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The Czech Republic’s Position on the OECD Innovation Strategy

(This article expired 23.10.2014 / 16:00.)

The Czech Republic acknowledges the key role of innovation in improving economic performance and the competitiveness of economies and in ensuring sustainable economic growth, including challenges such as the ageing population and climate change. Therefore, it supports all OECD activities in this field, including the prepared Innovation Strategy.

The Czech Republic acknowledges the key role of innovation in improving economic performance and the competitiveness of economies and in ensuring sustainable economic growth, including challenges such as the ageing population and climate change. Therefore, it supports all OECD activities in this field, including the prepared Innovation Strategy.

We have no significant comments or suggestions to make about the draft report for the MCM on Innovation Strategy (document SG/INNOV(2010)1) or the draft Innovation Strategy (document SG/INNOV(2010)2). The documents accurately characterize trends in innovation and set out relevant indicators (education, patents, the impact on productivity, etc.) while identifying the priorities which should be addressed by government innovation support policy. They also confirm the emergence of countries like China and the other BRICs in science, technology and innovation.

Regarding access to innovation in general, the Czech Republic fully supports a broad interpretation of innovation, i.e. including non-technological (such as organizational and marketing) innovation, user innovation, innovation in services, etc., and agrees that each type of innovation may require a different kind of support, but that the whole system of support for science, research (R&D) and innovation must be coherent.

We view current efforts to improve the way the results of innovation policies are gauged in a very positive light. Only quality assessments of the impacts, results and effectiveness of our activities can identify our weaknesses and improve policies in the promotion of R&D and innovation. In this regard, we agree that the R&D indicators focused on inputs (e.g. the proportion of R&D expenditure in relation to GDP) are important, but we should also concentrate on outputs and impacts.Also, R&D monitoring indicators do not reflect fully the general understanding of innovation mentioned above. We also agree that merely observing patent numbers in different countries cannot show the degree to which inventions are used in practice and does not reflect the fact that certain types of new technologies are not patentable. Indeed, companies do not patent all their new technology, e.g. due to the costly patent systems in some countries.

In our opinion, the proposals for concrete economic-policy measures affect all major aspects of support for the transition to an economy based on knowledge and promoting innovation. We might mention, for example, the creation of framework conditions for innovative entrepreneurship, including the simplest possible legislative environment, a reduction in the administrative burden related to the procedures required to start up or close a business, arrangements concerning the access that enterprises, and start-ups in particular, have to financial resources, the effective protection of intellectual property rights, the reform of state education systems, and activities to promote the transfer of knowledge into practice, which is a persistent problem, for instance, in the EU. State financial support plays an important role in the promotion of innovation, both in science and basic research on the one hand and in the innovative projects of private companies on the other.Yet the effectiveness of such spending is often inadequate, and tools need to be developed to improve it.

In the spirit of the Innovation Strategy, the Czech Republic is faced with the challenge of building a knowledge-based economy producing high-tech products and products with high added value, while ensuring the efficiency of the public R&D sector. These challenges are among the priorities of the Czech Government.

In its longer-term, more structured approach, the Czech Republic must stand up for start-up innovative enterprises; the support is currently mainly material (technology parks), but in the future it will be necessary to promote these enterprises’ business skills in particular (i.e. business plans, marketing strategies, development plans and searches for subsidiary investments).

Innovative areas such as nanotechnology and biotechnology should be supported by a specific, longer-term support strategy in the Czech Republic (as is the case in the UK, the Netherlands and Germany).This is not limited to financial resources, but also includes legislative, personnel and marketing support for science, research and production.

The OECD’s innovation work (including the Innovation Strategy now being finalized) is also inspiring for the Czech Republic in the context of the ongoing reform of the R&D system, the main objective of which is to cultivate an innovative environment in which public funds invested in basic research must return genuinely new knowledge (and not only within the Czech Republic, but especially in comparison with the world). The Czech Republic can succeed in worldwide, globalized competition only if it has a smoothly operating knowledge triangle (research – education – innovation). Each of these three areas must be well structured, each of them must involve the public sector and private sector, and the interaction of these three areas must, as far as possible, be free from the formalities and barriers limiting the effectiveness of the system as a whole.

We welcome further cooperation between the Czech Republic and the OECD in this area; for example, we will look at how the current phase of the OECD Innovation Strategy project can best use the OECD’s knowledge base to successfully implement the reform of the R&D and innovation system in the Czech Republic.

 

As part of the preparations for the OECD Innovation Strategy, the Czech Republic hosted one of the regional High-level Roundtables in Prague on 30 and 31 March 2010 and made a voluntary contribution which will be used, among other things, to present the OECD Innovation Strategy in the Czech Republic in autumn 2010. 

Specific examples of R&D and innovation support in the Czech Republic

Regarding R&D and innovation support, in the Czech Republic it has been possible, since 1 January 2005, to apply a tax deductible item which essentially enables selected internal R&D costs to be reflected in the tax base for a second time (and is therefore equivalent to a subsidy covering the total cost at a percentage of corporate income tax without the numerous disadvantages of a subsidy).In the period 2007–2013, important tools for the direct support of R&D and innovation are the 2007–2013 Entrepreneurship and Innovation Operational Programme (EIOP) and the Research and Development for Innovation Operational Programme (R&DIOP).

An example of a technology transfer support project at regional level which helps to eliminate barriers in cooperation between companies and universities is “innovation vouchers”, an output of the South Moravia Region’s Regional Innovation Strategy 3.The aim is to promote cooperation between companies and universities in innovation-related development and problems.An innovation voucher is a lump-sum subsidy for the purchase of knowledge from the research community in South Moravia. Only small or medium-sized enterprises, from anywhere in the country, are eligible for these vouchers. Each voucher has a nominal value of CZK 150,000.The system of support through innovation vouchers is inspired by a similar instrument in place in the Netherlands, Ireland and other countries. Project costs are covered from the budget of the City of Brno and the first projects to receive funding were selected by lot in October 2009. Preparations are under way for the publication of a second call for applications (scheduled for April–June 2010); CZK 7 million is earmarked for this project in 2010.

International cooperation involving the Czech higher education system

An example of successful international cooperation by a Czech university is the Agent Technology Centre at the Czech Technical University’s Department of Cybernetics, which has been working with the US on defence matters since 1999 (e.g. with the US Air Force). In 2007, for example, the Centre cooperated in the development of the software prototype AgentFly, used for the collision avoidance of unmanned aircraft without a control tower. This year, the US military expressed an interest in a research project by Czech scientists at the above Department of Cybernetics designed to protect computer networks against cyber attacks.(Further information is available at http://agents.felk.cvut.cz/).

Up-to-date information on the OECD Innovation Strategy

www.oecd.org/innovation/strategy