CLUSTER CONFERENCE 2005 Innovation Systems and Clusters Programme for Eastern Africa (ISCP-EA). Presented by: Eng. Dr. J.B.Turyagyenda and Assoc. Prof. E. Lugujjo Faculty of Technology, Makerere University-Kampala, Uganda.

INTRODUCTION New approaches in the business to increase the productivity and competitiveness Africa has been lagging behind East Africa has come on board The paper constitutes a progress report of what has been done so far in the area of Innovation Systems and Innovative Clusters in the East African Region.

2.0THE MOTIVATION TO ESTABLISH AN ISCP-EA participation of East African Delegates at 6 th Global Conference Delegates from East Africa greatly inspired to pursue Innovative Cluster establishment Tribute to Sida/SAREC Participating Universities and Faculties

3.0CLUSTER ACTIVITIES/CONFERENCES Two Regional Conferences and one National Stakeholders’ Conference in each Country have been held, a brief of which is given below.

3.1First Regional Conference (The Bagamoyo Regional Conference 18 th -20 th, February 2003 ) The specific objectives of the Conference were:- i. To introduce concepts of innovation systems to participants; ii. To review the status of innovative clusters in Africa, with particular reference to Eastern Africa; iii. To identify key actors and support institutions and the nature of interactions between them;

Specific objectives Continued iv. To identify important policy directions and management interventions required for building capacities for the promotion and management of innovative clusters in Africa; v. To discern the role of universities and other knowledge generating institutions in the promotion and management of innovation systems and innovative clusters; vi. To come up with an Action Plan on the way forward.

Seven strategic actions from Action Plan: a. Implementation of follow-up research; b. Establishment of pilot innovation systems and/or cluster initiatives; c. Organization of follow-up forums; d. Implementation of an awareness creation exercise; e. Implementation of competence building measures; f. Preparation and distribution of various types of publications; g. Establishment of a Coordination Office.

3.2National Stakeholders’ Conferences Uganda A National Steering Committee to facilitate the formation of clusters was formed with the mandate of facilitating the creation of new clusters and to coordinate the activities of already existing but fragmented clusters and to oversee the implementation of the Action Plan on innovation systems and clusters. The representatives of the National Steering Committee were drawn from different Universities, research institutions, the business community, business associations, government, and policy makers.

Tanzania The objectives of the Workshop included the following: i. To receive and discuss developments after the February 2004 Regional Conference in Bagamoyo; ii. To refine the Action Plan, deliberate on the implementation strategies and complete the Log Frame Matrix; iii. To deliberate on the need to establish an Innovation Systems and Clusters Programme in Tanzania (ISCP-Tz); iv. To deliberate on the Way Forward including, among other things

Tz Continued Members of the National Steering Committee were selected from the following organizations:- University of Dar es Salaam, Tumaini University, DIT, COSTECH, Ministry of Industry and Trade and SUA.

Mozambique The Mozambique National Steering Committee comprises of the representatives from the following institutions: Ministry of Science and Technology; Institutions of Higher Learning; Ministry of Industry and Trade; Private Sector; Regulatory Bodies;

3.3The Second Regional conference in Jinja, Uganda The main objective of the conference was to take stock of the current state of Innovation systems and clusters in the participating countries and to chart out a road map for the same. The specific objectives were: 1. To review the current status of the Innovation systems and clusters in the region especially in the participating countries; 2. To determine how the Networks and Teams of capable individuals interested in innovation systems are to be formed.

Specific objectives continues (Jinja 3. To identify viable policies to promote activities in Innovation Systems and Clusters in our region. 4. To evaluate how the Action Plan is going to be executed in the participating countries; 5. To determine how the ISCP-EA and national ISCPs are to be organized and linked. 6. To determine the criteria for selection of Pilot Innovation Systems and Cluster Initiatives.

Specific objectives continues (Jinja) 7. To determine how to organize the short-term and long-term training in innovations. 8. To determine the modalities of cooperation and exchange of experiences between firms and staff involved in innovation programmes. 9. To determine how to mobilize the initial funding for ISCPs and their sustainability. 10. To come up with an agreed funding proposal to be sold to the Development Partners who will be identified during the course of the conference

Resolutions of the Jinja Conference A. The concept on Innovation Systems and Innovative Clusters is crucial to the development of the countries in the region and should therefore form a major component of the collaborating research activities of the three participating Universities/Countries. B. Industries should be given tax holiday if they are involved in innovative and developmental activities but not just for business purposes. C. Governments should adopt good policies for Science and Technology in order to encourage innovation and development.

Resolutions Continued D. The curricula in institutions of learning should be reviewed so as to stimulate innovation, creativity and entrepreneurship. E. Governments should create an enabling environment whereby local innovations are not subjected to unfair competition from imports especially before they reach a given threshold on the local market. F. Users of scientific equipment should come together and network for effective bargaining with suppliers of the equipment. G. National Steering Committees should constitute the Regional Committee, with rotating chairpersons from the participating countries.

Resolutions Continued H. The University of Dar-es-Salaam should be the Headquarters of the Regional Programme on the Innovation Systems and Innovative Clusters while the respective participating universities should be the National Coordinating Centers. I. In the long run Kenya, Rwanda and other non- member countries in the region should be incorporated in the program and that observers from these countries should be invited to the next Regional conference in Maputo, Mozambique. J. The participating countries should write and present a joint regional proposal

Major Outcomes Of Jinja Conference The status of innovation systems and clusters in each cooperating country was discussed. 1. The framework of the funding proposal was approved. 2. A common position on how to execute the Action Plan was reached. 3. Resolutions to foster the operations and cooperation of innovations systems and clusters were made.

3.4Programme funding In order for the ISCP-EA programme to take off, funding is required. Besides the funds expected from the National Stakeholders, interested development partners such as Sida/SAREC, United Nations Industrial Development Organization (UNIDO), International Development Research Centre (IDRC), and other regional support organizations such as; NEPAD and African Technology Policy Studies Network (ATPS) are being contacted for additional funding.

4.0CONSTRAINTS TO CLUSTER FORMATION AND GROWTH IN E. A.  Limited knowledge of concept and role of innovation systems and their potential for development;  Lack of clear policies in respective sectors of the Economy;  Existing research institutions have low motivation for innovation due to lack of facilitation;  Absence of firm formal linkages between stakeholders i.e. government, private sector and relevant academia;

Constraints Continued  No clear, streamlined patenting system in most of the countries in the region;  Limited markets due to low purchasing power for products and services;  Stiff competition from imported products;  Limited supporting industries within the Region;  Limited confidence in home-grown/locally manufactured goods;

Constraints Continued  Mistrust amongst local businessmen/women and between themselves and manufacturers;  Financial institutions that are ready to support innovative research and clusters are limited if any as the former do not have confidence in local research outputs.  Innovation systems and innovative cluster initiation and facilitation are a costly venture within an environment of limited resources and limited government support;

Constraints Continued  Limited capacity within the private sector to provide the required leadership amongst the cluster member enterprises;  Limitations of economic infrastructure to facilitative easy linkages between the different regions of the country and even outside the country;  Limited complementarity of government and private sector roles.

5.0 CONCLUSIONS AND THE WAY FORWARD To sustain innovative clusters drive there is need to I. Initiate policies that should lead to strategies of maintaining successful alliances between Government, Universities and the Private Sector/industry; II. Carry out research to find out how the spontaneously created clusters have been able to grow and how they have been able to support the creation of new products and processes.

Conclusion Continued III. Use these findings as a basis for the formation and promotion of innovative systems and innovative clusters. IV. Facilitate private sector institutions to carry out service/sector studies to identify opportunities for innovative cluster initiatives.

Conclusion Continued V. Support to build capacity and competencies of all stakeholders is absolutely necessary; Establishment of an Innovation System and Clusters Programme for Eastern Africa (ISCP-EA) and mobilization of funds to finance its activities is also very vital;

Conclusion Continued VI. Regular participation in the Annual International Conferences organized by The Competitiveness Institute (TCI) and other cluster organizations should be encouraged so as to keep abreast with developments in the international arena;

Conclusion Continued VII. Organization of Regular Meeting/Seminars and Annual National and Regional Conferences on Innovation Systems and Clusters to ensure continuity and close follow-up of developments within each country and the region.