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Around the World in TBED

June 13, 2012

Governments of advanced economies are starting to believe as the 21st century advances significant opportunities for their technology-based product and service sectors will emerge from increasingly open, competitive and affluent global markets. To compete in this changing world, they are looking to expand access to capital for startups and entrepreneurs, support their research and development (R&D) infrastructure and address weaknesses in their national economies. Canada, the United Kingdom and the European Union (EU) are among those that recently have announced initiatives or released reports intended to strength their national innovation economy.

Canada must become more productive to sustain its high standard of living, according to the Organization for Economic Co-operation and Development's (OECD) Economic Survey of Canada 2012. The report points out that Canada's overall productivity has slightly fallen since 2002 compared to a 30% increase over the past 20 years in the United States. To address this decline in productivity, the OECD identified two priorities:

  • Boost innovation — Although academic research is world class, the return on investment (e.g., business innovation and productivity growth) has not been large. Business (R&D) is particularly low (approximately 1% of Gross domestic product to R&D), despite significant government policy support. OECD recommends that government support to R&D should focus more on sharpening incentives and raising performance. The country also should unify corporate tax rates to encourage firms to attain the scale needed to adopt innovations.
  • Improve the quality and access to tertiary education — OECD believes that participation at the tertiary level will need to continue growing to maintain the supply of highly skilled workforce as the population ages. To improve equity of access to a postsecondary education, OECD proposes reducing non-financial barriers and increasing targeted need-based financial assistance. Canada should also foster a more flexible system that facilitates lifelong learning.

The report also calls for Canadian institutions of higher education to be differentiated between institutions that engage in research and those that focus primarily on teaching. Read the report's overview...

Another report, Spotlight on Science Learning: A benchmark of Canadian talent looked at several key benchmarks in Canada's Science Technology Engineering and Math (STEM) learning and found some interesting results. Although Canadian students perform well in national and international tests, there is a huge drop-off in the uptake of science and math courses once they are no longer compulsory, usually after grade 10. The proportion of students studying these courses in colleges and universities also remains flat. Eight recommendations are provided to increase interest in STEM learning among secondary students (grades 10 to 12) and to increase the enrollment of post secondary students in STEM related majors including:

  • A system-wide review of STEM curricula across Canada to develop programs that increase interest and participation in STEM studies (optional high-school courses and postsecondary programs);
  • A national forum for ongoing multistakeholder discussion related to STEM talent development; and,
  • Better connections between job forecasts and STEM learning demands.

The report was published by Amgen Canada, a biomedical company, and Let's Talk Science, a nonprofit organization. Read the report...

United Kingdom
A new report — The Current and Future Role of Technology and Innovation Centres in the UK — released by the British government provides 14 recommendations that the government should adopt to set out in some detail the mission, strategy, funding requirements and governance for the Technology and Innovation Centers program. The UK's Technology and Innovation Centres program is intended to support the adoption of new and emerging technologies by industry, by bridging the gap between research and technology commercialization. According to the report, however, the current UK approach is not achieving its purpose because it follows no national strategy; and pays insufficient attention to business requirements and the location of relevant expertise. It also looks at other nations' efforts to cultivate specific industry clusters including South Korea and Taiwan. Read the report...

European Union
According to Reuters, the European Parliament economic affairs committee voted in favor of the law that would create a pan-EU "passport" for venture capital (VC) funds, allowing them to market themselves to potential investors across the 27-country bloc. The legislation would allow VC funds to market themselves to potential investors across the EU. Under the proposed legislation, VC funds would be required to use a depository, an independent body entrusted with keeping the fund's assets safe and noting how the money is being invested and dividends being paid. Another provision would make investments redeemable after a specific period to prevent short-term, speculative bets. The proposed rules, due to take effect in July 2013, would apply to funds with less than €500 million (approximately $627.6 million). Funds above the €500 million threshold in assets will be regulated under the EU's new alternative investments rules also set to take effect in July 2013. Read the article...

Internationalinternational, policy recommendations, stem, capital