Innovation in Brazil: Public Policy Challenges and Business Opportunities
As Brazil seeks to solidify its position as an emerging economic power, policymakers, business leaders and scholars are focusing on how the country can better employ a coherent and robust national innovation strategy to diversify its economy and achieve higher, sustainable levels of growth. On July 31, 2008, the Brazil Institute held the fourth seminar in an ongoing series dedicated to the issue of innovation. It highlighted new and persistent challenges Brazil faces to harness this tool and create the necessary policies and business climate that will spur innovation. The speakers also discussed what Brazil has done to close the gap with highly innovative nations and take advantage of a more diversified and sophisticated global economy. Experts from the agricultural and biotechnology fields commented specifically on the contributions and challenges of these innovative sectors.
Ricardo Sennes, Director and Partner of Prospectiva International, presented the results of a study produced by Prospectiva International that examined Brazil's innovative potential, from 1990 to 2007, by comparing patent filings from ten institutions, including universities, public research centers, and domestic private companies. Sennes stated that the innovation environment in Brazil has improved drastically. Funding has increased; better legislation has improved the structure of various innovative sectors; and, as a result of the growing recognition of the need to patent and promote a "culture of innovation in Brazil," the number of patent filings by Brazilian entities has increased both domestically and internationally. Nevertheless, serious obstacles remain. Despite improvements, government coordination of innovation policies often lacks coherence, and institutions tasked with managing innovation processes, such as the Intellectual Property Agency (INPI), retain bureaucratic and inefficient tendencies. In addition, Sennes argued that Brazil's domestic policies remain disconnected from its international agenda. On the domestic front, Brazil appears to be making great efforts to encourage innovation through rigorous IP protection and an integrated network of institutions, laws and norms. These efforts, however, are not replicated on the international stage, he explained.
Roberto Castelo Branco, a consultant for the Brazilian Agricultural Research Corporation (Embrapa), provided a case study of innovation in Brazil's agro-industry, focusing on the central role of Embrapa. According to Castelo Branco, the increase in agricultural productivity in Brazil since the 1970s is due primarily to innovative agricultural techniques. As a result, Brazil has transformed itself from a net food importer into the world's second largest agricultural exporter. He commented on the critical need for intellectual property protection in order to establish sustainable development strategies, citing the fact that Embrapa uses licensing or royalty revenues from successful products to fund nearly one-third of its research. Castelo Branco also underscored the importance of cooperative networks and partnerships between government agencies, researchers, and private industry to spur innovation.
In contrast to Castelo Branco, Kátia Ramos Moreira Leite, a partner of the private biotechnology firm Grupo Genoa Biotecnologia, stressed the difficulties and limitations associated with government funding of biotechnology research efforts and called for a better incentive structure for the development of private venture capital and seed money markets for the sector. Leite expressed the need for infrastructure reforms on the part of both federal and state government agencies in order to facilitate high added value activity in Brazil. If given the same opportunities, advantages, and policy structure available in innovative countries, she argued, Brazilians would be competitive globally because the necessary human resources already exist. The critical issue that remains, she contended, is the high level of risk associated with R&D investments that deter more individuals and companies from getting involved in the Brazilian biotech sector.
Diógenes Feldhaus, director of INOVA at the University of Campinas (Unicamp), explained how his firm, a joint public-private venture, has been able to facilitate the creation of linkages for technology transfer between university researchers and industrial producers. The success of research at the university is due to its engagement with the private sector; the funds generated from Inova's patents and products have allowed it "to enter into a sustainable cycle of innovation," where proceeds from successful technologies can finance future projects.
Generally, participants conceded that although Brazil is moving in the right direction, there is still much that needs to be done. Commentator Stephen Merrill, Executive Director of the National Academies of Science's Board on Science, Technology, and Economic Policy (STEP), pointed out that agriculture helped jump start innovative processes in the United States and in many of today's most internationally competitive countries—a pattern which may be replicated in Brazil as the agro-industry drives the country's emergence in international markets. That is not to say Brazil is merely a country of agricultural exports; it has a very diverse industrial base and has innovative companies operating in nearly all sectors.
Michael Ryan, Director of Creative and Innovative Economy Center and Professor at George Washington University, and Rahim Rezaie, PhD Candidate at the McLaughlin-Rotman Centre for Global Health of the University of Toronto, served as commentators of the second panel. Both provided insightful suggestions for moving Brazil towards an efficient and flexible innovation policy framework that would allow Brazil to compete with other newly emergent nations, such as India and China. Both commentators agreed that a widespread change in culture and attitudes in Brazil will be necessary in order to demonstrate the need for and positive results from risk-taking innovative efforts.
- Ricardo Sennes
- Roberto Castelo Branco
- Stephen Merrill
- Katia Ramos Moreira Leite
- Diogenes Feldhaus
- Rahim Rezaie
- Brazilian health biotech: Fostering crosstalk between public and private sectors
- Agenda - "Innovation in Brazil: Public Policy Challenges and Business Opportunities"
- Speaker Bios