PROMOTING COMPETITIVENESS Investment in Value Addition and Technology Transfer

1. CONFERENCE ON SOUTH-SOUTH COOPERATION SRI LANKA, AUGUST 2008 PROMOTING COMPETITIVENESSInvestment in Value Addition and Technology Transfer 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: • Skilled manpower • Optimal resource allocation • Capacity for Technology Transfer (TT) and technology development • Sound infrastructure • Effective value addition • Quality of products and well designed processes • Investment in R&D, Science and Innovation • Promotion of regional trade and joint strategies for global market • Good governance and political stability

5. Regional (EAC) Balance of Trade 2002 2003 2004 2005 2006 2007 2008 • Negative balance of trade due to excessive imports *Sources: British Chamber of Commerce Country Profiles (2002 – 2003) & CIA World Fact book (2004 – 2008)

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

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. FACILITATORS ARE SALES PERSONNEL LOCAL MARKETS FINANCE MICROFINANCE, BANKS, ETC. RESEARCH (e.g. NARO) C O N S U M E R PRIMARY PRODUCT FARMER/FARM H A R V E S T MARKET LOGISTICS VALUE ADDED PRODUCTS TRAINING & EXTENSION SERVICES RESEARCH (FOOD SCIENTISTS) FARM INPUTS (SEED, FERTILISERS ETC. TECHNOLOGY (FARM IMPLEMENTS) EXPORT MARKET TECHNOLOGY FOR AGROPROCESSING (Add Value) Facilitators Are EPB; AGOA, etc. The Product Value Chain Post harvest loss

12. Modern Photography Modern Photography Pin Hole Camera Pin Hole Camera 35 mm Camera 35 mm Camera Digital Cameras (Kodak DCS-100) Digital Cameras (Kodak DCS-100) 1727 107 yrs 1834 157 yrs 1991 1727 107 yrs 1834 157 yrs 1991 Timelines for Technology development • Photography Modern Photography Modern Photography Modern Photography Modern Photography Modern Photography Pin Hole Camera 35 mm Camera Digital Cameras (Kodak DCS-100) 1727 107 yrs 1834 157 yrs 1991

13. Vacuum tube diode 1904 43 yrs Transistor 1947 Timelines for Technology development • Transistor was invented in 1947 and commercialized in 1953 (6 years later)

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 • Stability • Policy development • Resources allocation PRIVATE SECTOR TECHNOCRATS Collaboration • Implement policy • Offer technical services • Develop enterprises • Promote products • Effect industrialization

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

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!

18. Thank you !