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Finnish Case Final 100 S E R I E comercio internacional Building long term strategies and public-private alliances for export development: the Finnish case Thomas Andersson Division of International Trade and Integration Santiago, Chile, April 2010 This background document was prepared by Thomas Andersson, Consultant of the Division of International Trade and Integration, Economic Commission for Latin America and the Caribbean (ECLAC), within the activities of the study “Public-private alliances for innovation and export upgrading”, coordinated by Robert Devlin and Graciela Moguillansky, with the financial support of Comité Innova de CORFO (Government of Chile), through the project “La Innovación en el contexto de Alianzas Público-Privada para la Inserción Internacional”. Some of their preliminary findings were formerly presented at ECLAC, in Structural Change and Productivity Growth 20 Years later: Old Problems, New Opportunities , (LC/G.2367 (SES.32/3)), Santiago de Chile, 2008, chapter. VI, pages. 231 to 299. The views expressed in this document, which has been reproduced without formal editing, are those of the authors and do not necessarily reflect the views of the Organization. United Nations Publications ISSN printed version: 1680-869X ISSN online version: 1680-872X ISBN: 978-92-1-121726-1 LC/L.3155-P Sales No.: E.09.II.G.128 Copyright © United Nations, April 2010. All rights reserved Printed in United Nations Applications for the right to reproduce this work are welcomed and should be sent to the Secretary of the Publications Board, United Nations Headquarters, New York, N.Y. 10017, U.S.A. Member States and their governmental institutions may reproduce this work without prior authorization, but are requested to mention the source and inform the United Nations of such reproduction. CEPAL – Serie Comercio internacional N o 100 Building long term strategies and public-private alliances for export… Contents Abstract .................................................................................................7 I. Overview of succesful economic performance ..........................9 A. Some general characteristics..................................................9 B. Economic development........................................................12 C. Education..............................................................................13 D. Macroeconomic and labour policy.......................................15 E. Infraestructure ......................................................................15 F. R&D investment...................................................................17 G. Growth of the ICT industry..................................................21 H. The Finnish model................................................................24 II. The public strategies underpinning economic transformation and development ................................................25 A. Trade and external capital liberalization..............................25 1. FDI liberalization..........................................................25 2. Trade liberalization.......................................................27 B. Industrial and business strategies.........................................30 1. Business structure.........................................................31 2. The Finnish tax system.................................................32 3. Seed capital...................................................................33 4. SME policy...................................................................34 5. Public procurement.......................................................34 III. How contemporary innovation strategies developed ..............35 A. The Finnish innovation system.............................................36 B. The Science and Technology Policy Council of Finland and the innovation policy....................................37 C. The major implementing agencies........................................39 3 CEPAL – Serie Comercio internacional N o 100 Building long term strategies and public-private alliances for export… 1. The Academy of Finland....................................................................................................38 2. The Finnish Funding Agency for Technology and Innovation (Tekes) .............................40 3. The Finnish National Fund for Research and Development (Sitra)...................................41 4. The Technical Research Centre of Finland (VTT).............................................................42 5. Finnpro and Finnerva..........................................................................................................42 D. Private-public alliance................................................................................................................42 E. The cluster approach ..................................................................................................................44 F. Cooperation programs ................................................................................................................45 G. University cooperation and links to private interest ..................................................................46 IV. Implementation strategies for innovation promotion ...........................................................49 A. How implementing activities are coordinated among agencies .......................................................49 B. Funding.......................................................................................................................................50 C. Evaluation mechanisms..............................................................................................................51 D. Main innovation and policy changes..........................................................................................53 Bibliography .....................................................................................................................................57 Annexes .............................................................................................................................................61 Annex 1: Networked support of innovation.......................................................................................63 Annex 2: The Science and Technology Policy Council ....................................................................67 Annex 3: The Academy of Finland....................................................................................................69 Annex 4: Finnish Funding Agency for Technology and Innovation (Tekes) ....................................73 Annex 5: Innovation and Technology for SME.................................................................................79 Serie Comercio Internacional: Issues published ...........................................................................83 Table index TABLE 1 GLOBAL COMPETITIVINESS INDEX.............................................................................11 TABLE 2 FINNISH INNOVATIVE CAPACITY INDEX, 2004.........................................................11 TABLE 3 FINNISH INNOVATIVE CAPACITY INDEX, 2004.........................................................16 TABLE 4 EVALUATION TECHNIQUES...........................................................................................53 TABLE 5 NATIONAL INNOVATION GOVERNANCE: SWOT OVERVIEW ................................54 Box index BOX 1 EDUCATIONAL EXPENDITURE AND PERFORMANCE..............................................14 BOX 2 SUMMARY OF FINNISH INNOVATION POLICY..........................................................23 BOX 3 FEATURES OF THE FINNISH MODEL............................................................................24 BOX 4 STRUCTURE OF STPC AND OPERATION......................................................................38 BOX 5 STRUCTURE OF TEKES AND ITS MAIN ACTIVITIES.................................................40 BOX 6 THE NATIONAL TECHNOLOGY PROGRAMS...............................................................46 BOX 7 TEKES: EVALUATION OF PROGRAMS IN ELECTRONICS AND TELECOMMUNI.52 Figure index FIGURE 1 GDP VOLUME IN FINLAND AND OECD EUROPE........................................................10 FIGURE 2 FINLAND’S STAGES OF INDUSTRIAL AND ECONOMIC DEVELOPMENT .............13 FIGURE 3 EDUCATIONAL EXPENDITURE, 2004............................................................................15 FIGURE 4 TELECOMMUNICATION ACCESS PATHS.....................................................................16 FIGURE 5 R&D INTENSITY, 2004 ......................................................................................................17 FIGURE 6 NUMBER OF RESEARCHERS...........................................................................................18 FIGURE 7 NUMER OF TRIADIC PATENT FAMILIES......................................................................19 FIGURE 8 NUMBER OF SCIENTIFIC PUBLICATIONS, 2001..........................................................20 4 CEPAL – Serie Comercio internacional N o 100 Building long term strategies and public-private alliances for export… FIGURE 9 HISTORICAL OVERVIEW OF R&D EXPENDITURE.....................................................20 FIGURE 10 R&D EXPENDITURE IN RELATION TO GDP AND SECTOR, 2003.............................21 FIGURE 11 GROWTH IN ELECTRONICS SINCE THE EARLY 1990S, FINNISH MANUFACT.....22 FIGURE 12 ICT DATA............................................................................................................................23
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