Date: 17/03/2008
Source: Department of Science and Technology
Title: SA: Mangena: Launch of Knowledge for Africa's Development Book

Remarks by Minister Mosibudi Mangena at the launch of the Knowledge for Africa's Development Book, Sheraton Hotel, Pretoria

Ambassador Tuunanen,
Distinguished guests,
Ladies and gentlemen

Two years ago when we hosted the Knowledge for Africa's Development conference at the Sandton Convention Centre, in partnership with the government of Finland and the World Bank, we had one goal in mind: to initiate dialogue aimed at empowering African policy and decision makers in the formulation of strategies to promote knowledge based economic growth in our continent. It is now common knowledge that global knowledge flows are becoming a key driver of economic development. These flows encourage the surge of new ideas and enable domestic innovation to be better exploited globally.

As Africans, we knew the conference will afford us an opportunity to ask ourselves some difficult questions. On the other hand, we were also aware that our partners, in the World Bank and the government of Finland have walked down this road before. And that amongst them, there is enough experience that can help us embark on our own journey towards establishing a knowledge economy for Africa.

Our road is perhaps less even, or so we may think. But we can draw our inspiration from the Indian cities of Bangalore, Chennai, and Hyderabad where hundreds of thousands of new jobs for skilled knowledge workers have been created through the utilisation of knowledge. Such developments give credence to the conclusions drawn in the recently launched World Bank Institute publication, Building Knowledge Economies: Advanced Strategies for Development, which perceives knowledge as the heart and mind of economic development.

For the past two centuries, neo-classical economics has recognised only two factors of production: labour and capital. Knowledge, productivity, education, and intellectual capital were all regarded as factors outside the system. But now, a change from the neo-classical model sees technology and the knowledge on which it is based as an intrinsic part of the economic system.

Thus, knowledge has become the third factor of production in leading economies. As things stand, productive capability is no longer just dependent on capital and equipment; information, knowledge and assets or platforms of dissemination of these are becoming more important.

For the forerunners in the world economy, the balance between knowledge and resources has shifted so far towards the former that knowledge has become perhaps the most important factor determining the standard of living - more than land, tools, and labour. Today's most technologically advanced economies are truly knowledge-based.

Peter Drucker observes: "Increasingly, the human being does not work in mass production, but in what might be called 'team production'." This means that the producing human being is a knowledge worker, who effectively now owns the means of production. Just as information and knowledge are changing the nature of our economy, they are also changing the practice of local economic development. Companies are changing how they operate and what drives their location decisions.

In Africa, local economic development strategies must adapt to these changes. As we gain a better understanding of how information and knowledge affects the economy and the economic success of specific localities, an increasing number of new theories on economic development, such as economic clusters, that can be useful in guiding our local economic development activities are coming into being. A knowledge-driven Africa must therefore position herself to compete for foreign direct investment opportunities.

The shift to a knowledge or information-based economy is also changing what business requires as inputs to the production process. No longer is business location decisions simply based on the availability of cheap land, cheap energy, cheap labour, availability of raw materials, or access to transportation.
The ability of a locality to supply a company's need for information and knowledge assets has become paramount in economic development. There are at least two elements involved, namely, up-to-date Information Technology (IT) infrastructure, and the availability of skilled workers.

The starting point for economic development in the information age is the existence of a suitable IT infrastructure. Many people see the Internet as a consumption tool, a means of recreation, information gathering and shopping. Economic development practitioners know that the information technology infrastructure is a production tool.

Advanced information technologies do not only make businesses more productive and efficient; they also expand their markets. To take advantage of these opportunities, companies must have access to high-speed telecommunications connections, or "broadband". Having access to broadband is especially important in attracting technology-creating companies. Other areas, especially rural areas and parts of the inner city, are in danger of being left behind. Unfortunately, as Africa we are still lagging behind. We need to imitate countries like Finland and use this challenge as an opportunity to innovate and develop solutions that are truly African.

The second obvious change in business practice due to the emergence of the information age is the greater need for a skilled workforce. Access to the physical infrastructure is a necessary, but not sufficient condition for economic development. If worker skills are companies' greatest assets, then companies will locate where skilled workforces are available.

In addition, new companies are more likely to be started in such locations. One economic development specialist was quoted thus: "Brainpower will be the dominant resource of the 21st century. Cities that do the best job of attracting and educating talented people will flourish. People are the new products." Training and workforce development issues are now at the top of every economic development agenda-national as well as local.

The demand for workers with information technology skills remains high. With the current skills shortage in Africa, the solution is not only to increase investment in education, but also to tackle the problem of brain drain. The exodus of highly trained manpower from developing countries to industrialised nations is not a new phenomenon.

However, the magnitude of the problem in Africa, and its alarming increase, presents a growing urgency for action as the consequences of brain drain threaten to stunt the overall development of the continent. It is common knowledge that in all major capital cities and many other cities in developed countries there is an African Diaspora of scientists and intellectuals that is increasing annually.

As Africans, we need to learn from and engage our Diaspora as trainers, mentors, investors and entrepreneurs. The exploitation of indigenous knowledge systems is crucial in the development of a knowledge economy. Indigenous knowledge has been central to the flourishing pharmaceutical industry in India. Indigenous Knowledge, as the World Bank describes it, is local and rooted in a particular community, and situated within broader cultural traditions. It is a set of experiences generated by people living in those communities. This is an area of strength for Africa and can be utilised as a springboard for our development.

Examples of successful innovation initiatives in Africa such as those in Kenya, Ghana; South Africa, Ethiopia, Uganda, Niger, Burkina Faso, Benin, and Mali as highlighted in the very booklet we are launching today, shows that African countries can individually and collectively identify niche areas for own development. My department is currently implementing two projects in partnership with the government of Finland.

One is aimed at strengthening the South African national system of innovation, and the other at the use of information and communication technologies in economic and sustainable development. We are currently finalising an agreement for a regional project aimed at the exploitation of our rich biological resources, including the enhancement of the Indigenous Knowledge Systems and biotechnology for development.

Through the Co-operation Framework on Innovation Systems between Finland and South Africa (COFISA) specifically, the partnership is already exploring the feasibility and viability of Science Parks, and sharing information and knowledge on regional innovation systems, on how Science and Technology Parks can become catalysts for local economic development where they are located.
I am pleased that at the Science Parks seminar last year, a number of African countries, including Ghana, Nigeria and Senegal, Swaziland, Namibia and Botswana, were active participants.

Distinguished guests, I earlier indicated that the purpose of the 2006 Knowledge for Africa's Conference was intended to initiate dialogue. I am pleased that indeed that workshop has been a catalyst to a number of knowledge sharing moments amongst Africans. Following that conference, my department signed joint conclusions on deepening cooperation and development of knowledge partnerships with the World Bank.

This co-operation covers knowledge sharing on global best practice on science and technology for development, through joint participation in knowledge sharing fora, and collaborative development and implementation of analytical work, with a focus on South Africa's involvement in the Bank's regional science and technology system and gap analyses studies.

To this end, South Africa was honoured to join fellow policy makers from the continent gathered in Maputo during November 2007. Discussions at that meeting highlighted regional integration opportunities, dealt with issues aimed at promoting the alignment of country policies with their research priorities, and sought mechanisms for addressing the gaps between research and innovation.

Ladies and gentlemen, we have learnt with interest how Finland, one of our partners in this initiative, successfully transformed into a knowledge economy in a short time. Theirs is an experience that represents one of the few examples of how knowledge can become a driving force for economic growth.

Finland became the most Information and Communication Technology (ICT) specialised country in the world during the nineties, thus completing its move from the resource driven forestry based economy to a knowledge and innovation driven economy.

Like Finland, countries in Asia are also moving forward. If anything, this should inspire us to rise to the occasion, and deploy knowledge as a development tool in Africa.

Thank you.

Issued by: Department of Science and Technology
17 March 2008