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Important Determinants of Innovation and Knowledge Generation

S&T and R&D are important determinants of innovation and knowledge generation and need to be given greater emphasis.

Countries with the right conditions stand a better chance of moving ahead through innovation than those countries that still hold to traditional and obsolete methods of governance.

Innovation can only happen in places where there is encouragement for new ideas.

Without the right conditions the most talented and most creative brains will migrate to places where they are able to do their best work.

This can plainly be seen in the world’s most inventive and most innovative nations which are also the world’s richest and most powerful nations.

Switzerland, Finland, Sweden, Netherlands and Denmark are in the top 10 global ranking of the Economist Intelligence Unit 2004-2008 innovation performance study, and all have a population smaller than Malaysia’s.

These five European countries also are listed in the top 10 rankings of the World Economic Forum’s Global Competitiveness Index 2008-2009.

Malaysia achieved 4 patents per million populations in the Economist study for 2004-2008. Japan had 1,274 patents per million populations. Taiwan (293 patents), South Korea (148), Singapore (111) and Hong Kong (67) performed far better than Malaysia in patents output.

Malaysia’s gross expenditure on R&D as a proportion of GDP in 2006 was 0.64 percent although it targets to increase gross expenditure to 1.5 percent by 2010, according to the Malaysian Economic Planning Unit (EPU).

Malaysia had a ratio of 17.9 researchers to every 10,000 labour force in 2005. The figure placed Malaysia well below those in Singapore (87.4), South Korea (89.8) and Japan (202.8). Malaysia was even behind South Africa (20.7) and Turkey (25.3), says the EPU.

Ericsson, the world’s biggest telecommunications equipment supplier, has 25,000 people around the globe working day and night on R&D. That number is more than half the researchers Malaysia had in 2005.

Intellectual property is a measure of a country’s ability to create wealth year after year and across the world, and it is no surprise that the developed world has the most number of patents.

Most companies in Malaysia treat intellectual property merely as a means of protection for their products. They do not see the potential in creating wealth out of IP.

Innovation should be industry-led. Industry has developed the skills and the capacity to compete and win.

The process of innovation must also involve the people who run the government’s approval system. Government agencies must support and facilitate the private sector to enable it to be at its competitive best.

The government must ensure at all times that there is compatibility between the public and private sectors. The government must lend active support to build Malaysian companies to enable them to succeed, to empower them to compete globally.

We must make the development of creativity and innovation a national agenda.