ME countries slip down Global Innovation Index

GII 2013 shows four countries - the UAE, Saudi, Qatar and Kuwait - rate in top 50 innovative economies

Tags: Booz & CompanyCornell UniversityINSEAD (www.insead.edu)Innovation
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ME countries slip down Global Innovation Index The GII was released at a press conference in the UAE.
By  Mark Sutton Published  July 4, 2013

The annual Global Innovation Index (GII) 2013 edition, which is published by Cornell University; business school INSEAD, and the UN's World Intellectual Property Organization (WIPO), suggests that countries in the Middle East are falling behind developed economies when it comes to innovation.

The index, which is intended to assess the economic support for innovation and achievements, ranks the UAE, Saudi Arabia, Qatar and Kuwait in the top 50 nations worldwide, but none rank higher than 38th, and only Saudi and Kuwait have risen in the rankings since last year.

The UAE ranked highest of Middle East countries, in 38th place, down from 37th last year. Saudi Arabia was 42nd, Qatar 43rd and Kuwait 50th. Qatar dropped ten places, while the other top economies in the MENA region - Jordan, Bahrain, Tunisia, Lebanon, Oman and Morocco, all slipped down the rankings.

Globally, Switzerland ranked highest, followed by Sweden and the UK.

The Index ranks countries based on two sub indices. The Innovation Input Sub-Index gauges elements of the national economy which embody innovative capabilities grouped in five pillars: Institutions, Human capital and research, Infrastructure, Market sophistication, and Business sophistication. The Innovation Output Sub-Index captures actual evidence of innovation results, divided in two pillars: Knowledge and technology outputs, and Creative outputs.

The UAE led the Middle East in institutions, human capital and research, infrastructure, and business sophistication, while Saudi Arabia ranked highest for market sophistication, Kuwait in knowledge and technology outputs and Qatar in creative outputs.

"Worldwide, innovation is increasingly seen as a powerful tool to strengthen the competitiveness and global relevance of corporations and nations," said Bruno Lanvin, the report's co-editor and executive director of INSEAD's European Competitiveness Initiative. "In the Middle East and Northern Africa, recent political and social changes have also underlined the importance of addressing the needs and expectations of populations in terms of growth and job creation, especially for the young. This year's GII shows that, in this regard, performances in the region remain uneven, but innovation is becoming a visible and pertinent instrument for economic diversification, enhanced competitiveness and global integration in an increasing number of MENA countries."

Countries in the region should look to develop their own strategies to foster innovation, rather than rely on copying successes from elsewhere in the world. Economies can catch up by ‘learning' to innovate, by transforming innovation inputs into market place results, more efficiently, according to Hatem Samman, Lead Economist and Director of Booz & Company's Ideation Center. MENA countries can achieve this by strengthening and aligning their policies on innovation inputs-such as human capital and research-with policies that help translate them into tangible products and services-such as high- and medium-high tech output-to spur economic activities and create wealth. Strong innovation hubs can provide an efficient platform for such transformation by facilitating knowledge creation and sharing, and by providing a bridge for the commercialization of ideas. As a result, more MENA countries can move up the innovation ladder towards innovation learners and chart their way into innovation leadership.

"In the Middle East, we are seeing governments focus on building innovation capabilities as a means of catalysing the growth and diversification of their economies. For instance, many MENA countries are establishing innovation hubs in which large state-owned enterprise champions, whose business goals are aligned with the objectives of the innovation hub, are acting as the critical drivers of hub activities," said Rasheed Eltayeb, Principal in the Public Sector Practice at Booz & Company. "These state-owned enterprise champions have the talent pools to stimulate innovation, the financial resources to bridge the gap between research and commercial success, and the scale to create markets for innovative products."

"Dynamic innovation hubs are playing a greater role in the Middle East's innovation efforts, and are multiplying around the world despite the difficult state of the global economy. These hubs leverage local advantages with a global outlook on markets and talent," said WIPO Director General Francis Gurry. "For national-level policy makers seeking to support innovation, realising the full potential of innovation in their own backyards is often a more promising approach than trying to emulate successful innovation models elsewhere."

The GII 2013 looked at 142 economies around the world, using 84 indicators including the quality of top universities, availability of microfinance, venture capital deals - gauging both innovation capabilities and measurable results.

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