PROMOTING COMPETITIVENESS Investment in Value Addition and Technology Transfer CONFERENCE ON SOUTH-SOUTH COOPERATION CONFERENCE ON SOUTH-SOUTH COOPERATION SRI LANKA, AUGUST 2008 Prof Charles G Kwesiga Executive Director Uganda Industrial Research Institute

2 Outline of Presentation  Factors for success  Current regional status  Value Addition  Conclusion Subsequent discussion assume that EAC is a microcosm of the “South-South world”, albeit at the lower end economically

3 FACTS ABOUT EAC  Wealth of resources and favourable climatic conditions  Strong political commitment to EA Federation  Similarity of development profiles key to harmonization of policies, strategies and development agendas

4 Critical success factors: (i)Skilled manpower (ii)Optimal resource allocation (iii)Capacity for Technology Transfer (TT) and technology development (iv)Sound infrastructure (v)Effective value addition (vi)Quality of products and well designed processes (vii)Investment in R&D, Science and Innovation (viii)Promotion of regional trade and joint strategies for global market (ix)Good governance and political stability

5 Regional (EAC) Balance of Trade *Sources: British Chamber of Commerce Country Profiles (2002 – 2003) & CIA World Fact book (2004 – 2008)  Negative balance of trade due to excessive imports

6 Comparison of Regional & Select Country Balance of Trade  In contrast, Southeast Asian countries register positive & increasing balance of trade due to increased export of high value finished products $54.6 billion

7 Challenges faced in EAC Region  Post-harvest losses are very high  Exports are mostly raw materials  Lack of affordable financing  Lack of highly skilled workers  Importation of basic goods & services  Limited indigenous technology base  Low levels of entrepreneurship

8 World Technology Clusters

9 EXPORTS COMPARISON (The major difference is level of commitment to industrialization)

10 VALUE ADDITION  The state of our economies require, as a matter of priority, that we focus on value-addition.  This requires addressing several necessary conditions (e.g. TT, infrastructure, skills).  The guiding principle is the concept of the “Product Value Chain” which must be understood and adhered to.

11 FINANCE MICROFINANC E, BANKS, ETC. TECHNOLOGY (FARM IMPLEMENTS ) FARM INPUTS (SEED, FERTILISERS ETC. RESEARCH (e.g. NARO) TRAINING & EXTENSION SERVICES PRIMARY PRODUCT LOCAL MARKETS MARKET LOGISTICS EXPORT MARKET VALUE ADDED PRODUCTS RESEARCH (FOOD SCIENTISTS) TECHNOLOGY FOR AGROPROCESSING (Add Value) FARMER/FARM CONSUMERCONSUMER FACILITATORS ARE SALES PERSONNEL HARVESTHARVEST Facilitators Are EPB; AGOA, etc. The Product Value Chain Post harvest loss

12 Timelines for Technology development  Photography Modern Photography Pin Hole Camera 35 mm Camera Digital Cameras (Kodak DCS-100) yrs yrs 1991 Modern Photography Pin Hole Camera 35 mm Camera Digital Cameras (Kodak DCS-100) yrs yrs 1991 Modern Photography Pin Hole Camera 35 mm Camera Digital Cameras (Kodak DCS-100) yrs yrs 1991 Modern Photography

13 Timelines for Technology development b)Transistor was invented in 1947 and commercialized in 1953 (6 years later) Transistor yrs Vacuum tube diode1904

14 Consideration for effective TT  Operability of the technology in the intended environment  Infrastructure to sustain the technology  Availability of skills to work the technology  Sustainable supply of suitable raw materials  Intellectual property rights  Policies and other political, social and cultural issues

15 Key Players POLITICAL CLASS TECHNOCRATS PRIVATE SECTOR Stability Policy development Resources allocation Collaboration Implement policy Offer technical services Develop enterprises Promote products Effect industrialization

16 Collaboration between Institutions TECHNOLOGYTECHNOLOGY E N T R E P R E N E U R S H I P COLLABORATION IN RESEARCH MANPOWER AND ADVISORY SERVICES SKILLS IMPROVEMENT MANPOWER Industry (Private Sector) Technical and Tertiary Institutions University and Higher learning Institutions R & D Institutions Processes R&D Skills Incubation Innovations Products

17 WAY FORWARD  Invest in R&D and support R&D institutions  Establish science and technology academies  Reverse the brain drain  Invest in infrastructure that supports competitiveness  Establish TT regimes; create business incubators  Create a sustainable indigenous technology base  Joint trade missions  INVEST IN VALUE ADDITON; TECH TRANSFER; and WORK TOGETHER!

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