metadata: authors: 0: author: Watson,Robert T.
1: author: Crawford, Michael
2: author: Farley, Sara
docna: 0: docna: Strategic approaches to science and
            technology in development
docty: Policy Research Working Paper
subtopic: Health Care Services Industry,Education Information &
            Communications Technologies,Tertiary Education,Educational Sciences,Educational Institutions & Facilities,Educational Informatics,Inequality
teratopic: Poverty Reduction
abstracts: cdata!: Watson, Crawford, and Farley examine the
            ways in which science and technology (S&T) support
            poverty alleviation and economic development and how these
            themes have been given emphasis or short shrift in various
            areas of the World Bank's work. Central to their thesis
            is the now well-established argument that development will
            increasingly depend on a country's ability to
            understand, interpret, select, adapt, use, transmit,
            diffuse, produce, and commercialize scientific and
            technological knowledge in ways appropriate to its culture,
            aspirations, and level of development. The authors go beyond
            this tenet, analyzing the importance of S&T for
            development within specific sectors. They present policy
            options for enhancing the effectiveness of S&T systems
            in developing countries, review previous experience of the
            World Bank and other donors in supporting S&T, and
            suggest changes that the World Bank and its partners can
            adopt to increase the impact of the work currently
            undertaken in S&T. The authors' main messages are:
            1) S&T has always been important for development, but
            the unprecedented pace of advancement of scientific
            knowledge is rapidly creating new opportunities for and
            threats to development. 2) Most developing countries are
            largely unprepared to deal with the changes that S&T
            advancement will bring. 3) The World Bank's numerous
            actions in various domains of S&T could be more
            effective in producing the needed capacity improvements in
            client countries. 4) The World Bank could have a greater
            impact if it paid increased attention to S&T in
            education, health, rural development, private sector
            development, and the environment. The strategy emphasizes
            four S&T policy areas: education and human resources
            development, the private sector, the public sector, and
            information communications technologies.
repnme: repnme: Strategic approaches to science and
            technology in development
display_title: Strategic approaches to science and
            technology in development
listing_relative_url: /research/2003/04/2329621/strategic-approaches-science-technology-development
topicv3: Tertiary Education m1326349 482,Poverty m1326687 695,Education and ICT m1327028 494,Education m1327048 470,Health m1504661 3480
publishtoextweb_dt: 2010-07-01T00:00:00Z
historic_topic: Poverty Reduction
origu: Education Team (HDNED)
no_of_pages: 68
model_extractions: POLICY RESEARCH WORKING PAPER 3026

# Abstract

Watson, Crawford, and Farley examine the ways in which science and technology (S&T) support poverty alleviation and economic development and how these themes have been given emphasis or short shrift in various areas of the World Bank's work. Central to their thesis is the now well-established argument that development will increasingly depend on a country's ability to understand, interpret, select, adapt, use, transmit, diffuse, produce, and commercialize scientific and technological knowledge in ways appropriate to its culture, aspirations, and level of development. The authors go beyond this tenet, analyzing the importance of S&T for development within specific sectors. They present policy options for enhancing the effectiveness of S&T systems **in** developing countries, review previous experience of the World Bank and other donors in supporting S&T, and suggest changes that the World Bank and its partners can adopt to increase the impact of the work currently undertaken in S&T. The authors' main messages are: S&T has always been important for development, but the unprecedented pace of advancement of scientific knowledge is rapidly creating new opportunities for and threats to development.

- Most developing countries are largely unprepared to deal with the changes that S&T advancement will bring. **o** The World Bank's numerous actions in various domains of S&T could be more effective **in** producing the needed capacity improvements **in** client countries.

**-** The World Bank could have a greater impact if **it** paid increased attention to S&T **in** education, health, rural development, private sector development, and the environment.

The strategy emphasizes four S&T policy areas: education and human resources development, the private sector, the public sector, and information communications technologies.

> This paper-a Joint product of the Education Team, Human Development Network, and the Environmentally and Socially Sustainable Development Vice Presidency-is part of a larger effort in the Bank to engage client countries **in** an active science

> and technology dialogue while increasing awareness of the centrality of these issues to the Bank's work. Copies of the paper are available free from the World Bank, 1818 H Street NW, Washington, DC 20433. Please contact Robert Watson, room MC4-139, telephone 202-473-6965, fax 202-S22-7122, email address rwatson@worldbank.org. Policy Research Working Papers are also posted on the Web at http://econ.worldbank.org. The other authors may be contacted at mcrawford@worldbank.org or sfarley@worldbank.org. April 2003. _(52_ pages)

_The_ **_Policy_** _Research Working Paper Series disseminates the findings of work_ **_in_** _progress to encourage the exchange of ideas about development issues An obhective of the series is to get the findinzgs out quickly, even_ **_if_** _the presentations are less than fully polished. The papers carry the narmes of the authors and should be cited accordingly The findings, interpretattons, and conclusions expressed_ **_in_** _this paper are entirely those of the authors. They do not necessarily represent the view of the World Bank,_ **_its_** _Executive Directors, or the countries they represent_ Produced by the Research Advisory Staff
# STRATEGIC APPROACHES TO SCIENCE AND TECHNOLOGY IN DEVELOPMENT

Robert Watson, Michael Crawford and Sara Farley
# **Table of Contents**

|**Executive**|**.........................................................................**|**...................**<br>**v-ix**|
|---|---|---|
|**Summary**|||
|**Introduction**|**............................................................................................**<br>|**1-5**|
|**SectionA **|**TheImportanceofS&Tfor**||
||**Development.**|**5-12**|
||<br>_TheRoleofS&TinPovertyAlleviation_<br>_TheRoleofS&TinCreating_<sup>_EconomicOpportunity_</sup><br>_ExistingS&TCapacityinthe_<sup>_DevelopingWorld_</sup>||
|**SectionB **|**PolicyOptionsforReaping**<sup>**theBenefits**</sup><br>**fromS&T.12-19**<br>_PoliciesforBuilding andMaintaining_<sup>_AdequateHumanCapitalforS&T_</sup><br>_PoliciesthatEncouragea Demandfor_<sup>_KnowledgeinthePrivateSector_</sup><br>_PoliciesforEffectivePublicSupport_<sup>_ofScientificandTechnological Research_</sup><br>_PoliciesthatMaximizetheBenefits_<sup>_fromInformationandCommunications_</sup>||
||_Technologies_<br>_AdjustingPoliciestoFitthe_<sup>_NeedsofSmaller,PoorerStates_</sup>||
|**Section C**|<br>**WorldBankExperience**<br>**inPromotingS&TCapacity**<sup>**.19-26**</sup>||
||<br>*<br>WorldBankexperienceinpromoting<sup>humancapital inS&T</sup>||
||*<br>WorldBankexpernencein creating<sup>demandforknowledgeinthe</sup><br>productivesector<br>*<br>WorldBankexperienceinfostering<sup>theproperpublicroleforS&T</sup>||
||*<br>WorldBankexperiencewiththepromotion<sup>ofICTinfrastructure</sup><br>_ExperienceofBi-LateralDonors,_<sup>_NGOsandFoundations_</sup>||
|**SectionD **|**RethinkingtheWorldBank's**<sup>**Approachto**</sup><br>**ScienceandTechnologyin**<sup>**Development.26-32**</sup>||
||*<br>Increasing awareness||
||*<br>Increasingattentionto S&Tinthe<sup>fourpolicyareas</sup>||
||<br>*<br>Buildingtheanalyticalbaseand<sup>promotingglobalpublicgoodsforS&T</sup><br>*<br>Strengthenigpartnerships||
|**APPENDIX**|**1**<br>**MillenniumDevelopmentGoals**<sup>**andtheS&TInputsNecessaryfor**</sup><br>**theirAttainment**|**33**|
|**APPENDIX**|2<br>**PolicyOptionsbyCountryGrouping**|**34-37**<br>|
|**APPENDIX**|<br>3<br>**Reviewersand Consultants**|**38-44**|
|**APPENDIX**|4<br>**Bibliography**|**45-52**|
# RESOURCES AND ACKNOWLEDGEMENTS

This paper on Strategic Approaches to Science and Technology in Development was produced in tandem with several background pieces, including a larger volume, together referred to as "A Resource Book for S&T in Development." The various background papers composing the resource book treat many of the issues discussed in this strategic approaches paper in greater detail. Throughout this paper, footnotes will direct the interested reader to the more detailed discussions contained in these background papers. Full citations for publications cited **in** both the strategic approaches paper and the resource book may be found in the bibliography. Titles of the background papers included in the resource book include: "Bi-laterals, NGOs, and Foundation Experience"; "Science and Technology for Development Regional Issues in S&T Policies for Developing Countries: Africa--Selected Case Studies of S&T and Innovation Capacity"; "Lessons Learned from Previous Attempts to Promote S&T Capacity"; "RAND Study: Science and Technology Collaboration-Building Capacity **in** Developing Countries"; "The Millennium Science Initiative"; and, "The Role of the Pnvate Sector in Facilitating the Acquisition of Technology in Developing Countries." Please contact authors Sara Farley or Robert Watson for further mquiries.' This first volume was presented to the Bank Board in tandem with the Tertiary Education Strategy on July 23, 2002, where it received approval and commentary.

The authors would like to thank several kind contributors and reviewers for their ideas, commentary, edit and support. These individuals include: Elju Pehu, Launtz Holm-Nielsen, Gary Alex, Jean-Eric Aubert, Derek Byerlee, Shawki Barghouti, Leonid Norsworthy, Jacob Bregman, Donald Bundy, Charles Kenney, Sarwat Hussain, Mariam Claeson, and Kabir Kumar. Special thanks are due to several external contnbutors including C.N. R. Rao, Victor Ngu, Caroline Wagner, Gerald Lalor, Attia Sashour, Enk Thulstrup, Najia Ariguib, Tony Maijoram, Lill-Ann Bjaarstad Medina, Abed Peerally, Pedro Aymonino, E.M. Essien, Karin Roggenbuck, Jon Andri Lys and M. Shamsher Ali. The team initiated the work under Ian Johnson, vice president of the Environmentally and Socially Sustainable Development Network and finalized the work under Ruth Kagia, director of the Education Department and Jo Ritzen, vice president of the Human Development Network.

Extensive consultations on various drafts were carried out within and outside of the World Bank. In addition to review meetings with various sector staff in the Human Development and Environmentally and Socially Sustainable Development Networks as well as other areas of relevance to the Bank's S&T work, stakeholder consultations were convened in Paris, Abidjan, and New Delhi to seek the views of the international S&T community. The list of those who attended these consultations and review meetings and who generously offered written conmments would be to long to permit recognition of the contributions of each individual. Annex 3 contains the names, titles and country of origin of all of those individuals who served as reviewers, consultants and peer editors to whom we offer our thanks.

Email addresses follow: rwatson@worldbank.org and sfarley@worldbank.org ii
**List of Acronyms**

|CGIAR|ConsultativeGrouponInternationalAgnculturalResearch|
|---|---|
|DALY|Disability-AdjustedLifeYears|
|DANIDA|DanishMinistryofForeign Affairs|
|DGF|DevelopmentGrantFacility|
|DGIS|DutchMinistryofForeignAffairs<br>|
|ENRECA|EnhancingResearchCapacity(ResearchProgramofDANIDA)|
|ERC|EngineeringResearch Centers|
|ESSD|EnvironmentallyandSociallySustainableDevelopment|
|FDI<br>|Foreign DirectInvestment<br>|
|FY|FiscalYear|
|GDP|GrossDomestic Product|
|GM|GeneticallyModified|
|GTOE|<br>ThousandMillion TonsofOilEquivalent|
|HDN|HumanDevelopmentNetwork|
|IARC|International Agricultural ResearchCenters|
|ICSU|IntemationalCouncil forScientificUnions|
|ICT|InfornationCommunicati6risTechnology|
|IFS|InternationalFoundationforScience|
|InfoDEV|InformationforDevelopment Program<br>|
|IPCC|IntergovernmentalPanelonClimate Change|
|IPR|IntellectualPropertyRights|
|ISR|Industry-ScienceRelations|
|ITD|IndustrnalTechnologyDevelopment|
|JICA|Japan InternationalCooperation Agency|
|MDG|MillenniumDevelopmentGoals|
|MFP|<br>Multi-Factor Productivity|
|MSB|MauritiusStandardsBureau|
|MSI|MillenniumScienceInitiative|
|MSTQ|Metrology,Standards, Testing and Quality|
|NARIS|<br>NationalAgriculturalResearch Institutes|
|NARS|NationalAgriculturalResearch System|
|NGO|Non-governmentalOrganization|
|NIS|NationalInnovationSystem|
|NORAD|Norwegian AgencyforDevelopment Cooperation|
|ODA|OfficialDevelopmentAssistance|
|OECD|Organization forEconomicCooperation andDevelopment|
|OED|OperationsEvaluation Department<br>|
|PISA|ProgramforInternational StudentAssessment|
|R&D|ResearchandDevelopment|
|S&T|Scienceandtechnology|
|SAREC|DepartmentforResearch CooperationofSIDA|
|SIDA|The SwedishInternationalDevelopmentCooperationAgency|
|SME|SmallandMediumEnterprises|
|SPAAR|SpecialProgramforAfricanAgricultural Research|
|TDS|TechnologyDiffusionScheme|
|TIMSS|<br>TrendsInternationalMathematicsandScienceStudy|
|TSC|Technology StrategyforCompetitiveness|
|TWAS|ThirdWorld AcademyofSciences|
|UNAIDS|Joint UnitedNationsProgram on HIV/AIDS|
|WBI|<br>WorldBankInstitute|
# ABSTRACT

This paper examines the ways in which science and technology (S&T) support poverty alleviation and economic development and how these themes have been given emphasis or short shrift in various areas of the World Bank's work. Central to the paper's thesis is the now well-established argument that development will increasingly depend on a country's ability to understand, interpret, select, adapt, use, transmit, diffuse, produce and commercialize scientific and technological knowledge in ways appropriate to its culture, aspirations and level of development. The paper goes beyond this tenet, analyzing the importance of S&T for development within specific sectors. It presents policy options for enhancing the effectiveness of S&T systems in developing countries, reviews the previous experience of the World Bank and other donors in supporting S&T, and suggests changes that the World Bank and its partners can adopt to increase the impact of the work currently undertaken in S&T. Its main messages are that: (i) S&T has always been important for development, but the unprecedented pace of advancement of scientific knowledge is rapidly creating new opportunities for and threats to development; (ii) most developing countries are largely unprepared to deal with the changes that S&T advancement will bring; (iii) the World Bank's numerous actions in various domains of S&T could be more effective in producing the needed capacity improvements in client countries; and (iv) the World Bank could have a greater impact if it paid increased attention to S&T in education, health, rural development, private sector development, and the environment. The strategy emphasizes four S&T policy areas: education and human resources development, the private sector, the public sector and information communications technologies.

iv
# **STRATEGIC APPROACHES**<sup>**TO**S&T</sup><sup>**INDEVELOPMENT:**</sup> EXECUTIVE **SUMMARY**

Since its founding, the<sup>WorldBankhassoughttopromotespecificaspectsofscienceand</sup> technology (S&T), especially<sup>intheareaofagricultural research.ThisStrategicApproaches Paper</sup> tmderscores the ways<sup>inwhichscienceand technologysupportpoverty alleviationand economic</sup> development, and explores<sup>howtoimprovethe effectivenessof theBank'sroleinthisarea.Itwill</sup> serve as an input into various<sup>formalsectorstrategiesin whichS&Tissuesbearon theachievementof</sup> the Millennium Development<sup>GoalsandthepursuitoftheWorldBank'sCorporateAdvocacy</sup> Pnonties, as well as on<sup>thecreationofaclimate for investment,jobs,sustainablegrowthandthe</sup> empowerment of poor<sup>people.</sup> The paper argues that<sup>developmentwill increasingly dependona</sup> country's ability to understand,<sup>interpret,select,adapt,use,transmit,diffuse, produceand</sup> commercialize scientific<sup>and technologicalknowledgein waysappropriatetoits ambitionsand levelof</sup> development.

The paper analyzes the<sup>importanceofS&Tfordevelopment,presents policyoptionsfor</sup> enhancmg the effectiveness<sup>of S&Tsystemsin developing countries,reviews thepreviousexpenence</sup> of the World Bank and<sup>otherdonorsinsupportingS&T, andsuggestswaysthattheWorldBankcan</sup> increase its effectiveness<sup>through betterintegrationof the work currentlyundertakeninS&T.Its main</sup> messages are that: **(i)** S&T<sup>has alwaysbeenimportantfor development,but theunprecedentedpace of</sup> advancement of scientific<sup>knowledgeisrapidly creatingnew opportunitiesforandthreatsto</sup> development; (ii) most developing<sup>countnesarelargelyunprepared to dealwith thechanges that S&T</sup> advancement will bnng;<sup>**(iii)**the World Bank'snumerousactionsin variousdomainsof S&T couldbe</sup> more effective in producing<sup>the neededcapacityimprovementsin clientcountries; and(iv)the World</sup> Bank could have a greater<sup>impactif</sup><sup>**it**paidincreased attention toS&Tbothwithinstrategiesin</sup> particular sectors and by<sup>achievingsynergiesamongon-goingS&T-relatedlendingand grant activities</sup> **_in,_** _inter alia,_ the Education,<sup>Health,Rural,Private Sector Development,and Environmentsectors.</sup> The role of S&T in sustainable<sup>developmentis receivingvigorousattention inthecontext of the</sup> World Summit on Sustainable<sup>Development. Themajorinternational S&Torganizationsareupdating</sup> their strategies to reflect<sup>therenewedemphasis onS&Tthatsustainabledevelopmentrequires. The</sup> United Nations, in particular,<sup>hasidentifiedfiveareas (Water,Energy,Health,Agriculture,and</sup> Biodiversity) as particularly<sup>criticalforprogress.TheWorldBankshouldbereadytoplayan</sup> appropriate role along with<sup>partner agenciesin respondingtotheheighteneddemand forS&T-related</sup> services **in** this new environment<sup>of S&T prioritization.</sup>

**_The Importance of S& T_**<sup>**_for Development._**Science andtechnologyhavebeencentralin the progress</sup> made to date In the fight<sup>againstpovertyandinstimulating economicgrowth.Today,however,the</sup> accelerating rate of progress<sup>inscienceandtechnology createsbothtremendousopportunitiesand</sup> significant risks for developing<sup>countries.A lack of capacity among somedevelopingcountnesto even</sup> access and utilize advances<sup>inS&Thasprevented themfromcapturingthe benefitsof S&Tthathave</sup> become commonplace **in**<sup>the restof theworld.Todate,thecost todeveloping countriesof lowS&T</sup> capacity has been confined<sup>mostly tolost opportunities, such asin thefailuretocapturethebenefitsof</sup> the Green Revolution in<sup>Sub-SaharanAfrica.Inthefuture,activethreatsto,</sup><sup>_inter alia,_foodsafety,</sup> natural capital, and human<sup>healthwill join lostopportunitiesin comprisingthefullcosts of inadequate</sup> S&T capacity. More specifically:

- **In agriculture,** advances in<sup>S&T have facilitated higher yields, greaterefficiency,andgreater</sup> nutritional content in the world's<sup>food supply.Food production, however, must double in the</sup>

v
coming decades to meet nsing demand, and meet the challenges entailed in, _inter alia,_ improving resistance to drought, pests, salinity and temperature extremes; raising the nutritional content; and reducing post-harvest loss all in an environmentally and socially sustainable manner. At the same time, the regulatory challenges of assuring safety **in** food production and consumption will increase exponentially.

- In health, advances in scientific knowledge and its application have helped slow the trend of "high fertility, high mortality" and led to increasingly better health for many people in developing countries. Nonetheless, vector and water bome disease, AIDS, inadequate prenatal and maternal/child healthcare and other deficiencies continue to create a tremendous burden in the developing countries. Countries will be unable to correctly identify public health needs and choose cost-effective packages of health services if they lack S&T capacity.

- **O** Other problems, such as the needs of the 1.3 billion people who live without access to adequate fresh water, or whose health and livelihoods are endangered by environmental degradation call for development of new technologies (along with appropnate policy frameworks) to mitigate these problems and their effects on poor people. Timely local adoption often requires significant indigenous technological capacity.

- **O** Access to affordable energy is essential for the two billion people currently living without electncity and is a pre-requisite for economic growth. Further advancement and application of research is needed to find new, environmentally and socially sustainable technologies that can meet the energy needs of developing countries.

- With respect to economic growth, emerging evidence shows that-when an enabling environment for investment is present-the developing countnes that are home to half the world's poor (Brazil, China, India, Thailand, Mexico, Malaysia and the Philippines) are using technological capabilities to capture growing percentages of expanding global high tech export markets, and thereby adding to their rates of GDP growth. Other developing countnes will need improved S&T capacity if they are also to capitalize on opportunities for economic growth.

Science and technology in education pervade all of the above themes, with existing human capacity, training, research and application composing a significant part of the paradigm for the successful use of knowledge in any domain.

_Policy Options for Reaping the Benefits from_ **_S&_** _T._ Some middle-income countries have managed to create pockets of S&T capacity that at least partially serve their economic and social ambitions. The vast majonty of developing countries, however, have severe deficits of S&T capacity. Improvement depends on the adoption of appropnate policies and activities in at least four areas: human resources development, demand for knowledge in the private sector, public support of S&T, and access to information and communication technologies (ICT).

- **O** Policies for S&T in hum **a** n resources development aim to provide science education at the basic, secondary and tertiary levels, prepare young people to enter a diverse labor force that requires various levels of S&T sophistication, and encourage the conduct of research and advanced training.

- "Implicit" policies for S&T create an enabling environment that stimulates demand for knowledge in the private sector through, _inter alia,_ a stable macroeconomic environment, appropriate climates for trade and investment, credit policies, and an adequate intellectual property rights regime. "Explicit" policies for S&T in the private sector aim to further break down barriers to the use of knowledge. These policies may include support for firm-based training to encourage technology deepening, increase industry-academia linkages and public-

vi
private partnerships, establish<sup>protectionfor indigenousknowledge,providetax incentives</sup> for firms engaged **in** R&D,<sup>and stimulate"clusters"of knowledge-basedindustries.</sup>

- Policies for **public support**<sup>**of S&T**mustaddressthevarious aspectsof the publicroleinthe</sup> national innovation system,<sup>including: settingprioritiesfor fundingand research,providing</sup> financing, instituting<sup>open,transparentpeer-review</sup> selection processes,<sup>establishing</sup> governance, regulatory<sup>andmanagement mechanisms, incorporatingthe resultsof research</sup> into public policy decisions,<sup>and monitoringand evaluatingthe system.</sup>

- Policies for **information**<sup>**andcommunicationtechnologies**shouldseek tomaximizethe</sup> access to and flow of<sup>knowledgeby,</sup><sup>_inter alia,_extending accessof available ICT toawider</sup> range of users, improving<sup>the regulatoryframework to facilitateaconduciveenvironmentfor</sup> ICT growth, and providing<sup>training and educationtofacilitate broaderuseof ICT.</sup>

_Lessons_ **_From_** _Previous_<sup>_Experience_</sup><sup>**_in S&_**</sup><sup>_T_</sup><sup>**_Capacity Buildinsi of theWorldBank and Other Donors._**</sup> Annual World Bank<sup>lendingfor S&Tisroughly$500millionperyear,abouthalf of whichisinthe</sup> Rural/Agriculture sector. Most non-agriculture<sup>lendingistoasmallnumberofmiddle-income</sup> countries in East Asia<sup>andLatinAmerica.Another$100millioningrantsis providedtoS&T-related</sup> activities through the<sup>DevelopmentGrantsFacility.</sup> Total donor and foundation<sup>contributionsare</sup> harder to quantify, but<sup>areestimatedat roughlythe sameorderof magnitude.Themainfindingsfrom</sup> previous experience<sup>arethat:(i) withtheexceptionof Agriculture/Rural Development, nosectorhas</sup> given systematic attention<sup>toor pursuedacoherent strategyto promotethe appropriateroleof S&Tfor</sup> development, despite<sup>itsrecognizedimportance; and(ii)promotingS&Trequiresasustained,</sup> coordinated multi-sectoral<sup>approach that has not yet emerged from the myrnadof differentactivitiesthat</sup> the World Bank has sponsored.<sup>Recently, more sectors appearto be recognizing the needfor greater</sup> integration, but the progress<sup>madetowardthisgoalhasbeen modestandhascome slowly andthe</sup> timeline for anticipated<sup>resultsfails to reflectthe longertimeframe requiredfor this type of change.</sup> In particular, lessons<sup>such asthosehighlightedbelowhave shownthateffectivepoliciesfor</sup> improving S&T capacity<sup>indeveloping countriesvarybycountrysize,population,levelof</sup> development, previous<sup>traditions,existingcapacity,andfactor endowments.</sup> Smaller and poorer countnes face a special set<sup>of challenges.</sup>

- **Human resources development:**<sup>Historically, the WorldBankhasnotalwaysemphasized</sup> science at the basic<sup>andsecondary levelsortheassessmentofstudent learningoutcomes.</sup> The support given has<sup>focusedtoagreatextentontheprovisionof physicalmputsat the</sup> expense of teacher training<sup>and curriculumdevelopment.The WorldBankhas beenmore</sup> successful with S&T at<sup>thetertiarylevelinmiddle-income countries wheninvestmentshave</sup> been made over a period<sup>of adecade ormore.</sup>

- **Stimulating demand**<sup>**forknowledgeintheproductivesector:**</sup> Success in building technology capacity<sup>hasbeengreatest when it has been linkedtoanexplicitnationalscience</sup> and technology strategy.<sup>Incontrast,thedisconnectof theproductive sectorfromresearch</sup> and development was<sup>identifiedbyOEDasafactorlimitingthe successoftechnology</sup> development efforts.<sup>Thisisastrueforgoods andserviceswith "public purposes"(e.g.,</sup> health care, agricultural<sup>industries,etc.)asfor other industries.</sup>

- **Public support of S&T:** Effective projects were<sup>oftenthosethathelpedinstituteopen,</sup> transparent governance<sup>andpeerreview systems,linkedresearchmorecloselytograduate</sup> training and higher<sup>educationpolicy moregenerally,andensuredgreater relevanceof</sup> research. At the same time,<sup>ahostofparticular investmentsmadethroughthe DGF</sup> (including, but not limited<sup>to support fortheCGIAR)showthat targetedinvestmentsin</sup> research can yield high<sup>impacteconomicandsocialresults. Morerecently,theWorld Bank</sup>

vii
has piloted support to improve research excellence through the adoption of international best practice funding mechanisms (e.g., competitive, peer reviewed selection, intensive human resources training, and mvestigator autonomy coupled with adequate research budgets) through the Millennium Science Initiative (MSI). The MSI can be successful if implemented flexibly and carefully, integrating it with the needs of a country's education system and its development pnorities.

- World Bank expernience in ICT: As the World Bank's ICT strategy paper establishes, investments in ICT infrastructure alone are not sufficient to create ICT capacity in developing countnes: concomitant investments in human capital training and strengthening of regulatory frameworks are also necessary.

Analysis of bilateral, foundation, and NGO S&T capacity building initiatives reveals that significant positive results are achievable with small, targeted budgets aimed at specific S&T-related challenges, particularly when the projects address all aspects of the challenge from the need for training to the necessity for linkages to the public and pnvate sectors.

_Rethinking the World Bank's Approach to S&T and Development_ The World Bank's potential impact in promoting S&T capacity depends primarily on client interest and commitment. In addition, the degree of ownership of the issue within and across the World Bank's own Networks and Regions determines how timely and effectively we can anticipate and respond to client needs. Again with the exception of Agriculture/Rural Development, the World Bank's work on S&T has most often been the result of interest from individual staff, teams or sectors. Going forward, active synergies will be achieved by the relocation of Science and Technology to the Human Development Network as of July 2002 to more effectively promote linkages with the Higher Education group. Additionally, a possible first step toward increased focus and ownership within the World Bank is to establish an internal S&T Thematic Group with representation from both the Regions and from the Education, Rural, Health, Private Sector Development, Energy, and Environment Departments, plus the CGIAR and the DGF. The S&T Thematic Group would consist of "champions" for S&T from these sectors, who would coordinate, share knowledge, and identify opportunities for action. These opportunities would be linked to client demand, mterest and commitment; would take into consideration the World Bank's comparative advantage **in** the specific area and country; and would be realized within the context of the World Bank's Country Assistance Strategies (CAS).

An improved World Bank approach to S&T could, in principle, aim toward achieving the following goals:

- To increase awareness of S&T and its role in development: The World Bank could foster communities of practice within the organization itself so that sectoral and cross-sectoral S&T issues can be addressed productively among the staff working on these issues and with the client countries. At the same time, the World Bank's comparative advantage in dealing with global public goods priorities and cross-sectoral S&T issues would be leveraged mternally as well as externally under the auspices of the WBI's outreach capabilities.

- To increase attention to S&T in four key **policy** domains (human resource development, promoting private sector demand, public sector support to S&T, and ICT): Among the many actions that can be recommended in these areas, the World Bank might increase the emphasis on science education in basic and secondary education lending, include S&T as part of the renewed and expanded emphasis on tertiary education, place emphasis on the creation of linkages between firms and knowledge institutions, reform enabling environments for better

viii
use of knowledge, help<sup>govemmentswith theirmultipleroles pertainingtoS&T, and promote</sup> access to and use of ICTs.

- To **achieve greater integration**<sup>of on-goingS&Tsupport:The World Bankcouldbuildon</sup> current "knowledge assessments"<sup>andpilotcoordinatedlendingefforts acrossS&T-related</sup> sectors (Education, Pnvate<sup>Sector Development,RuralDevelopment,Health,etc.)and</sup> promote other synergies<sup>among the S&T-related initiatives.</sup>

- To **increase and strengthen**<sup>**S&T-related analyticalwork:**The World Bank could provide</sup> analysis and policy recommendations<sup>onglobalpublicgoodsprioritiessuchasbraindrain,</sup> food security and new<sup>agricultural technology, andeffectiveS&T education indeveloping</sup> The<sup>World Bankwouldalsoexpand itsparticipationinintemational</sup>

- country settings. scientific assessments<sup>(suchastheIPCCand theMillenniumEcosystemAssessment)that</sup> have global public goods<sup>characteristicsandproducepolicy-relevantknowledgeoncritical</sup> development issues.

- To **foster collaboration**<sup>**witharangeof international partners:**TheWorld Bankwould</sup> support and build upon<sup>thesuccessfulS&T capacitybuildinginitiativesof various bilaterals</sup> NGOs and foundations,<sup>andincreaseprofessional contacts with representativesofthe</sup> intemational science and<sup>technologypolicy community,includingthe OECD,UNESCO,the</sup> Third World Academy of<sup>Sciences,theInter-AcademyCouncil,theIntemationalCouncilfor</sup> Scientific Unions, as<sup>wellasnational academies, sciencefoundations,andespecially</sup> experienced private sector<sup>partnersand technologydevelopmentspecialists.</sup>

The ullimate aim of these<sup>actions wouldbe to helpthe World Bank respond to the growing</sup> requests from clients, and<sup>to facilitatethe appropriateattention to S&T issueswithin Country</sup> Assistance Strategies that<sup>willlead to improvedabilityto use scientificand technologicalknowledge</sup> for the growing list of development<sup>challengesthat require</sup><sup>**it.**</sup> ix
STRATEGIC APPROACHES TO S&T<sup>IN DEVELOPMENT</sup> Science and Technology (S&T)<sup>arecritical inputs foreconomicdevelopmentand</sup> poverty alleviation. Advances<sup>inscientificandtechnologicalknowledgemadepossible</sup> the significant reductions of poverty<sup>andimprovementsinthequalityoflifeinboth</sup> developed and developing countries<sup>throughoutthe</sup> 20<sup>th century.In thefuture,theability</sup> of countries to access, comprehend,<sup>select,adapt,andusescientificandtechnological</sup> knowledge will increasingly be<sup>thedeterminantof materialwell-beingand quality of life.</sup> As a development institution, the<sup>WorldBank2canplayanimportant rolein helpingits</sup> clients use science and technology<sup>for development.</sup> Concern for the scientific and technological<sup>capacityof itsclientshasbeena part</sup> of the World Bank's work since<sup>itsfounding,butattemptsto raiseS&T capacityamong</sup> clients has not always been sustained<sup>andsystematic.Many World Bankinitiatives, both</sup> in lending operations and through<sup>theDevelopmentGrantsFacility,havefocusedonan</sup> array of S&T-related issues (e.g.,<sup>agriculturalproductivity,disease control,technical</sup> education, etc.), but these have<sup>never been articulatedwithinacomprehensive vision or a</sup> plan for improving S&T capacity<sup>acrosstheboard.With theacknowledgementof the</sup> importance of knowledge for development<sup>undertheK4DFramework,thereisroomfor</sup> rethinking this approach. Four of<sup>the WorldBank'sfiveGlobalPublicGoods Priorities</sup> are strongly linked to S&T<sup>(Communicable Diseases,EnvironmentalCommons,</sup> Information and Knowledge,<sup>andTradeandIntegration).</sup> Likewise, most of the Millennium Development Goals have<sup>a strongS&T-component,and improvedin-country</sup> S&T capacity is directly required<sup>toreach,sustain,andmonitor24of the48MDG</sup> Indicators [See Appendix 1]. In<sup>addition,all the priority areasidentified by UN Secretary</sup> General Kofi Annan (Water,<sup>Energy,Health,Agriculture,andBiodiversity)forthe</sup> World Summit on Sustainable Development<sup>requireadvances inS&T.TheWorld Bank</sup> needs to respond to the growing<sup>demandfortheS&Tservicesentailedinthese</sup> challenges.

Reaping benefits from science<sup>andtechnology dependsonanumberoffactors</sup> including: (i) investment in human<sup>resourcestraininganddevelopment;(ii)thedemand</sup> for knowledge by the private sector;<sup>(iii)publicpoliciesthat providetheappropriate</sup> enabling environment for strong<sup>knowledgeinstitutions;and,(iv) theleveland quality of</sup> the information and communication<sup>technologiessystemsthat permittheflowand</sup> dissemination of knowledge and<sup>information.When the policiesandinstitutionsoriented</sup> around these four factors are present<sup>inagiven countryandperformanceishighboth</sup> within and between them, significant<sup>progresscan bemade inrespondingtoproblems</sup> associated with poverty and stimulating<sup>economicgrowth.When theappropriateS&T</sup> infrastructure, which is composed<sup>of thesefourfacets,isnotdeveloped,countriesfall</sup> further behind, rendered stagnant<sup>by problemsthat other moretechnologically-advanced</sup> countries have long since overcome.

> **2** paper deals primarily with the World Bank.<sup>Importantfuture work will mcorporatefullconsideration</sup> of the roles of all members of the World<sup>Bank Group.</sup>

1
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.

2
Developing countries are not<sup>alikein S&Tcapacity.Brazil,China,and India may</sup> have more in common in S&T-relevant<sup>sectorswithOECD countriesthanwithlow-</sup> income countries. No single<sup>set of policy prescriptionsforimprovingS&Tinfrastructure</sup> within developing countries<sup>couldcover suchawiderangeof circumstances.</sup> For the purposes of this paper developing<sup>countrieswillbesubdividedintothree categoriesof</sup> S&T capacity:

- _Scientifically proficient countries_<sup>increasingly definetheir relations withthe</sup> scientifically<sup>6</sup> advanced countries<sup>onthebasisofequalityor nearequality;</sup> examples include Brazil, China,<sup>India, Hungary, and South Africa.</sup>

- e _Scientifically developing countries_<sup>havepocketsof adequate scientificand</sup> technological capacity amidst<sup>general scarcity;examples includecountries</sup> such as Turkey, Colombia, Indonesia,<sup>Pakistan, and Latvia.</sup>

- _Scientifically lagging countries_<sup>lackcapacityalmostentirely; examples</sup> include countries such as Nepal,<sup>Albania,Mali,Ecuador,and Libya.</sup>

Depending upon where a country<sup>issituatedwithinthesethree categories, the</sup> goals of S&T policy will vary<sup>acrossacontinuumof policycharacteristicsasbriefly</sup> highlighted in Table 1. To the<sup>extentpractical,thepaper'srecommendationswillbe</sup> tailored to the different needs<sup>of thesethreegroups,7withdifferencesbetweencountry</sup> groups and their implications<sup>forpolicy beingdiscussedingreater detailinthePolicy</sup> Matrix in Appendix 2. However,<sup>it should be notedthat thereare likelyto be significant</sup> differences between countries<sup>withinthesameoverallcategorywithrespecttothe four</sup> policy areas (human resources,<sup>demand from theprivatesectorfor S&T,public</sup> management of S&T, and the<sup>availabilityof ICT infrastructure).These differenceswill</sup> need to be reflected in the<sup>individual Country AssistanceStrategieswithregardto</sup> strengthening S&T capacity.

|Conunon~<br>Commo|Functional educationsystemsthatpromote<sup>soundUno</sup><br>n<br>~~~~~scienceeducationatalllevels|<sup>un</sup><br>Ucmo|
|---|---|---|
|Common|Competitvemarketsthatallowfor<sup>theemergenceof</sup><br>innovativefirms thatdemand<sup>knowledge;Financial</sup><br>infrastructuretosupportinnovative firms'|Uncommon|
|Strong|PublicmanagementofS&Tincludes<sup>competitive,</sup><br>merit-basedallocationoffunding<sup>to basicresearch</sup><br>priontiesand evaluationandaccountability<br>mechanismsforresearch(er)output<sup>and</sup><br>effectiveness|Weak|
|Strong,Common|Associations andnetworksthatshare<sup>information</sup><br>locally,nationally, regionally,<sup>andintemationally</sup><br>acrossandwithinsectors|Weak,Uncommon|

**6** For the sake of brevity, countries<sup>will be categorizedas"scientifically"advanced, proficient, developmg,</sup> or lagging rather than "scientifically<sup>and technologically"advanced,proficient, developing,or lagging.</sup> The latter term is more accurate,<sup>and useof the shorter term does not imply any bias against technological</sup> capacity.

7 Differences span a continuum of<sup>thepolicycharacteristicspresentedin this chapterand exploredin more</sup> depth m Volume Two, Table 10, p.<sup>27and Appendix2 of this volume.</sup> 3
> People tend to associate science and technology with the creation of new

> knowledge, through "frontier" or "cutting edge" research. Although this image has a

> strong hold on the popular imagination, it feeds a partial and biased view of what is important in functioning S&T systems. While the returns to investment in appropriate R&D for countries at a certain stage of development are well documented, the benefits of

> S&T for the majority of countries come through the diffusion of knowledge, and its translation into goods and services via technological applications and engineering. These

> applications could be in classical industrial sectors like manufacturing, or in other sectors such as health, agriculture, and natural resource management. The vast majority of an

> S&T workforce uses what a very few have discovered, adapting, converting and applying knowledge locally. Indeed, the main value of S&T in education is to create the human capacity to comprehend and apply, not to advance, knowledge in a given discipline.

> Aiming policy to build this broader capacity for application of knowledge is

> especially important for developing countries. Initially, the bulk of benefits are likely to

> accrue from thousands of small scale technological improvements in small and medium enterprises (SMEs), not through investments in large-scale corporate labs. Improved technology development at the SME level, however, helps create income that can

> finance, among other things, future investments in S&T.

For highly resource-constrained countries, focusing on knowledge advancement or cutting edge research is costly and unwise (Box 7 in Volume Two provides more detail regarding the specific challenges faced by smaller, poorer countries in building science and technology capacity). Clearly, no country or culture, rich or poor, has more inherent potential or talent for advancing knowledge than any other. But rich countries have, through decades of continuous investment in human capacity and institutions, built infrastructures that better allow the potential of science and technology as a social endeavor to flourish. Once in place, the infrastructure helps create the wealth that funds future investment. At the same time, the infrastructure acts as a global magnet, drawing into itself talented individuals from abroad. Countries wishing to reap the benefits of S&T should seek to put in place this broad infrastructure that captures existing knowledge, and employs it in wealth-enhancing investments in improved health, environment, and technology development for economic opportunity. While the timeframe for such change is long, this is the surest path toward fuller eventual participation in knowledge generation and cutting edge research.

The list of issues for which developing countries need scientific and technological expertise grows longer daily: agricultural productivity, health, sustainable use of natural resources, education, creation of economic opportunity, etc.. At the same time, scientific advances are defining new challenges (e.g., the environmental and human health issues associated with genetically-modified organisms) that many countries find themselves poorly prepared to handle, given the increasingly sizeable divide separating the scientifically advanced OECD countries from the rest.

> Science and technology capacity is not the only factor relevant to development.

> It is one component within a set of factors-along with policies favorable to competition,

4
sound fiscal and macroeconomic policies, accessible quality education, affordable and accessible health services, and good governance-that build the climate for investment, growth, and empowerment. These factors are mutually dependent, and strength in complementary institutions becomes more important to science and technology the more deeply they permeate a society and economy. At the same time, the stronger complementary institutions and policies become, the more S&T can contribute to overall development.

## _The Importance of S& T to Development_

Science and technology are intimately connected with development because: (i) they have a historical record of bringing advances that have led to healthier, longer, wealthicr and more productive lives and (ii) they are key ingredients to solutions to the most serious poverty alleviation and economic development challenges that we currently face and are likely to face in the future. The many ways in which science and technology impact poverty alleviation across various sectors and economic growth merit attention.

# _For Poverty Alleviation_

Advances in science and technology are, in many ways, the ultimate Global Public Good: once discovered, their benefits can be extended to additional users at little or no marginal costs. In the most basic and critical areas of human need, science and technology have made possible significant progress to date, and they hold the best prospects for continued progress, particularly with respect to agriculture, health, energy, water, and environmental concerns.

_Agriculture:_ In the domain of food security, advances in S&T provided the foundation for the Green Revolution, and have allowed food prices to remain at historical lows for the past several decades. Improved knowledge of plant biology and breeding techniques led to better seeds and cultivation practices that drastically increased yields [See Figure 1]. Not surprisingly, Africa, the region of the world with the lowest indicators for S&T capacity, has had the greatest difficulty in capitalizing on and benefiting from the Green Revolution. Throughout the rest of the developing world, yields rose much faster than the population increased, mitigating pressures to extend cultivation to scarce additional land. It is estimated that, without the scientific advances of the past 50 years, an additional land area the size of Europe would be required to produce the world's current agricultural output. Nonetheless, over 800 million people remain food insecure, and global food production will have to double in the next 30 to 50 years to keep pace with growing demand. Rapid advances in the understanding of plant biology and related areas (especially via genomics) hold hope for solutions to problems as varied as increased productivity, nutritional content of food, food as a carrier of vaccines, soillIand degradation, post-harvest loss, and drought and pest resistance. Unforlunately, the majority of cutting edge research in these fields is performed in private laboratories and focuses on profit opportunities in OECD countries rather than on issues that are of greatest concern to the well being of poor people.

5
<!-- Start of picture text --> FIGURE 1: WHEAT YIELDS IN ARGENTINA AND INDEA CORRELATING TO<br>THE SCIENTIFIC REVOLUTION (Average Annual Yields in 1,000 Kilograms/Hectare)<br>- Argentina - India<br>3 Horsepower Mechanical Power Science<br>2.5<br>2<br>1.5<br>0.5<br>1885 1895 1905 1915 1925 1935 1945 1955 1965 1975 1985 1995<br><!-- End of picture text -->

> Adapted from Pardey, Chang-Kang and Alton 2001

_Health:_ Ill-health is both a cause and a consequence of poverty. Over the past century, science and technology provided the basis for the largest ever aggregate improvements in human health. Life expectancy is up sharply worldwide [See Figure 2 on the following page]. Certain scourge diseases have been eliminated, (e.g., smallpox) while the morbidity and mortality associated with everyday health-related events like childbirth and routine infectious disease have declined sharply. In health, the cumulative effects of scientific advances are very evident: while health indicators have always varied with income, during the 20th Century, the same real increase in income led to progressively greater health improvements. As knowledge accumulates, the same money buys increasingly better health. Still, progress is good but uneven. The developing world still accounts for a disproportionate amount of the global burden of disease, and research spending on health is severely skewed away from the concerns of developing countries. Far too many countries are trapped in cycles of "high-fertility, high mortality" that the world's better-off countries have broken. Indoor air pollution, dysentery, water-borne disease (e.g., cholera), vector-borne disease (e.g., malaria, dengue, etc.) and AIDS account for millions of deaths annually and are hitting hardest the countries that are least prepared and can least afford to deal with them. Some of these issues can be addressed using current knowledge, (e.g., dysentery) while still others require scientific breakthroughs in S&T (e.g., AIDS and malaria).

> Figure 2 illustrates changes in life expectancy at birth in the developing world, presented by region, as compared to the developed world. As the figure shows, from 1960 to 1998

> many regions have begun to catch up to the high income countries' average life

> expectancy. However, the grim improvements in some regions, such as Sub-Saharan Africa, illustrate the need for continued attention to the inequities in health attainment.

6
<!-- Start of picture text --> Figure 2: Life Expectancy at Birth in the Developing World<br>90<br>80 -<br>70-<br>60 -<br>50--<br>40--<br>30-<br>10<br>0 E.<br>Latin America and India China Other Asia Sub Saharan High Income<br>the Canbbean Affica Countfies (for<br>comparison)<br>[i 1960 * 1980 0 1998 1<br><!-- End of picture text --> Box 1 below draws on examples from the health sector to draw out the complexities in the relationship between knowledge, diffusion and outcomes. As the box describes, advances in S&T make possible, but do not guarantee, progress against poverty.

7
4efil 4 en~ U~e reita onslnp be~e~ii kxb **i** ecig. **L** Os . **o,i** ond outcomes in the health sector are XsM, ; ,sgL¢s, ~xielu4g.xi~ in l,'g i ;wctlv1ty~ or--n technology development in **[er tj,ked** qear~tiuxe~ ,TC-c2"i _tvo years_ of chooling for ruraJ .farmers; SiS1htbk Rr~6~ X$ rc 1 < ~ .~ amaong trn exen}tfitry Ion vny f~s concgr rs [ of .i chie.nA & .a'.'09W i# i Iantbiology' Tecinolo were correlated ciffisior<sup>t6</sup> and'use<sup>more</sup> yu armqm mma M~tAfnGWeCg~an rtiand'ueelo tkdUe fi.'ig,isli4 ~litiftcY 0e pn'PORWlace as it 3 I., bd a-a contrys educatioa system, by ec4 am -- kno'wlbdgZ. d by ot t li hthinaun elenlent of caltural and fifnot allfctors at; u*nnbie tr inmprvement ugoa government 9>XtioSaS$l,g, ite,fitc,,omeA cv pJ,dc,idhpt $, u,it i-f }<xGwlOecg, anid a GNCr-cal level of _Energy:_ Despite its importance to economic growth and<sup>povertyalleviation,</sup> energy continues to be exploited in a short-sighted and unsustainable<sup>way.Unfortunately</sup> many countries are promoting fossil fuel energy policies<sup>andpracticesthatarecausing</sup> environmental degradation at the local (particulates and smog),<sup>regional (aciddeposition)</sup> and global (climate change) scales, leading to significant<sup>lossofhumanlifeand</sup> ecological damage. Currently, two billion people in the world<sup>are withoutelectricity.A</sup> central question to be answered in addressing the energy needs<sup>of thisone third of earth's</sup> population is-how do we adequately address the growing<sup>energy needsof theworld's</sup> population without exploiting the natural resource base<sup>andcompromisingthe</sup> environment? Modem clean, renewable energy technologies (e.g.,<sup>solar,wind,modem</sup> biomass) need to be developed further and there needs to be<sup>an increaseinthe efficiency</sup> and sustainability of energy use in transportation, industry,<sup>andhousing.</sup> Depending upon projections of population and economic growth, technology<sup>change and the growth</sup> rate of different information markets and governance structures,<sup>globalprimaryenergy</sup> use by 2100 is predicted to range from a low of 514 EJ to<sup>ahigh of 2,683 EJ,whileCO</sup> 2 emissions are predicted to increase to between 2.7 Gt and 36.7<sup>Gt [IPCC2000]</sup><sup>**8**</sup> <!-- Start of picture text -->
| Figuire 3: lProjectedl C2 Ems2Bs!ons<br>30 - | | W Umts meAIFI<br>20 35- - AlT<br>15 -.- _ - A2<br>10 - Bl<br>5 ~ ~ ~ ~ ~ ~ ~ ~ -=B2<br>0 Units measured<br>1990 2020 2050 2100 in GtC/yr.<br>Source. IPCC<br>[2000]<br><!-- End of picture text -->

8 Emissions scenarios coded in Figure 3 correlate with the six illustrative scenarios used<sup>bythe IPCC in</sup> their 2000 publication _Emissions Scenarios_ See publication for description of<sup>scenanocharacteristics.</sup> 8
_Water:_ Water is another vital but<sup>scarceresourcefor which,intheabsenceof</sup> technological innovation, current<sup>andprojected use patternscanonlyleadtosevere</sup> crises. Today, about 1.3 billion<sup>peoplelackaccessto anadequate supplyof safewater,</sup> two billion people do not have access<sup>toadequatesanitation;andwaterpollutioncauses</sup> millions of preventable deaths each<sup>year,especiallyamongchildren.Waterpollutionis</sup> expected to continue to degrade freshwater<sup>and marineecosystems, witha significantloss</sup> of biodiversity. The challenge<sup>is toleveragenew technologiestoprovideanadequate</sup> supply of "safe" water in urban<sup>andrural areastoallusersinagrowing-wealthier</sup> population: households, agriculture<sup>andindustrialsectors(e.g.,inexpensivedesalination</sup> technologies).

_Environment:_ Environmental<sup>degradationatthe local,regionalandglobalscale</sup> adversely affects the livelihoods,<sup>healthandvulnerabilityof poorpeople.Local issues</sup> include indoor and outdoor air<sup>pollutionandwaterpollution,regionalissuesincludeacid</sup> deposition, and global issues include<sup>climatechange,stratosphericozonedepletion,loss</sup> of biological diversity, land<sup>degradationanddesertification.These changesinthe</sup> environment can adversely affect<sup>theincomesof poorpeoplewhodependonnatural</sup> resources for their livelihood. These<sup>changesmayalsoadverselyaffecthumanhealth</sup> through air and water pollution,<sup>an increase in theexposure to vector-borne diseasessuch</sup> as malaria and dengue, and<sup>anincreasethevulnerabilityofpoorpeopletoextreme</sup> weather phenomena (e.g., floods<sup>anddroughts) and sea levelrisedue toclimatechange.</sup> Hence, environmental degradation threatens poverty alleviation and long-term sustainable development.

The key challenge is to recognize<sup>thatlocal,regionalandglobalenvironmental</sup> issues are inextricably linked and<sup>affectsustainable development.Therefore,thereare</sup> synergistic opportunities to develop more<sup>effectiveresponseoptionstothese</sup> environmental issues that enhance<sup>benefits,reducecosts,andmoresustainablymeet</sup> human needs. The capacity of<sup>countriestoadaptandmitigatecanbeenhanced when</sup> environmental policies are integrated<sup>with nationaldevelopmentpolicies.</sup> _For Economic Growth_ Science and technology are strategically<sup>importanttoeconomicopportunityand</sup> growth. For many years policymakers<sup>havesuspectedaclose link betweeneconomic</sup> growth and productive investments<sup>inS&T, and now mountingevidence supportsthis,in</sup> three principal ways.

First, since the industrial revolution,<sup>rich (developed)countrieshavehadthe most</sup> S&T capacity and have grown fastest.<sup>From,1870tothepresent,scientifically-and</sup> countries<sup>havebecome increasinglywealthy,andtheir ratesof</sup> technologically-advanced growth have not diminished as this<sup>occurred[Pritchett,</sup><sup>_Divergence Big Time_1995].</sup> Second, returns to R&D have been<sup>showntobeconsistentlypositiveandhigh</sup> across virtually all industries examined,<sup>inthedevelopedand(morerecently)the</sup> 9
developing world. These findings have helped establish a correlation between innovation and growth. In a host of categories, different measures of knowledge inputs to production continue to increase, and measures of the returns to these inputs outstrip those to less knowledge-intensive production. The evidence confirning the positive returns to investments in knowledge is vast. Recent meta-analyses summarized 57 published studies of rates of return to industrial R&D at both the firm and the industry level [OECD 2001] and 292 published studies of agricultural R&D demonstrated consistent high double digit returns [Pardey 2001]. Moreover, as the recent flagship report on closing the gap in education and technology [LAC World Bank 2002] confirmed, within the context of the knowledge economy framework, the "interaction between technology and skill is critical in determining growth, productivity and the distribution of earnings." Third, and perhaps most important from the perspective of the World Bank, technological capacity appears to be contributing to accelerated growth in some large developing countries (e.g., China, India, Brazil, Mexico, Philippines, Thailand, Malaysia). High tech manufacturing exports have grown faster than all other categories and developing countries are gaining a larger share of this expanding trade. These developing countries, which are now benefiting from a combination of technological capacity, openness to trade and other comparative advantages (such as lower wages), are also experiencing accelerated rates of economic growth. What is more, the countries benefiting are home to over half the world's population, and more than half of the world's poor. Additional evidence [Dollar and Kraay, 2001] shows that incomes of poor people are rising proportionally with growth rates.

Table 4a and Figures 4b and 4c on the following page present the quantitative evidence for the correlation between increased technology content of exports and GDP growth.<sup>9</sup>

> 9 For an annotated listing of recommended readmg relevant to S&T and economic growth as well as S&T

> and each of the sectors covered in the preceding sections, consult the annotated bibliography in _Annex 6 of Volume Two._

10
<!-- Start of picture text --> Rsuc-based 19.5 13.7 5.7/<br>Lw Tch -25.3 21.3 6.9<br>Medium Tech 38.6 37.2 7.8<br>Hgi, Tech . , .:'21416ES _ __ _ " 7.7-, -j 11.6<br>Total 100 100 8.1<br>Figure 4b: Increases in High Tech Manufactured Exports...<br>@ High Tech as % of manuf. exports '85 0 High Tech as % of manuf. exports '95<br>80 6.9<br>70<br>60 51<br>50 -36.9<br>40 -27.7 26.9<br>30 - ~17.4<br>20 4.1 6.6<br>10 5.<br>0<br>China Mexico Malaysia Philippines India<br>A Figure 4~c: Ma.. orlaysa tes w niahGPGot<br>6 - Aerg D got at 0'54 04vrgeGPgowhrte450<br>-2 .83<br>| El3 Aerag GDP rowt rate'80-85 O verae GDPgrowh rat '95'00<br>3.9 4.2 3.8 3.1 313<br><!-- End of picture text -->
_Policy Options for Reaping the Benefits of S&T_ The effects of S&T on poverty and economic growth underlie their importance for development. However, achieving progress in S&T capacity depends on good policies and practices that foster the appropriate environment implemented consistently over the long term. The framework for these policies must recognize the interconnectedness of the areas upon which S&T bears. Policies that affect human resources development, demand for knowledge from the private sector, public support for and management of knowledge institutions, and access to information and communication technologies (ICT) infrastructure must be coordinated and harmonized in order to create the conditions in which S&T capacity deepens and consolidates. Each of these areas, which are detailed in brief in the following pages, entail a set of specific sub-policies, yet success depends on integrating them harmoniously. Different countries, of course, face different challenges that require emphasis in one area or another.'I

> Policies for iRlHnman Resources DeveRoplment Policies concerned with human

> resource development seek to accomplish four major goals that are briefly highlighted below.

- Provide the broad basic science education that makes a human resources base scientifically literate, imparting both everyday skills and intellectual abilities needed for an informed citizenship

- Stimulate interest and prepare adequate numbers of young people to pursue careers in science and technology as well as provide opportunities for life-long learning and skill renewal

- Educate a diverse labor force and develops skills for various purposes at various levels of sophistication

- Encourage the conduct of research and advanced training that creates the knowledge and highly trained specialists needed to advance the frontiers of knowledge and applications

> Sound human resources development for S&T begins with science education at the primary and secondary levels. Student achievement outcomes in science in much of the

> developing world are very low." Of course, many of the problems of science education

> at primary and secondary levels cannot be separated from the more generalized

> challenges in basic education, such as teacher training and recruitment, stable education

> finance, availability of teaching materials, etc. Other challenges are specific to the

> domain of S&T. These include curricula that are appropriate and science programs tailored to the developmental needs of students and their societies, the use of goals and

> standards for student achievement to guide the design, implementation, and assessment of

> all elements of the science program, and provision of support systems for teachers that

> align with the goals of the science program.

> **_10_** _Appendix 2_ summarizes how the policy area of emphasis for S&T growth differs with the varying

> capacities of developing countries.

> See the results from the TIMSS for a more detailed description at www.timss.bc.edu.

12
As students progress through<sup>theeducationsystem,scientific and technological</sup> education opportunities should<sup>deepenanddifferentiatewithinacontextoflifelong</sup> learning. Between the general<sup>scientific literacythatispartof secondaryeducation,and</sup> the advanced programs pursued<sup>by university-boundstudents,acriticalmiddlelevelof</sup> technical skill needs to<sup>bedeveloped.</sup> Secondary-level science education<sup>should</sup> stimulate learners and encourage<sup>studentstopursuecareersinS&T,whetheras</sup> technicians, engineers, or researchers.<sup>Todothis,andtoprovide opportunitiesforlife-</sup> long learning and skill-updating<sup>requiresanarrayof technical andprofessionalschools,</sup> community colleges, and other<sup>intermediateS&T institutions.Technicaland professional</sup> schools often seek to provide<sup>mid-leveltechnicalskilltolargenumbersof studentsin</sup> areas with strong immediate<sup>labor marketdemand.</sup> More advanced training opportunities<sup>will beoffered bya differentset of institutions</sup> within a country's tertiary<sup>educationsystem.Thesemightinclude regional and national</sup> universities, as well as research<sup>universitiesandinstitutes. Often,research universities</sup> and institutes are the locus<sup>ofacountry'smaineffortsinknowledgeproductionand</sup> advanced human capital training<sup>inS&T.Withoutthenecessarypoliciesthatencourage</sup> the proper functioning, growth<sup>andreformof thediverse institutions that worktogether to</sup> educate a country's populace,<sup>it isunlikely theresultingworkforcewill be trainedin the</sup> relevant skills needed to<sup>driveacomplexandgrowingeconomy.</sup> The reform and improvement of tertiary education<sup>systemsisadomainuntoitself,andthechallenges</sup> here are many and important. Options for reform in tertiary<sup>educationgenerallyare</sup> discussed in the Bank's<sup>2002tertiaryeducationpaper,"ConstructingKnowledge</sup> Societies: New Challenges for Tertiary<sup>Education." Thatpaperandthisoneare</sup> complementary and are intended<sup>to be read anddisseminated together.</sup> Promoting research quality<sup>isadelicate institutionalbalancingact.Someissuesare</sup> general and affect tertiary education<sup>andresearchinstitutionsof all types.Thesepertain</sup> to the quality of faculty, the<sup>relevancyof curricula,the adequacyof physicalresources,</sup> the flexibility and autonomy<sup>of institutionalmanagement,andthesources andstabilityof</sup> financing. A major challenge facing<sup>developingcountriesishowtheycanmeetthe</sup> growing demand for tertiary<sup>educationwhilesimultaneously improvingqualityand</sup> relevance, within shrinking public<sup>budgets.The growing rolefortheprivatesectorin</sup> higher education is another<sup>phenomenonthat requiresattention.</sup> These issues acutely affect education in science<sup>andengineering,whichtends tobemore complexand</sup> expensive, particularly in research-intensive<sup>subdisciplines.</sup> Other issues are specific to<sup>scienceandtechnologyitself;</sup> they revolve around assuring the linkages between<sup>graduateeducation,theprivatesector and publicly-funded,</sup> university-based research systems.<sup>Thelatter relieson competitiveallocationprocedures;</sup> transparency, and peer review;<sup>research evaluationandaccountabilityforresults;special</sup> programs, national priorities,<sup>andperhapsmostimportant, theadaptabilityof thesystem</sup> to changing conditions and<sup>new challenges.Anothercritical issuein tertiary educationis</sup> how to balance public support<sup>forforeignanddomestictrainingtostrengthendomestic</sup> capabilities and avoid brain-drain<sup>by individualseducatedat publicexpense.</sup> 13
> Policies for StAmulatiung Demand for Knowledge An thIe Private Sector Highly

> skilled human resources for science and technology cannot in and of themselves produce

> benefits for a society. They must act within a structure in which the private sector

> requires and seeks knowledge. Countries that have transformed their economies and

> dramatically improved income levels have done so by improving the technological

> performance of their industries within supporting investment climates. They have

> deepened their technological capabilities and services to the point where they can consistently and successfully compete on a global scale in a growing number of

> industries. They have recognized that economic performance is more sustainable when it

> is founded on the dynamic advantage of flexible production and cost reduction, rather

> than on the static advantage of low-cost labor or factor endowments. They have

> combined policies for investment that encourage and reward entrepreneurship with those

> that facilitate the greatest flow and use of commercially-relevant knowledge.

> Transformations did not occur overnight; in general, they required two to three decades of sustained national effort. While each experience has been different, some basic

> lessons have emerged. In general, countries did not "leapfrog" from archaic to modem

> technologies. Instead, as one observer put it, "they engaged in a painstaking and

> cumulative process of technological learning (from imitation to innovation)."<sup>12</sup> In many

> cases, they focused a broad-based strategy on technology development at the level of the

> SME, rather than on support to cutting edge R&D.

> Demand for knowledge in the private sector should not be limited to classical

> industrial sectors such as manufacturing. It is equally important to stimulate this demand in areas such as agricultural productivity, health services, energy services and natural

> resource management, in both firms and government institutions. This stimulation of

> demand may occur through both explicit and implicit policies, examples of each are provided below.

> A number of "explicit" policies may be appropriate at the level of the firm. Such policies are generally intended to overcome information barriers to understanding or

> appreciating the potential benefits of R&D, or to lower the cost of risk-taking. These

> goals may be accomplished through a variety of interventions that foment strong

> university/industry relations and labor market-linkages, including tax or other incentives

> to firms for cooperative pre-competitive research, commercialization of publicly-financed

> research, sponsorship of "scientist-in-industry" programs, provision of joint or

> specialized training, and other similar activities. Success in industry-science relations

> often relies on informal, person-to-person links that are best promoted through a diverse

> set of interactions, which create cultures of information exchange. Successful cultures of

> this kind seem to emerge when labor is mobile, incentives are aligned, basic research results are shared, and rigorous evaluation of research is conducted. The creation of

> shared infrastructure for new firms in the form of technology parks or "incubators" can be a means of promoting the desired interactions, but such ventures have a mixed

> empirical record of success. Best practice lessons are now emerging for technology parks and incubators that reflect the need for long time horizons for commercial

> **12** Bezanson, Keith, and Geoffrey Oldham, "A Science Technology and Industry Strategy for Vietnamn,"

> p.37. This section of the paper draws on this work as well as on conversations with the authors.

14
sustainability, careful matching of target markets with the strengths and ambitions<sup>of</sup> potential firms, and proximity and linkages to top quality research institutes<sup>and</sup> universities. '<sup>3</sup> "Implicit policies for S&T", which create a supportive environment for investments in scientific and technological undertakings, are virtually identical to those that build the climate for investment, jobs, sustainable growth and empowerment of poor people<sup>more</sup> generally. These may include, but are not limited to:

- **_Basic Macroeconomic Stability._** While desirable for a host of reasons, avoidance of fiscal and monetary crises helps provide the stability and continuity needed for the finance of research and commercialization.

- **_Openness to Trade and Foreign Direct Investment._** While some countries have managed to improve scientific capacity and technological performance<sup>through</sup> strictly domestic measures, the weight of the evidence is showing<sup>more casesin</sup> which trade and FDI were critical conduits for the technology transfers<sup>that</sup> spurred growth. 14

- **_Credit_** _Policies._ If a diverse set of financial instruments (loans, equity financing, venture capital, etc.) do not evolve as technological capacity increases, industrial development can be stifled.

- **_Intellectual Property Rights Protection._** IPRs are effective when they balance individual interest to control, set the terms of, and profit from the use of<sup>an</sup> invention with collective interest to stimulate innovation by encouraging the publication and diffusion of new discoveries, to assign rights through due (judicial) process, and uto override these rights partially or fully when a greater social good is judged to warrant this. When properly balanced, IPRs facilitate investments to develop and commercialize inventions and can stimulate technology transfer (refer to the more detailed discussion of IPRs in Volume<sup>Two,</sup> page 43).

- **_Competition Policy._** Policies that create a level playing field and facilitate<sup>the</sup> entry and exit of firms into new markets stimulate innovation and commercialization of new technologies.

- **_Provision_** _of_ **_Industrial Standards._** This can either take the form of<sup>a pure public</sup> good, in which the government creates and maintains standards that permit technology based commerce, or, simply creating an atmosphere in which firms themselves agree on such standards to facilitate open interchange and<sup>useof</sup> specific technologies.

13 For a more detailed look at the way in which demand is stimulated in the<sup>privatesector,</sup><sup>**_VolumeTwo,_**</sup> **_Annex 5_** provides a study of the role of the private sector in facilitating<sup>theacquisitionof technologyin</sup> developing countries.

**14** Openness to trade may often accompany growth that is fueled by<sup>technologydevelopment,but</sup><sup>**it**isnot</sup> true that openness is an indispensable prerequisite for S&T-led growth in all cases. Some countries<sup>have</sup> developed strong industrial bases with relatively closed economies. Openness, like the other<sup>items</sup> mentioned here, might be best considered a likely associated condition, to which there are exceptions. See Nelson, Richard _National Innovation Systems: A Comparative Analysis_ (New<sup>York:OxfordUniversity</sup> Press) for further detail.

15
> Policies for Public Support of S&T The public sector has played a significant role in all countries that have developed strong S&T capacity. This role should have

> clear boundaries, limited in many cases to identifying priorities, creating incentives and

> frameworks, funding basic research, and providing S&T-related public goods. Lately, the role also involves stimulating linkages between public and private sector entities.

> Nonetheless, public action will always be a part of the creation and maintenance of an s&r system, as many of its features have public goods characteristics and would be undersupplied by the market alone.

> The proper functioning of the public sector, be it with respect to the private sector,

> education and training, or technology transfer and information flows, is critical to the creation and maintenance of a well-functioning S&T system. Conceptually, the public

> role can be disaggregated into five functions:

- Setting priorities for public sector financing

- Directly financing some parts of the system

- Governing, regulating, and (partially) managing the system

- Incorporating the results of research into public policy decisions

- Monitoring and evaluating the system to ensure accountability and relevance

> These responsibilities come together in a cycle of continuous revision and formulation of

> S&T policies that determines the size, character, and effectiveness of a given system.

> Effective S&T systems emerge when governments are constantly engaged in this cycle of priority setting, policy formulation and implementation, execution, use, monitoring, and evaluation.

One such area in which a number of functions come together, requiring a knowledgeable yet flexible government is that of setting the research agenda. The goal is to strike the proper balance between the need for basic and applied research while achieving breadth that connects research to important national priorities.

> Box 2 considers the ways in which these issues are evolving in the policy sphere.

16
The challenge in this policy area is to provide<sup>effectivepublicsupportforS&T</sup> through a variety of channels simultaneously. First, governments must set national priorities and assure that the S&T system<sup>isdiversifiedanddecentralized,again,</sup> balancing concentration of resources in centers<sup>of excellencewithstimulatinglarge-scale</sup> and dispersed research efforts. Second,<sup>theymust play majorrolesinorganizingand</sup> sustaining education systems and sectoral<sup>ministriesthateitherproduceorrequireS&T</sup> inputs and outputs. This is done through<sup>balancingtheir rolesas producers,consumers,</sup> financers, managers, and regulators/controllers<sup>ofqualityfor researchandits</sup> accompanying human resources training.<sup>Third, it is alsonecessaryfor govenunentsto</sup> play a critical role in establishing the rules<sup>of thegameof S&T resourceallocation.A</sup> major part of this involves promoting transparency,<sup>objectivity,andpeer reviewand</sup> evaluation procedures, assuring that<sup>meritandperformancearethecriteriafor</sup> determining how to award discretionary<sup>researchfunding.Fourth,governmentsmust</sup> seek to inform their policy decisions with<sup>thenecessaryscientificdata.</sup> Finally, as monitors and evaluators of a transparent<sup>andimpartial S&T system, the governmenthasa</sup> role to ensure that women and other traditionally-excluded<sup>groupshaveaccesstothe</sup> same opportunities as men to build and advance<sup>careersinscienceandtechnology.</sup> The gender dimension of S&T in development<sup>isonerequiringparticularattentionfrom</sup> public sector agents as women are egregiously<sup>under-representedinmostscience-and</sup> technology-related professions and global poverty and its consequences fall 17
disproportionately on women, whose historical lack of empowerment has marginalized their voices in many of the decisions that affect their lives (see Volume Two, pages 54-56 for further discussion).

> **Policies** to Promote Adequate ECT hinfrastructure Information flows are an

> essential part of the overall structure that promotes the use of knowledge. Adequate information and communication technologies (ICT) infrastructure is now indispensable to

> ensure access to the global stock of knowledge and information on which innovation

> depends. ICT infrastructure has created new channels that rout information more

> efficiently, reducing transaction costs and making possible new and/or greater economic opportunities. In research specifically, new technologies for information storage, organization, and sharing are changing the nature of research in a number of fields. New disciplines like bioinformatics concern themselves exclusively with the discovery and

> organization of massive quantities of data on living organisms.

> As in other areas for S&T capacity building, the challenge for the vast majority of

> developing countries is to access available ICTs rather than to generate new ICT

> research. Policies that expedite the process of helping cities, regions and whole countries

> to become physically wired are critical to narrowing the divide between the scientifically

> advanced and the scientifically lagging. The nexus between private industry, educational systems and the pubic sector stands to gain as well from improvements in ICT capability

> as connectivity fosters communities of knowledge and practice capable of addressing

> innumerable cross-sectoral development-related objectives. Countries that lack adequate

> ICT infrastructure are excluded from the efficiency gains related to ICT modernization

> and the opportunity to benefit from further knowledge made available in ICT-dependent forms, as explored in more depth in the recently released ICT Strategy Paper.

> Coordinating the Four Policy Areas: The himportance of Monitoring,

> Evaluation, and Dialogue. Because each of the four aforementioned policy areas is

> conceptually discrete, any description is bound to make the policy prescription sound formulaic. In reality, formulation and coordination of policies across these domains is a

> dynarnic and on-going process. It requires a subtle appreciation on the part of governments as to their role and a deft touch in knowing how and where to be involved or not. It also requires a factual grounding that can only come from careful monitoring,

> collection of indicators, and evaluation. Here, many developing countries are completely without experience. With the exception of larger, middle-income countries, data are

> scarce and the amount and quality of dialogue is inadequate. The challenge is to convert

> the growing interest of politicians in S&T into opportunities for dialogue on policy and

> performance, within an integrated and coordinated framework for S&T in development.

> The role of government in the promotion of S&T is a combination of a number of responsibilities. In addition to the specific areas mentioned earlier in this paper, it

> involves the inclusion of S&T-related policies in all levels of education, in industrial policy and the entire legal framework that governs business environments, as well as in

> any number of specific concerns of "line Ministries" (agriculture, health, energy,

> environment, transportation, and others). The need for coordination is substantial, as is a

18
sound judgment in deciding on<sup>thetypesofactionneededacrossthevarioussectors.</sup> Good science and technology<sup>policyisthe aggregateofappropriatedecisionson</sup> frameworks, incentives, direct<sup>support,andevaluation/policyanalysisacrossthis</sup> spectrum.

**_Lessons from Previous Experience_**<sup>**_WorldBankExperienceinPromotingS& T_**</sup> **_Capacity_**

In a variety of forms, improving<sup>S&T hasbeenaconcernof the WorldBankfor</sup> decades. It is worthwhile to extract the lessons<sup>of thepast whenconsidering directions</sup> for future action. However, analyzing<sup>previousexperienceof donorsand multi-lateralsis</sup> difficult because S&T is a cross-cutting<sup>theme.Lessonsmust be mined froma continuum</sup> of sector-specific initiatives in<sup>agriculture, health, education, energy,environment,</sup> private sector development, and<sup>other domainsin whichS&Tis a key ingredientbut not</sup> the dominant concern. Nonetheless,<sup>analysisof previousexperience doeslead toseveral</sup> lessons specific to the four policy<sup>areasaswellassomeoverall cross-sectoral</sup> conclusions.

The World Bank has supported<sup>S&Tcapacityin(i)educationprojects;(ii)</sup> industrial technology development<sup>andotherprivatesector developmentprojects;(iii)</sup> agriculture research and extension<sup>projects;and,(iv)informationandcommunication</sup> technologies projects. Still, apart from Agriculture/Rural<sup>Development,andselect</sup> middle-income countries in East<sup>AsiaandLatin America,RegionsandNetworkshave</sup> not treated S&T in development<sup>inaconsistentandsystematicway.</sup> A number of activities outside of lending operations<sup>havebeensupportedbygrants fromthe</sup> Development Grant Facility, but<sup>againwithnosystematicattentionto S&Tcapacity</sup> building for the long term.

Specific quantitative analysis of<sup>WorldBank operationalsupporttoS&Treveals</sup> that:

- Between 1980 and 1999, the World<sup>Bank lent $7.8billion todirectly support S&T</sup> activities across 590 projects, though<sup>fewerthan100ofthesecontaineda</sup> significant S&T capacity building<sup>component.Annually, 30S&Tprojectswere</sup> sponsored, with average lending<sup>forS&Ttotaling$390million.Fiveprojectsa</sup> year provided major support for<sup>S&T (greaterthan$10million)andtwentyfive</sup> projects a year provided minor support<sup>forS&T (less than $10 million).</sup>

- Most major support for S&T<sup>(outsideof agriculture) went toahandfulof large,</sup> middle-income countries.

- Regionally, East Asia received half<sup>ofallmajorS&Tloansduring thereview</sup> period. The next most frequent S&T<sup>borrower,LatinAmerica,tookoutnearly</sup> one-fifth of the loans.

- The DGF provides close to $100<sup>millionannuallyforprogramsthatare S&T-</sup> related.

- The World Bank itself is a<sup>funder.ofglobalpublicgoodsresearchfor</sup> development. In some disciplines,<sup>suchasdevelopmenteconomics,fundingand</sup>

19
publications constitute a significant portion of the input and output for the discipline.

Lessons from the World Bank's diverse experience with S&T are summarized below.<sup>1</sup> 5

> Lessons from Worild Bank experience in human **n** resources development

> Three major conclusions from the World Bank's involvement in basic and tertiary education emerge. First, attention to science education has been limited at the primary

> and secondary levels in both policy dialogue and lending. The support provided has

> typically prioritized equipment over teacher training, curriculum development, and

> improving assessment, although somewhat less so recently. Second, sufficient attention

> has not been given to improving learning outcomes in science. The international

> assessments of student learning outcomes in science have not been meaningfully incorporated into the World Bank's support for science. By advocating an increase in the

> number of countries participating in international assessments (e.g., the Trends in

> Intemational Mathematics and Science Study (TIMSS) and the Program for Intemational

> Student Assessment (PISA)) the World Bank could encourage monitoring and

> benchmarking of both student progress and teacher training efforts. The third lesson

> from the World Bank's involvement with S&T education, tertiary in particular, is that the

> overlap between academic training and research and the private sector stands as an

> important nexus of capacity and use. Tertiary education systems are often the final stage of training for labor market entrants with advanced scientific skills. Creating the right

> "backward" linkages to the broad reform agenda for tertiary education (e.g., quality

> assurance, finance, coverage, equity, institutional governance and management, diversification) and the forward linkages to the private sector are both critical steps needed to ensure the successful use of S&T-educated people for social and economic ends.

> Lessons from World Bank experience in stimulating demand for knowRedge in the private sector The World Bank has fostered a demand for knowledge in the private sector in two ways: by working to improve the overall macroeconomic conditions of its client countries and by directly investing in private sector and industrial technology

> development activities. With respect to the former, OED evaluations conclude that, on

> average, adjustment operations have done well in helping countries lay a foundation for

> accelerating growth, improving macroeconomic conditions, lowering inflation and

> removing the economic distortions that are damaging for productivity growth. To the

> extent that such efforts are successful, they will continue to help build a conducive environment in which S&T can grow and flourish. Lessons from industrial technology

> development (ITD) show that the success of ITD projects is contingent upon the presence of a well-articulated technology strategy at the national level. Many of the larger, fast

> growing countries-such as Korea and Singapore-that had such well-crafted policies in

> place experienced positive S&T-led growth following subsequent investments in ITD.

> 5 A more detailed qualitative and qualitative analysis is available m **_Volume_** _Two, Annex 2._ Similarly,

> lessons from bilateral, NGO, and foundation experience are discussed briefly here and more in depth in Volume Two as well as in **_Volume Two,_** _Annex 2._

20
However, some knowledgeable observers commented that an unwillingness on the part of the World Bank regarding projects that require government interventions for technology development led to a discontinuation of ITD projects in the mid-1990's despite their success.

Also in its review of ITD projects, the OED identified science and technology's disconnect from the private sector as an important obstacle to be overcome. To better foster the necessary linkages and enable ITD's contribution to knowledge development and enhancement, several key actions are suggested, including the need for a core group of specialized staff with interest and expertise in technology lending activities, better dissemination of technology literature within the World Bank to stimulate more discussion on the matter, and at the country level, an emphasis on private sector institutions and their linkages between SMEs and R&D institutes to narrow the divide existing between the private sector and knowledge-generating institutions.

Lessons learned from fostering partnerships between the private and public sectors serve to reinforce the notion that successful S&T capacity building requires linkages between these two spheres. Two examples taken from the OECD experience, illustrate the point. The US National Science Foundation helped foster more than a dozen Engineering and Science and Technology Research Centers, by providing ten years of core funding under a decreasing "sunset" clause. Depending upon whether the Centers were engineering focused or science focused, their mandate was centered around providing valuable services to industry, and in the case of the engineering centers, they had to become self-sustaining in order to survive once their public funding was exhausted. The majority of the centers continue to exist today with the potential for future profit-making dependent upon the filing of various patents and the possible commercialization of these technologies. In another example, in the year 2000, national university professors in Japan were given the right to become board members of private corporations in an effort to enable the transfer of technology to private industry. The legislation also allows researchers who take up a position as a board member to be granted leave without penalizing their retirement allowance. This package of publicprivate partnership-friendly legislation has drastically changed the culture of sharing and exchange now existing between academia and the private sector in Japan [OECD 2000]. Both of these examples underscore the lesson that mutual gains are achievable when the private and public sectors enter into partnership.

Lessons **from World Bank experience in public support of S&T** Lessons learned over the course of lending to encourage proper public support of S&T include the proven importance of creating open, transparent governance and peer review systems at the heart of S&T systems. These qualities are critical for success in priority setting as well. Other lessons learned include the tendency of the World Bank to over-emphasize physical inputs at the expense of improvements in policy to build public support for S&T. Major public sector S&T lending projects from 1980 through the mid-1990s received criticism for such an over-emphasis. Another important lesson learned is the need for sustained engagement and long term commitment, given the timeframes for change in the S&T sector.

21
The World Bank's response to these findings has been, inter alia, to seek to foster excellence through competitive funding mechanisms, using best practice for research management. This has taken the form of project components in higher education reform projects, such as the Quality Improvement Fund _(Fundo para el Mejoramiento de la Calidad: FOMEC)_ in Argentina or the competitive funds in the Chile Higher Education Improvement Project. It has also given rise to the Millennium Science Initiative, an expanding group of projects that seek to improve the quality and efficiency of research systems through an emphasis on excellence (especially as guaranteed by competitively funded peer-reviewed grant allocations), on intense human resources training, and on relevance of research and linkage to the private sector. [See Box 3 for further details about the MSI].

|lBox3:.'The'MillenniumScienceI,ltiative:CanSupporttoCeiitersof-ExcellenceBA<br>Cbatasfor.Reformi4gPuSlicSuppiirtof 'S&T7|
|---|
|In1998,iheBBankbeganprogramsofsWportmi:asm,rlgroupofcountries topromoteexcellence<br>inresearch.Theiinfitiiilprijectsand project,cmpon6nts(inChile,Venezuela, Mexico,andBrazil)for<br>|
|,thispurposewereigroupe-litogetherunderAtheNMillen,niuumiScienceInitiative(MSI).Themotivation<br>-beliindcieating.ithveMSIS4was.<br>providethe`framework'fora.highlyselectiveprocesstogmakelarge<br>grantsavail'abf,`e, fo'r3grannteestopeb'ormciienaic-w'ork,wff".interniatiorial-levelquality",TheBank's<br>rationale for.fundingth,e',MSIextended-bdiyonpro-grese,archoutputalone,however.,r TheMSI<br>wasalso:,esd,tab,lish,esdaXs,ameanstoca.effidc8ncy'giipndtodemonstratethat'imnroved-fuiding<br>,proqess-esc-an<br>rastlytimpsrove<br>thebfoiia7ntehof"WS&T-,ymsas'awvi&,gincluding thequality-of,<br>hunancapiia<br>,p<br>'-fies<br>g>the,<br>strerith6fHnkafes,totheiivatesector;,,|
|- ->Results<br>fromth'e7>stiMSI<br>uau, aIL,3to<br>iit;lae.nowbecomingavailable.They.revealthatasmall<br>*5ivestpient,uA<br>millionintod$ibii2<br>vpgddoubling of.theprod&ictionofPh.D.sin'<br>sChlale3<br>s,fiurM*or<br>400_,,'4_<br>pe,r-yteari**n** sc,0eticeand engineeringto,anexpectedrate<br>of.90,-,IOO,,yw,heat,<br>&firs',tf<br>ndotorMfid`d1es;graduate.<br>InidldiOtion,qu)ty'across'the Chilean<br>sciencessyst'rpiiiushiy,<br>u,c<br>st, otheprivatesectoraddtieed,ucationcomnmunity<br>havestrenghep4,-spsingexpectationsn<br>Six-patent applicationshavebedenfiled'intwoyears, some<br>of,whicha,v--.higtilecon,omhi<br>tinaly,itemationalhinkageshavebeenfortifiedand<br>the,proileoftesrd1,',Culehasbeenrafsed,asCileentireChileanS&T systemhasbenefitedfromthe|
|,c<br>h l<br>t<br>et<br>X<br>e<br>^<br>i<br>-<br>-<br>,<br>.<br>;<br>haulges<br>bytheisu<br>il-drougenerilizedacrosstheentire Chilean<br>tSAcT^system;are-,everal'.irst,hile'snfiam4iiudi(eiicy-hasidoptede,more.transparent<br>allocationprocessesused-byttheMSI:<br>eSe.snd,<br>researcjers:usethe.MSIasaapqsfiveexamplein<br>dialogueaboout<br>p<br>iinpiovtthi<br>to,Chiii'ist1ird,-<br>ChileiashiostedregionalS&Tpolicy<br>meetingsundertheauspi,cesS,of;theMSI.;-F6irdi,7tlf&governmenthasrequstedafbllow-onprojectthat<br>' <br> `'|
|wouldseektogeneralizethereformsI.<br>dFi6ntratedundertheMS1LEIL<br>2<br>'<br>.|
|d.<br>.<br>#<br>sxgmfiante<br>,the<br>4W<br>oewev<br>ongm'aea<br>*£,,iiTS,.t&ilgFonsistgofth,,o,<br>b,estr,esea,rchersandtei(tl<nlateri<br>,pge,nezer2dc<br>atsyste<br>asawhol,C:1al therightconditionasforth.istypeofasction,<br>,-tbunu<br>h<br>be<br>SIin,-idiffere,nt\ay.Benefits,do not'coitonisuppotto<br>¢-.<br>sente<br>rs;,of,ll'>o_<br>e, thedycomefrom,dem-outraAtg lhat'excellenceis,possibleWiththe-right<br>;policit,"Mihenfromiiging'eralizingdthis-denmostio`.JheBankshouldconimi',<br>use,the,IiSto<br>-initiateactioh,n"<br>ca7talyzereforfsvwher,e;<br>ts-6ek,toiprov6theirundemperforningS;T,.system<br>-<br>hex,plihci,tlink<br>cs<br>tothehigher-ducatibsiri.<br>1<br>-<br>,<br>,-.-<br>,>*iii<br>x4ndfrVoue`2offerxsamoredetiuileddescriptiofioftieMillennium ScienceInitiative....|

22
> In Agriculture, experience has focused on building capacity in publicly-managed

> National Agricultural Research Systems (NARS). Despite much notable success, especially in larger middle-income countries, several issues are consistently listed as difficulties or areas in which effectiveness should be increased. First, lack of borrower commitment to sustainable funding limits NARS' success. NARS, like virtually all

> advanced research systems, accumulate strength and capacity slowly and are by nature

> exlremely vulnerable to even short periods of funding scarcity or excessive fluctuation.

> Second, management capacity and incentive structures are often weak and inflexible.

> Lack of capacity in priority setting has been detrimental to relevance and efficiency.

> Third, more attention needs to be given to human resources development. Even the

> World Bank's Agricultural Sector Policy Paper published in 1980 called for an increase

> in the number of trained scientists in the sector (that paper projected an additional 9,000

> scientists would be needed in the agricultural sector), yet, until recently, insufficient

> attention had been given to linking research with human resources training. Fourth, monitoring and evaluation is generally inadequate at the level of research programs and outputs as well as with respect to institutional and policy changes.

According to the analysis of Byerlee and Alex (1998), the incorporation of lessons from past experience in agricultural S&T has led to changes in lending practices, including a notable shift in priorities after 1993 toward management and policy competence, incentive systems, and accountability. The shift could be described as the adoption of a "quality agenda" that emphasizes: (i) merit and scientific rigor through the use of competitive funding, external reviews, and increased institutional linkages, (ii) sustainability of funding through a variety of mechanisms including public-private interaction, cost-recovery, endowed research foundations, and farmer financing, (iii) more recognition of and support for human resources training, especially as conducted at universities,<sup>16</sup> (iv) continuing efforts to reform National Agricultural Research Institutes (NARIS) and the policies that affect them, and (v) increasing "knowledge-intensive" agriculture through linkages to basic research and the international knowledge base.

> **Lessons from World Bank experience in ICT** While the World Bank has sponsored several projects and initiatives to establish and/or improve client countries' ICI' infrastructure, many of the new World Bank-funded systems are somewhat

> precariously situated in the client countries. Significant effort is still required to integrate

> these systems effectively into the societies in which they have been created to make them

> accessible and useful. Additionally, the World Bank has learned that investments in ICT research and extension must include concomitant investments in human capital as it is necessary to use skilled workers to implement the expansion of ICT programs beyond the

> initial transition phase. Recent evaluations of the World Bank's ICT work also reveal that IT activities would be more effective if they were integrated more closely with other

> programs related to the information infrastructure, such as those pertaining to research

> 16 Page 63 of Byerlee and Alex notes that Bank-supported agriculture R&D projects should pay more attention to general issues of universlty quality and improvement, as a means to strengthening NARS.

> This is a potentially fruitful area of cooperation between staff in the Agriculture and Human Developments Networks.

23
and private sector development and such<sup>initiativesasInfoDev.OEDspecifically</sup> recommends fostering essential experimentation,<sup>researchandapplicationsthatcan</sup> provide a basis for a more demand-led information<sup>infrastructuredevelopmentprogram</sup> by the World Bank, which would incorporate<sup>and build upon theInfoDev program.</sup> In response to several of the aforementioned<sup>needs identifiedbytheOED,the</sup> World Bank's Global Information and Communication<sup>Technologies(GICT) Department</sup> now addresses four strategic areas: broadening<sup>anddeepeningsectorandinstitutional</sup> reform; increasing access to information infrastructure;<sup>supportingICThumancapacity;</sup> and, supporting ICT applications. The first<sup>area helpscreatethe overallenvironmentfor</sup> adoption of ICT, while the other three areas<sup>sharespecificgoalswiththescience,</sup> technology, education, and productivity concerns<sup>thatarethesubject of this paper. One</sup> example of this is the ICT Strategy's emphasis<sup>on the need tobuild humancapacity,both</sup> for general pedagogy and for sector-specific<sup>applications:"themostimportantuseof</sup> ICT in education is as a pedagogical tool,<sup>when properlyintegratedintoabroader</sup> educational program. However, there is also<sup>a need forICT to beused to developsector-</sup> specific skills and capacity." Other areas, such as fostering public-private<sup>partnership,</sup> also show significant overlap with and are<sup>complementarytotheconcernsof S&Tin</sup> development.

Lessons from the Development Grant Facility's<sup>SupporttoS&Tluniatives.</sup> A review of the funding priorities of the Development<sup>GrantFacility(DGF)reinforces</sup> the critical role that S&T issues play in development. Close to two-thirds of total DGF funding goes to S&T-related programs and priorities.<sup>Somegrants,suchassupportfor</sup> the Global Forum for Health Research are at<sup>or near best practicefortryingtouseS&T</sup> capacity to reduce poverty. Many others fund important specific activities<sup>andform</sup> strategic partnerships for progress against specific<sup>S&T-related problemsin development.</sup> However, the weight of S&T in this important<sup>developmentfinancing instrumentonly</sup> serves to emphasize the need for a comprehensive<sup>strategy for S&Tcapacity buildingin</sup> World Bank client countries. Experience to<sup>date is not encouraging.Theresearchof the</sup> CGLAR has clearly contributed to many breakthroughs<sup>inagriculturalresearch,however,</sup> while historically the largest DGF grant recipient,<sup>it hasrecognizedthemodestgainsit</sup> has made in capacity building in the developing<sup>world.Worse, perhaps,collaboration</sup> with the CGIAR in the World Bank's<sup>operationalsupporttocapacity buildingfor</sup> agricultural research has been minimal. The<sup>mostprominentlesson learnedfromDGF</sup> experience is that the knowledge gained from<sup>global public goodsprogramsis not being</sup> adequately utilized in country programs to the greatest extent<sup>possible.</sup> The following table itemizes the DGF programs,<sup>bycategory,thatrelateto</sup> science and technology. The S&T-related programs<sup>constitutealmost$100 million of the</sup> DGF's $145 million annual expenditures.

24
|_Empowerment,SecurityandS_ci__l_|**I**|I<br>-VM01<br>Ia<br>_DiigassCo'tinued_|**II**<br>_<br>_c__o_L_<br>___ica_|
|---|---|---|---|
|ProVentionConsortium|332,500<br>1|Special ProgramforResearch andTraining<br>**~~~in**<br>Tropical Diseases|2,500,000|
|_Education_<br>||GlobalForumforHealthResearch|6,925,000|
|Programforthe AssessmentofStudent<br>Achievement<br>|1,615,000<br>lNAIDS<br>I1,615,000|andRegional Initiatives<br>UNAIDS_and____________________|4,000,000<br>**4,000,000**|
|ProgramforEducation Statistics|;<br>1,070,000|RollBack Malaria**in**Africa|1,500,000|
|_Health_|_,_|StopTBInitiative|700,000|
|ResearchandDevelopmentinHuman<br>ReDroduchon<br>Reproduction|~~~~~2,000,000|_Environment,Conmmons_||
|PopulationandReproductiveHealth<br>CapacityBuilding Programs|2,000,000|Consultative GrouponInternational<br>Agricultural Research (includes$500,000<br>fortheMillennium EcosystemAssessment)|50,000,000|
|GlobalMicronutnentInitiative|1,200,000|Critical EcosystemsPartnership Fund|5,000,000|
|_InformationandKnowledge_|.|UNConventiontoCombatDesertification|1,250,000|
|WorldLinksforDevelopmentProgram|750,000|ForestPartnershipProgram|750,000|
|InformationforDevelopment Program|4,000,000|The GlobalWaterPartnership|400,000|
|GlobalDevelopment Network<br>_______________________|5,450,000|Natural ResourceDegradationofArid<br>Lands|300,000<br>|
|_COMMUnicablAe,Disiss_<br>-<br>--. ~,~-,-4'|,-*c+s'<br>A,~'(_Wj-_|WorldResources:2002-2003:**Livingin**<br>Ecosystems|150,000<br>150,00|
|<br>OnchocerciasisControl Program|<br>1,733,066|SolarDevelopmentGroup|2,000,000|
|AfricanProgramforOnchocerciasis<br>Control||<br>2,758,798<br>2,758____|_______________798_________||
|TOTALDGF CONTRIBUTIONto|theaboveS&|T-related**programs**annually|93,184,364|
|AverageannualDGF Budgetacross al|l77prioritypr|ograms|**145,000,000**|
|Science-and.Technology-Reievaiitpro|giarnsasaper|centageof**DGF**programfinancing|64%|
|Source'WorldBank_CompendiumofPro_|_grams,_2002.|||

In short, a review of World Bank experience illustrates a history of support for S&T in which much disparate activity occurred without any coherent framework or longterm goals for improving S&T capacity in client countries. With the exception of agriculture, the World Bank has also been reactive, and focused on large, middle-income countries whose S&T infrastructure was already comparatively advanced. While World Bank operational and grant support to S&T has been effective in some instances, it has generally occurred in vertically isolated "knowledge silos", with little connection to vitally-related activities and areas, across sectors and within them. **Lessons from Bilateral, NGO, and Foundation Experience.** A small number of bilateral donors, NGO's and foundations have dedicated programs to improving S&T capacity over the past few decades. The record is mixed, but cases of success seem to have come from concentrating long-term support on well-defined sub-sectoral goals in smaller countries. This has often been the case for foundations that chose a particular problem, like malaria, and built a program around it. On the negative side, bilateral support has fluctuated enormously, with funding for research being one of the first activities to be cut when budgets are declining. This is especially damaging as continuity of support is vitally important to research and capacity building. In general, only a small sub-group of donors have made systematic attempts to: (i) give prominence and importance to improving S&T capacity as an essential long-term goal for development; _25_
(ii) approach S&T in an integral manner, emphasizing cross-sectoral connections; and (iii) reach out to smaller and poorer countries that have the greatest need and face the greatest challenges in improving their S&T capacity. Success has been notable, although it has been on a small scale with modest resources. The Nordic bilaterals and the US foundations have the longest histories, but recently the Netherlands, Switzerland,<sup>and</sup> others have increased their activities for S&T. These cases of success are a potential source of partnerships for other members of the international S&T community.

# _Rethinking the World Bank's Approach to Science and Technology in Development_

The World Bank does not have a specific unit or section bearing central responsibility for promoting S&T capacity. Although this approach has not prevented the development of some effective initiatives in specific countries or sectors, it may have limited the Bank's ability to develop an integrated and systematic approach toward capacity improvement. To increase its effectiveness, the World Bank is exploring different means: (i) measures to increase awareness of the importance of S&T and development within the Regions and Networks, (ii) piloting multi-sectoral initiatives, (iii) integrating S&T concerns into sector strategies and country assistance strategies (CAS's), both of which provide appropriate entry points for issues of science and technology capacity building onto the individual development agendas of client countries; (iv) building the analytical base, and (v) creating partnerships. Any of these courses of action would be facilitated if there were a clearer locus of responsibility and sense of ownership for S&T capacity. Active synergies will be achieved by the relocation of Science and Technology to the Human Development Network as of July 2002 to more effectively promote the linkages with the Higher Education group. Further synergies within the World Bank might be achieved through the formation of a Thematic Group whose internal members are champions and leaders in S&T from the Education, Rural, Health, PSD, Energy, Environment and other sectors, as well as from the Regions. Without such a mechanism, it could prove difficult to break with the historical legacy of _ad hoc_ promotion of S&T.

A multi-sectoral internal Thematic Group is advisable because the steps required to promote S&T are complex, and essentially involve creation of champions within each Network, along with greater coordination and inter-sectoral cooperation. Creating a program for action across sectors with monitorable indicators will require a great deal of finesse and balance between core responsibilities in the sectors (e.g., Education, Health, Agriculture, etc.) that need to be pursued separately. However, if exploited, synergies among sectors could result in quantum improvements in clients' S&T capacity. The goals, processes and anticipated outcomes of the creation of the multi-sectoral Science and Technology Thematic Group are described in brief.

# _The Goals..._

The Thematic Group would lead efforts to raise awareness of the importance of S&T within each Network and Region by coordinating, sharing knowledge, identifying 26
> and piloting inter-sectoral initiatives, and leveraging the World Bank's comparative advantage as the institution with the mandate and resources to address the four vital areas of policy that bear on S&T:

> **Human Capital Development.** Education will continue to be the cornerstone of

> long-term S&T capacity building. The main challenge in education is to increase the amount and effectiveness of World Bank attention and support to scientific and

> technological education at all levels within the framework of general education reform. Specific actions could include:

- _Increasing the emphasis on science education in basic and secondary education lending._ This would also include encouragement and operational support for wider participation of developing countries in teacher training, curriculum development, physical investments (where appropriate), and assessment of outcomes. A starting point could be increased participation of World Bank clients in international assessments of achievement in mathematics and science.

- _Including science and technology as part of the renewed and expanded emphasis on tertiary education._ To participate more fully in the knowledge economy, more countries are seeking to strengthen the core knowledge institutions that constitute their tertiary education systems. The World Bank has increased and broadened its portfolio of tertiary education activities, placing emphasis on meeting the challenges of expanded access with quality and cost effectiveness. In some cases, tertiary education reform has also included attention to S&T issues, but this is predominately the case for large middle-income countries. The challenge is to make S&T a part of tertiary education reform for a broader spectrum of clients.

**Stimulation of Demand for Technology from the Private Sector.** The World Bank should explore ways to include concern for S&T as part of its important work of improving investment climates and increasing the knowledge content of economic activity. While many issues on this agenda must be carried forward simultaneously, more attention can be given to those key pressure points that induce greater use of technology in the private sector and the removal of obstacles to knowledge sharing and S&T diffusion. Among the means for achieving this are the following:

- _Renew emphasis on the creation of linkages between firms and knowledge institutions._ World Bank lending operations should continue to explore innovative means to reduce barriers and information problems that stifle greater use of knowledge in production. Stimulation of contact between university and industry, or appropriate support for the formation of clusters of knowledge-based industries are among the diverse mechanisms that can be part of a series of measures designed to increase knowledge flows in firms.

- _* Reform enabling environments for better use of knowledge._ Intellectual property rights administration, as well as taxation, credit policy, and

27
competition policy reform should routinely be included in World Bank efforts to improve the investment climate in all client countries.

Strengthening the Pubfic Role in S&T. The nature of the World Bank's support for improving the public role in S&T is likely to vary greatly according to country circumstances. Nonetheless, interventions should revolve around:

- _Priority setting and evaluation._ As it expands to work with a greater range of client countries, the World Bank should provide support and technical assistance to help smaller, poorer countries plan and set priorities in S&T. This could involve the development of evaluation and diagnosis techniques that consider where success is most likely and how limited S&T resources can be effectively concentrated on the most socially and economically useful investments.

- _Promoting transparency, objectivity, and selectivity and international best practices in S&T funding._ One of the most effective ways the World Bank can promote long-term, sustainable improvements to national research systems is through promoting the adoption of intemational best practice in funding with transparent, objective peer-review selection processes. A principal means for doing this could be the expansion of the Millennium Science Initiative beyond its successful beginning in Latin America [See _Volume Two Annex 4]._

- O _The government as a consumer of knowledge._ Not only is there a role for the public sector to help fund and support knowledge-creation, but there is also a role for the govemment as a user of knowledge. In creating S&T-relevant policies, the public sector necessitates access to the scientific knowledge necessary to understand the likely outcomes of policy decisions, thus, there is a role for the World Bank to assist in building capacity to utilize scientific knowledge and to serve as a potential clearinghouse for some types of S&Trelated information needed by public sector decision-makers.

Increasing Access to 111CTs. As the core work of the Global ICT group expands, opportunities should be sought to make the S&T infrastructure more available to potentially innovative firms, knowledge institutions, national research systems, and other stakeholders. The main instrument of the World Bank will continue to be policy and regulatory reform, given its potential system-wide impact. Additionally, the World Bank should continue to focus less on the R&D aspects of new ICTs and focus its efforts primarily on widening distribution and usage across regions and countries. As called for in the recent ICT Strategy, future action will also need to prioritize support for ICT human capacity.

_The Process..._ The process through which the Thematic Group should pursue these goals would include building a community of practice within the World Bank that unites stakeholders and champions whose work depends on strengthened capacity in various aspects of S&T.

28
This process would stimulate greater attention to S&T issues in each Network, coordination of key policies, and the piloting of cross-sectoral operations that take a more integrated approach to improving S&T capacity in areas that are key to development, such as:

- _Combining improvements in policy frameworks for the private sector and the tertiary education sector._ Examples of such industry-academia linkages might include specific actions in medical education, agronomy, natural resources management, or other areas.

- _Building on knowledge assessments with coordinated lending efforts across sectors (e.g., in Private Sector Development or Human Development)._ Client demand is high for analytical products that demonstrate the role of knowledge, especially scientific and technological knowledge, in new strategies for growth. The World Bank has responded with a number of technical assistance and non-lending services through the WBI's Knowledge for Development program. -These should be followed by specific lending services in the relevant sectors.

- _Emphasizing a development-oriented approach to improving science and technology in larger middle-income countries._ This involves encouraging the harmonization of the four policy areas detailed extensively in this document.

- _Developing regional S&T-based interventions around specific development problems._ This might be aimed to provide groups of smaller, poorer states with a focused set of strategies to address specific development problems (in health, agriculture, the environment or other areas) around which they could concentrate efforts to improve their capacity, performance, and policies in the S&T sector.'<sup>7</sup>

Periodically the Thematic Group would report to the Board on the progress made in each of the aforementioned areas.

**_Building the Analytical Base, Promoting Global Public Goods for S&T and Fostering Partnerships._** Along with increased operational emphasis on S&T, key areas for new analytical work (AAA) and participation in international fora and activities that will strengthen the knowledge base for S&T in development should be identified and pursued. This would include more work on critical issues such as gathering and extending the best current knowledge on the phenomenon of migration of scientists, technicians, and other highly skilled individuals from the developing world.1<sup>8</sup> The outcomes of this and other AAA work might provide the basis for greater awareness and advocacy on key development issues.

Another important part of an adequate analytical base for S&T in development would entail expansion of the World Bank's participation in international scientific assessments, such as the Millennium Ecosystem Assessment (currently funded in part by

> **17** **_Annex I of Volume 2_** provides more rn-depth coverage of some of the regional mterventions specific to the Africa region. See Volume Two, p.39.

29
the DGF) and the work of the Inter-governmental Panel on Climate Change<sup>(IPCC).</sup> These scientific assessments, which involve hundreds of experts from all over<sup>the world</sup> from all stakeholder groups, address issues that are at the heart of the World<sup>Bank'swork</sup> on environment and development. The World Bank should remain involved, both through funding (as is the case with the Millennium Ecosystem Assessment) and<sup>through</sup> the participation of World Bank staff, when the issues under consideration, like<sup>climate</sup> change or the conditions of fragile ecosystems, have a clear link and relevance to<sup>poverty</sup> and development. Other potential areas for involvement include the role of S&T in agricultural productivity and food safety and new technologies that relate<sup>to cost-</sup> effective delivery of health care services in the developing world.

At the same time, the Thematic Group could explore ways in which the World Bank could play a potentially large and beneficial role in the area of public<sup>regulationof</sup> science and technology. Whether in public health, bio-safety, agricultural productivity, or related trade and commerce issues, the need for effective public regulatory capacity<sup>for</sup> S&T-related issues is growing daily, and the capacity of the majority of developing country governments is not keeping pace. The World Bank, using its staff and its partnerships, as well as the Global Distance Learning Network and other WBI<sup>outreach</sup> products, could facilitate training and capacity building around specific regulatory issues in S&T. These services, if designed correctly, are likely to be in high demand from<sup>client</sup> governments, which struggle more than ever with new issues in bio-safety and<sup>related</sup> areas. The World Bank could serve as well as an entry point for complementary policy dialogue and operational activities built around the goal of long-term improvement<sup>of</sup> S&T capacity.

Finally, on a global level, the Thematic Group could take the lead in facilitating new partnerships and deepening existing ones. One part of such an effort might<sup>be on the</sup> stimulation of the public-private partnerships that can make development-relevant knowledge available and usable. In the new international context of S&T, private companies now generate an increasing percentage of the new knowledge<sup>and</sup> technologies available. By keeping the World Bank involved with both public and private entities, poverty issues could be kept on the international research agenda<sup>as</sup> opposed to being marginalized in the for-profit sector. While it is true that most of<sup>the</sup> new knowledge generated pertains to rich country markets, much of what is developed is still highly relevant to the problems facing the developing world. The marginal<sup>costof</sup> making the new knowledge and research available can be negligible, especially if channels exist to bridge the gaps between producers and users. Private companies<sup>have</sup> expressed willingness to share such data when it will be used for public purposes, however, often the channels for distribution and outreach are not there in the private sector. The World Bank should be actively engaged in building partnerships with the private sector to ensure the maximum use and distribution of knowledge and research for the global public good, particularly given the trend toward increasing private ownership of key S&T knowledge.

International partnerships between the World Bank and other multilateral organizations, bilaterals, NGOs and various entities engaged in science and<sup>technology</sup> 30
for development should also be fostered. While strategic partners already strengthen a number of the working groups within the World Bank, including the International Labor Organization, the World Health Organization, the World Wildlife Fund and many others, an even greater number of partners with an explicit concern for S&T in development would be sought to strengthen the Bank's work in S&T. The World Bank's ability to catalyze partnerships in S&T would extend to specific organizations, including: bilateral aid agencies concerned with S&T for development (e.g., SAREC, ENRECA, DGIS and NORAD); national scientific foundations, academies, and international science organizations (e.g., the Inter-Academy Council, the Third World Academy of Sciences and the International Council of Scientific Unions,); specialized multilateral organizations (e.g., the OECD and the World Trade Organization); and NGOs and other multilaterals concerned with science (e.g., the Bill and Melinda Gates Foundation, the Rockefeller Foundation, UNESCO, and the World Health Organization). (see Volume **Two** pages 86-87 and Volume Two Annex Two for a fuller discussion of partnerships).

# **_Anticipated Outcomes..._**

If the World Bank pursues a more systematic approach to S&T, woven into the regular programs of Networks and Regions through the workings of a well-organized Thematic Group, a decade from now, as we approach the established deadline for reaching the Millennium Development Goals, the World Bank could find itself in a situation in which:

- The responsibility for S&T issues in development is established with a professional Thematic Group that coordinates the growing number of S&T-related activities in the World Bank's work, maximizing the institution's impact.

- Education projects routinely include adequate, culturally appropriate science education components that raise student learning outcomes.

- _e_ Middle-income countries have increased the quantity, quality, and relevance of their scientific and technological output in areas that make direct contributions to social and economic goals.

- _e_ Low-income countries have targeted human resources development programs that channel talent toward the sectors with the greatest technical needs and that hold the highest opportunity for economic growth and development.

- Infrastructure for research and employment in the sciences has improved throughout the developing world, and subsequently pressure to emigrate has decreased.

- The critical mass of researchers working on development-related problems has increased.

- Access to and transfer of knowledge between producers, wherever they may be, and end-users in firms and public entities, has grown. substantially.

- Connections among innovative firms and talented researchers has grown worldwide.

- The critical mass of skilled personnel that developing countries need to implement the Millennium Development Goals is available.

31
Under such circumstances, the World Bank would help to promote a<sup>muchfuller</sup> contribution of science and technology to the development agenda.

32
# **Appendix One:** Sustainably Implementing and Monitoring<sup>the</sup> Millennium Development Goals Will<sup>RequireImprovedS&T</sup> Capacity in Client Countries

||I!<br>1<br>*.<br>*LII<br>**IL**|i|
|---|---|---|
|Halveb<br>*<br>*<br>Ensuret<br>afullco<br>*<br>*<br>*|etween1990and2015,theproportion<sup>ofpeoplewhosufferfromhunger</sup><br>Prevalenceofunder-weightchildren(Under<sup>fiveyearsofage)</sup><br>Proportionofpopulationbelowminmmum<sup>levelofdietary energyconsumption</sup><br>hatby2015,childreneverywhere,<sup>boysandgirls alike,willbeabletocomplete</sup><br>urseofpnmaryschoolmg<br>Netenrollmentinprimary education<br>Proportionofpupilsstartinggrade1who<sup>reachgrade5 </sup><br>Illiteracyrateof15-24-year-olds|Increased agncultural<br>researchand enhanced<br>foodsecurityregimes<br>Improvedaccess tobasic<br>education, including<br>science andmath<br>educationthatisbuilt<br>aroundappropnate<br>curriculaand deliveredby<br>well-trainedteachers|
|Reduce<br>*<br>*<br>|bytwothirds,between1990and<sup>2015,theunder-fivemortalityratio</sup><br>Under-fivemortalityrate<br>Infantmortality rate<br>|Increasedavailabilityof<br>trainedmedicalpersonnel<br>|
|*|Proportionof1-year-oldchildren<sup>immunizedagainstmeasles</sup>|andImproved accessto<br>|
|Reduce <br>*<br>*|bythreequarters,between1990and2015,<sup>thematernalmortalityratio</sup><br>Maternalmortalityratio<br>Proportionofbirthsattendedby skilled<sup>health personnel</sup>|immunizationsand<br>nutritionalinputs|
|Haveha<br>*<br>*<br>*<br>Haveha<br>diseases|ltedby2015andbeguntoreverse<sup>thespreadofHIV/AIDS</sup><br>HIVprevalence among15-to24-year-old<sup>pregnant women</sup><br>Contraceptiveprevalencerate<br>Numberofchildrenorphaned byHIV/AIDS<br>ltedby2015 andbeguntoreversetheincidence<sup>ofmalariaandothermajor</sup><br> <br>|Continuedresearchand<br>developmentintoneeded<br>vaccinesandtreatments<br>and improved distribution<br>|
|*<br>*<br>*<br>*|Prevalenceanddeathratesassociated<sup>withmalaria</sup><br>Proportionofpopulationinmalariansk<sup>areasusingtheeffectivemalana</sup><br>prevention andtreatmentmeasures<br>Incidenceoftuberculosis(per100,000people)<br>Proportionoftuberculosiscasesdetected<sup>andcuredunder directlyobserved</sup><br>|ofavailable vaccines and<br>treatmentsforthese<br>diseases|
||treatrnentshortcourse||
|Integra<br>progra<br>*<br>*<br>*<br>*|te theprnciplesofsustainable<sup>developmentintocountrypoliciesand</sup><br>mmesandreverse thelossesof<sup>environmentalresources</sup><br>Proportionofland areacoveredbyforest<br>Landareaprotectedtomaintainbiological<sup>diversity</sup><br>GDPperunitofenergyuse(aproxy<sup>forenergy efficiency)</sup><br>Carbon dioxideemissions (percapita)|developmentof<br>altemative energysources<br>andenhancedland-use<br>systemsincludingground<br>watermanagement<br>|
|Halveb<br>*<br>|y2015theproportionofpeople without<sup>sustainableaccesstosafednnkingwater</sup><br>Proportionofpopulationwithsustainableaccess<sup>toanimproved water source</sup><br>|techniques,sustainable<br>forestrytechniques and<br>|
|By202<br>slumd<br>*|tohaveachievedasignificantimprovement<sup>inthelivesofatleast100million</sup><br>wellers<br>Proportionofpeoplewith accesstoimnproved<sup>sanitation</sup>|improvedsanitation<br>systems|

33
|rj**4;**<br>**'o**<br>**ZI**<br>**Pk**<br>**_'M_**<br>**ci**<br>**0-9**<br>**cr**<br>**"04**<br>**U.**<br>**_4.1_**<br>**to:**<br>**iz**<br>**Q**<br>**to**<br>**ow**E<br>t3<br>.O. c)<br>g<br>rz<br>4.O<br>>O**CL**<br>§4411<br>OC=3<br>0<br>O<br>0<br>0<br>0|
|---|
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# Appenmdix Three: Reviewers and Consultants

## John Gibbons

Former Science Advisor to President Clinton, and MSI Panel Chair United States

## Dr. Edward Ayensu

President of the Pan African Union for Science and Technology Ghana

## Dr. Simon Schwartzman

Former Director of the Brazilian Bureau of the Census Brazil

## Dr. R. K. Pachuari

Director of the Tata Energy Research Institute India

## Dr. Enric Banda

Secretary General of the European Science Foundation Spain

## Dr. Peter Tindemans

Director for Science and Technology Policy in the Netherlands Ministry of Education Netherlands

## Dr. Bruce Alberts

President of the National Academy of Sciences Umted States

## Mohamed Hassen

Executive Director, Third World Academy of Sciences Italy

## Dr. Hameed Ahmad Khan

Executive Director, Commnission on Science and Technology for Sustainable Development in the South Pakistan

## Dr. Ibrahim Othman

Director General, Atomic Energy Commission of Syria Syria Dr. Jacques Gaillard Deputy Director, International Foundation for Science Sweden _Mu Shik Jhon_ President, The Association of Academies of Sciences in Asia Korea

## Larry Kohler

Executive Director, International Council for Science

## Dr. Juan Carlos Navarro

Chief _ad interim,_ Education Umt Inter.-American Development Bank United States 38
# **Dr. Michael Hoffmann**

Director General, Federal Mmistry for Economic Cooperation and Development Germany

# **Ali Al-Shamlan**

Director General, Kuwait Foundation for the Advancement of Sciences Kuwait

# **Lydia Makhubu**

President, Third World Orgamzation of Women **m** Science, Vice Chancellor University of Swaziland Swaziland

# **Bernard Petit**

Director, DG Development, European Commission Belgium

# **Dr. Thomas Rosswall**

Director, International Foundation for Science Sweden

# **L.N.R.Rao**

President, Third World Academy of Sciences and Honorary President, Jawaharlal Nehru Centre for Advanced Scientific Research India

# **Walter Alhassan**

Director General, Council for Scientific and Industrial Research Ghana

# **Goverdhan Mehta**

President, Indian National Science Academy India

# **Yongxiang Lu**

President, Chinese Academy of Sciences China

# **Yves Quere**

Foreign Secretary, Academie des Sciences, Delegation aux Relations Internationales France

# **Souleymane Niang**

President, Academue des Sciences et Techniques Senegal

# **Thamas Odhiambo**

Honorary President, African Academy of Sciences Kenya

# **Dr. Reinder Van Duinen**

President, European Science Foundation and Netherlands Organization for Science Research (NWO) Nethei lands

## **Rafael Vicufla**

Vice-President Chilean Academy of Sciences Chlle 39
Dr. **Pedro Aymonino** Director National Academy of Exact, Physical and Natural Sciences Argentma

# G. 0. P. Obassi

Secretary General, World Meteorological Society Switzerland

# Gerald Lalor

Director-General, International Centre for Environmental and Nuclear Sciences Jamaica Dorairaj an Balasubramanian Director of Research, L.V. Prasad Eye Institute India

# Dr. Abdul Omar

Chairman, CPTM, Science Advisor, Prime Minister's Department Malaysia

# Dr. Abdul Zakri

Director, Institute of Advanced Studies, United Nations University Japan John Grayzel Director, Office of Development Programs, USAID Umted States Hoan Vu. Tuyen President, Vietnam Umon of Science and Technology Associations Vietnam

# Laura Kansikas

Director, Department for Development Cooperation, Ministry of Foreign Affairs Fmland Dr. Howard Mnoore Chief, Science Publications Unit UNESCO Dr. Phillip Griffiths Director, Institute for Advanced Study Umted States

# Hon. Att-Ur-Rahman

Minister, Ministry of Science and Technology Pakistan

# Jacob Palis

Director, Instituto de Matematica Pura e Aplicada Brazil Elisabeth Beton Delegue Directrice de la Cooperation Scientifique, Universitaire et de la Rechereche, Ministere des Affaries Etrangeres France 40
F. I. B. Kayanja Vice Chancellor Mbarara University of Science and Technology Uganda

# **Victor Ngu**

President Cameroon Academy of Sciences Cameroon

# **Wataru Iwamoto**

Deputy Director General, National Science Museum, Special Inspector, Elementary and Secondary Education Bureau Japan

# Miguel **Virasoro**

Director, Vaduz Salam International Centre for Theoretical Physics Italy

# **Mohan Munasinghe**

Chairman, Munasinghe Institute for Development SSn Lanka

# **Muhammad Akhtar**

Emeritus Professor, University of Southampton United Kingdom

# **Francisco Tilak-Viegas**

Principal Scientific Officer, DG Research, European Comisu6n Belgium

# **Michael Oborne**

Deputy Director, DSTI of OECD

# **Dr. Daniel Maselli**

Swiss Agency for Development and Cooperation Switzerland

# **Dr. Berit Olsson**

Department for Research Cooperation SAREC Sweden

# **Dr. Eric Thulstrup**

Department of Life Sciences and Chemistry, Roskilde University Denmark

# **Attia Ashour**

Deparlment of Mathematics, Cairo University Egypt

# **Dr. Mohamed Shamsher Ali**

Department of Physics, University of Dhaka Bangladesh

# **Dr. Nacisco Matos**

Carnegie Corporation of New York United States 41
# **Elisabeth Beton-Delegue**

Mimstere des Affaries Etrangeres France

**Etim** M. **Essien** Department of Haematology and Immunology Nigena

## **Fidel Castro Diaz-Balart**

Member Cuban Academy of Sciences Cuba

# **Susan Thompson**

Office of Agnculture and Food Secunty Umuted States

# **Claude Freud**

Center for International Cooperation m Agronomic Research for Development France Dr. **Jon-Andri Lys** Swiss Comrrussion for Research Partnerships with Developing Countries Switzerland

# **Brent Herbert-Copley**

International Development Research Center Canada Dr. **Hans Hurni** Centre for Development and Environment, University of Berne Switzerland

# **Caroline Wagner**

Science and Technology Policy Institute, RAND United States

# **Cecilia Scharp**

Swiss Agency for International Development, Department for Research Cooperation of Sida (SAREC) Sweden

# **Andrew Bennett**

Department for International Development England

# **Gilles Saint-Martin**

DRIC-Ministere de la Recherche/Ministere de l'Education Nationale France

# **Hanns Sylvester**

German Academuc Exchange Service Germnany

# **Jacques Gaillard**

International Foundation for Science 42
# **Jean-Michel Chasseriaux**

Institute de Rechereche pour le Developpement France

# John Grayzel

United States Agency for International Development Unmted States

# **Jon-Andri Lys**

Swiss Commission for Research Partnerships with Developing Countries Switzerland

# Klaus Winkel

Royal Danish Ministry of Foreign Affairs Demnark

# Leen Boer

Research and Communication Division, Dutch Ministry of Foreign Affairs Netherlands

# **Lill-Ann Bjaarstad Medina**

Research Advisor, Norwegian Agency for Development Cooperation Norway

# **Najia Kbir-Ariguib**

Institut National de Recherche Scientifque et Technique Tumsia

# **Peter M. MsolIa**

Deputy Vice-Chancellor, Sokoine University of Agriculture Tanzania

# **Philippe Barre**

Ministry of Foreign Affairs France

# **ProL Abed Peerally**

Casa Blanca Maunlius

# **Prof. Pleimbert**

Instituto de Astronomua Mexico

# **Renee van Kessel**

Research Council for the Netherlands' Special Unit for Cooperation with Developing Countires (WOTRO) Netherlands

# **Driss lien Sari**

University Mohammad V., Mohammadia School of Engineers Morocco

**Dung** T. **Le** CMI-Universite de Provence France

43
Reza Mansouri

> Department of Physics, Shanf University of Technology Iran

Caroline Wagner RAND Umted States Robert-Jan Scheer

> DGDEV Research and Development, European Commission Belgium

**Richard Carey** OECD

**Mario Cervantes** OECD

**Brian Hammond** OECD Mustafa El-Tayeb UNESCO

**Tony Marjoram** UNESCO

Paul Fallon UNESCO

**Robert-Jan Scheer** European Comrnission

**John Campbell** InterAcademy Council

> Sachiko Ishizaka Intemational Council for Science

Hameed Khan COMSATS

**Enric Banda** European Science Foundation

44