Esko-Olavi Seppälä / SB HOW TO MEET THE CHALLENGE IN FINLAND'S STI POLICY TAMPERE, JUNE 4TH, 2008 TRENDS AND CHANGES IN STI POLICIES INFLUENCED BY GLOBALISATION Esko-Olavi Seppälä S&T Policy Council of Finland

Esko-Olavi Seppälä / SB 338,000 sq. km 5,3 million people Capital Helsinki 2 official languages Finnish Swedish GDP per capita 2006 € 31,700 a member of the European Union FINLAND; the country Helsinki

Esko-Olavi Seppälä / SB CHARACTERISTICS/FINLAND Political consensus + citizens' support Mutual trust between STI players 'Top-down and hands-off' expert and funding-level (meso-level) activities have occupied a key role (Academy, Tekes, Sitra) Economic crisis in early 1990s ICT boom technological innovation In 2000s: technological + social innovation Strengths (incl. high level of education) mostly self-created

Esko-Olavi Seppälä / SB GDP IN FINLAND 1985=100

Esko-Olavi Seppälä / SB Source: Statistics Finland R&D EXPENDITURE BY SECTOR OF PERFORMANCE, million €

Esko-Olavi Seppälä / SB Enterprises Universities Public Sector Total OECD U.S.A EU Japan Canada Finland BREAKDOWN OF INVESTMENT IN R&D IN 2005 BY SECTOR OF PERFORMANCE (% of GDP) Source: OECD

Esko-Olavi Seppälä / SB Food industry 1½% Chemicals 7% Other industries 20½% Wood processing industry 2% R&D EXPENDITURE IN FINNISH ENTERPRISES IN 2006 Electronic and electrical industries 56½% Engineering and metal products 11% Other manufacturing industries 1½%

Esko-Olavi Seppälä / SB STRUCTURE OF GOV'T R&D FUNDING Basic institutional funding Free ”competitive” funding EUR million 75% 25% 40% 60% 45% 55%

Esko-Olavi Seppälä / SB Government (Gov't R&D funding 2008: million Euro) Science and Technology Policy Council Ministry of Education (778 million €) Ministry of Employment and the Economy (673 million €) Other Ministries (347 million €) Finnish Funding Agency for Technology and Innovation (526 million €) Academy of Finland (297 million €) SITRA Fund HE institutes and government research institutes Enterprises, private research institutes, funds and foundations, learned societies, intermediaries

Esko-Olavi Seppälä / SB SCIENCE AND TECHNOLOGY POLICY COUNCIL OF FINLAND CHAIRMAN Prime Minister DEPUTY CHAIRMEN Minister of Education and Science Minister of Economic Affairs OTHER MINISTERS Minister of Finance other ministers 10 OTHER MEMBERS Academy of Finland Finnish Funding Agency for Technology and Innovation (Tekes) Industry and Commerce Employees’ organisations Universities + other members Science Policy Subcommittee Technology Policy Subcommittee Council Secreteriat

Esko-Olavi Seppälä / SB Source: Finnish Science Barometer 2004 FINNISH SCIENCE BAROMETER 2004

Esko-Olavi Seppälä / SB SWOT ANALYSIS OF FINLAND'S R&D A small domestic market area and population Limited economic and intellectual resources Fragmented research activities: Resources allocated to a large number of small units A small number of foreign students and researchers The inflow of FDI is low

Esko-Olavi Seppälä / SB 2000’s The situation in the mid-2000s

Esko-Olavi Seppälä / SB 1990’s 2000’s Green line describes the situation in the 1990s

Esko-Olavi Seppälä / SB MAIN CHALLENGE HOW TO RETAIN NATIONAL STRENGTHS AND COMPETITIVENESS IN THE FUTURE, IN OPEN GLOBAL COMPETITION? THE "PACKAGE OF REFORMS" OF THE PRESENT GOVERNMENT: - "THE BIG FIVE" - GENERIC DEVELOPMENT ISSUES - SELECTIVE MEASURES

Esko-Olavi Seppälä / SB MEETING THE CHALLENGE I THE BIG FIVE: –Structural and other renewal of the HE institution –National innovation strategy –National infrastructure policy –Structural and other renewal of the sectoral research –Implementation of a four-stage research career system

Esko-Olavi Seppälä / SB NATIONAL INNOVATION STRATEGY

Esko-Olavi Seppälä / SB MEETING THE CHALLENGE II GENERIC DEVELOPMENT ISSUES: –Internationalisation –RDI funding National target 4 % of GDP by 2011 Share of public funding around 30 %, i.e. 1.2 % of GDP (today about 1 %)

Esko-Olavi Seppälä / SB MEETING THE CHALLENGE III SELECTIVE DEVELOPMENT ISSUES: –Strategic centres of excellence in STI ("SHOKs"): A cluster-based PPP policy instrument Example: –Centres of expertise programme ("OSKE"): A regionally driven cluster-based development programme ( )

Esko-Olavi Seppälä / SB