Looking at the dictionary, the word ‘Innovation’ means revolution or upheaval. Generally, the word is almost always synonymously used with ‘Invention’ as well. The ‘Innovation’ we are going to look at here however, means progress. More specifically, the progress of the world and Bangladesh in overall sectors with a primary focus on the economy. The insight will be sought through the eyes of the Global Innovation Index (GII) 2022. The World Intellectual Property Organization (WIPO), in collaboration with the Portulans Institute and with the assistance of its corporate partners, released this year’s edition of The GII 2022 in September.
Based on 81 parameters, the GII 2022 presents the most recent global innovation rating of 132 economies. The question this year’s report tries to answer is, “What is the future of innovation-driven growth?” The GII 2022 also describes the advantages of two waves of original innovation. The report underlines that these advantages would take time to materialize. Said advantages are:
1. A wave of innovation from the digital age based on automation, artificial intelligence, and supercomputing. The effect of which would be making significant productivity impacts across all industries and scientific disciplines.
2. Discoveries in biotechnology, nanotechnology, novel materials, and other sciences were the foundation for a Deep Science innovation surge. This advantage would affect revolutionising advancements in food, environment, mobility, and health.
WIPO had some special findings in their annual report regarding the expenditures and growth of Research and Development (R&D) worldwide. The contemporary world puts much emphasis on R&D and attracts significant investors towards it. So, it evidently plays a significant role in the economy. These findings are:
1. Despite the COVID-19 pandemic, research and development (R&D) and other investments that fuel inventive activity continued to soar in 2021.
2. Prior to the pandemic in 2019, the top global corporate R&D spenders boosted their R&D spending by approximately 10% to over USD 900 billion in 2021.
3. Four industries, including ICT hardware and electrical equipment, software and ICT services, pharmaceuticals and biotechnology, and construction and industrial materials, were principally responsible for this surge.
4. For the top R&D expenditure economies, government budget allocations showed a significant rise in 2020. Budgets for government R&D in 2021 showed a more mixed picture, with rising spending in Germany and the Republic of Korea and declining investment in the US and Japan.
5. The fastest-growing Venture Capital markets are in Latin America, the Caribbean, and Africa.
Here are some quick highlighted facts and takeaways from this year’s GII report:
1. In the GII ranking, Canada rose to the 15th spot, leading “in joint venture and strategic alliance partnerships, venture capital beneficiaries, and computer software spending.”
2. In terms of “innovation indicators, including global corporate R&D investors, venture capital investors, the quality of its universities, the quality and impact of its scientific publications, and the value of corporate intangible asset intensity,” the United States of America moved up to the second place.
3. Eight Latin American and Caribbean economies made progress in the rankings. The top 60 are Mexico, Brazil, and Chile.
4. The majority of innovation leaders in the top 25 are still found in Europe.
5. For the past 12 years, Switzerland has been at the top of the list and has excelled “in metrics like researchers, R&D spending, and knowledge-intensive jobs.”
6. Indicators like researchers, R&D spending, and knowledge-intensive jobs showed that Sweden was at the top.
7. In terms of exports of ICT services, India continues to lead in the world.
8. Israel tops the list for advanced degree-holding female employees, venture capital investments, and PCT applications submitted.
9. Fourth in terms of intangible assets, Turkey made it into the top 40.
10. In terms of market value, South Africa tops the list, and Kenya holds the record for the longest winning streak, which continued for 12 years.
11. Vietnam “dominated the world in high-tech imports,” Indonesia “led the world in entrepreneurial policies and culture,” and the Philippines “led the world in high-tech exports.”
The report goes a great length explaining and painting a picture of the initiatives undertaken by various governments. These initiatives are considered to be the key to future progress. India has been perhaps one of the most noticeable in this field. For example, India has been a booming hub for Startups in recent years. After the US and China, India now has the third-largest startup ecosystem in the world and is home to more than 100 such businesses. A few additional initiatives such as the Startup India Initiative to build a robust startup ecosystem; SAMRIDH programme to develop a supportive environment for new Indian software product companies; and Startup India Seed Fund to provide financial assistance to new startups have played a crucial role. Also, with well over 700 million users and a projected increase to 974 million by 2025, India is the nation with the fastest-growing Internet usage. Additionally, 40% of all real-time digital transactions worldwide last year took place in India.
Bangladesh vs. Vietnam: A Comparison
The GII 2022 lists both Bangladesh and Vietnam as lower-middle-income economies. Yet still, Vietnam placed much higher than Bangladesh in the index. Vietnam placed 48th with 34.2 points, and Bangladesh placed 102nd with 19.7 points. Vietnam placed 2nd among the lower-middle-income countries, just short of India, with a performance that was above expectations for the level of development. Bangladesh, on the other hand, as was indicated in the report, barely placed among the countries that were keeping up with their projected line of development. Question is, with all the efforts made, why is Bangladesh falling so far behind?
A picture of Vietnam’s performance will help ease some aspects of that question. Vietnam was ranked second out of 36 economies in the lower-middle-income group, making it the region’s innovation leader. Vietnam, which exhibits mild competition with other nations in the region, is ranked 10th out of the 17 economies in Southeast Asia, East Asia, and Oceania. Even still, this year wasn’t Vietnam’s best, as they were placed better in 2020 and 2021.
Vietnam performed exceptionally well in terms of output performance, demonstrating that its investments in innovation are yielding high returns and high-quality outputs. With an average GDP per capita of about $9,250 USD, Vietnam is already performing better than anticipated, given its stage of development. Vietnam is the most innovative nation among the economies in the lower-middle income group, as opposed to other nations with comparable GDP per capita but substantially lower GII scores. In fact, statistics revealed that the nation beats the group average in all GII pillars, including infrastructure, knowledge and technology outputs, human capital and research, market maturity, business finesse, and creative outputs. Vietnam’s performance is particularly exceptional in the creative output pillar when compared to Southeast Asian, East Asian, and Oceania countries. In contrast, the regional average eclipsed performance in other categories.
The index does indicate that Bangladesh moved up in rank. But the change remained almost the same as remaining stagnant. According to the report, Bangladesh improved in terms of intangible assets, online creativity, and creative outputs. Be that as it may, the country could not perform as well in some crucial sectors as expected. For example, Human Capital and Research was one of the leading elements to be factored in while defining the gross innovation of a country. Vietnam performed much better (71st) than Bangladesh (127th), which immensely boosted the country to perform better in the economy. Also, in terms of Infrastructure and Business Sophistication, Vietnam showed tremendous growth compared to Bangladesh. These elements are essential indicators and contributors to the growth of a nation. Sadly, Bangladesh did not show much improvement in this respect. The intangible assets intensity of the country was one of the best in the world (27th), but factoring in all other elements, the country fell far behind. The infrastructural improvement, as well as attaining business sophistication and knowledge and technology outputs needs to be pushed further if the country is to reach a better innovation milestone in the future.
Vietnam has been an exemplary nation for innovation. Clustering among the lower-middle-income countries, they have been constantly endeavoring to do better. Being in that same cluster, Vietnam can be a great inspiration for Bangladesh. While keeping up with the increasing rate of GDP, the country must take up new initiatives to welcome and hone ventures which will define the future.
Author- Shiddhartho Zaman
