Daily newspaper per’000 population
1 Japan
551
2 Norway
12 Singapore 234
17 USA
20 Canada
157
29 Spain
10/10
41,770
10,579
8,848
544
188
110
Mexico is not in the top 30 countries my guess of newspaper
per 1000 population is about 20
45
Indicators about Mexico
Trade ($bn fob)
Principal exports
Manufactured products 160
(Maquiladora
77.5
Crude Oil& products 20.5
Agricultural products
5.2
Total incl. others
164.9
Principal imports
Intermediate goods 129.2
(Maquiladora
68.4)
Consumer goods
21.5
Capital Goods
20.2
Total
170.5
Main export destinations (%)
United States
88.8
Canada
1.7
Spain
0.9
Main origins of imports(%)
United States
61.8
China
5.5
Japan
4.5
46
Indicators about Mexico
Health & education
Health spending, % GDP 6.1
Doctors per 1,000 pop
1.6
Hospital beds per 1000 pop 1.0
Education spending, %GDP
5.1
Enrolment,%: primary
110
secondary
79
tertiary
21
Obesity (17M,16W in the world ) 19.4, 29 %
Diabetes ( 1 in the world)
14.2 %
11th largest pop. 103.5 M
Highest tertiary enrolment in the world
1 Finland
86
5 Australia
2 South Korea
85
13 Estonia
3 United States
81
16 Denmark
4 Sweden
74
18 Poland
74
64
63
60
A mathematic study for 15 years olds placed Mexican students in the last place
29/29 in countries belonging to the OECD
47
What are some potential solutions to create (HT)
High Technology industry in developing countries?
 Who are the players in this creation of a HT industry?
 Who should lead and pay for this national initiative?
 What should be provided to create a suitable
environment to develop this industry?
 What level of commitment is needed with the
participants of this initiative?
48
What are some potential solutions to create (HT)
High Technology industry in developing countries?
 The players must be from university-industry-government
 Government and industry should lead and pay for
this national initiative.
 Make different regions and states compete to attract
industry by tax exempt and providing financial support
including real state. Improve infrastructure, roads, schools,
and health
 Facilitate importing and exporting permits for this industrial
sector. Provide financial aid and simplify bureaucracy.
49
What are some potential solutions to create (HT)
High Technology industry in developing countries?
 Serious long term level of commitment is needed with the
participants of this initiative.
 This should be an initiative at the national level and
independent of the government in office.
 Put someone in charge based on experience, technically
capable and world recognized. Do not put in charge a politician
or someone without the credentials.
 Increase the number of qualified undergraduate and
graduated students in science and engineering
50
Remarks on creation of (HT) High Technology industry
in developing countries.
 There is no single approach to accomplish this goal and is
adaptable to variation in the world market. Previous
approaches followed by Japan, India, China and Korea
should be studied and come with one that suits the local
culture and maturity of society.
 The main national goals should be set independent of
government in office and should have plans for 5 to 10
years.
 Encourage the local industry to become a partner of these
goals. This industry should move from being distributors,
maintenance, assembly and manufacturers to world leaders
51
in some key high technology niches.
• The first group of people that will form this
high tech industry could come from natives
working abroad at industry and academia.
• Attract the best people from all over the world
with experience to help to develop this industry,
provide the proper financial benefits with a
constructive and intellectual environment.
• Creation of well educated and trained human
resources should become the highest priority of
the national priorities. What is need to accomplish
this?
52
How to transform classical university environment into the current world
situation?
An international survey offers two pieces of advice for
countries that are trying to create successful
higher-education systems, be they newcomers such as India
and China or failed old hands such as Germany and Italy.
First: diversify your sources of income.
The bargain with the state has turned
out to be a pact with the devil.
Second: let a thousand academic flowers bloom. Universities,
including for-profit ones, should have to compete for customers.
A sophisticated economy needs a
wide variety of universities pursuing a wide variety
of missions.
These two principles reinforce each other: the more that the
state's role contracts, the more educational variety will flourish.
http://www.economist.com/displaystory.cfm?story_id=4339960
53
Undergraduate programs at university should be up
dated to reflect the needs of the international industry, not
just the local needs which often do not have a large market.
 Faculty members at universities should have MSc and
Ph D. degrees. A drastic renovation program should be
in place. They should have periodic stays at industry
supporting their research.
 Salaries of professors must be competitive with industry
salaries. Promotion should be based on results and
guided graduate students.
 Talent resides in the brains of individual, but it is also
nurtured by organizations.
54
• A typical Mexican home earns $10,244 pesos monthly
• The national income grew 0.8% per year in the last 5 years
• The difference in income between the 10% richest and the
10% poorest is about 22 times
• 50% of the poorest Mexican population lives with less than
$ 3 US dollars per day
• 18.2% (19M) of the population leaves in extreme poverty,
about $72 and $52 monthly in urban and rural areas,
respectively.
From the “ Encuesta Nacional de Ingreso y Gastos de los Hogares 2005”
http://www.cronica.com.mx/nota.php?id_nota=265296
55
The World's Richest People
Rank
Name
Citizenship
Age Net Worth ($bil)
1 William Gates III
United States
2 Warren Buffett
United States
3 Carlos Slim Helu
Mexico
4 Ingvar Kamprad
Sweden
5 Lakshmi Mittal
India
6 Paul Allen
United States
7 Bernard Arnault
France
8 Prince Alwaleed Bin Talal Alsau
9 Kenneth Thomson & family Canada
10 Li Ka-shing Hong Kong
11 Roman Abramovich Russia
12 Michael Dell United States
50
75
66
79
55
53
57
49
82
77
39
41
50.0
42.0
30.0
28.0
23.5
22.0
21.5
20.0
19.6
18.8
18.2
17.1
Residence
United States
United States
Mexico
Switzerland
United Kingdom
United States
France
Saudi Arabia
Canada
Hong Kong
Unite Kingdom
United States
http://www.forbes.com/lists/2006/10/Rank_1.html
56
57
http://www.businessweek.com/pdfs/2005/0548_philsco.pdf
Many talented people not only create jobs and wealth,
They turn their hands to philantropy
•
Promote philanthropy among the richest people in the
country.
• Increase donations to private and public universities
coming from former students and industry.
• Provide an easy legal and financial path to
establish high tech start up companies.
• Implement measurement for identifying the best
undergraduate students in the country. A national
entrance exam?
• Increase exchange of graduate students and
faculty, attract top foreign students to study
in Mexico, of course make attractive Fellowship
offers.
58
• Industrial growing must be accompanied by social
responsibility, continuing education, parental
support and encouragement, medical care,
promotion for career development.
• Modern companies to win the talent wars should
turn themselves into learning organizations.
• “The success of advanced economies is
increasingly dependent not on their physical capital
but on their capacity to mobilize their citizens’
brainpower”
59
Conclusions
• As a society one can choose to shift the
responsibility or to choose to change the paradigm.
• The preconditions for development and progress
involve basic infrastructure ( ports, power and
roads) and human capital ( health and education)
• Technology has been the main force behind the
long-term increases in income in the rich world,
not exploitation of the poor. Consider the cases of
Korea and Japan. This not to say that human
exploitation has not occurred and is occurring. 60
Conclusions (continues)
• Governments must invest heavily, especially in the
early stages of Research and Development and
should maintain the momentum as a part of a
permanent national strategy.
• Break the cycle: “ The rich move from innovation to
greater wealth to further innovation; the poor do not.”
• Collective action, through effective government
provision of health, erase impunity and corruption,
enhanced and invest heavily on education and R&D.
61
References
[1] F. Zakaria, “ How long will America lead the World” Newsweek.
http://www.msnbc.msn.com/id/13123358/site/newsweek/page/3/print/1/displaym
ode/1098/
http://www.enchantedwebsites.com/maquiladora/
[4] http://www.iitkgp.ac.in/institute/history.php
[5] “The Economist, Pocket World in Figures”, Profile Books, Ltd,London,
Edition 2006
[6] J. D. Sachs, “ The End of Poverty ”,Economic Possibilities of Our Time.
Pinguin Books, New York, 2005.
[7] http://video.google.com/videoplay?docid=4237353244338529080
62
Appendix I
1. Top number of graduate students in different
universities at different levels
2. Tertiary education by field for OECD countries
Reading Comprehension
Finland 543.5
Korea
534.1
Mexico 399.7
Basic Sciences
Finland
548.2
Japan
547.6
Mexico
404.9
63
Bachelor's Degrees Awarded by School:
1. Pennsylvania State University
1,396
2. Georgia Institute of Technology
1,372
3.Purdue University
1,261
4. North Carolina State University
1,240
5. Univ. of Illinois, Urbana-Champaign
1,198
6. University of Michigan
1,127
7. Virginia Tech
1,098
8. Texas A&M University
1,044
9. Ohio State University
892
10. University of California, San Diego
883
11. University of Florida
882
12. Iowa State University
868
13. University of Texas, Austin
865
64
Master's Engineering Degrees Awarded by School
1. University of Southern California
1,244
2. Stanford University
930
3. University of Michigan
894
4. Georgia Institute of Technology
838
5. Massachusetts Inst. of Technology
808
6. Johns Hopkins University
777
7. University of Texas, Arlington
661
8. San Jose State University
625
9. Univ. of Illinois, Urbana-Champaign
577
10. Purdue University
525
11. Texas A&M University
522
12. University of Florida
503
13. Cornell University
490
65
Doctoral Engineering Degrees Awarded by School
1. Massachusetts Ins. of Technology
273
2. Stanford University
251
3. Georgia Institute of Technology
250
4. University of Michigan
226
5. Univ. of Illinois at Urbana-Champaign
220
6. University of California, Berkeley
201
7. Purdue University
165
8. Pennsylvania State University
151
9. Texas A&M University
148
10. University of Florida
145
11. University of Texas, Austin
143
12. Univ. of California, Los Angeles
137
13. Univ. of Maryland, College Park
131
14. Cornell University
116
15. University of Minnesota, Twin Cities
115
66
Chart A3.6. Tertiary graduates, by field of education (2004)
Graduates with tertiary-type A and advanced research qualifications
Lif e sciences, physical sciences and agriculture
Engineering, manuf acturing and construction
Humanities, arts and education
Other
Mathematics and computer science
Health and w elfare
Social sciences, business, law and services
Korea
Germany
Finland1
Sweden
Slov ak Republic
Greece
France1
Austria
Russian Federation2
Japan2
Czech Republic
Spain
Mexico3
Switzerland
Belgium4
Chile
United Kingdom
Italy
Ireland
Israel
Portugal
Australia
Canada
Turkey
New Zealand
Denmark1
Netherlands
Iceland
Norway
United States
Poland
Hungary 5
Brazil6
0%
20%
40%
60%
80%
100%
1. Year of reference 2003.
2. Physical sciences, mathematics, statistics and computing are included in lif e sciences.
3. Excludes tertiary-type A second degree programmes.
4. Excludes tertiary-type B second degree programmes (f or the Flemish community in Belgium).
5. Excludes tertiary-type B second degree programmes.
6. ISCED 5B programmes are included w ith ISCED 5A/6.
Countries are ranked in descending order of the proportion of qualifications in life sciences, physical sciences and
agriculture; mathematics and computer science; and engineering, manufacturing and construction.
Source: OECD. Table A3.3. See Annex 3 f or notes www.oecd.org/edu/eag2006).
(
67
Appendix II:
Indicators about Mexico
Color TVs per 100 households
1. USA 99.5
26 South Korea
39 Mexico 90
47 Russia
Computer per 100 people
1. Switzerland 70.9
10 Canada
48.7
? Mexico < 19
8 South Korea
34 Spain
Telephone lines per 100 people
8 Canada
65.1
17 South Korea
? Mexico < 28
93.3
75.8
55.8
19.6
53.8
68
Indicators about Mexico
Book Sales $m
1 United States 32,264
5 Mexico
3,567
2 Japan
20,818
15 South Korea 821
Nationality of asylum applications in indust. Countries ( in 000, 2003)
3 Turkey
29.2
11 Colombia
12.4
4 China
26.3
13 Mexico
10.7
Highest foreign debt $m, 2003
1 Brazil
235,431
2 China
193,567
6 Mexico
140,004
25 Peru
39 Ecuador
47 Iran
29,857
16,864
11,601
69
Indicators about Mexico
Agriculture Biggest producers ‘000 tonnes
Meat
1 China
70,899
6 India
2 United States
38,911
9 Mexico
Fruit
1 China
76,893
6 Italy
3 Brazil
34,298
7 Mexico
Sugar top ten producers
1 Brazil
26,000
2 India
21,700
7 Mexico
5,400
Coffee top producers
1. Brazil
1,729
5. Mexico
273
5,941
4,908
15,727
14,743
top ten consumers
1 India
18,600
2 EU15
14,100
7 Mexico
5,300
top consumers
1 USA
1,230
70
2 Brazil
825
Indicators about Mexico
Metals
Lead
producers
1 China
955
5 Mexico 135
Zinc
4 Canada
788
6 Mexico
427
Silver
1 Peru
2,921
2 Mexico
2,551
6 Canada
1,309
Oil ‘000 barrels per day
1. Saudi Arabia
3 USA
5 Mexico
consumers
1. USA
1,494
7 Mexico
307
3 Japan
619
5 South Korea 438
producers
consumers
9,817
1 USA
20,071
7,454
7 South Korea 2,303
3,789
11 Mexico
1,864 71
Indicators about Mexico
Innovation Index is a measure of human resources skills, market
incentive structures and interaction between business and scientific
sectors.
1. USA
6.41
2. Taiwan
6.06
3 Finland
5.74
7. South Korea
4.62
11 Canada
4.36
20. France
3.81
Mexico is not in the top 44
Information and communication technology index
1 Iceland
6.36
2 Denmark
3 Sweden
6.23
7 USA
15 Japan
5.79
18 South Korea
Mexico is not in the top 44
6.26
6.07
5.74
72
Appendix III
Korean National Growth Engines

Digital TV Broadcasting
 standard, broadcasting system, TV, camera

Display
 LCD, PDP, organic EL

Semiconductor
 process, nano-device, memory, SOC

Mobile Communication
 4G standard, system, cell phone, wireless network, telemetics,

Intelligent Home Networks
 home server/networking, intelligent consumer electronics, ubiquitous computing, USN

Digital Contents
 contents development tool, digital contents, contents distribution

Robotics
 home, medical, military application, intelligence, HCI

Automobile
 electrical car, hybrid car, fuel cell, safety, sensors, intelligent driving assistant, part
Battery
 fuel cell, next generation battery


Bio-technology
 medicine, artificial organ, bio chip
73
Korean strategy to promote
start up companies
 Various government funding programs are available
 Startup, research, manufacturing, marketing, office, equipment, consulting
 Almost all the start-up companies take benefit from these funds
 Fluent of government research fund especially for 10 growth engines
(refer previous page)
 Most of government research program require/encourage the participation
of start-up companies by the law
 Exemptions of mandatory military service for researchers who are
employed in a start-up company (limited for qualified researchers with
Master’s degree)
74
How many Korean engineers are produced per year?
<Graduates in Engineering and Science>
year
1997
1998
1999
2000
2001
BS.
79,908
82,442
82,129
85,546
96,979
MS. /Ph.D.
13,644
15,770
18,190
20,211
22,007
*total number of people in Korea: 50 million
<Current Ph. D. : 2001>
Total
Korea
USA
Industry
University
National Lab.
46,146
5,351
35,141
5654
357,200
147,900
175,900
33,500
<Ph. D. expected : total during: 2001~2010 >
Science
Engineering
Mathematics, Computer
Science
2,735
Mechanical / Aerospace
5,199
Physics
1,830
Material
2,471
Chemistry
2,272
Electrical
10,132
745
Chemical.
1,546
Biology
2,681
Bio / Food
919
Others
597
Fabrics
357
Earth Science
Nuclear / Petroleum
Architect / Civil
400
4,663
Others
3,285
75
Who promoted the industrialization in Korea?
1960~1980 : President Junghee Park promoted/emphasized
<bright side>
- Social Overhead Capital deployment
- Heavy Industry
- Export
- Education/ cultural enlightenment
<dark side>
- prolonged one-man rule
- overemphasized uniformity
- too strong government control on industry
- infringement of human right
Thereafter : not a specific person, it runs by itself
76
Another important factors in the industrial
development and university-industry
cooperation

Very little amount of money from the industry is donated to university
for pure research and education (example: Yonsei university only 10%
out of 140million$ research fund comes from industry)

However, industrial research fund for practical application is active

The topic and specification are generated by industry need. (very short
term research : around 1~2 years)

Almost all the government research fund requires participation of
industry (even in the research/education program for university)

Technology that was developed by the university itself is rarely
transferred to the industry (Industry prefer to employ the student
rather than technology licensing)

However, the industry-initiated research outcome is easily integrated
with the product.
Naturally, Industry have the initiative of research.
77