Krisis di Eropa, dan Peran R&D dan

Inovasi dalam bidang ICT

Pelajaran Apakah yang Bisa Diambil untuk
Indonesia?
IBRAHIM KHOLILUL ROHMAN *

*) Research fellow at JRC-IPTS, European Commission, Seville, Spain

The information and views set out in this presentation are personal and do not necessarily
reflect the official opinion of the JRC-IPTS
 What we are going to talk
About myself and JRC-IPTS
Setting the scene: R&D, innovation
and ICT sector
The recent outlook of the
European economy
The importance of Research and
development
ICT sector and why Europe pays a lot
attention on it?
Horizon 2020: The EU exit strategy
from crisis.
What can we learn?
 What we are going to talk
About myself and JRC-IPTS
Setting the scene: R&D, innovation
and ICT sector
The recent outlook of the
European economy
The importance of Research and
development
ICT sector and why Europe pays a lot
attention on it?
Horizon 2020: The EU exit strategy
from crisis.
What can we learn?
 JRC
We are doing science for policy
The Joint Research Centre (JRC) is the
European Commission's in-house science
service which employs scientists to carry out
research in order to provide independent
scientific advice and support to EU policy.
Who we are?

Direct link to decision making

process
There are 33 DGs

Matrix organization (most of the

works with CONNECT, GROW, RTD,
EMPLOY, JUST
Where
we are?
 What we are going to talk
About myself and JRC-IPTS
Setting the scene: R&D, innovation
and ICT sector
The recent outlook of the
European economy
The importance of Research and
development
ICT sector and why Europe pays a lot
attention on it?
Horizon 2020: The EU exit strategy
from crisis.
What can we learn?
 What we are going to talk
About myself and JRC-IPTS
Setting the scene: R&D, innovation
and ICT sector
The recent outlook of the
European economy
The importance of Research and
development
ICT sector and why Europe pays a lot
attention on it?
Horizon 2020: The EU exit strategy
from crisis.
What can we learn?
 Setting the scene

The new paradigm of

economic growth
theory

It suggests that the future of economic growth will depend on how a

country raises the level of innovation and technological development
through the process of creative destruction initiated with imitation and
diffusion spreading throughout the economic system. Moreover, the ICT
sectors are best suited to the rapid technological innovation process in this
paradigm.
 The new paradigm of
economic growth theory

Technology, innovation and the role of economic variable. The process of

innovation when a particular invention is adopted and distributed to different
markets is amenable to economic analysis thus it is possible to account for a large
share of the spatial and chronological difference in this process .
Zvi.G. (1957) Hybrid corn: an exploration in the economics and technological
change. Econometrica, Volume 25, October 1957 Cambridge
Endogenous technological changes : having a large population is not sufficient to
generate economic growth but the portion of spending in the R&D activities and
the development of human capital
Romer, P.M., (1990) Endogenous technological changes, Journal of Political
Economy, Vol 98, No.4.
The role of ICT in supporting economic growth.
Scherer, F.M., (1999), New Perspective on Economic Growth and Technological
Innovation, Washington DC: Brooking Institute Press.
 The new paradigm of
economic growth theory

The technology effect is still more dominant driving diffusion process of new
services in European countries. It is due to the economic variables is actually
led by technological changes
Herald.G, and Frank.V. (2001) The diffusion of mobile telecommunications
services in the European Union, European Economic Review 45 (2001),
pp.577-588
Other study : Sridhar and Sridhar on India (2004), Belaid : on developing
countries , Shiu and Lam: on 105 countries (2008), Chakraborty on developing
countries (2009)
 The new paradigm of
economic growth theory

Grossman and Helpman (1991), this new concept of economic growth

should be examined as a transformation of innovation.
Scherer (1999, pp.33-36) stresses that the future of economic growth
depends on how a country raises the level of innovation and
technological development through the process of creative
destruction.
Gould and Ruffin (1993) the role of technology is important as a
source of growth based on the relation between growth-enhancing
factors and technological development. It is believed that technology
drives the level of human capital, education and rate of investment
 The new paradigm of
economic growth theory
 Information and Communications
Technology
ICT
 ICT sector (OECD, 2008, 2009)

Constant monitoring (PREDICT study)

 What we are going to talk
About myself and JRC-IPTS
Setting the scene: R&D, innovation
and ICT sector
The recent outlook of the
European economy
The importance of Research and
development
ICT sector and why Europe pays a lot
attention on it?
Horizon 2020: The EU exit strategy
from crisis.
What can we learn?
 What we are going to talk
About myself and JRC-IPTS
Setting the scene: R&D, innovation
and ICT sector
The recent outlook of the
European economy
The importance of Research and
development
ICT sector and why Europe pays a lot
attention on it?
Horizon 2020: The EU exit strategy
from crisis.
What can we learn?
 Europe at a glance

Source : ECB
 Decreasing performance

Source: Corrado and Jaeger (2014)

Labor productivity and growth trend
Growth decomposition
Forecasting
Problem concerning productivity
Different pictures of Europe
Different pictures of Europe
Investment
More detail
 ICT sector
PREDICT 2:
EU vs.
Map andrest of the world
summary (2010-2011)
o (201f
theSource
results
: PREDICT (2014). Rohman (ed)
Legend General improvement from previous year
General decline from previous year

Business Researcher
R&D Public
Value added Employment Enterprise and
funding
R&D personnel

General finding

Comparison
between MS

Comparison
between ICT sub
sector

Comparison with
selected non ICT
sector Non- Non- Non-
Non-

Comparison with
selected non EU
countries

ICT VA ICT sector

share of employment share of total ICT
BERD R&D
GDP share of total sector employment
intensity intensities
employment
30 5 August 2017
 Public funding on ICT R&D

Source : Stancik & Rohman (2014)

Progress on Digital Agenda for Europe (DAE)

100%

25%

10% 12%
Cumulative growth rate

15%

10%

5%

1%

2007 2008 2009 2010 2011 2020 Year

5.5 billion 11 billion Target

Source: Stancik (2012) & Stancik & Rohman (2014)

32 5 August 2017
 Summary of current condition
The combined downturns and subsequent economic
stagnation have potentially eroded some sources of long-term
growth, such as skills and ICT investment.
Countries in the Integrated Value Chain group delivered by
far the largest total factor productivity improvement.
Productivity is the Achilles heel in Europes growth picture
and not lack of investment, as is sometimes argued.
The intensity of ICT capital is strongly related to the level of an
economys development

Source : Various studies (CB, CJ, 2015)

 Summary of current condition
As more companies adopt technology and innovations spread across the
economy, the impact on productivity at macro levels becomes more visible.
The rapid diffusion of high-speed networks and mobile devices has the
potential to empower consumers and businesses to drive demand in new
ways.
Countries with large Internet economies are receiving more revenue growth
and consumer surplus affiliated with broadbands diffusion to households.
Pre-conditions for reaping ICT-driven growth benefits need to be secured by
a high-quality and affordable infrastructure in all sectors.
The role of ICT should be increased : 1. a productivity effect through the ICT
producing sector, 2. an investment effect from ICT-using industries through
capital deepening, and 3. a productivity effect from an efficiency rise
through the use of ICT which goes beyond the direct capital deepening
effect.
Source : Various studies (CB, CJ, 2015)
 What we are going to talk
About myself and JRC-IPTS
Setting the scene: R&D, innovation
and ICT sector
The recent outlook of the
European economy
The importance of Research and
development
ICT sector and why Europe pays a lot
attention on it?
Horizon 2020: The EU exit strategy
from crisis.
What can we learn?
 Exiting the crisis
The European Union has been working hard to move decisively
beyond the crisis and create the conditions for a more competitive
economy with higher employment.
The Europe 2020 strategy is about delivering growth that is: smart,
through more effective investments in education, research and
innovation; sustainable, thanks to a decisive move towards a low-
carbon economy; and inclusive, with a strong emphasis on job
creation and poverty reduction. The strategy is focused on five
ambitious goals in the areas of employment, innovation, education,
poverty reduction and climate/energy.
To ensure that the Europe 2020 strategy delivers, a strong and
effective system of economic governance has been set up to
coordinate policy actions between the EU and national levels.
 Horizon 2020
What is Horizon 2020?
Horizon 2020 is the biggest EU Research and Innovation programme ever
with nearly 80 billion of funding available over 7 years (2014 to 2020) in
addition to the private investment that this money will attract. It promises
more breakthroughs, discoveries and world-firsts by taking great ideas
from the lab to the market.
Horizon 2020 is the financial instrument implementing the Innovation
Union, a Europe 2020 flagship initiative aimed at securing Europe's global
competitiveness.
Seen as a means to drive economic growth and create jobs, Horizon 2020
has the political backing of Europes leaders and the Members of the
European Parliament. They agreed that research is an investment in our
future and so put it at the heart of the EUs blueprint for smart,
sustainable and inclusive growth and jobs.
 Horizon 2020
What is Horizon 2020?
By coupling research and innovation, Horizon 2020 is helping to achieve
this with its emphasis on excellent science, industrial leadership and
tackling societal challenges. The goal is to ensure Europe produces world-
class science, removes barriers to innovation and makes it easier for the
public and private sectors to work together in delivering innovation.
Horizon 2020 is open to everyone, with a simple structure that reduces
red tape and time so participants can focus on what is really important.
This approach makes sure new projects get off the ground quickly and
achieve results faster.
The EU Framework Programme for Research and Innovation will be
complemented by further measures to complete and further develop the
European Research Area. These measures will aim at breaking down
barriers to create a genuine single market for knowledge, research and
innovation
Horizon 2020
Pelajaran yang bisa diambil
 The future direction of economy

The total GDP for 48 Sub-Saharan African countries in 1995-1996

was approximately USD 325 billion (1995) and USD 338 billion
(1996), only 72% of the aggregate weightless economy consisting
of the intellectual capital in General Electric, Microsoft and Shell.
When intellectual property is properly
developed...
Challenges
Current map
 Radical policies are needed!!
More R&D activities.
A parallel process with the conventional
structural transformation
Not to develop The Silicon Valley in all regions
But to promote more
Berapa jumlah perusahaan Indonesia
dalam top 2000 R&D spender?

Source : JRC-IPTS Industry Scoreboard

 Asians top 2000 R&D intensive
companies

Source : IPTS-European Commission, Industry Scoreboard (2013). The highest R&D companies in Asia
 Bagaimana wajah industri kita?

Source : IPTS-European Commission, Industry Scoreboard (2013). The highest R&D companies in Asia
 Nest sales and R&D

Source : IPTS-European Commission, Industry Scoreboard (2013). The highest R&D companies in Asia
Bagaimana wajah pendidikan tinggi
dan lembaga penelitian kita?
R&D budget
 R&D budget

Mulyanto (2012)
 Indonesia vs ASEAN
B. Lakitan et al. / Technology in Society 34 (2012) 227238
Published article
 Published article

Source: Lakitan (2012)

Published article
Our triple helix
Institutional problem (?)
Broadband sector
El-Darwiche (2009)
Broadband
 Internet cepat untuk apa? (Sembiring,
2012)
Application Broadband speed
Application technology 1Mbit/s 10Mbit/s 100Mbit/s 1Gbit/s

High-quality non-real-
time video-imaging for File transfer High quality High quality High quality High quality
diagnosis

Cardiology neurology
Low/ Medium
and emergency room H.323 video High quality High quality High quality
consultations quality1)

Cineo-angiography and Low/ Medium

H.323 video High quality High quality High quality
Echocardiograms quality1)

3D interactive brain
imaging
SGI Vizserver Unsupportable Unsupportable Medium quality High quality

Clinical decision support

systems
Web browsing Medium quality High quality High quality High quality

Advanced clinical
decision support system
Image transfer Unsupportable Low quality Medium quality High quality

Professional tele-
education
MPEG 1 video Low quality2) High quality High quality High quality

Source: Network Developments in Support of Innovation and User Needs, OECD (2009), Arthur D. Little analysis
Note: 1) At least 10Mbit/s is normally recommended for H.323 video. 2) MPEG 1 video typically required 1,5Mbit/s without excessive quality loss.
Indonesia vs ASEAN
 Broadband development

Competition and Regulation in Network Industries,

Volume 16 (2015), No. 1
 Epilogue
More R&D activities.
Promoting more R&D companies (R&D patent box,
etc)
Universities
Stronger triple helix
A greater emphasize on the broadband
development
Parallel processes between conventional
economic structural transformation and leap-frog
policies new paradigm (R&D and innovation)
THANK YOU --GRACIAS