Increase international collaboration in public R&D, says OECD

25 Nov 2008 | News
Governments need to increase international cooperation and strengthen links between public research bodies and industry, says a new OECD report.

OECD governments need to increase international cooperation and strengthen links between public research bodies and industry to boost science and innovation and drive long-term growth, according to a new report from the Paris-based international body.

The OECD Science, Technology and Industry Outlook 2008 published this week, reviews trends and developments in science, technology and innovation policy in OECD countries and six emerging economies, including China, Israel and the Russian Federation.

Emerging economies account for a sharply growing share of global spending on research and development, up from 11.7 percent in 1996 to 18.4 percent in 2005, the most recent year for which data are available.

The US remains the world’s leading investor in R&D, spending $344 billion in 2006, but its share in global R&D has been falling due to falling corporate investment in R&D. The share of the 27 Member States of the European Union has also declined.

China’s spending on R&D in the business sector as a percentage of GDP, a metric known as R&D intensity, has increased rapidly from 0.25 per cent of GDP in 1996 to 1.01 percent in 2006, almost catching up with the EU-27 business intensity of 1.11 per cent. In real terms, this represents an annual increase of 20 per cent in China over the past decade compared with 3 per cent R&D growth in the private sector in both the EU-27 and the US.

Future global investment will depend in part on the longer-term impacts of financial market instability on corporate spending, since this accounts for most R&D investment by OECD countries.

The review identifies a number of issues that need tackling urgently. These include:

  • Increasing co-operation with foreign firms and governments. OECD countries must strengthen capacity to attract foreign investment and foster participation in global innovation networks.

  • With growing demand for skilled workers and growing competition for foreign talent, OECD countries need to improve policies to foster talent in the domestic economy.

  • Innovation in firms goes considerably beyond technological innovation and also includes process, organisational and marketing innovation; policies to foster innovation will need to expand to capture the full range of innovation activities.

The OECD is currently elaborating an Innovation Strategy, based on a mandate endorsed by Ministers in 2007.

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