Estonian RD&I policy new strategy in preparation. Dr. Indrek Reimand Deputy Secretary General for Research and Higher Education

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1 Estonian RD&I policy new strategy in preparation Dr. Indrek Reimand Deputy Secretary General for Research and Higher Education Tallinn,

2 Estonian context Very small country Still having its own language based culture and higher education system R&D needs to balance between specialisation and cultural/educational coverage Very dynamic Unfavoured starting point, but catching up No stabile economic structure to align the research system Very lean government Very simple tax structure (no tax incentives for R&D) Very e E-banking 99% of transactions European largest Public Key Infrastructure First e-elections in the world

3 R&D is growing fast GERD / BERD Publications Patents FP success

4 4,00 R&D expenditure (GERD) in 2011, % of GDP 3,50 3,00 2,50 2,00 1,50 1,00 0,50 0,00 Source: Eurostat

5 CURRENT RD&I STRATEGY AND RECOMMENDATIONS

6 Estonia in European Innovation Survey

7 Thematic foci of current RDI strategy Estonian strategic RDI priorities are chosen to support research-driven, technology-driven and problem-driven R&D. Three of the seven national programs are selected with a technological focus ICT, biotech and material technologies) Four are focusing on societal challenges energy, defence and security, health care and welfare services, environmental protection.

8 Targeting R&D during growth ~ 25% growth per annum cannot be very focussed Broad focusses apply! No stabile economic structure exists (fast restructuring even before crisis) to align the research system R&D should be aligned with future economic structure R&D policies concentrate to basic values: People, quality, enterpreneurship, infrastructure and cooperation On the verge of change of economic structure (critical phase, metastability) R&D may drive economic changes

9 ERAC peer review findings OUTSTANDING PROGRESS, BUT NOT WITHOUT CHALLENGES Overall conclusions Steady progress driven by quality, excellence and competition Innovation system detached from vast part of the economy Challenge to further develop RDI system to make a difference in the economy & society at large Upgrade the role of Estonian industry in the global value chains Lack of trained personnel hinders growth and investments

10 ERAC peer review - some recommendations Perceive RDI as a means to achieve economic and societal goals Priorities directly responding to the needs of Estonian society and the economy More clear focus for Estonian RDI programmes linked to the implementation of the new national strategy Fewer programmes of key importance Ensure coherent and systemic RDI policy Attention on coordination and implementation of policies Stronger horizontal coordination by RDC Harness RDI measures to drive structural change in the economy

11 ESTONIAN RD&I STRATEGY

12 Estonian RD&I strategy The terms of reference for the new Estonian RD&I strategy were approved by the Government in June Ministry of Education and Research is in charge of drafting the strategy in close cooperation with other ministries. The new RD&I strategy has to be in compliance with the National Reform Programme, Estonia 2020 strategy and Entrepreneurial Growth Strategy 2020

13 Goals Main goal: Good framework conditions for development and making social and economic effects of RD&I Targets 2020: GERD 3%, BERD 2% of GDP (2011: 2,41% and 1,52% of GDP) 10. place in innovation Union Scoreboard (2011: 14. place) Productivity per employed 80% of EU average (2011: 68%) Specific goals: Research excellence and versatility Increasing the socio-economic impact of R&D Changing economic structure: smart specialisation Estonia is active in international RD&I cooperation

14 Excellence and versatility Estonian research is competitive and visible in the world, while covering main directions. Estonia is an attractive place for RD&I. Research career is valued. Targets 2020: Scientific publications among the top-10% most cited publications worldwide as % of total scientific publications of the country), 11% (2010: ~ 7,5%) PhD degrees awarded per year 300 ( )

15 Increasing socioeconomic impact of R&D R&D is oriented to the needs of society and economy, appreciating applications. RPO-s cooperate with business and government. State is a smart procurer of research Targets 2020: Government budget appropriations or outlays on R&D (GBAORD), except General Advancement of Knowledge: 40% (2011 estimated ca 30%) Share of publicly-performed research financed by business 7% (2011 2,95%)

16 Changing economic structure: Smart Specialisation Research system actively contributes to change economic structure. Share of knowledge-intensive business is growing. Value added in export has grown Targets 2020: Employment in high and medium tech sectors 9% (2010 6%); Export share of high tech products and services 15% ( ,4%)

17 Smart specialisation: How will we do? Selected growth areas will have dedicated support programmes The growth areas are selected by Estonian Development Fund using OECD/EC Smart Specialisation methodology The economic and research profile quantitative analyses are made by Enterprise Estonia, Estonian Research Council and leading economists. The growth areas will be supported comprehensively by different policies and strategies Problems methodological limitations: Smallness of the region, Quantitative versus qualitative approach Balance between horisontal and vertical measures (the degree of specialisation)

18 The growth areas The tentative growth areas has been chosen : ICT supporting other sectors IKT usage in industry Cyber security Health technologies and services biotechnology e-health Resource efficiency Material science and industry Innovative building industry Health promoting food industry Chemical industry (oil shale)

19 Timeline for the strategy In June the draft of the strategy will be consulted in Research Policy Commission and R&D Council. The strategy will be submitted to the Government in June together with the Entrepreneurial Growth Strategy According to the law, the RD&I strategy has to be approved by the Parliament - the expected time is autumn 2013.

20 Thank you! Dr. Indrek Reimand Deputy Secretary General for Research and Higher Education Ministry of Education and Research Munga 18, Tartu Tel.:

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