Transcript Measuring the Innovation Potential of the Bulgarian Economy

Measuring the Innovation Potential of
the Bulgarian Economy
Establishing an IRC in Macedonia, Skopje, March 29, 2006
Ruslan Stefanov
Economic Program
Center for the Study of Democracy
Bulgarian National Innovation System
The National Innovation Strategy
 Financial Measures
 Non-Financial Measures
The National innovation Council
 Policy formulation
 Policy Coordination
Challenges Ahead
The Process Innovation.bg
 The Objective
 The Target Group
 The Team
 Innovation Expert Council
 Consulting with various institutions
 Value Added
Competitive advantages in the Bulgarian
import and export (1999 – 2004)
25,0
Clothing and shoes
20,0
Non-ferous metals
Cast iron, iron and steel
15,0
Foods, beverages and
cigarettes
Raw materials for production
of foods
Drugs and cosmetics
10,0
5,0
Electric appliances
Plastic, rubber
0,0
1999
2000
2001
2002
-5,0
2003
2004
Machines, appliances and
apparatuses
Transport vehicles
Textile materials
-10,0
-15,0
Source: BNB and Applied Research and Communications Fund
Иновации.бг
 Gross innovation product
 Entrepreneurship and innovation networks
 Innovation investments and financing
 Human capital for innovations
 Information and communication infrastructure
Aggregate innovation product
Compared to EU-25 the share of the
innovative enterprises in Bulgaria is four
times lower
The technological and the scientific
product remains relatively higher than the
innovation product
 Excessive supply
 Low demand
Relative share of the innovative enterprises in
Bulgaria and EU-15
Total
Extracting Industry
Processing Industry
Electric Power, Natural gas and Water
Wholesale Trade and Trade Mediation
Transport, Store and Communication
Industry
Financial Mediation
Computer technologies, R&D,
architecture and engineering
0%
10%
20%
30%
Bulgaria
40%
50%
60%
EU-15
Source: National Statistical Institute (NSI), 2004, Eurostat, NewCronos, 2001.
70%
Innovation activity of the Bulgarian
firms
2% 4%
6%
16%
14%
1%
7%
First
place
24%
7%
7%
Second
place
7%
11%
5%
18%
5%
26%
36%
4%
R&D conducted by the
com pany
R&D conducted by another
com pany
Attainm ent of m achinery
and equipm ent
Attainm ent of non-m aterial
assets
Staff training
Marketing of new products
or processes
Industrial planning and
other
Other
Does not know or N/A
Source: Vitosha Research, 2004
Objectives of the innovation activities of
innovative companies in Bulgaria (2003) and
the EU-15 (2000)
Increase of the assortment
40
Provision of standards conformity
Market expansion
30
20
Environment protection
10
Improvement of the quality
0
Lowering the material and energy
expenditures
Attainment of flexibility
Lowering of the labor force
expenditures
Increase of the production capacity
ЕU
Resource: NSI, Eurostat, NewCronos , 2001
Bulgaria
Comparing barriers to innovation in Bulgaria
(2003) and EU-15 (2000)
Source: NSI 2004, Eurostat, NewCronos 2001.
Number of EPO patent applications per
million inhabitants in Bulgaria and EU-10
9
8
7
6
5
4
3
2
1
0
1996
1997
1998
1999
Bulgaria
Source: Eurostat, 2005
2000
ЕU-10
2001
2002
S&E articles from Bulgaria, registered at
the Institute of Scientific Information
2000
1998
1996
1994
1992
1990
1988
0
200
400
600
800
1000
1200
Source: National Science Foundation, Science & Engineering Indicators, 2004.
1400
Relative performance of science systems in EU
8+2 (share of citations in the population)
Slovenia
100%
80%
The Slovak
Republic
Romania
70%
Poland
60%
Lituania
90%
50%
Latvia
40%
Hungary
30%
Estonia
20%
The Czech
Republic
Bulgaria
10%
0%
Population
Citations
Source: National Science Foundation, Science & Engineering Indicators, 2004.
Entrepreneurship and innovation
networks
 Low entrepreneurship activity
 Market-based, rather than innovation and technological
networks
 The domestic science and technology system is not
efficiently used
 Necessity of:
 Innovation policy that differentiates the various types of
enterprises
 Promoting horizontal relations and cluster formation
Level of entrepreneurship (number of enterprises per
1000 inhabitants in Bulgaria)
100
90
80
70
60
50
40
30
20
10
0
Bulgaria
Romania
Source: EBRD (2004)
Croatia
Czech
Republic
Hungary
Poland
Slovak
Republic
Slovenia
EU-19
SMEs structure dynamics in Bulgaria
(1996-2003)
Source: 2001 – 2003, NSI, (2004); 1996 – 2000, Report on Small and Medium-Sized Enterprises in Bulgaria (2003).
Partnership typology of the Bulgarian innovative
enterprises in the development of innovative
products and/or processes in 2003 (%)
80,0
70,0
73,0
Product innovators
65,5
Process innovators
60,0
50,0
40,0
30,0
17,2
20,0
12,5
10,0
13,8 12,1
3,3 1,7
3,9 5,2
0,0
Mainly within the The firm with other The firm with other Mainly by other
firm
local organizations
foreign
local organizations
organizations
Source: Vitosha Research (2004)
Mainly by other
foreign
organizations
Share of innovative enterprises in Bulgaria, which
have indicated as “very important” to their joint
innovation projects the listed partners
European Union
Local partners
40
35 31
International partners
29,8
30
National and local authorities
Suppliers of equipment, materials, components
and software
28,6
25
20
15
Financing organizations
12,5
10
7,1 4,8
5
Clients, users
39,3
1,8 0
3,6
4,2
Industrial enterprises/centers conducting R & D
6
2,4 7,1
Consultancy agencies/enterprises
7,7
State and private non-profit research institutes
Competitors and other sector enterprises
Universities and other institutions of higher
education
Enterprises from other sectors
Big international companies
Source: Vitosha Research (2004)
Innovation investments and financing
 Not enough depth in the accumulated fixed
capital in the economy – importance of the
channels for transfer of foreign innovations
 One of the lowest business R&D expenditures in
Europe
 Considerable structural misbalance: the public
sectors dominates, without attracting enough
funds
 The credits for the private firms has increased 7
times, but their innovative activities are funded
by the firm’s own revenues
 Relying on market-oriented financing on
competitive basis or on EU grants and programs
FDI intensity (FDI stock as % of GDP)
40
EU-15
35
EU-8
Bulgaria
30
29
CEE
25
23
20
20
20
18
15
13
10
10
6
5
3
0
1995
1996
Source: UNCTAD (2005).
1997
1998
1999
2000
2001
2002
2003
R&D intensity (% of R&D expenditure in GDP)
2,00
1,80
1,60
1,40
1,20
1,00
Bulgaria
0,80
EU-15
0,60
0,40
0,20
0,00
1993 1994 1995 1996
Source: NSI, Eurostat, 2004.
Bulgaria
1997 1998
1999
2000
2001
2002
2003
Misbalance: Structure of R&D expenditure
by sectors of performance
Bulgaria
Higher
education
sector
9,7%
Private nonprofit sector
0,3%
Government
sector
70,1%
Business
enterprise
sector
20,0%
European Union (EU-15)
Higher
education
sector
21,0%
Government
sector
13,0%
Source: NSI (2004), Eurostat (2005)
Private nonprofit sector
1,0%
Business
enterprise
sector
65,0%
Misbalance: Structure of R&D
expenditure by sources of funds
Abroad, nonprofit
organizations,
higher
education
6,3%
Bulgaria
Government
sector
66,9%
Business
enterprise
sector
26,8%
Abroad, nonprofit
organizations,
higher
education
9,0%
Government
sector
35,0%
Source: NSI, Eurostat, 2004.
European Union (EU-15, 2001)
Business
enterprise
sector
56,0%
Main sources of financing of the innovation
activity of innovative enterprises in Bulgaria in
2003 (%)
1,8
0,6
2,4
5,4
Own sources
2,4
1,2
Local banks
8,3
Venture capital
State budget
Bulgarian partners
Foreign partners
Parent company
78,0
Source: Vitosha Research, 2004
NK-NA
Human capital for innovations
 Good education level in the secondary and higher
education
 Decrease in the quality of the secondary education
 Institutional variety in the higher education
 Lack of life-long learning education
 Low business demand of R&D » Employment
decrease and smaller interest in scientific career
 Public funding for employment in the R&D sector
– long-term unstable misbalance
 Necessity of comprehensive long-term vision for
the education development
Falling average performance of
Bulgarian 8-graders
Mathematics
560
545
Science studies
540
527
518
520
511
500
476
480
460
440
1995
Source: IEA, TIMSS
1999
2003
479
Life-long learning (share of population
aged 25-64, taking part in education and training)
12,0
9,9
10,0
8,0
9,2
7,9
7,8
6,0
4,0
2,0
1,4
1,3
1,4
1,3
0,0
2001
Source: Eurostat (2004)
2002
2003
EU-25
Bulgaria
2004
R&D personnel per 1000 persons of
the workforce (1995-2002)
16,0
14,0
12,0
10,0
8,0
6,0
4,0
2,0
0,0
13,9
8,6
8,9
8,4
6,2
1995 1996
1997
Bulgaria
Source: NSI, Eurostat (2004)
6,3
5,5
1998 1999
5,2
5,1
5,2
2000 2001 2001 2001 2002
EU-10 EU-15
Information and Communication
Infrastructure
Bulgarian firms, which use ICT are more
innovative than the rest
The ICT density is constantly increasing
and the more effective use of ICT proves
to be key issue
The innovation policy should be directed
towards the infrastructure and the
improvement of the general ICT education
level
Innovativeness of Bulgarian enterprises
by level of ICT use
Use computers
43
Do not use computers
23,4
Use Internet
47
Do not use Internet
20,2
Average age of computers used in production
is under 2 years
58,4
All enterprises
32,9
0
Source: Vitosha Research, 2004
10
20
30
40
50
60
70
Thank you!
The full text of the report can be found
at:
www.arcfund.org