1. TAFTIE Taftie Policy Forum Fernando de Nielander Ribeiro FINEP – Innovation and Research November 25 / 26 th 2014

2. Brazil: Country profile 8.5 million sq. km 202 million US$ 2.22 trillion 1.2% GDP 45.3% from renewable sources (world 13%) diversified base Sources: (04/02/2014) Sites: IBGE, IPEA, Banco Central, MCTI Total area: Population (2013): GDP (2013): S&T&I Investments (2010) : Energy Production: Natural Resources: Industry:

3. Promote Innovation to Raise Productivity and Competitiveness  Strong development of scientific activity  Important evolution on numbers of Masters & PhDs.  New policies and institutions dedicated to science and innovation.  Innovation policy is part of the social and economic agenda.  However, companies are not clearly in the spotlight and technology development is weak.  Investment in technology is still low and there are only a few innovative companies.  Dialogue between Universities and Enterprises is still difficult.  There is a lack of human resources, particularly, in engineering.  Poor seed and venture capital market  Strong development of scientific activity  Important evolution on numbers of Masters & PhDs.  New policies and institutions dedicated to science and innovation.  Innovation policy is part of the social and economic agenda.  However, companies are not clearly in the spotlight and technology development is weak.  Investment in technology is still low and there are only a few innovative companies.  Dialogue between Universities and Enterprises is still difficult.  There is a lack of human resources, particularly, in engineering.  Poor seed and venture capital market

4. A FINEP To speed up the transition to more knowledge intensive economy, Brazil needs to grow faster in S, T & I Underdeveloped Advanced countries Intermediary countries Brazil Technological Mastery Scientific areas 1. Small scientific infrastructure unable to feed technology producing 2. Science can determine part of the technology production but does not generate effect on scientific production 3.Established connections. Main determinant of growth is the scientific and technological capacity Source: Ipea/Cedeplar, 2009

5. 5 ______________________________ Ministries ______________________________ PRESIDENCY OF THE REPUBLIC S&T Council Agencies FINEP | CNPq | CGEE | AEB | CNEN HEALTH EDUCATIONDEFENSE ENVIRONMENT DEVELOPMENT, INDUSTRY AND TRADE MINING AND ENERGY FOREIGN RELATIONS CULTUREFINANCE PLANNING, BUDGET AND MANAGEMENT SCIENCE, TECHNOLOGY AND INNOVATION ______________________________ Ministries ______________________________ PROGRAMS AND FINANCIAL SUPPORT COMPANIES UNIVERSITIES RESEARCH AND TECHNOLOGY ORGANIZATIONS SOCIAL ORGANIZATIONS LABOR & EMPLOYMENT COMUNICATIONS Other Ministries (Departments) – total 24 + Secretaries and Councils Brazilian Science, Technology and Innovation System

6. Finep - Innovation and Research Finep is a government owned company, linked to the Ministry of Science, Technology and Innovation Stablished in 1967 740 employees US$ 5 billion budget Offices: Rio de Janeiro (head office), São Paulo and Brasília

7. Finep To promote Brazilian economic and social development through governmental funding of Science, Technology and Innovation in companies, universities, technological institutes and other public or private institutions. Mission Finep - to act in the whole process of innovation, focusing on strategic and structural actions aiming the sustainable development of Brazil.

8. Objectives: To improve scientific infrastructure To encourage and support high standard scientific research To encourage the implementation of ongoing S, T & I activities in universities, R&D institutions and companies To reverse the domestic weakness in technology-intensive segments To increase the productivity and competitiveness of Brazilian companies To support the entry of innovative companies into global markets To stimulate private investments in innovation

9. Information and Communication Technologies (ICTs)Defense and Aerospace HealthClean TechSocial Development and Assistive Technologies Renewable Energies Oil & Gas and Marine Finep – Priorities Support for: Research Infrastructure, Tech. Services and Innovative Environment

10. Finep´s annual budget growth * Grants+ Loans + Subvention ** Expected Amount US$ billion

11. FINEP - Disbursement 2001 – 2013 (2014 = US$ 2 billion) 382% Average Total Disbursement 2001 – 2003 R$ 1.064 million Average Total Disbursement 2011 – 2013 R$ 4.065 million

12. Loans for companies Negative interest rates Up to 12 years payback period Up to 4 year grace period Leveraging: up to 90% FINEP Financial Support to Foster Science and Innovation Support different S,T&I activities: from basic research in universities to products, services and processes development in companies. Grants for companies To companies to develop high risk technology projects Investment in Funds and Equity Equity, Venture and Seed Capital to support creation and growth of high- tech companies Grants for research organizations To public and private research institutes and Universities through public selection

13. Loans for Companies US$ 5,2 billion in 2013-2014: 4 x 2009-2010 US$ 5,2 billion in 2013-2014: 4 x 2009-2010 52% of contracts 2009-2010 to 2013-2014 52% of contracts 2009-2010 to 2013-2014 62% new clients (2013-2014)

14. Grants – Research Infrastructure Expand and modernize research infrastructure in universities and research institutes in Brazil Period: 2007 a 2013 Quantity Amount (USD million) Calls for proposals9 840,0 Proposals1.153 2.407,7 Financed projects719 839,8 Construction399.576 m² 255,9 Equipments7.135 401,6

15. Grants - Innovative Environment Technology parks and incubators program Promote habitats to support innovation and knowledge intensive business Call for projects (2010): 12 projects / USD 26 million Call for projects (2013): 16 projects / USD 44 million TOTAL: 28 projects / USD 70 million

16. Investment Stimulate the creation and development of innovation based business and help them gain access to capital. Actions: Identify and develop entrepreneurs and support them in approaching with investors (Seed Forum, Venture Forum and Forum Brasil: 42 editions / 377 participants / 77 invested companies ) Select and invest in Seed Capital, Venture Capital and Private Equity Funds focused on innovative companies Equity for high tech companies

17. Investment - Funds Focused on Venture Capital, Private Equity and Seed Capital Funds 281 Received Proposals 132 GP’s 126 performed due diligences 29 Funds: USD 208 million committed Finep USD 4,4 billion Fund Capital 120 Invested Companies 18 investors take part on program board 12 observers in the last call 8,4 x

18. Equity - Investment in Companies Focus: Stimulate business growth by investing in technological innovation projects in companies that have condition to achieve leadership positions in their markets Capital: USD 200 million National coverage Sectors: ICT, Health, Biotech,... 2014: 2 invested companies

19. Focus: to increase R&D in companies Encourage high technological risk projects Integration of tools: Loans + Subvention + Grants + Equity Using public procurement Fostering innovation in SMEs Simplify and reduce burocracy + Productivity + Competitiveness Inova Empresa Plan Finep-30- Days Inova Empresa Plan Negative Interest rates Inova Empresa Programs Inova Drugs Decentralization

20. Inova Empresa Plan - Priorities Energy – Oil&Gas – Biofuels /Chem. – ICTs – Health – Agro – Space – Social Tech – Clean Tech Inova Energy Inova Petro Inova Ethanol Inova Health Inova Telecom Inova Sustainability Inova Space Inova Agro INFRASTRUCTURE TECH. SERVICES

21. Demand US$39,5 billion 2.787 companies 238 research centers 12 ministries and agencies Inova Empresa Plan US$15 billion budget 2013/2014 Inova Empresa Plan – High Quality Projects Credit – 9.5 bi Equity – 1.0 bi Grants – 1.9 bi Subvention – 0.54 bi US$ 11,7 billion signed so far

22. Clean Energy and Green Economy Programs Encourages research activities, development, engineering, technology absorption, production and marketing of products and processes for innovative services in the field of energy. Supports innovations that induce sustainability in Brazil, such as technologies and solutions for sustainable production, recovery of biomes and also supports initiatives for sustainable productive forest-based activities, environmental sanitation and disaster prevention.

23. FINEP – Management Efficiency www.finep.gov.br/30dias What is it? An innovative methodology that reduces time and increases the transparency and quality of project analysis. Finep reduced to a 30 day period the merit analysis and classification of funding proposals. Objective: To raise the technological status of the national industrial park in order to make it possible to face the prevailing challenges in domestic and international markets.

24. National Plan for ST&I Platforms Raising the level and the impact of Brazilian ST&I

25. ST&I Platforms Attributes Connecting intelligence High standards to guide evaluation Oriented to results Special regime for procurement and hiring people US$ 11 b / 10 years Platforms are guided to generate strong impacts in the Brazilian economy and society Attracting high level researchers from abroad Public funding for 10 years

26. FINEP - International Cooperation Knowledge and innovation increasingly interconnected across organizations in different countries Competition takes place in the world market Global solutions for global issues Knowledge and infrastructure may be complementary an enabling environment for companies to gather …to shorten technological development’s process …to provide a reliable environment for business partnership …to encourage the sharing of research infrastructure

27. Finep – International Cooperation Selecting countries convergent strategic areas with Brazil cooperation oriented important innovation players convergent strategic areas with Brazil cooperation oriented important innovation players FINLAND SWEDEN SPAIN UNITED KINGDOM NORWAY FRANCE

28. Measuring Innovation Measuring innovation = effectiviness of public policies / organization of new policies and plans / transparency and information to society. Brazil economic = develop public policies for fostering innovation. After 2000 - Measuring the effort on technological innovation / statistics every three years. Focus on R&D expenditure, R&D dynamic and strategy within firms, factors that influence the innovative behavior of firms, incentives, barriers and outcomes of innovation. Relevant growth on the amount of innovative firms (2000 – 2011) Innovative firms: higher output, productivity and salary, better skilled workers, export more and are able to compete world wide. Reported factors that obstruct firms innovation: high risk and cost, rigid firm organization, lack of skilled personnal, short technology and market data, low opportunities for open innovation, standard rules, low consumers perception to innovative products, lack of technical services.

29. Thank you Fernando de Nielander Ribeiro fribeiro@finep.gov.br