Research, Economic Development, Competitiveness are Intertwined, Fill the Policy Gap

Research and development (R&D) refers to investigative activities conducted to identify and address challenges or improve existing ways of doing things through innovation of new technologies. Public or private organizations engaged in the production of goods and services conduct R&D to improve product quality, productivity, and service delivery.
The budget organizations allocate to R&D is a significant factor to its outcomes. Countries and organizations that have realized this allocate a significant deal of resources to Research. Although Ethiopia is hugely investing in the education sector, it’s one of the countries known for allocating insignificant amount of resources for R&D. Even with a robust economic growth experienced for over 10 years, the country keeps to allocate small budget. EBR has explored the issue to offer this report.

A number of data indicate that developing countries like Ethiopia invest far less in Research and Development (R&D) as a share of their gross domestic product (GDP) than developed nations. However, globalization is fostering diffusion of technology. This is necessitating an increased spending on R&D in poorer nations to improve their absorptive and national learning capacity needed to exploit technological advance originated in richer countries.
Ethiopia, a country that is striving to industrialize by unlashing its untapped resources and import of machineries necessary for this economic revolution, is paying little attention for R&D activities.
According to the 2017 African Capacity Report published by African Capacity Building Foundation (ACBF), released three months ago in Addis Ababa, Ethiopia spends 0.61Pct of its GDP on R&D. Of course, the index is based on the survey conducted in 2013 and published in May 2014, by the Science and Technology Information Centre (STIC), which is the research wing of the Ethiopian Ministry of Science and Technology (MoST). The expenditure, which increased to 0.61Pct in 2013 from 0.24Pct in 2010, is estimated at ETB5.2 billion, based on the 2013 GDP volume, which was ETB852.7 billion.
“The figure is expected to remain at least less than 1Pct of GDP for the coming few years. Though the economy is growing faster the attention given to R&D is not tantamount to it.” Daniel Taresa, Director of R&D Analysis at STIC told EBR. Daniel mentioned the problem in their part that “though MoST has tasked the STIC to survey R&D expenditure every two years, no such report is produced since 2014, due to financial constraints.”
R&D activity in Ethiopia is as old as the establishment of the two pioneering higher education institutions, the College of Agriculture (Haremaya University now) and Hailesilassie University College (now Addis Ababa University) in the 1950s. The research outputs from these institutions were predominantly theoretical and were published in the 1960-70s.
The establishment of research oriented institutions such as Ethiopian Agricultural Research Organization (EARO) and Ethiopian Nutrition and Health Research Institute (ENHRI) added to the budget stress only securing limited amount of budget allocated and significant amount of their budget from donors. Documents acclaim the role of Sweden International Development Agency (SIDA) in funding research activities in Ethiopia. Another new development was the Ethiopian Science and Technology Commission (ESTC) introduced local R&D grant scheme in 1999 available for local research activities.
All paradigms of research undertakings are to further develop human life in expanding knowledge changing practices and introducing innovative ways of doing things. This indicates that all types of research packages (pure, applied and experimental) share the related purposes.
Researching is an excellence that develops though experience and continues growing. That’s why, “developing nations such as Ethiopia cannot simply copy latest technologies from the developed countries, due to the wide gap of knowledge and expertise between developed and developing countries,” argues Abdi Yayu (PhD), a researcher and head of School of Humanities and Social Sciences at Adama Science and Technology University (ASTU). There needs to be a step by step progress in the ladder of excellence though learning from others is not bad in itself. For this Abdi proposes increased investment on R&D in order to select, copy, customize, innovate and diffuse technological advancements to enterprises, and finally fuel sustainable economic growth.
Abdi presented a study entitled ‘Does Innovation Improve the Productivity of Firms in LDCs? Evidence from Ethiopia’s Enterprise Survey’, during the Second International Research Symposium held in Adama. The three days symposium, under the theme ‘Ensuring Sustainable Development through Research in Science and Technology’, lasted from June 10-12, 2017.
“Low export diversification and less innovation are the basic signs of economies that have low gross domestic expenditure on R&D to the share of GDP.” explains Daniel. Such economies export is low and limited to agricultural commodities. They largely depend on huge importations. As this is the fact on the ground Ethiopia should think about investing more on R&D.” he advises.
Innovation has become central to economic growth. Innovation activities include R&D, knowledge generation and transfer and the adaptation of technologies. As a result, the ability to design, carry out, assign, determine and run R&D activities is an important aspect of economic development and building competitiveness.
Naturally, local development problems require local solutions and perspectives, according to a study conducted by UNESCO entitled ‘Measuring R&D: Challenges Faced by Developing Countries’. Therefore, developing countries benefit more if they engage in more focused, organised and purposeful R&D. The study further states that “technological solutions are socially and culturally embedded and, as such, must take indigenous knowledge systems into consideration. Culturally sensitive R&D works held in collaboration with indigenous knowledge practitioners offer the potential to devise peculiar solutions to peculiar problems.”
Yet, due to the insignificant investment towards R&D especially from the private sector in Ethiopia, Abdi underlines, higher education institutions are forced to shoulder the task of accelerating R&D momentum. For instance, about 74.1Pct of the R&D spending, which is of ETB5.2 billion in 2013 was utilized by universities while government research institutions utilized 24.5Pct.
However, even though higher education institutions receive the largest pie of the R&D fund, the capacity of universities to engage in R&D activities and diffusion of technologies that best serve the various sectors of the economy is marred by various limitations. In addition to the low R&D funding, stakeholders stress that the research outputs and innovation outreach of universities to help enterprises are insignificant, mainly due to inadequate number of researchers, lack of lab facilities and weak university industry linkage.
For instance, according to the Careers of Doctorate Holders (CDH) survey report released by the STIC in 2016, researchers’ number per million people has stood at 87 in Ethiopia, far from other African countries like South Africa, which has 818 researchers for a million people.
Alemu Disasa (Prof), research dean at ASTU says even though Doctor of Philosophy holders at universities have to spend at least 25Pct of their time on research, this could not be materialized because they are forced to dedicate their time in teaching. “Lack of financial freedom is also hindering the full utilization of the budget allocated for research.” Alemu adds. “The procurement procedure also does not consider the urgent demand and quality of lab equipments.”
According to Alemu the procurement procedures of lab materials force university administrators to purchase from local distributors, while they prefer to import directly from manufacturers. “Another bottleneck is a lack of foreign currency.” he stated. “For instance, we waited more than three months to purchase lab equipment worth USD3,000.”
Alemu added that the lack or delay of research supplies such as laboratory equipment and supplies in their university is forcing researchers to go to institutions like Addis Ababa University (AAU) and others to test their hypothesis and validate their research findings. “This year alone, we have paid ETB3 million for the use of laboratories in other institutions.” complained Alemu.
ASTU has eight centres of excellence and also hired South Korean expats to push the R&D practice in the University. “However, we did not start providing technology prototypes for enterprises because we are facing many challenges. For instance, we conducted research on the use of biodiesel for power and energy but because the University does not have the necessary research facilities, the findings could not be scaled up.” Alemu explained.
ASTU mainly focuses on solving challenges in the manufacturing industry. It has funded 108 research projects in the last two years. In the just ended fiscal year, the university budgeted ETB20 million for research, 53.8Pct up from ETB13 million in the previous fiscal year. It also allocated a 50Pct more budget for the soon to begin fiscal year, according to the information obtained from the University. Despite this fact, the University has a tradition of underutilizing more than half of its research budget.
The other challenge is the lack of cooperation with the private sector. “We have entered into a memorandum of understanding (MoU) with many public and private enterprises. However, most of the plans agreed in the MoUs are in the reimplementation stages. Government direction is needed to solve challenges with industries.”
Abdi argues that “creating an enabling legal framework and conducive research environment is essential to establish strong and productive universities and industries linkages. It’s under such circumstances that institutions may be able to closely work together from production all the way to marketing.”
Since its establishment in 2008, MoST has prepared STI policies and strategies that envisioned rapid learning, adaptation and utilization of effective foreign technologies by 2025. Technology transfer, human resource development, expanding manufacturing, and university industry linkages are among the 11 critical policy issues identified by the Ministry.
Accordingly, 12 institutions including the Ethiopian Academy of Sciences, Ethiopian Biotechnology Institute, Ethiopian Space Science and Technology Institute, Adama Science and Technology University, Addis Ababa Science and Technology University, and Ethiopian Intellectual Property Office are selected to collaborate on the issues and report to the Ministry. In addition, the Ministry has enacted the STI policy in February 2012, while the strategies for implementation followed in 2014.
Through a nationally coordinated R&D activities, which is facilitated by STI Research Council and Research Technical Committee, the Ministry has funded 21 research projects in the just ended fiscal year, with ETB90 million. This is up from 14 projects funded two years ago with ETB40 million.
Even though the number of research publications increased to 900 in 2013, which is nine times up from 1991, the figure is still less compared to Kenya’s 1,500 in the same year. In addition, only 15Pct of PhD holders that conducted research have applied for patents, in the years between September 2013 and August 2015; not only that, only 5Pct of the PhD holders have commercialized their products.
While a lot of research is conducted each year which could be commercialized into products and usable technologies, enterprises in Ethiopia still import technologies. What’s worse is that, most of the imports are done without properly analysing the suitability of the technologies and assessing the presence of local knowledge and skill to use and maintain them. This is to a larger extent due to the absence of research and development offices in most public and private organisations. Only 30Pct of the 400 enterprises assed by MoST in 2016 have in house and outsourced R&D mechanism.
Agriculture and manufacturing are high priority sectors, while health, ICT, transport, energy, irrigation and mining are also given due emphasis. In the manufacturing sector, leather and leather products, textile and garment, food and beverage, metals, pharmaceuticals, chemicals, and construction inputs sub sectors are in the list.
Currently, ASTU has finalized 75Pct of the construction of a state-of-the art research park at a cost of ETB300 million. This cost is not inclusive of the internal facilities and laboratory equipment procured. Up on completion the facility will accommodate 60 researchers at a time. “This will enable the University to produce prototypes for enterprises. The enterprises can also focus on product innovation.” Alemu hopes.
In addition to fulfilling some of the research facility needs in several universities the government is revising the salary scale for researchers and the amount of time they are required to dedicate for teaching and research. Even if PhD holders are required to allocate 25Pct of their academic time for research and community services, they are too busy in teaching due to the increasing number of students every year. However, “when the [research facilities are enhanced], burden of teaching reduced and financial issues solved, we will do better.” Alemu hopes.
Unlike the manufacturing sector, Ethiopia has been involved in agricultural research for more than half a century. It established the Ethiopian Agricultural Research Organisation (EARO) in 1966. The Institute has over the years established seven research centres which are working on improving crop productivity.
Nevertheless, because the centres are limited in number compared to the vast size of the country and have evident human resource, technological, and financial limitations, their contributions have to a larger extent been limited to producing research papers. Their contribution in terms of technology outreach to modernize and revolutionize productivity has remained [minimal], says Sime Debela (PhD), a retired agricultural consultant. Sime joined the EIAR in 1967; a year after its establishment and had since served the Institute as a researcher and director general.
He says, “Each climatic and geographic circle in the country needs well equipped national labs independent research institute both for crop and livestock.”
Sime recall the plan to establish more specialized research centres both for crop and livestock. He said, there were many locations selected across the country, in addition to the seven centres. However, with the change of government the plans have been put aside, he regrets.
Sime also regrets that Ethiopia is utilizing less than 10Pct of its irrigation potential. “If Ethiopia could appropriately implement even half of the research outputs already done, using the existing infrastructure, [the country] could have avoided importing wheat.”
Despite the low level of R&D works in the agriculture and manufacturing, Ethiopia has a better start in few other frontiers in recent years. The emerging railway industry is an example, in this regard. Ethiopian Railway Corporation (ERC) currently administers rail transport in Ethiopia which consists of one electrified standard gauge rail line, the Addis Ababa–Djibouti Railway and the Addis Ababa Light Rail, which started operations in 2015.
“This year, we have picked six outstanding research projects for funding, out of 16, from MSC graduates of the Addis Ababa Institute of Technology. We will increase the research funding gradually,” said Abiy Getachew, chief officer for research and development at ERC. “The research projects focus on better technology adaption and local innovative improvements in railway slipper, pad, maintenance technology, traffic, bridge, tunnels, among others.” Abiy mentioned.
Out of the ETB726 million budget allocated for the ERC for five years, starting from the just ending fiscal year, the Corporation has allocated ETB62 million for R&D alone in the current fiscal year. It has also allocated ETB27 million for technology transfer.
In collaboration with MoST, ERC has already prepared national railway roadmap, which focuses on railway track, rolling stock, power supply, signalling as well as communication and safety. “Detail road mapping for each of the fields is underway.” explains Abiy. “We have prioritized local capacity building through R&D, training and education as well as investment in technologies.”
Government has been working towards boosting the role of R&D in the public sector. This however undermines the role of the private sector in R&D in Ethiopia that is not anywhere to mention about. According to the information obtained from the Addis Ababa Chamber of Commerce and Sectoral Association (AACCSA) though there are a number of requests for capacity building in training and business development consultancy, the private sector request in R&D is a very rare case. Therefore, integrating efforts in both public and private sector in R&D should be a strategic approach that developed nations have already gone too far and benefited the most out of it. EBR

5th Year • July 2017 • No. 52


Leave a Reply

Your email address will not be published. Required fields are marked *

Ethiopian Business Review | EBR is a first-class and high-quality monthly business magazine offering enlightenment to readers and a platform for partners.

2Q69+2MM, Jomo Kenyatta St, Addis Ababa

Tsehay Messay Building

Contact Us

+251 961 41 41 41