Investing in innovation will reduce unemployment and poverty

COMMENT

“All happy families are alike; every unhappy family is unhappy in its own way.” This is the opening line of Anna Karenina, one of the best novels ever written. Through this unrivalled masterpiece, Leo Tolstoy sought to paint a full portrait of 19th-century Russian aristocracy. It is also an ideal starting point for those who seek to understand what a deviation from established and proven societal norms could amount to — a tragic end. 

Could this also be a frame of reference in our differentiation of successful economies or societies from unsuccessful societies? In other words, can it be said: all successful economies are alike; every unsuccessful economy is unsuccessful in its own way? If investment in research and innovation is a variable to consider, then the answer to the question is a resounding yes!

Innovation, in all endeavours of humankind, has always been at the heart of civilisation. Advances in natural, medical, engineering and social sciences have served to improve the quality of life, albeit in various degrees of measure. Our understanding of mathematics, physics and engineering has allowed us to send rockets to space, land a man on the moon and place rovers on Mars. The proliferation of mega-pharmaceutical and chemical industries in the last quarter of the 19th century and the first quarter of the 20th century was a direct consequence of breakthroughs in chemistry. Most of these multinationals are still in existence today and continue to play critical roles in our lives. 

The last century recorded the largest growth in human population compared to any other equal period in history. This was made possible by new frontiers in medicine, and discoveries of chemicals and processes that significantly increased crop yields, thereby allowing millions of people to be fed. Furthermore, industrialisation led to lower levels of unemployment and poverty. Therefore, the role of science in the advancement of human lives cannot be overstated.

South African innovation

South Africa too, has had its fair share of contributions to innovation, both locally and internationally. In 1950, the country founded the largest commercial-scale coal-to-liquids facility, Sasol, based on Fischer-Tropsch technology — a set of chemical reactions that converts gases to synthetic lubrication oil and synthetic fuel. Although this technology is of German origin, the design, synthesis and optimisation of the plant is South African and was preceded by many years of dedicated research and development. 

The first microwave electronic measurement equipment, the tellurometer, which proved groundbreaking for land-surveying globally, is a South African invention from the Council for Scientific and Industrial Research (CSIR) in 1954. 

In 1965, South Africa successfully designed and commissioned a nuclear reactor, SAFARI-1, which was later adapted to the production of radioisotopes for radiopharmacology use. This allowed the country to emerge as a world leader in nuclear medicine. The reactor is still in use today producing world-class science. 

The list is massive, but would not be complete without the mention of Rooivalk, the heavy vehicle simulator and the world’s first digital laser. These are all South African innovations that have changed the world for the better. All of them are underpinned by many years of research and development, and a significant amount of financial investment.

What is perhaps Tolstoyan in this narrative is that almost all the countries that could be considered world leaders in innovation also invest sizeably in research and development (R&D). Germany, the United States, Japan, Israel and South Korea have a gross expenditure on research and development (GERD) of more than 3% on average as a percentage of their gross domestic product (GDP). These countries also do not carry any significant economic burdens that result in massive levels of poverty, unemployment and inequality. 

Innovation reduces poverty

There is a circle of dependency in the investment in R&D and the reduction in poverty, unemployment and inequality. If we invest in R&D, the resulting economic expansion will, in the long run, reduce the burden of poverty, unemployment and inequality. If we focus solely on addressing the burden of poverty, unemployment and inequality at the expense of R&D, we shall, in the long run, have a worse burden of unemployment and poverty.  

In 2006, the 8^th ordinary session of the executive council of the African Union in Khartoum endorsed a call upon member states to raise their national GERD to 1% of GDP by 2010. This was indeed a cogent call. None of the member states, however, have achieved this goal to date. South Africa reached a peak of 0.95% in 2006, but there has been a steady decrease ever since. This figure is currently at about 0.7%, a significant deviation from the national target of 1.5%. 

The onset of coronavirus early this year has only served to compound the situation. This was the coup de grâce to an already ailing South African economy, thereby making any chance of achieving the set target even bleaker. It is no doubt that R&D, in particular, will not be spared in the raging economic storm. In essence, a number of critical public sector entities have received notices of significant funding cuts.

What then should South Africa do to salvage the gains made over the years and minimise the impact of the prevailing reality?

Changing the landscape

First and foremost, there should be a realisation that South Africa is too small a country to afford duplication of effort. The current situation should be the clarion call for stronger collaboration and tightening of strings within our ecosystem of innovation. We ought to maximise and leverage the regions of confluence and complementarity among various research entities in the country. Engineers know full well that a system, by its very nature, is an integrated framework wherein every part is meaningful to the whole. Our so-called National System of Innovation (NSI) lacks this fundamental character.

Secondly, all avenues of commercialisation or industrialisation that exist within our system of innovation should be seized and capitalised on. This calls for an urgent relook at our university model, where research is largely an intellectual exercise destined solely for journal publication. Where feasible, universities must become centres of innovation, while maintaining their reputation as sancta sanctorum of intellectual activity. Here, one is thinking of replicating parts of the Silicon Valley model. 

Thirdly, an environment must be created for industry or the private sector to invest meaningfully in R&D. For the past 10 years, the private sector has been trailing behind the public sector in GERD. To resuscitate our footing on R&D, this will have to change.

Fourthly, we need to rethink the NSI, made up of organisations that advance innovation in South Africa such as the CSIR, the National Research Foundation, the Medical Research Council, the Agricultural Research Council and others. 

We need to drop the “national” part of this acronym because this system of innovation should be international with strong linkages to the global centres of innovation such as Silicon Valley and Zhongguancun. It should rather be an Ecosystem of Innovation where the duplication of effort is minimised and aggregation of efforts maximised.

If we can achieve this, we stand a better chance of coming out stronger on the other side of the Covid-19 pandemic.