Cluster and Innovation Networks are Instruments to Increase the Competitiveness of Regions and Enterprises- are German Experiences Transferable to Kazakhstan?

Dr. Kurt Hornschild

Senior Executive DIW BerlinInnovation,Manufacturing Servicekhornschild@diw.de

Astana, 1-2 July 2010

Why are Cluster and Networks currently so important?

Within the last three decades we recognize an accelerating speed in structural change in the world economy and its markets. Driving forces are

firstly: world trade increases more than national production: exports and imports have an increasing share on national production and enterprises establish world wide new production places;

secondly: we have a rapid development of new technologies and their diffusion with an increasing share of the knowledge based service industry.

Results: increasing competition for enterprises, economies and regions; efficiency of the national innovation system is the most important factor for competitiveness

innovative networks and cluster create excellent conditions for regions and enterprises, they are good answers to these challenges.

• High intensity of knowledge

• High innovation potential

• Export capability

• Products are sold on markets with an increasing demand

• A combination of tacit (personnel knowledge, experience) and codified knowledge characterizes the production: quality (not the prize) is the main competition-parameter

• Capability to solve complex problems with technological high-quality solutions (increasing importance of high qualified services)

Characteristics of Growth Sectors

Chronology of German Innovation Policy – important steps of development

Until 1980: promotion of big enterprises and technologies (nuclear, air and space,…)

Up to 1980: the importance of SME and Start up has been acknowledged: promotion of R&D activities of SME, of Techno parks, of technology transfer

Up to 1990: additional promotion of R&D-collaboration, of innovative networks and the development of cluster; e.g. BioRegio (technology-specific); InnoRegio (technology unspecific, East Germany)

Up to 2000: High-tech strategy - a strategic concentration of measurements and innovation potential under one strategic aim. To be mentioned are: High-tech Cluster Competition, extension of SME-promotion (Program ZIM), reforms in the education sector and more investments in education.

High-tech – Strategy – a Paradigm Change

The High-tech-Strategy is Industrial Policy in a new shape: it combines elements of strategic planning and competition. Its aim is a better use of economic (regional) potentials.

A more intensive collaboration between enterprises, science and administration should support a process to bundle up (regional) competences in which strengths should be strengthened.

Within the High–tech-Strategy “High-tech-Cluster of Excellence” are a central measurement

Based on a convincing “Cluster-Concept” R&D should help to develop innovative products, processes, services in the region and accelerate their introduction into the market.

The winners of the Competition - in the maximum 5 – will receive in the period of

5 years in the maximum up to 200 Million Euro to realize their concepts in the cluster.

Why are Cluster nowadays so important?

Cluster are an effective combination of factors of success:

• They offer a scientific qualified and practice oriented executive training and have excellent offers for further education.

• They have a long term oriented R&D-Strategy

• The technology development is market-oriented

• They offer excellent conditions for Start up

• They have a strategic extension of international collaboration.

Elements of a Modernizing Policy for Kazakhstan - first Recommendations

• Modernizing Policy is Innovation Policy: Cluster und innovative Networks are therefore adequate organization forms

• The development of innovative Cluster should be promoted with promotion-programs, based on competition

• National Innovation System should be strengthened through an target-oriented collaboration of enterprises, science and administration

• Very important is the development of an efficient and innovative industrial sector in which SME and Start up are main elements

Are German experiences transferable to Kazakhstan?Yes, we have made good consulting experiences in the Republic of Bashkortostan (RB)

For more than four years German Experts work together with colleagues of the Republic of Bashkortostan to modernize its industry.

Starting points were two Tacis Projects, one for the Federal Government in Moscow and a following one for the RB.

Actually we do consultancy in a collaboration project “Modernizing the Industrial Policy of the RB”. Contractors are the German Ministry of Economy and Technology and the RB Ministry of Industry (Mr. Vagapov)

The Project has two key topics:

• Modernization the Industrial and Innovation Policy

• Development of Clusters, starting with ”machinery”, “wood industry”, “health/tourism”.

Are German Experiences Transferable to Kazakhstan? Yes, we have made good Consulting experiences in the Republic of Bashkortostan (RB)

Some results and activities:

• RB-Innovation Strategy

• Concepts for Techno parks

• Working groups to develop cluster and networks in the fields ”machinery”, “wood industry”, “health/tourism”

• Study-journeys to Germany

• Contact mediation to German enterprises and institutions

• Information transfer: presentations, round tables, events, consulting

Thank you for your attention!

If you have questions, please ask

Dr. Kurt Hornschild,

Senior Executive DIW Berlin

khornschild@diw.de