Baja California’s Business Development Policy: The next steps to reach a regional economy based on Knowledge & Technology

World class manufacturing EVOLUTION OF THE LOCAL ECONOMIC DEVELOPMENT STRATEGIES Productive Re-conversion Old national & regional industries Heightening of worldwide competition Worldwide Economic Recession Increasing loss of regional & national competitiveness Productive Chains & Clusters of high added value and technology InnovationPolicies FDIDrivenPolicies Local Innovation Systems of Organization Coming of the new economy BusinessDevelopmentPolicies Strategies for Development + + Added Value + + Technological Complexity   Business Clustering Strategy.   Focused on high added value and high technology business opportunities.   Value chain rapid scaling due to key and high added value projects.   Creation of capacities for the innovation, development of technologies with potential for commercialization.   HC in research, development & design.   Support to previously established industries   Attraction of OEM, EMS, Manufacturing Capabilities

Federal Competitiveness Program Business Development Policy VOCACIÓN1VOCACIÓN1 VOCACIÓN2VOCACIÓN2 VOCACIÓN3VOCACIÓN3 VOCATION FOR TECHNOLOGICAL INNOVATION A. A.High concentration of PhD's and technologists in BC B. B.Closeness to the most innovative regions in the world (SD, Silicon Valley, etc.) C. C.Experience in world class manufacturing of high-tech products Cluster 1Cluster n Local Innovation Systems of Organization 1 State Economic Development Plan Inhibitors Projects Champion Projects Champion State Business Council Economic Development Law Investment Promotion (FDI Attraction) Business Development Strategy (Incentives & support) Update of the State Development Plan Path reorientation and evaluation V O C A C I Ó N n… Innovation & Technology Development Policy Cluster 2 Local Innovation Systems of Organization 2 Projects Champion Strategic Level Operative Level Strategy for the development of technology and innovation resources & capabilities

Added Value Pre-manufacturingManufacturingPost-Manufacturing Research & Development Fabrication of Strategic Components Fabrication of non strategic components New Products Design Package & Assembly Customization Logistics & Distribution Brand Development / Mkt Post sale services DISTRIBUTION OF THE BUSINESS VALUE CHAIN The function of innovation in the productive & economic escalation strategy L1L5 Innovation &Technology Development Strategy Value Chain Control Participate in product introduction stage Brand and mark-up (overpricing)

BC Strategy: BC Strategy: Create Local Innovation Systems of Organization Centered on Research+Development+Design Taking advantage of current regional & environment conditions: Solid Scientific Base + Closeness to the US+ World Class Engineering  Create Conditions for I+D+D  Solid Financing Policy  Infrastructure (Technology Parks)  Fortify Innovation Agencies (BCInnova, BorderTech, PRODUCEN, CENTRIS, etc.)   Business Development Policy   High-tech Clusters (6)   Technology Innovation in traditional Clusters   New technology based companies   Science & Technology Policy   Scientific networks (UABC-CICESE- UNAM-IPN)   New centers for the development of high level human capital   Talent Development Policy   Science Museums   Children Follow-up (beginning from 8 up to 17 years) Local Innovation Systems of Organizaton I+D+D 3 suns Mexicali Tijuana-Tecate- Rosarito Ensenada BASE POLICIES DRIVING & PROMOTING POLICIES   Create Capacity for I+D+D   Seed Projects (CENI2T, Design Centers, Incubators, etc.)   High-tech / R&D Investment Attraction   Promote the development of new technology based businesses

¿ What does it mean to Baja California to be the national leader of the new economy ? Be able to gain a substantial amount of private annual investments in activities and businesses (companies, labs & R&D Centers) centered in strategic high-tech areas high added value jobs related to knowledge & technology Generating high added value jobs related to knowledge & technology in the next 8 years Provide Mexico and its partners the opportunity to participate locally in high added value business and activities of the product development value chain These activities will generate a constant flow of young entrepreneurs and new local companies based on technology. Provide BC high global visibility as a technological leader in Mexico & in Latin America best investment projects Attraction of the best investment projects in manufacturing and high added value and technology services in Latin America. Baja California: Technological &Knowledge Frontier

Innovation & Technological Development in the industrial & cluster development policy of Baja California EMBRIONICMATURITYGROWTHAGING SEMICONDUCTORS AUTOPARTS AEROSPACE PARTS MEDICAL PRODUCTS SOFTWARE CONSUMER ELECTRONICS SPECIALIZED ELECTRONICS PERSONAL COMPUTERS APPERAL (TEXTIL) Emerging Industries Industries at risk BIOTECHNOLOGY Innovation & R+D Innovation & R+D is a critical factor for the growth of emerging industries Innovation & R+D Innovation & R+D is a critical factor to reach added value and diversification in mature industries

Baja California: Knowledge & Technology Frontier