The countries of Latin America and the Caribbean are making comparatively low investments in research and development, and the region’s private sector is also comparatively under-represented in R&D spending, according to a new study by the Inter-American Development Bank.
Through a comparative analysis of R&D investments in developed countries, the study, entitled “The need to innovate,” concludes that companies in Latin America and the Caribbean have favored technology procurement strategies instead of promote endogenous generation of technology and new ideas.
Data from 2007 show that on average, in Latin America and the Caribbean there is only one investigator per 1000 people in the workforce, compared to around seven investigators per 1000 employees in countries belonging to the Organization for Economic Cooperation and Development (OECD).
All this translates into very low performance when it comes to innovation, and the study points out that the problem may be getting worse. The number of new patent applications per 100,000 inhabitants—a standard indicator of innovation—fell from 6.5 the years 1995-1998 to 5.5 in the years 2005-2008, for example.
"Innovation today is an imperative for the development of all countries, and Latin America and the Caribbean is no exception,” said Flora Montealegre Painter, head of the IDB's Science and Technology Division. “The countries of the region cannot keep postponing the required investment in innovation and technological development needed to achieve levels of productivity and growth that will enable a substantial improvement in the quality of life of their populations."
Painter said that the IDB has worked since its founding to promote science and technological development in the region and is committed to continuing its support. “We work to increase investment in science and technology, encourage more effective innovation policies, and generate new strategies to facilitate innovation and the development of transformative industries like information technology and communications," she added.
An example of the IDB’s recent work in this sector is the Regional Innovation Systems (CRS) launched by the Bank this year in Brazil. This technical cooperation aims to support the strengthening of regional innovation systems in the states of Minas Gerais, Santa Catarina, Paraíba and Alagoas as a pilot project to identify actions and priorities for assistance in the area of innovation in Brazil. The program has the support of national institutions (Agencia Brasilera de Desarrollo Industrial, Confederación Nacional de la Industria, Consejo Nacional de Secretarios Estaduales para asuntos de Ciencia Tecnología e Innovación) and International (Agencia Española de Cooperación Internacional para el Desarrollo). Although Brazil is the Latin American country that spends the highest percentage of GDP to innovation, it faces the challenge of effectively coordinating the actors involved in innovation processes. The IDB is consequently helping Brazil to strengthen coordination between government, research institutes and enterprises.
"The disconnect between what is studied in universities and companies is a major challenge in Brazil and throughout Latin America," added Painter. "Our interest is to strengthen regional sustainable development, focusing on innovation sponsored by companies."