Innovation.bg 2007 The Bulgarian Innovation System in the EU Round Table Discussion 29 June 2007 Mr. Ruslan Stefanov, Coordinator, Economic Program, Center for the Study of Democracy Coordinator of Innovation.BG Working Group, ARC Fund

Innovation.bg 2007 Analyzes the performance of the national innovation system and its elements and the opportunities for its development 2007 gross innovation product (innovation, technological and R&D performance) = output entrepreneurship and innovation networks = input and links investment in and financing of innovation = input human capital for innovation = input information and communication technologies (ICT) = input and links Innovation index of Bulgarian Enterprises

Summary Innovation Index Source: European Commission, 2007

Market and Innovation Lifecycle Source: Harvard Business Review, Moore, G., Darwin and the Demon: Innovating within Established Enterprises, 2005

Share of Bulgarian Companies by Type of Innovation They Have Introduced in 2006 Source: Applied Research and Communications Fund, 2006.

Innovation Index of Bulgarian Enterprises Source: Applied Research and Communications Fund, 2006.

Innovation Index of Bulgarian Enterprises and Their Primary Market Source: Applied Research and Communications Fund, 2006.

Innovation Index of Bulgarian Enterprises and the Type of Cooperation They Engage in with Their Innovative Projects Source: Applied Research and Communications Fund, 2006.

Innovation Product Index of Bulgarian Enterprises and Their Planning Horizon Source: Applied Research and Communications Fund, 2006.

Innovation Product: Share of Innovative Enterprises in Bulgaria and the EU-15 by Economic Activities Source: NSI, 2006, Eurostat, 2006.

Content of the Innovation Activities of Bulgarian Innovative Companies Source: Vitosha Research, 2006.

Relative Importance of the Effects of Innovation Activities of Bulgarian Enterprises Source: NSI, 2006, Eurostat 2006, Applied Research and Communications Fund, 2006.

Factors Impeding the Innovation Activity of Companies (Share of Companies Specifying the Respective Factor as Relevant in Bulgaria and the EU-15) Source: NSI, 2006, Eurostat, 2001.

Factors Hindering the Innovation Activity of Firms in the Panel (Share of The Firms Defining Their Importance as ‘Great’) Source: Vitosha Research, Applied Research and Communications Fund, 2006.

Technological Product: Applications for Patents at the European Patent Office per One Million Inhabitants Source: Eurostat, 2006.

Research Product: Share of EU 8+2 Countries in the Region’s Population and Citations Source: Applied Research and Communications Fund based on National Science Foundation Data, 2006.

Entrepreneurship: Changes in the Structure of SMEs Source: National Statistical Institute, 2006.

Innovation Financing: Investment in R&D as a Share of GDP Source: Eurostat, NSI, 2006.

Structure of R&D Expenditures by Institutional Sectors in Bulgaria Source: NSI, 2006; Eurostat, 2006.

Projected Growth of the R&D Expenditures According to the National Innovation Strategy Source: Innovation Strategy of the Republic of Bulgaria, 2004.

Actual R&D Expenditures in Bulgaria Source: NSI, 2007.

Human Capital for Innovation: Employment in High-Tech Industry (% of total employment) Source: Eurostat, 2007.

Employment in Research Intensive High-Tech Services (% of total employment) Source: Eurostat, 2007.

Share of University Students in the Total Population of the Country Source: Eurostat, 2007.

ICT: Innovation Index of Bulgarian Enterprises and the Software Applications They Employ Source: Vitosha Research, 2006.

Conclusions The market component of the Bulgarian innovation system is in its early stages of development: Bulgarian enterprises display low levels of innovation performance. The major setbacks for the development of the national innovation system are the lack of appropriate sources of financing (in the short term) and the lack of qualified personnel (in the long term). The national innovation system has started to improve its performance, giving a clear sign that the time for action in this area has come.

Recommendations Greater political, administrative and financial resources should be pooled for implementing the national innovation policy (urgent update needed) The coordination between strategic papers, policies, administrative and financial instruments that bear relation to the national innovation system should be improved Cohesion and Structural Funds resources for innovation should be better channeled and focused on innovation at national level and in relation to other European programs

Thank you! Ruslan.Stefanov@online.bg