Kingdom of Saudi Arabia:Toward Knowledge-Based Economy

Mohammed I. Al-SuwaiyelPresident, King Abdul-Aziz City for Science and Technology

2008 Global Competitiveness Forum20-22 January 2008, Riyadh

� Introduction�The digital and knowledge divides

� Investment in Research and Development

�Planning for Science and Technology in Saudi Arabia

OUTLINE

1. If you give a man a fish, you feed him for a day2. If you teach a man how to fish, you feed him for a

lifetime.3. If invent a better method of fishing, e.g.

� better fish farming, better sales techniques, better fish (GM),

� prevent over-fishing, You will feed many people or even whole nations for a

long time!

� Step 3 is all about generating knowledge and knowledge-based economy.

INTRODUCTION

The fish analogy from “Knowledge and the Wealth of Nations,”, David Warsh, W W Norton & Co .2006

� The Kingdom has successfully completed seven, five-year development plans that focused on prioritized, need-based development areas.

� The current development plan, i.e. the eighth, emphasizes largely knowledge-based economy and addresses the following areas:

– Development of public education– The national plan for information and communication– The National Policy for Science and Technology

Where Does Saudi Arabia: What’s next?

� Digital Divide describes differences in Information and Communications Technologies (ICTs) among countries, regions within countries, etc.

� It is generally measured by two indicators: – Access to communications and information

technologies– Utilization of these technologies (e-readiness,

applications) � The Kingdom has narrowed the digital divide

in the past few years via the national information technology plan.

Digital Divide

� Knowledge Divide describes differentials in abilities of countries, regions to create, adapt and use knowledge, as such it is not about differences in technological capabilities, but also about: – Education system and people skills – Institutional capabilities, which provide

incentives for acquiring and using knowledgeeffectively.

� The Kingdom seeks to bridge the knowledge divide by putting into effect the National Policy for Science and Technology and by investing in education, training, and support for innovation and creativity.

Knowledge Divide

Source: Bridging the Digital and Knowledge Divide, Frannie Léautier, World Bank Institute Sept 2005.

Science and Technology: Investment in R&D

CountryYearGovernment Spending

Private Sector Spending

Japan200420%80%

USA200331%69%

Germany200331.1%68.9%

France200340.8%59.2%

UK200432.9%67.1%

EU200335.5%64.5%

•The private sector in developed countries contributes about 66% of the total.•The private sector in developing countries does not invest in R&D because it believes that the risks are high, which is true! •Recent studies have shown that R&D produced a return about three times larger than capital investment.

•http://www.mext.go.jp/english/news/2007/03/07022214/002/001.htm

8

� NSTP Policy document was approved by Council of Ministers on 8/7/2002AD (27/4/1423AH)….

� Allotted budget for the next five years is 7.9 billion Saudi Riyals.

� The Government Expenditure on R&D is planned to be 0.7% of the GDP by 1433 AH (2012 AD)

� The Government Expenditure on R&D is planned to be 1.6% of the GDP by 1438 AH (2017 AD).

� The national sector is expected to contribute increasingly to R. & D. spending more than 1% in 2012 and more than 2% in 2017.

The National Science and Technology PolicyNSTP

Join the advancedcountries in S&T by enhancing the S&T Competitiveness by 2025

To be a leader in the region nations in Competitive S&TTo be a leader in the region nations in Competitive S&T

•1st 5y Plan (2010)

Become the center of research in the regionBecome the center of research in the region

•2nd 5y Plan (2015)

Become a major hub for research in AsiaBecome a major hub for research in Asia

•3rd 5y Plan (2020)

To join the industrialized nationsTo join the industrialized nations

•4th 5y Plan (2025)

Long-term Vision

NATIONAL SCIENCE AND TECHNOLOGY POLICY

Session issues

� Desire and need for the Kingdom of Saudi Arabia to go beyond oil and contribute more to the global economy

� The impact of the 10 by 10 program of the General Investment Authority on the local business environment

� Leveraging the Kingdom’s competitive advantages to become a strong global player in ICT and energy

� Competitiveness of Saudi Arabia and its role as a global leader

Thanks to the Audience and to the

Organizers!