Both of us have written extensively on the commercialization of technology (see Bibliography) and its impact on economic prosperity for a region, country, or continent. Our focus in this article is to elucidate how a real country is making strides to enable a cultural shift in focusing on commercialization from a “research state of mind”.
Uzbekistan is Central Asia’s most populous country. The demographic structure is heavily skewed toward younger people, with about 60% of the population under the age of 30 years old.
It’s also interesting to note that Uzbekistan is a multi-ethnic country, with more than 100 ethnic groups. Ethnic Uzbeks comprise about 80% of the population. In late 2016, the country launched a process of market-oriented reforms, following the first leadership change since the country gained independence in 1991. President Shavkat Mirziyoyev embarked upon an economic modernization program to reinvigorate equitable growth, strengthen and modernize public institutions and increase the role of the private sector in the economy.
As the President has stated: “…we need to create such an environment for those businesses and foreign investors that are producing export-oriented, innovative and HiTech products. It is desirable for each industry to have a network of research institutions, design bureaus, pilot production, and innovation centers. We must attract investment not only for the economic sectors of our country but also in the areas of scientific research and ‘know-how’”.
The Reform Roadmap outlined reform actions across all strategic areas, to achieve the objective of becoming an upper-middle-income country by 2040.
In February 2017, the Government of Uzbekistan (GoU) announced a broad market-oriented National Development Strategy (NDS) for 2017-2021, targeting five priority policy areas: (i) Enhancing state and public institutions; (ii) Securing the rule of law and reform of the judicial system; (iii) Promoting economic development; (iv) Fostering social development; and (v) Ensuring personal and public security through inter-ethnic and religious tolerance and constructive foreign policy. Among the key priorities were promoting the growth of the private sector through privatization of state-owned enterprises (SOEs) and public-private partnerships (PPPs), improving the investment climate, encouraging entrepreneurship and investment in modern technology and innovation. In January 2019, the GoU adopted an ambitious Reform Roadmap, developed with the support of the World Bank Group (WBG). The Reform Roadmap outlined reform actions across all strategic areas, to achieve the objective of becoming an upper-middle-income country by 2040. The Reform Roadmap foresaw the development of a National Innovation System (NIS) for the Uzbek economy, and the mobilization of financial resources for research grants to create partnerships with the private sector and foreign universities. See: https://www.hstoday.us/subject-matter-areas/information-technology/what-federal-agencies-can-learn-from-the-international-community-about-commercialization-of-technology/ for more information related to Uzbekistan’s program.
Creation of effective mechanisms for promotion and implementation of promising domestic achievements in research and innovation activities, including the organization of scientific and experimental specialized laboratories, high technology centers, technology parks and other structures, including with the participation of foreign investors, were one of the key tasks.
Uzbekistan has made some progress in the development of its National Innovation System (NIS) over the past two years. The main drivers of this process are the strategic vision of the Government, as well as high-level political support: the Uzbek authorities have declared an ambitious goal of entering the ranks of top-50 in the Global Innovation Index by 2030. To achieve this goal, the government adopted a roadmap that envisages (i) Quadrupling gross (public and private) spending on R&D from the current 0.2% of GDP to 0.8% of GDP by 2021, (ii) Improving scientific excellence, and (iii) Strengthening the links between education, science, and industry.
The Ministry of Innovative Development (MID) extensively worked to create a modern infrastructure for the development of science and innovation that provide the necessary conditions for sustainable growth of the social and economic potential of the territories, as well as to improve the living standards and welfare of the population. Ministry worked on attracting investments in the sphere of development and implementation of innovative ideas and technologies, improvement of the regulatory and legal framework to ensure their development.
MID has started reforming the science funding system. Prior to 2018, the government would fund R&D projects, initiated by the scientific community, once a year through a cumbersome procedure. Now it is a competitive selection of R&D proposals on a rolling basis (calls for proposals are announced online every 2 months) and are based on specific priorities and needs of the national economy. Before the establishment of MID, R&D projects would receive more funding incrementally and mainly to cover researchers’ salaries. The Ministry has increased funding (the average size of grants tripled and reached US$80K) and at least 50% of allocated funds are now used by beneficiaries to purchase R&D equipment. MID has also increased the available funding for field expeditions and laboratories in regional universities in order to diversify the subject areas of R&D and expand the geographic coverage of science facilities. This implies increased funding of institutions outside of the National Academy of Science.
The government has also launched short-term (3-month) foreign internships for researchers. A total of 40 researchers went abroad in 2018, and 300 more will be sent in 2019. The Ministry has also launched calls for proposals for joint research in cooperation with worldwide research institutes and universities.
Progress Report: Tech Commercialization is Hard Work
The expertise needed for this type of activity is still evolving and needs time to implement.
Among the reforms of Uzbekistan’s NIS, promoting commercialization in the research arena is among the most challenging. The effective and efficient transfer of ideas from research to be used for innovation from existing firms or startups of knowledge-based enterprises occurs—it requires a new level of dedication by researchers. Developed countries have recognized this potential and tried tapping into it in many ways, as reflected, for instance, in the emphasis of European Union (EU) countries in the so-called ‘third mandate’ of universities. Yet, commercialization is not an automatic process. Funding for early stages of commercialization, such as the preparation of a proof of concept, prototyping, etc. – is underprovided by the private sector. The expertise needed for this type of activity is still evolving and needs time to implement. These challenges are not specific to Uzbekistan but are becoming more acute with the ongoing transition of Uzbekistan’s NIS. Progress has been made, yet much more is needed, through detailed planning and execution, over the next several years. They certainly possess the will to succeed, and with support from the World Bank, we anticipate updating you on their progress in this important endeavor.
The authors wish to thank their colleagues in both the private and public sectors over the years for all the fruitful discussions related to the commercialization of technology as a means of economic prosperity.
About the Co-Author:
Dr. Tom Cellucci has been a senior executive in both the private and public sectors for over 39 years. He served as the US Government’s first-ever Chief Commercialization Officer, working for both President Bush and President Obama. He assists President Trump’s team when asked… Tom has authored or co-authored 25 scholarly books and over 314high-tech business articles. Cellucci earned a Ph.D. in Physical Chemistry from the University of Pennsylvania (1984), an MBA from Rutgers University (1991), and a BS in Chemistry from Fordham University (1980). He is on 21 Boards and Chairman of the Board of Trustees of Eurasian Technological University in Kazakhstan. He currently possesses the rank of Honorary Professor at two prestigious universities in Kazakhstan, as well as taught at the Harvard Business School, Princeton University, and the University of Pennsylvania. He is considered a pioneer in the commercialization of technology in government and a “turn-around” expert on Wall Street. He’s also the Chairman of the Board of a highly successful Private Equity firm, GVP Global Corp, with headquarters in Boston, Massachusetts. Tom and his wife Julie are blessed with seven children and six grandchildren.
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