Western Balkans Regional R&D Strategy for Innovation G ROWTH THROUGH R ESEARCH AND I NNOVATION IN THE W ESTERN B ALKANS — T HE M OMENT FOR A CTION Kristina Ferara Blašković, Ministry of Science, Education and Sports Paulo Correa, World Bank December 12, Zagreb

7 Policy Reviews of key institutions, policies and programs: Country Papers The Western Balkans R&D Strategy for Innovation Technical Assistance: Inception Report — Regional R&D Strategy for Innovation in the Western Balkan Countries: Key Issues and Implications for Technical Assistance, World Bank (2011). 4 High Level Workshops with representatives from governments, research institutes, universities and private sector from all beneficiary entities, as well as international experts 3 Technical Studies ( The State of Scientific Performance of the WBCs; Survey of the status of research Infrastructure and technology transfer activities; and Assessment of Data Availability on Research and Innovation) and 5 technical notes : Overview and Main Report of the Status of Research and Innovation in the Western Balkans. Video : Research for Innovation: The moment for actionesearch for Innovation: The moment for action Website: s/2013/10/24/balkans-innovation- event An 18 Months Fact-Based Consensus Building Exercise 12 Visits to the region Outreach exercise and broader consensus building between 12/2011 and 8/2013

S UMMARY V IEW : THE STATUS OF THE RESEARCH AND INNOVATION SECTOR What/?

The Impact of R&D and Innovation in the Western Balkans Innovative firms grow faster: 15 percent faster (in sales) and 8 percent faster in labor productivity than non-innovative firms. Firm R&D expenditures significantly contribute to performance: raises sales (by 12 percent) and labor productivity growth (by 6 percent) on average in the Western Balkans (without Croatia). When firm R&D, training and infrastructure services sales are compared, R&D is shown to have the highest correlation to sales growth (excluding Croatia) Source: Seker, M. (2013) – Background paper for the technical assistance on the Western Balkans R&D for Innovation Strategy

The Western Balkans’ Investment in R&D Gross expenditure on R&D in the WB has declined dramatically in the past two decades. The region is investing approximately €495 million in the R&D per year The variance of R&D intensity within the region The regions R&D intensity – 0,33 % of GDP Scientific performance – substantially bellow EU average The average number of citation per document in the WB (0,62) in was about half of the EU 27 average (1,27) Science- industry collaboration ranking of 144 countries, the WB’s average stands at the 88th position (EU27- 40th)

L OW R&D I NVESTMENT L EVELS

GERD/ Total Triadic patents C OSTLY R ESULTS OF R&D I NVESTMENTS US$ 1,000

S TRATEGIC V IEW INVEST MORE AND BETTER IN R&D POLICY REFORMS AND SELECTED INVESTMENTS A “SECTOR – WIDE” APPROACH The Vision

T HE W AY F ORWARD

R EFORMS AND I NVESTMENTS TO FOSTER EFFECTIVE RESEARCH COMMERCIALIZATION AND INDUSTRY SCIENCE COLLABORATION 10 Intermediate GoalsPROPOSED ACTIONSMeasurement Build expertise and infrastructure for Intellectual Property Rights (IPR) management Promote higher levels of industry-science collaboration POLICY REFORMS Reform of IPRs legal Framework for publicly-funded research Employment and Higher Education Laws encourage commercialization and collaboration with industry INVESTMENT T ECHNOLOGY T RANSFER O FFICES : provide assistance in the management and commercialization of research outcomes; training and expertise development for TTOs; link with TT intermediaries. F UNDING of Prototype Development and Proof-of-Concept; and Grants for industry-science collaboration Increased share of research pool coverage by TTO services Increased number of research results disclosed to TTOs Increased number of patents and other IPRs Increased licensing activity Larger number of spinoff companies Higher number and value of licensing agreements & spinoff companies Increased volume of contract research

R EGIONAL P ROGRAMS 1.A research excellence fund to increase international collaboration with the scientific Diaspora and expand opportunities for young researchers. 2.Regional networks of excellence in selected fields – consistent with a strategy for “smart specialization” of the region. 3.A technology transfer facility to support and provide assistance at national level 4.An early stage innovation facility to complement the support to be provided by the Western Balkan Enterprise Development and Innovation Facility (EDIF). The Western Balkans Innovation Strategy Exercise — (WISE)

Ministerial Conference on the Western Balkans Regional R&D Strategy for Innovation, October 25, Zagreb 12

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T HANK Y OU !