This paper seeks to underscore<sup>theimportanceofscience andtechnologyfor</sup> development, the policies<sup>thatcanmaximizethebenefitsof S&Tatthecountrylevel,</sup> and the strategic approaches<sup>thattheWorldBankanditspartnerscanadopttohelp</sup> accelerate the growth of scientific<sup>and technological capacityinthe developing world.It</sup> proposes specific ways for<sup>the World Banktointegratethe isolatedactivitiesit currently</sup> undertakes in support of improved<sup>S&T capacity,makingfutureactionsmoretargeted</sup> and effective.

The paper has three sections<sup>followingthisintroduction. SectionAaddresses the</sup> state of the developing world's<sup>scienceand technology capacity.SectionBdiscusses the</sup> policy options for reaping<sup>the benefitsof S&T.SectionC presents lessonslearnedfrom</sup> World Bank experience and<sup>Section D discussesthe implicationsof thelessonslearned</sup> and explores avenues for renewing<sup>the role of the World Bank inS&T capacity building.</sup> It is cheaper and easier<sup>now thaneverbeforetogainaccesstoscientificand</sup> technological knowledge,<sup>thanks mostlytonew informationandcommunication</sup> technologies. But access to knowledge<sup>withoutthecapacitytouse itisworthless.</sup> Countries lacking adequate<sup>infrastructuretocaptureandusetheincreasingamountof</sup> accessible knowledge and information<sup>stand nochance tobenefitfromit.Theneeded</sup> infrastructure is a mix of human<sup>capacity,hardware,institutions,incentives, policiesand</sup> investments. Finding ways<sup>to createandstrengthentheinfrastructure whereit isabsent</sup> is not simple, but the costs of<sup>inaction make it an imperativetask.</sup> The differences in capacity<sup>betweenthescientifically-advancedcountriesofthe</sup> OECD and the poorer countries<sup>of thedevelopingworldarestark.</sup> OECD countries spend more annually on<sup>R&Dthanthevalueof total economicoutputof61ofthe</sup> world's lowest-income countries<sup>3(US$500billionversusUS$ 464billionin1998).4</sup> Again, compared with low-income<sup>countries,OECD countrieshavetwelvetimesthe per</sup> capita number of scientists<sup>andengineersworking inR&D andpublish25timesmore</sup> scientific journal articles per<sup>capita. IntheOECD,theratioof patentsfiledbynon-</sup> residents to those filed by residents<sup>is3.3toone,whileinlowincomecountriesit is690</sup> to one.<sup>5</sup> Of course, quantitative<sup>measuressuchasthesizeof R&Dbudgetsgiveonlya</sup> partial glimpse of the situation;<sup>theyfallshortof describing the fullrangeof differences</sup> in S&T capacity. S&T capacity<sup>isamulti-faceted ensembleofhuman,physical,</sup> organizational, institutional,<sup>and financial capitalwhich defiesreductionto asingle set of</sup> indicators.

> 3 The low-income countries,<sup>excluding China and India:Data from World Bank's WorldDevelopment</sup> Indicators 2000.

> 4 OECD Science, Technology,<sup>and Industry Outlook 2000.</sup>

> 5 Inventors must patent their inventions<sup>separately in each country in which theywish to have them</sup> protected. A single invention may<sup>therefore be patented in severaldozen countries.Becauseof this,a high</sup> ratio of foreign to local patent<sup>applicationsindicatesa low level of innovativeactivity amongnational</sup> researchers. Despite the other<sup>vanousfactorsthat bear on thedecision whether and whereto seek patents,</sup> the ratio of foreign to domestic<sup>applicationsis considered a reasonably reliable indicatorof national</sup> innovation effort.

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