Tabl. 1
Human resources in IUS -2015 and in Belarus 2015
Human resources
Source EU/ Belarus
E
U28
B
elarus
1.1.1 New doctorate graduates
Eurostat
(2015)/Belstat(2015)
1
.8
0
.7
1.1.2 Population completed tertiary
education
Eurostat
(2015)/Belstat(2015)
3
6.9
5
9,6
1
1.1.3 Youth with upper secondary
level education
Eurostat
(2015)
/Belstat(2015)
8
1.0
9
2.6
Belarus on the performance of human resource development refers to developed
countries. Indicators characterizing the graduates from tertiary education and employment in
the production of goods and services, the country complies with such a recognized leader of
innovation as Finland and Sweden. But the level of economic and innovative development of
the country does not correspond to human capital. Innovation activity in EU according to CIS
6 was 52%, and in Belarus in 2014 was 22.8%. The process of reduction of the amount of
innovatively active companies, the primary type of activity of which is production of industrial
products, is taking place in Belarus. For the past three years, their number has reduced from
443 companies in 2011 to 383 companies in 2014, or by15.6 %.
The absence of a positive relationship between education indicators and indicators of
innovative development may have several explanations. Firstly, there is a considerable gap
between the formal criteria (e.g., shareholders of higher education, duration of training, etc.)
and indicators of educational quality as measured by the presence of necessary economic
competencies and skills. Secondly, the educational structure of the population is considerably
at variance with the skillstructure of the economy. Structure of human capital does not
correspond to the structure of demand for it, and the available stock of human capital is used
unproductive. The analysis shows that Belarus is lagging behind the EU countries on the
number of youth who are enrolled in doctorate graduate school, which can create difficulties in
the future to fill the scientific staff.
Business surveys suggest that they lack qualified personnel, which prevents development
(Figure 1).
1
Own calculation
222
Figure1 Skills constraints on firm expansion by 2013
Source http://enterprisesurveus.org
World Bank studies show that the lack of qualified personnel in Belarus is an obstacle for
the development firms. The EBRDWorld Bank Business Environment and Enterprise
Performance Surveys (BEEPS) have been conducted in virtually all ECA countries in 2009 and
2013 demonstrated, that the percentage of firms considered the level of skills as obstacle for
the activities and development, increased from 14 to 23 %. Thus,there isa contradictionbetween
theformaleducated
workforce,employed
inthe
economy,and
the
lackof
qualifiedpersonnelforinnovation.
Belarus had well – regarded education systems prior to the end of central planning.
While the intervening years have taken some shine off this reputation, country continues to
have some strong achievements in this field of education. Notably, enrollments are high at all
levels of education. Tertiary enrollment has grown rapidly in past decade in Belarus.The
numberof
studentsper10,000populationsincreasedfrom194in1995to
385
in2014,
but
expenditureper student tertiary (% of GDP per capita)has declined with 27.7% in 2005 to
14.7% in 2012. The emergence of skills shortages in face of high and rising enrollments
suggest that the problems lies not so much access as with quality of education. Despite high
levels of enrollment, education systems in Belarus do not produce enough graduates with right
skills. Students often graduate with diplomas, but not with necessary skills. The problem of
education system are still weakly making the transition from teaching the basics ( factual
content often via rote –learning) to inculcating higher order skills such as criticalthinking and
problem – solving.
It appears that the availability of education in general may depend on the degree of
openness societal system, how permeable are the social partitions separating the different
segments of the population in the national system of stratification. Permeability of social
boundaries is achieved through processes of social mobility, opening the possibility of free
movement of individuals or social groups, contributing to a qualitative change in social status.
One of the most effective channels of upward social mobility, along with channels economic
(changes in social status due to the presence or absence tangible property) and professional (the
change of social status for through vocational training higher level) the nature, supports
education. In different periods of historical development of education channel upward social
mobility
have
different
degree
of
intensity, limiting, or, conversely, promotes individuals and social groups of up to a better
socioeconomic status. Obstacletotheseprocessesmaybean increasing of the proportionof
223
students studying with fee. IfinSoviet times,highereducationwas free,nowinBelarusfor more
than 60% of university studentsenrolledfora fee. The growthof paidhighereducationreduces the
opportunities forsocialmobility, butcurrentfunding foreducationfromthe statecannotrefusetopay
foreducationalservices.
Belarus needs to focus more on measuring outcomes and using this information to
improve policy. Belarus has not yetparticipated in the PISA internationalassessment test.
International assessment tests such as PISA measure certain dimensions related to critical
thinking and problem solving. International learning through participation in those projects
may be useful for identification problems and to improve policy. National assessments should
be complemented international assessments. Developing student learning assessment systems
that measure learning competencies at key points in the learning cycle should be a priority, as
should using the assessment data to improve teaching and learning at policy making level.
Learning at the macro level and international level
At the macro level learning is determined by the presence of adequate opportunities.
These depend on access to educations, on the one hand, and on the other, on a context that
encourages the creative application of knowledge to resolve challenges. According to [12],
learning is a fundamental process for innovation, therefore involves a twostage process
consisting of two sets of necessarily complementary activities the acquisition of basic technical
skills and knowledge via tertiary educations and training; and subsequent learning within
productive employment that adds critically important complementary skills and understanding.
The objectivesof economic modernization and innovation development of Belarus according to
State Program of Innovation Development (SPID 20112015) increasethe value of lifelong
learning. The system of lifelong learning to build skills in later years was underdeveloped in
Belarus (only 0.06% of GDP). Expenditure on higher and postgraduate education decreased
relative GDP (from 1.15% 2005 to 0.92% GDP in 2013)
Learning cost for innovation iscarried 0, 1% innovation expenditure in Belarus, for
example, in 2015 from 343 innovative enterprises only 33 had carried learning for innovation
or less than 10%. Opportunities for learning later in life are extremely important for those who
may have finished or left school with only the most basic of proficiencies or those who were
educated under the regime of the planned economy and now find themselves without the skills
needed to sustain employability.
Convinced of the need to modernize education and training systems, as part of the Lisbon
strategy EU, the Copenhagen process began in 2002 to strengthen cooperation in vocational
education and training (VET). The period 200210 has been one of the most productive for
European cooperation in VET with some impressive results. Belarusis extremelyimportant
tostrengthenthe processesof international learningthrough theoccurrencenotonlyin theBologna
process,but alsoin theevaluation systemof qualityvocational education and training (VET).
Today, no country can rely on knowledge created within its borders. Internationalization
of technology is not any more confined to knowledge utilization but also includes knowledge
generation. While knowledge generation has never been confined within national boundaries,
the degree of internationalization of R&D is constantly rising as part of the trend of off shoring
services. R&D internationalization is no longer driven by adaptation to local conditions but by
a variety of new pull and push factors and involves complex stages of R&D [13]. In 2015, in
Belarus such an important index of science development as the research intensity of GDP
calculated based on the total amount of internal expenses (the method of OECD countries)
totaled to 0.52 % (in 2011 — 0.7 %). In comparison to 2011, that value went 35 % down. The
primary source of means used for financing of internal expenses for scientific researches and
developments in 2015 was the budget covering 44.7% (in 2011 —48. %) of the total amount of
internal expenses. Own resources of scientific companies totaled to 19.1 % (in 2011 —
17.9%), of the amount of internal expenses for scientific researches and developments.
The specific gravity of means for researches and developments financing provided by foreign
224
sources (means of foreign investors, including foreign credits and loans) in 2015 totaled to
12.7%.
The ability of a country to benefit from R&D internationalization depends first and
foremost on the strength of its NIS. In this context, domestic policies are important in ensuring
that strategic partnerships actually support national development. Belarus can accelerate
industrial development, worker productivity and economic growth by improving their
ability to tap into the global technology pool. Trade flows, foreign direct investment (FDI),
research and development (R&D), and labor mobility and training, are key channels for
domestic knowledge absorption. Openness to foreign trade and investment is critical to
the process of technological absorption and diffusion, not only for the competitive pressure
it exerts on management and corporate governance, but also for the exposure to global
best practice technology and management techniques provided to local firms.
Learning carried out through exchanges of students, academic staff and foreign direct
investment maycontributeknowledge absorption possibly. The share of foreign students in
tertiary enrollments in Belarus is small (in 2012/13 2.8%) and there is tendency to increasing
( 2007/81.3%).The share offoreigndoctoralstudents in Belarus is 5.39% (tabl.2).90% of
foreign PhD students were studying for a fee. The comparison shows that Belarus is behind in
attracting doctoral students from the EU28 and is on the same footing with neighboring
countries.For Belarus, it is important to increase the exchange of tertiary students and doctoral
students. Accession Belarus to the Bologna process can increase the exchange of students.
Tabl.2
Non-EU doctorate students as a % of all doctorate holders (for non-EU countries:
number of non-national doctorate students)
Belar
us
EU
28
Polan
d
Bulgari
a
Czec
h
Rep.
Esto
nia
Foreign doctorate students as a % of all
doctorate holders
5.39
25.5
1.9
3.1
4.4
4.7
Source: IUS 2015 and SCST of Belarus
In Belarus 6451 researches worked abroad in 2008, which is 35 % of the total, whereas
only 1/3 among them were involved in joint research projects and scientific work in foreign
organizations, which enriches the methods of researches and leads to the diffusion of
knowledge
At the same time, these contacts are shortterm – 99 per cent of all mobility were less
than 3 months and 6 researchers from Belarus worked for more than 1 year abroad. What
concerns the analysis of the mobility through the sector of economy, the share of higher
education is rather low – 1.5 per cent, which has a negative influence on the quality of modern
education and learning.
Important role ininternationallearningcarried out foreign directinvestment.Historically,
the catchingup economies have been successful in coupling their local technology efforts with
technology imports, either via FDI or through arm’s length relationships. In principle, the
domestic R&D should be integrated with innovation activities of FDI. Failure to build efficient
national innovation system may prevent the catchingup countries from generating new
competitive advantages. In today’s terms, this challenge can be interpreted as a need to link
valuechainFDI and NIS[6]. In policy terms, the issue is that of coupling between FDI and
innovation policies.
Objectives of the State Programof Innovation Developmentof Belarus (SPID 2011
2015)makes the goal ofattracting foreign direct investmentto modernizethe economy. The
government of Belarushas plannedgrowth inforeign directinvestmenton a netbasis(excluding
debtdirectinvestorfor goods (works, services) to $77.5billionin 2015 (but in 2015 only 3.9
billion USD). In today’s globalized economy, an important policy challenge related to
225
FDI in Belarus is to link valuechain foreigninvestment firms and national innovation
systems. Policy should seek to ensure coupling between FDI and the national innovation
process, for example through programmes for fostering innovationbased FDI and local
linkages. The formation of clusters, a critical mass of companies over a certain territory,
interlinked by a web of supply and demand interrelations, provides a solid foundation for
the emergence of competitive advantages. Cluster policies should focus on the
establishment of close relations between all relevant stakeholders from both the public
and private sectors. The related public interventions should support the efforts of the
private sector to improve performance, in an integrated strategy to build a competitive
advantage. There is also a great need for cluster facilitators who could work in
regions, raise cluster awareness and improve the culture of cooperation among
entrepreneurs.
There are disparities between Belarusian regions that deepened during the reform period
of the mid1990s until present, in contrast to the Soviet period when regions were very similar
in economic structure due to central planning of industrial production and more even location
of factories for strategic and geopolitical, rather than economic reasons. Significant
variations in incomes, poverty, health and educational attainment exist between areas of
relative prosperity and a large number of depressed regions, particularly in small towns with
unstable industrial enterprises and rural communities formed around poorly performing
agricultural farms, with high prevalence of lowpaying employment and poverty,
deterioration of social services and living conditions, high morbidity and mortality rates and
rapid outmigration of young and bettereducated people. An additional problem isthatin
Belarusthere are aconcentration offoreign direct investment and innovation infrastructure in the
metropolitan area,which makesdifficulties learning processesat the regionallevel and in
forming “learning regions” (tabl.3).
Regional innovation infrastructure centres have a great potential to correct regional
disparities and to promote a more balanced regional economic growth, from a bottomup
perspective that is complementary to the prevailing topdown approach of the current
policymaking framework. Regional S&T programmes are an important policy instrument
to realize this potential, which is currently underexploited.
Although there is a variety of innovation intermediaries, their number is
insufficient and, what is even more important, their overall impact is not substantial. The
participation of the business sector, in particular, of large enterprises, in the development
of the innovation infrastructure is fairly limited. For a comparison, in many EU
countries industry matches the public funding in establishing innovation infrastructure
that stimulates the links between science and business. This motivates the business to utilize
the available R&D potential and gives opportunities to R&D to come closer to and get to know
the needs of the business.
Tabl. 3
The innovation infrastructure and FDI distribution by regions in Belarus, 2015
B
rest
o
blast
V
itebsk
o
blast
G
omel
o
blast
G
rodno
o
blast
C
ity of
M
insk
M
insk
o
blast
M
ogilev
ob
last
Research
organizations
2
7
2
3
3
5
1
6
2
77
4
0
21
Industrial innovation
active companies
4
2
6
1
3
1
4
0
9
3
4
4
31
Scientificproduction
centres
3
2
6
3
3
3
6
3
S&T parks
1
1
1
1
5
1
226
Technology transfer
centres
2
3
6
2
8
1
2
FDI
(accumulated,
million USD)
5
88.5
7
13.3
1
464.2
8
13.3
6
348.2
2
963.0
89
8.8
Source: SCST and Belstat
Belarus is a catchingup economy whose technological and innovation system operates
behind the so called “technology frontier”. Its technology dynamics is strongly determined
by the rate of absorption of new technologies and knowledge from abroad. Hence, the
channels of acquisition of foreign technology and its absorption throughout the domestic
economy should be very important areas of innovation policy. However, this does not seem
to be always the case in policy practice as innovation policy is largely focused on domestic
knowledge generation and transfer of R&D results and innovation into commercial use. There
is only limited learning through FDI and mechanisms like direct learning of labor force
which works in foreign owned firms, learning of domestic suppliers and buyers which interact
with foreign firms as well as learning through imitation, observation, demonstration effects and
competition pressures.
The mere presence of FDI by itself is not a guarantee that technology accumulation will
take place. For this to happen openness to FDI would need to be complemented by a policy
of active technology acquisition. An alternative channel of technology access is
subcontracting which could play an even more important role than FDI. Recent policies
(SPID 20112015) have opened a possibility for the integration of Belarusian enterprises into
the networks of multinational companies by facilitating the access the knowledge, know
how, resources and market by integrating Belarusian firms into international value chains and
clusters.
Learning at the micro level
The firm is the main locus of innovation and learning processes at the micro level is the
key to indentifying the dynamic interplay the result in innovation. Companies innovate in
various ways. While some conduct R&D and develop new technologies, many base their
innovations on existing technologies or develop new business models or services driven by
users and suppliers, or within clusters or networks. Policies must therefore be designed to
support all forms of innovation, not only technological innovation. Specific approaches may
also be needed for innovative services with high growth potential, particularly in the cultural
and creative industries.
Innovation provides potential for economic growth but it also requires the management
of a scarce but renewable resource, the labour force, and all of the programmes that support it,
including education and training, lifelong learning, immigration, healthcare and social safety
nets. It also requires a cultural change to promote entrepreneurship and risktaking, and to
bring innovation and its successes, and failures, into the public discourse. Another shift needed
is recognition of leaning by doing, using and interacting (Lundvall’s DUI mode) leading to
innovation in firms without doing R&D, to firms that engage in user innovation, and to
consumers who innovate as a result of this knowledge[10].In Belarus, as well as in developed
countries, innovations made as with R & D (STI mode), and as without R&D (DUI mode). In
recent years, the structure of expenses for innovation has worsened: decreased weight relative
costs for research, training and marketing (tabl. 4).
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