RIS BRIDGE: South-West Region of Bulgaria “Fostering Regional Innovation-Based Development through Networking and Benchmarking Policies: the Bulgarian Experience” Daniela Tchonkova Programme Coordinator Applied Research and Communications Fund

Regional Innovation Strategy for the South West Region of Bulgaria: Bridging the Innovation Disparities between the Capital Sofia and the Rest of the Region

South-West Planning Region of Bulgaria: main characteristics Economically largest Planning Region, 38% of national GDP; Densest research and development infrastructure; Highest entrepreneurial activity; Highest level of foreign direct investment.

Inter-regional disparities widening GDP per capita Source: NSI

Inter-regional disparities also in R&D expenditure Source: NSI

Priorities of the Bulgarian Innovation Policy (1) Encouraging innovation: - National Strategy for the Development of High Technologies in Republic of Bulgaria (1999). Need for improving the overall economic environment and the scientific and engineering (technological) infrastructure - National Strategy for Encouraging the Development of Small and Medium-Sized Enterprises in Bulgaria for the Period Innovation Strategy of the Republic of Bulgaria (2004) - National Strategy for Scientific Research for the period Human Resources: - ( ) personnel engaged in R&D per 1000 employees: low with a downward trend after The work force engaged in R&D in 2001 in Bulgaria (5.1) twice as low as EU-15 (13.9) - Concentration of scientific staff in the middle and older age groups and weaker engagement of young people in scientific and technological activity

Priorities of the Bulgarian Innovation Policy (2) Priorities for developing the patent system The protection of intellectual property rights is adequate to the legislation in the EC. The challenges: degree of information and knowledge on the possibilities of the patent legislation and the financial capacity of the enterprises. Number of submitted applications (for inventions and useful models) and of issued patents by the Bulgarian Patent Agency YearSubmitted applicationsIssued patents Bulgarian applicants Foreign applicant s TotalBulgarian applicants Foreign applicant s Total Source: Bulgarian Patent Agency

Priorities of the Bulgarian Innovation Policy (3) Financing innovation. Programmes and projects for innovation: Road Map of Bulgaria, Pre-accession Economic Programme of the Government ( ) and ( ) directing a bigger financial resource to research and development activities; restructuring the sources of financing with the aim to raise the share of business and risk capital funds; optimizing the financial framework to achieve higher effectiveness when using the funds. Public expenditure on R&D and education as percentage of GDP in Bulgaria R&D 0,44%0,37%0,34%0,28%0,18%0,44%0,45%0,40%0,43%0,33%0,37%0,35% Education 6,06%5,74%4,77%4,04%3,15%3,93%3,86%4,16%4,22%4,03%4,19%4,37% Source: Act on the budget of Republic of Bulgaria for every year of the viewed period

Clusters in Bulgaria The cluster "Srednogorie Med" was created in January 2005 with a constitutive protocol under the patronage of the Vice-Prime Minister and Minister of Economy. The cluster comprises the large industrial enterprises for extracting and processing ores and non-ferrous metals of the Central Srednogorie region. The ICT cluster created in Bulgaria is an example of sector differentiation of enterprises in which the geographical localization doesn’t have influence as a cluster-forming factor. The „Mesta“ cluster in Razlog is built on the basis of a similar interaction. In response to a big order from a Dutch entrepreneur for manufacturing furniture, which could not be fulfilled by any of the 30 small enterprises in the region, the „Mesta“ Business Centre based in Razlog initiated a cluster alliance. Cluster in Sevlievo - initial investment of „American Standard“in 1992

Innovation index of the Bulgarian companies

Overview: Bulgarians’ Attitude Towards Innovation Source: Innobarometer (2005)

Overview: How Does Bulgarian Innovation System Fair in Europe Source: European Innovation Scoreboard (2006)

Relative share of the innovative enterprises in Bulgaria and EU-15 Source: National Statistical Institute (NSI), 2004, Eurostat, NewCronos, 2001.

Source: NSI 2004, Eurostat, NewCronos Comparing barriers to innovation in Bulgaria (2003) and EU-15 (2000)

Source: Eurostat, 2005 Number of patent applications per million inhabitants in Bulgaria and EU-10

Source: NSI, Eurostat, Misbalance: Structure of R&D expenditure by sources of funds

Life-long learning (share of population aged 25-64, taking part in education and training) Source: Eurostat (2004)

Challenges Spending on R&D % of GDP, mainly government; Significant reduction of the number of personnel in R&D activities; Deterioration of the role of the universities in research and innovation activities; Weak clustering between enterprises, universities and R&D centres/institutes; Lack of a coherent national and regional system and policy for integrating Bulgarian R&D and innovation activities into EU structures.

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