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Source: Department of Science and Technology
Title: Hanekom: Global Aspects of Technology Transfer
Address by Derek Hanekom, Deputy Minister of Science and
Technology, at the Global Aspects of Technology Transfer:
DEFINING TECHNOLOGY TRANSFER: PAST, PRESENT AND FUTURE - ASSESSING
TECHNOLOGY TRANSFER IN SOUTH AFRICA AND ITS IMPACT IN THE SOUTHERN
Ladies and gentlemen
Firstly let me applaud the organisers of these Gordon Conferences
that concentrate on science education and policy issues. They play
an important role in reflection on the very dynamic global
environment and the changes that inevitably impact the lives of
people and the sustainability of the environment. In short they
assist us to craft our common future.
It is a particular pleasure to share a platform with Lita Nelsen,
who has played such an important role in the promotion of
technology transfer from universities. She has welcomed many South
African delegations to MIT and in the setting of the Association of
University of Technology Managers (AUTM). It is also a good
opportunity to exchange views and perspectives with Dr Gill
Samuels, who has been immersed in the practical realities of
science policy from the perspective of the global pharmaceutical
I noted from the programme that Professor Turner Isoun, the
Minister of Science and Technology of Nigeria will address this
conference tomorrow. We share a very positive and growing set of
bilateral collaborations with Nigeria – including the domain
of space and satellite technology, indigenous knowledge and the
development of technologies and applications in human health.
The participation of key African countries in this conference
should assist in balancing our views, sharpening our reflections
and strengthening our analysis. The South African contributors at
the conference include Dr Tony Heher and Dr Sibongile Pefile
– both of whom are major participants in the debate on
innovation and technology transfer in South Africa. I’m sure
they will give you a sense of some of the challenges we face.
Overall, while one may have considered some genetic modification of
the programme here and there this conference could never be
described as a monoculture!
In assessing technology transfer in South Africa and its impact in
the Southern African region, I will concentrate on issues that
present challenges and give some areas of progress and development.
Given the focus of the conference I will choose the majority of my
examples from biotechnology – while recognising that the
challenges are no less intense in the setting of, say,
nanotechnology or high performance computing.
Norman Borlaug, now 91 years old, received the Nobel Peace Prize in
1970. That is long enough ago for many people in this audience to
be unfamiliar with the context of his achievement and his
background. The Nobel biography, from 1970, describes him as
“an eclectic, pragmatic, goal-oriented scientist; he accepts
or discards methods or results in a constant search for more
fruitful and effective ones, while at the same time avoiding the
pursuit of what he calls “academic butterflies”. Norman
Borlaug developed some of the key wheat varieties that underpinned
the green revolution and focused this work in Mexico, Pakistan and
In his Nobel acceptance speech he said: “The obligations
imposed by the honour are far greater than the honour itself, both
as concerns me personally and also the army of hunger fighters in
which I voluntarily enlisted a quarter of a century ago for a
lifetime term. I am acutely conscious of the fact that I am but one
member of that vast army and so I want to share not only the
present honour but also the future obligations with all my
companions in arms, for the Green Revolution has not yet been
Viewed through the lenses of current scientific optimism and the
complexities of the new issues that challenge us in global
knowledge transfer, the work of this man seems courageous, socially
concerned and principled. His research and experimental programme
was funded by the Rockefeller Foundation and the Mexican Government
but the transfer of his work was socially and politically mediated
rather than by means of the market.
The South African Government is looking to science and technology
as an enabler of improvement of quality of life and sustainable
economic development as a full player in the global knowledge
economy. In this regard we participate in a global trade regime far
more complex than that faced by Norman Borlaug. I am sure that
intellectual property was not uppermost in his mind at the time. We
do know that in a visit to the International Rice Research
Institute in 1999 he said in respect of intellectual property in
relation to biotechnology: "How will you keep out the lawyers? How
will you keep the tail from wagging the dog?"
Dr Borlaug saw a strategic challenge in making sure that future
interaction with IP professionals serves poor farmers rather than
other industry actors and interests. The job of responsible
scientists and public institutions is moving technology around in a
way that deals with human needs in balance with proper competition,
and the rights of inventors and owners of IP. I am not sure that
many principled scientists at the personal level would want massive
personal economic gain to pre-determine how their inventions are
used, or whether they are used at all – certainly not if they
are of the activist tradition of Norman Borlaug.
South Africa has a keen interest in intellectual property
development and protection, technology transfer, and ultimately,
developing our competitiveness. However the effective protection
and generous licensing of IP can also be used to advance public
good agendas related to food security, health and public safety.
Assuming that an economy, region or country has the capacity to
secure intellectual property efficiently, these options and choices
remain open. This for example is the approach adopted in the
securing of patents related to HIV/AIDS vaccine development in the
South African AIDS Vaccine Initiative.
Over and above intellectual property rights, we support open and
cost-effective access to published research and the large public
databases and open source software that underpin much of modern
biotechnology. The principles of open access need to be more
clearly articulated and developed.
We should avoid creating conditions where developing world
scientists are excluded from biotechnological research by issues of
bandwidth, and the cost of journals. South Africa enjoys some
advantages in these areas but most scientists in the developing
world are denied easy access to these resources.
The basic issue is this: if a technology holder and a technology
recipient see advantages in a relationship, technology transfer is
fundamentally about negotiation of agreements – the transfer
of value between stakeholders. But more than this - it is about the
genuine sharing of knowledge based upon the assumption that this
will lead to a sharing of benefits.
There is a strong case for far more thought and reflection on
public good technology transfer, by firms and public institutions,
when the economic case is weak or absent but where the recipients
may be able to use the technologies effectively.
Technology-based economic development is critical to the success of
industrial nations. Governments, institutions, and corporations are
accelerating creation and expansion of technology-based businesses,
expediting the development of high-performance economic clusters,
and strengthening research universities' ability to educate
knowledge workers and commercialise technology.
To many outside the frame of modern academic research and
commercialisation, the process of technology transfer is
mysterious; at one level filled with intrigue and at another level
obscured by the "invisible hand of the market."
It is true to say that some technologies are “slippery”
and cut across all sorts of boundaries very easily – for
example mobile phones. Other technologies are “sticky”
and don’t move easily at all: such as oil from coal
technology, deep hard-rock mining technologies and the technologies
that underpin household food security for example.
In the case of biotechnology mostly we are near the
“sticky” end of the scale, unless the products are
highly packaged and de-skilled such as some diagnostic devices and,
broadly speaking, pharmaceutical products (at least at the level of
marketing and sales).
Technology transfer also takes place at two levels – within a
country as part of the national system of innovation and globally
as part of the global trade regime. At both these levels the
significance and role of intellectual property is growing more
important and in many cases more contested.
Technology transfer is thus intimately linked with Intellectual
Property (IP) and its management. In the process of
commercialisation benefits can be derived from knowledge and
skills. Used correctly, the IP system is a powerful tool in the
innovation process. It allows for the identification of a protected
rights-holder, placing them in a position to derive economic
benefits from the exploitation of the inventions. Protected IP is
exploitable IP. Exploitable IP leads to job creation, to the
development of new goods, new services, and new wealth.
However, there are some critical issues that we need to be mindful
of. What if the protection is granted in the form of a local
patent, but there are no research groups in the developing country
that have the capacity, resources or equipment to do research in
the discipline involved? And what if there are restrictions in the
sale of certain dual use chemicals to that country? What if the
negotiations of a free trade agreement to enhance technology
transfer include anti-competitive extensions of the monopoly rights
of patenting, secrecy or copyright? An example of this arose in the
negotiations between the Southern African Customs Union (SACU) and
the EFTA (Switzerland, Norway, Iceland and Liechtenstein)
countries. These countries were pressuring SACU to enter into their
legislation, five to ten years exclusivity on data for registration
of brand name medicines, even those not protected by patents. This
would give the brand name holder authorising power even in
emergency situations. Clearly in the context of developing
countries’ health needs this is anti-competitive and protects
branded medicines from legitimate competition with the producers of
In an open market, the transfer of technologies between nations can
enhance social and economic benefits enjoyed by the recipient
society. Rather than merely selling the products of a particular
technology around the world, technology transfer properly organised
allows new jobs to be created, new skills to be developed and new
potential for innovation in the recipient society.
Kofi Annan has said that “National markets are held together
by shared values and confidence in certain minimum standards. But
in the new global market, people do not yet have that
South Africa occupies an intermediate position between
least-developed and developed countries. We also have a very
energetic life sciences and biotechnology community. Our government
has made significant focused investments and the private sector in
South Africa is a large investor in research and development. It
allows us a potentially useful perspective on global technology
transfer issues. However, it will not be news to this audience that
in many parts of the developing world there is scepticism of the
value of intellectual property, of patenting, of trademarks. These
are sometimes portrayed as “Western exploitation”. Is
this view the product of ignorance or experience?
If one takes the perspective of a national system of innovation it
becomes clear that the ability to secure patent rights is massively
asymmetrical between the developing world and the developed world.
South Africa, with the largest economy on the African continent
secured about 100 patents in the US patent office last year. Less
than 10% of these were generated in publicly funded institutions.
By contrast about 4000 to 5000 foreign-originated patents are
secured in the South African Patent Office annually. There is a
clear linkage between the GDP per capita of nations and their
levels of patenting. For example a number the larger African
economies have not secured more that 10 US patents over the last
decade. By contrast the US Patent and Trademark Office registered
1.3 million patents over the last decade!
This means that the majority of scientists and inventors on the
African continent do not participate in the activity of securing
IP, not because they are unable, but because the state of
development of the national system of innovation and its complex
relationships between different institutions and agencies has not
yet developed to the point where this is possible.
Why is this important in the field of biotechnology? Firstly, the
biotechnology revolution, in stark contrast tot the late industrial
revolution has been absolutely dependent on fundamental science
conducted at Universities. This good science coupled with an
enabling environment for technology transfer has fuelled the
development of entirely new classes of products and services.
Biotech patents often cite literature that is less than 5 years old
and produced by research groups of the home country. The
biotechnology age is intimately connected to the fabric of publicly
But this lack of capacity in intellectual property impacts on
economic development in a number of ways. Negotiations on the
Cartagena Protocol on Bio-safety, for example, have been marked by
a strong African lobby – pushing for very high safety
standards and an onerous liability regime. This is perhaps
understandable as Africa has limited current ability to exploit
genetic engineering – it thus wants very high safety
standards for first world-developed processes. But this might well
be a defensive mechanism that defeats its own purpose, which
creates substantial barriers preventing the developing world from
taking advantage through ‘home-grown’ or adapted
The complexity of bio-safety requirements has increased
significantly in the past few years in response to vocal activism,
and as a result of efforts to address public concerns. This has
become a major barrier to technology transfer, with the safety
testing of new products potentially costing more than their
development – and the requirements are constantly
Certainly evaluations must take place before products are released
commercially. We have to ensure, though, that the time and
resources required for such studies do not prevent the technology
from reaching the poor. In addition, we must ensure that developing
countries have the necessary capacity and capability to perform
these evaluations on their own, thereby reducing costs and at the
same time developing essential skills and knowledge. The knowledge
gained from this practice will cascade down to create a better
understanding of GMOs and would go a long way towards dispelling
some of the myths associated with GM crops and foods.
Regional cooperation in bio-safety regulation and risk assessment
for example, could build the capacity needed for these activities.
This could lower the cost of obtaining approvals by lowering the
number of entry points for developers. For instance, a single
bio-safety review for a new GMO in the SADC region could take into
account the different environmental conditions in the sub-region
and provide a single recommendation, which would be available to
all SADC regulators. The review process would feed into national
decision making systems, accepting that while safety assessments
can account for different environments, neighbouring countries may
make different decisions on specific GMOs because of socio-economic
Stumbling blocks in the face of success abound. The GM potato is
one example illustrating this point. The Agricultural Research
Council in South Africa is currently developing a GM potato, which
is resistant to local pests. This project is supported by a
multinational company which provides the technology royalty-free.
The technology is not patented in South Africa, but patented in a
number of developed world jurisdictions. The intended beneficiaries
are subsistence farmers in developing countries. There have been
demonstrated benefits in controlled field trials. However, the
multinational company is now growing increasingly wary of the
liability regime that may be imposed through the Cartagena
Protocol. Thus, it is requiring a comprehensive ‘stewardship
plan’ to be implemented in South Africa – for fear that
it may be liable for trans-boundary movements of the GM potatoes
(not by itself or any agency, but by potato seed smugglers).
The Agricultural Research Council now has to evaluate the potential
illegal trans-boundary movement, hold consultations with
neighbouring regulators, and present the risk assessment for such
occurrences. This is raising the costs of the development
substantially. It may ultimately prevent release of a crop which
could be highly beneficial to small-scale producers in Southern
Because ‘high tech’ intellectual property is developed
mainly in resourced nations, and transferred to less resourced
nations, technology transfer revenues tend to flow to the developed
world. This is away from where the resources are needed most. Even
though economic benefits accrue – a Malaria vaccine transfer,
for example, would reap huge economic benefit to the developing
world – the knowledge capacity to fully participate in global
research is not changed.
Somehow we have been seduced into believing that market presence by
high tech firms in the developing world does not include the social
responsibility to engage in product research and development in the
countries that buy the products. There is some evidence that this
is changing, but the evidence is limited and anecdotal. The
generous post war approach that allowed the Rockefeller Foundation
to fund work with the Mexican government and the 20 year programme
of Norman Borlaug is no longer the norm today.
It has been replaced with the rigidities of sector-focused
initiatives in development assistance that are short term and have
to deliver market or social outcomes that would not even be
achievable in the developed world.
There is a strong relationship between official development
assistance programmes and the capacity of many developing countries
to respond to opportunities to participate in global developments.
This complex area and its impact on science and technology capacity
needs a meeting of its own, but I want to indicate some of
the problems. Until very recently most donors would not consider
research and development funding and equipment in their programmes.
In the 2004 Foreign Policy Journal bilateral donor support to
Tanzania is analysed. Switzerland for example has five projects
with a value of about 30 million dollars, giving an average project
size of $6m. By contrast Ireland also a donor to the level of $30
million had 404 projects (and average project size of $75000).
Tanzania had substantive relationships with 18 donors with 1292
projects worth over $1 billion with a median project size of the
order of less than $500 000. Indeed, each of the projects may have
merit and value, but we should not underestimate the burden of
managing this number of diverse projects, each with their own
unique donor requirements, and have to carry on with the normal
business of government at the same time. This sort of analysis
indicates the additional burden of fragmented responsiveness and
multiple requirements that donors inadvertently place on the
developing world. The so-called Blair Commission for Africa has
adopted a different approach in placing far greater emphasis to
investment in science and technology.
Into this heady mix we must add the dimension of traditional and
indigenous knowledge. In the Southern African setting the Hoodia
plant, its appetite suppressant qualities, traditional knowledge
and the rights of communities is now an often told but still often
confused story – which Sibongile Pefile will explore further
in her presentation. While the current developments of the CSIR,
the San people and their partners are stalled in respect of the
core inventions and uses, other developments have taken place.
Hoodia extracts, which have not been submitted to any reliable
regulatory regime, are already included in dieting remedies
available from a variety of sources on the Internet. Other
communities are contesting the exclusive indigenous knowledge claim
of the San community The inescapable complexities should not
frighten us away from the legitimate recognition and protection of
indigenous knowledge, but this case study clearly shows that there
is a need to further develop our models and experience.
Acknowledging the important intersection of intellectual property
and traditional knowledge, the South African Parliament has before
it the Patents Amendment Bill which enforces full declaration of
plant origins and the use of traditional knowledge where these are
used in a patent application.
In the face of adversity communities show remarkable tenacity in
developing and utilising indigenous technologies for self-benefit.
One example is the launch of a mosquito repellent candle making
factory in a rural village in South Africa. An indigenous plant has
been used for centuries by indigenous people to control mosquitoes.
The technology to extract the highly effective ingredients has been
patented. The “active ingredient” in the form of a
plant extract is being incorporated into candles. I recently had
the pleasure of launching a new manufacturing facility next to the
fields in which the plant is cultivated by the local community. 67
jobs have been created to date in the rural community, 70% of whom
One could imagine a situation where this is company growing into a
small biotechnology venture, as new applications of the mosquito
repellent are developed. However there are numerous obstacles to
global success for such ventures. Small biotechnology companies in
the developing world find it difficult to challenge international
pirating of information and materials. This can result in a
strategic business approach which places an unduly high emphasis on
secrecy of intellectual property – this is likely to be less
effective in global competitive markets than adequately protected
and enforced patenting approaches.
In this global village we live in, huge disparities in access to
resources and levels of development often lead to tensions and
frustrations. So, one of the solutions is to encourage, facilitate,
or ensure that technology development also occurs in the developing
world. The biotechnology industry in South Africa is growing
rapidly at present, off a small base. Funding for genetic
engineering grew by 360% between 2002 and 2004. The growth in all
related fields: biochemistry, genetics and molecular biology,
microbiology, genetic engineering, and biotechnology, exceeded 46%.
This bears testimony to South Africa’s commitment to
This increase in investment has had the effect of attracting a
number of very active and promising South African scientists back
to the country, stimulated the formation of local biotechnology
venture capital firms and has led to a number of start-up
enterprises based on University generated inventions.
However we need to make sure that these local developments are
replicated in the region as a whole. This will require focus and
effort by each of the countries and our development partners.
Building around excellence and concentrating resources in existing
institutions will be much preferred to the development of
“green-field” institutions that will take far too long
to develop critical mass.
Promoting awareness of the benefits and complexities of
intellectual property and technology transfer to developing
countries is essential. The asymmetries I described earlier will
take time and effort to address effectively. South Africa,
according to some desk research on the membership of the Licensing
Executives Society (LES), has intellectual property and
commercialisation resources similar to those of Greater Manchester.
If we recall that South Africa has, at a country level, 10 to 100
times the resources of many other African countries, it is arguable
that the total IP and commercialisation capacity of the entire
continent is no more than two Greater Manchesters – or, put
differently, less than half of Massachusetts.
In the field of biotechnology, which is critically dependent on
cutting edge research, the situation will be even more strongly
This skewing effect needs to be understood in the developed world.
The need to facilitate access to technology and have generosity in
the arrangements with developing nations in the biotechnology field
is self-evident. The establishment of good University based
research infrastructure, which will lead to global collaborations
and partnerships, is an obvious step both at the bilateral level
and through European instruments such as the Framework
If we are determined to stimulate and implement successful
technology transfer to assist the developing world, serious
consideration must be given to ways of funding biotechnology
enterprises through government and private investments, local and
state grants, venture capital, venture leasing, capital equity
markets, and convertible debt.
We also need to ensure that there are mechanisms that will generate
confidence in first world investors to develop small and medium
enterprises in the developing world.
Greater social responsibility is required to ensure that developing
nations can emerge from a dependent to an independent existence
within the global community – and this development must be
sustainable. Louis Pasteur said: “Science knows no country,
because knowledge belongs to humanity, and is the torch which
illuminates the world.”
Alleviation of poverty, provision of food and development of
agriculture will remain an urgent priority in developing countries
where a high percentage of the population obtains its living from
the land. Trade distorting practices, such as agricultural
subsidies, which ruin the livelihoods of emerging farmers, will
need to be radically reviewed. This will remain the focal point of
intense and sometimes acrimonious debate in the World Trade
Organisation (WTO) negotiations.
Pressure on health care budgets will continue. There will be an
increased demand for cheaper and safer medicines and lower
treatment costs. Developing countries themselves will need to do
thorough surveys to establish their market requirements and niche
areas. There is a decline in the ageing population in the
developing world, whereas there is an increased ageing population
in the developed world.
The developed world will have a greater demand for drugs for the
elderly – in the developing world the need will be for drugs
to reduce infant mortality and to fight diseases such as HIV and
AIDS, TB and malaria.
Technology transfer and support from the developed world will not
solve all our problems but may very well be the seed in the
transition to a better future. Let us ask ourselves: ‘what
needs to change in our respective countries that will enable us to
move away from the conditions that we are so accustomed to right
now?’ and let us make the effort to change it.
Technology transfer is an important and powerful tool for global
development with positive implications, particularly for uplifting
the developing world – provided we have an approach based on
the development of robust national systems of innovation. As Kofi
Annan has said, “Globalisation is a fact of life. But I
believe we have underestimated its fragility.” Unless the
practice of technology transfer is developed to take account of the
realities, difficulties and obstacles in the developing world, the
gap between the first world and developing countries will merely
widen, fermenting disillusion and discontent across the
Bruce Alberts, long-time President of the US National Academy of
Sciences said this of Norman Borlaug: “Some credit him with
saving more lives than any other person in history”. I wonder
what will be said about us one day!
Thank you for the opportunity of addressing you on these important
issues. I hope that your deliberations allow you to have both the
vision and the courage to do remarkable things for a very needy
I thank you.
Issued by: Department of Science and Technology
4 September 2005