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TCI2013 A view from South Africa

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By Nigel Gwynne-Evans, Western Cape Government, South Africa, presented at the 16th TCI Global Conference, Kolding 2013.
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Differing priorities in clustering and innovation – a view from South Africa Nigel Gwynne-Evans Cluster Development in Times of Change 5 September 2013
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Page 1: TCI2013 A view from South Africa

Differing priorities in clustering and innovation – a view from South AfricaNigel Gwynne-Evans

Cluster Development in Times of Change

5 September 2013

Page 2: TCI2013 A view from South Africa

Differing priorities in clustering and innovation – a view from South Africa

TCI ConferenceSeptember 2013

Page 3: TCI2013 A view from South Africa

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Broad generalisations between developing and developed economies

• Differing industrial structure (More primary sector/ industrially focused).

• Within sectors – differing challenges.

• Cluster initiatives at different phases – generally less mature.

CONCERN WITH THE USE OF “INNOVATION” AS A CONCEPT FOR DELIVERY IN A DEVELOPING COUNTRY CONTEXT

Page 4: TCI2013 A view from South Africa

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Cape region cluster programme key facts

• 15 clusters – Euro 60m since 2006

• 140 staff in clusters (40 Public/ 100 Cluster )

• Funding - 60% from government/ 40% outside

• 6000 member companies represented

• All 4 universities

• Average 6 staff per SPV, but range from 2 up to 35 employees.

• Not-for profit companies • Public/ Private funded • Open membership to all firms

and actors within the cluster • Representative boards (majority

industry + reps from academic & research institutions / government).

• Directors appointed on an annual basis through open-AGM process

• Directors positions are non-remunerative

• CEOs – industry specialists

Background Nature of Clusters

Page 5: TCI2013 A view from South Africa

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Focus sectors for economic development: High multipliers

Focus sectorsFocus

sectors

• Oil, Gas and Marine

Complex

• Green Economy

• Tourism and Film

• BPO, Financial Services and

ICT

• Oil, Gas and Marine

Complex

• Green Economy

• Tourism and Film

• BPO, Financial Services and

ICT

• Agri- Aqua and food

processing

• Creative and Design-

Industries

• Clothing, Textiles & Fashion

• Metals and Engineering

• Agri- Aqua and food

processing

• Creative and Design-

Industries

• Clothing, Textiles & Fashion

• Metals and Engineering

1st leg: Key Propulsive Sectors

1st leg: Key Propulsive Sectors

2nd Leg: Employment Supporting Sectors

2nd Leg: Employment Supporting Sectors

Focused on reducing unemployment, through facilitating 400,000 new direct jobs: Further multiplier effects of 2.5

Page 6: TCI2013 A view from South Africa

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WC Clusters - 2013

Page 7: TCI2013 A view from South Africa

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10 functions of Cluster Initiatives

Goals of cluster

initiatives

Marketing and promotion

Skills and training

Debottlenecking

Innovation support Transformation

Productivity programmes

Networking

Understand the industry

Business development Support institutions

1

2

“SPVs provide the framework to deliver targeted programmes to firms within an industry sector”

3

4

5

6

7

8

9

10

Page 8: TCI2013 A view from South Africa

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Primary product/ Industrially focused needs

• Structure of the SA cluster programme – dominated by manufacturing – primary producers

• Programmes dominated by benchmarking, upgrading programmes, investment attraction, export-development, skills.

• Service sectors focused on skills, promotion, mentorship, venture capital attraction).

Page 9: TCI2013 A view from South Africa

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Examples of dominant functions of each sector:

• Oil and gas services: Infra-structure, skills, investment attraction

• Clothing and textiles: Lean manufacturing and benchmarking

• Agri-processing: New investment, export development and production efficiencies

• Engineering: Skills and lean manufacturing.• Clean-tech: Investment attraction, skills • Craft and design Sectors: Entrepreneurship,

market development, product development

Page 10: TCI2013 A view from South Africa

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Dominant Functions in service sectors:

• Call-centres: Investment attraction and skills

• ICT sector: Entrepreneurship support; skills development, funding attraction.

• Bio-tech: Commercialisation

Page 11: TCI2013 A view from South Africa

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Our experience with “Innovation” as a tool

• Innovation a very broad concept

• Difficult to determine the tools that should be applied

• Not well understood in primary/ manufacturing sectors

• Difficult to convince CEO’s/MD’s that they need to adopt innovation as a priority (need to focus on more concrete actions)

• Triple Helix / R&D considerations less critical? (Applied research & graduate development more important)

Page 12: TCI2013 A view from South Africa

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For Africa/ Developing countries

• Be wary of driving developed economy agenda’s on early-stage cluster development

• Focus on addressing competitiveness issues and the underlying market failures confronting each sector • Firm-level upgrading & market

development • Skills development • Infra-structure and investment • Regulatory constraints

Page 13: TCI2013 A view from South Africa

Thank you


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