1

Participatory Modernization PPP in Research Development and Innovation for the Southern Mediterranean

Sustainable and inclusive growth and economic development Consolidation of democratic reforms and institutional building

2 Changes in South and East MED B

ackground

Challenges Improved skill creation

Technology transfer through FDI Employment creation Enhanced regulatory framework for

business More efficient, transparent and

accountable public administration

Baseline Royalty and licence fees Share of knowledge based industries in gross value added

Source: W. Schwalje, (2011); World Bank, Enterprise Survey

Opportunities

Concentration of resources on large scale programmes (targeted predominantly at technical achievements

Involvement of a small number of participants,

Centralized administrative management

Lack of focus on outcomes delivering broadly diffused benefit

Lack of critical mass Lack of frameworks for a market-driven and

bottom-up definition of objectives

3 Limited impact of traditional RDI policies in the EU

Background

Inefficiencies

Shortcomings

4

PPPs: a tool for growth

Facilitate joint vision development and strategic agenda setting, including at a cross-national and regional level

Build critical mass through flexible structure providing size and cross-fertilization

Strengthen competitiveness by making the

RDI cycle more efficient and shortening the time from research to market Help to overcome fragmentation and

redundancies

Address major societal challenges

Partnering in Research and Innovation

Leverage Knowledge Leverage resources Leverage public policies COM(2011) 572

PPP as factor multiplier

C

ase Studies

EC Communication

5

PPP types in RDI

Mobile Life Vinnova Excellence Centre, Sweden Digital Enterprise Research Institute, Ireland

Research Centre-based Clusters/Networks

C

ase Studies

JTI Artemis, EU Fraunhofer Center for Nanoelectronic Technologies, Germany National Physical Laboratory, United Kingdom DTU Symbion, Denmark

Joint Ventures

Biosciences Research Centre Project, Australia Proton Therapy Centre - Essen University Hospital, Germany ISIS Innovation, United Kingdom

Asset-based RDI PPP

+ venture capital

+ venture capital

Clusters/Networks Medicines for Malaria Venture, USA

Biotechnet, Switzerland

Enhanced management/raised operational efficiency (and third party revenues with NPL)

Reduce redundancies

6

Leveraging Resources

Public funds used to pay for the research installation used by the private sector partners who financed the operational costs

Private and Public funds blended with EU grants Private funds used to pay for the research laboratory in exchange for

50% licencing and 50% of Chemistry Dep.’s spin off shares

Achieving scale & scope economies

Matching funds from the private partners/risk sharing Valuable contributions in kind (hardware, licences) from the private

sector partners blended with Government financial support

Valuable contributions

New constellation of R&D stakeholders including international organizations (WHO), international drug companies, research institutes, government development organisations (e.g. DFID, UK) as well private foundations (e.g. Bill & Melinda Gates Foundation).

E

vidence

New aggregations of capability Medicines for Malaria

Mobile Life Centre, Biotechnet

Fraunhofer CNT, JTI Artemis ISIS Innovation

Improving efficiency National Physical Laboratory, Biotechnet

Coherent strategic objectives/consistent with broader strategic government’s policy

Industry led/ Market driven competence centre Evaluation of marked submitted proposals Retroactive expenses’ repayment

7

Leveraging Knowledge

Knowledge broker with branch insight and knowledge of partners’ strengths

Access to venture capital knowledge/Provide financial support in pre-seeds market

Creating new Institutional Forms

Bring together key elements of the research process, facilitate a more effective technology transfer

Provide R&D infrastructure access Personal exchange/ in-house internships /training of PhD students Increase recruitment opportunities

Improving Technology Transfer

Unique set of stakeholders including government’s innovation agency, scientific institutes, municipal partners, SMEs and global players from ICT industry

E

vidence

Facilitating the Creation of Clusters Fraunhofer CNT , Mobile Life, DERI, Biotechnet

DERI, Mobile Life Centre, Biotechnet

MMV, Biotechnet, DTU Symbion, ISIS Innovation

Bolstering Innovation Mobile Life Centre, Fraunhofer CNT Biotechnet

Co-ordinated efforts by a wide range of specialists on complex research topics multi-disciplinary in scope

8

Leveraging Public Policies

Creating Social Capital

Reduce the strong cultural divide between private industry and academia

High Level Skills Transfer

Independent board entrusted with major financial, ethical and research selection issues

Output based/Termination of less promising projects

E

vidence

Governance for Public R&D MMV

Mobile Life Centre, CNT, DPI

DPI, CNT, MMV , JTI Artemis

Build a local industry cluster Improve research infrastructure/laboratory facilities Align research strategy

Boosting Competitiveness Fraunhofer CNT JTI Artemis

Align interests of public and private partners by facilitating delivery of new effective and affordable products to the market

Solving Market Failure MMV

PPP can build social capital by creating environments where different knowledge creators can effectively and successfully co-operate

PPPs offer a valuable means to ensure that state/IFIs sponsored RDI funding is more effectively employed where universities (as in the South and East Mediterranean) use traditional channels of knowledge delivery

9

Lessons learned

Creating Social Capital

PPPs offer a better solution to cut red tape in supporting RDI PPPs provide incentives, embedded control at entry and post

research evaluation systems through KPIs

E

vidence

Governance for Public R&D

South and East Mediterranean Countries have the opportunities to create clusters/centres of excellence in key area of relevant RDI, (e.g. solar energy, irrigation)

PPPs are a very effective way to both create and sustain clusters

Boosting Competitiveness

10 European PPP Expertise Centre (EPEC)

EPEC is a joint initiative of the European Commission, EIB, EU Candidate and Member States

EPEC assists the public sector to improve the conditions for delivering more successful PPP projects via:

(i) Network activities including working groups and workshops supported by the EPEC Executive (an analytical team with both critical mass and experience in PPP transaction advisory)

(ii) Bilateral support on PPP programme implementation

EPEC provides link to the private sector PPP community through Private Sector Forums

The EPEC network links over 27 countries : Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Israel, Italy, Latvia, Lithuania, Malta, Montenegro, Netherlands, Poland, Portugal, Rumania, Scotland, Slovak Republic, Slovenia, Spain, Turkey, and United Kingdom

Capacity Building, Institutional strengthening and programme support

Instruments

C

ontacts

Claudio Cortese Operations outside the EU Deputy Director General cortese@eib.org Javier Gutierrez-Degeneve Head of the Near East Division gutierre@eib.org Ioannis Kaltsas Policy and Trust Funds Head of Division kaltsas@eib.org Alain Nadeau Head of the Maghreb Division nadeau@eib.org

Thomas C. Barrett Technical and Financial Advice Director barrett@eib.org Nick Jennett European PPP Expertise Centre Head of Division jennett@eib.org Francesco Totaro European PPP Expertise Centre Advisor totaro@eib.org