In South Africa it is called the ‘Innovation Chasm’. It’s not unique to this country, but that does not make it any less of a problem. It is the gap between innovative ideas or new research, on the one hand, and new products and industries which will help grow and develop the economy, on the other. Or, if you prefer the words of the Department of Science and Technology (DST), it is “the gap between the local knowledge base and the productive economy”.

This has been a matter of concern for some time, with the idea of creating an institution to help bridge this gap being first proposed during the development of the Science and Technology White Paper in 1996. This proposal was reaffirmed in the 2002 National Research and Development Strategy. In July last year, Cabinet approved a process to create such an institution, officially dubbed the Technology Innovation Agency (TIA).

The draft TIA Bill was published in August 2007, revised in October 2007, and republished in revised form and with invitations for written submissions in December 2007. Public hearings took place in mid- and late-January 2008, and the Bill was adopted by the National Assembly early this month. (For the Technology Innovation Agency Bill see Creamer Media online publication at www.polity.org.za) Next, it goes before the National Council of Provinces for its approval, which will hopefully take place next month, and, thereafter, it will be sent to the President, for his signature, which is expected to occur in May.

“The DST is already preparing for the migration of entities to the TIA to have a smooth transition, so that the agency will be up and running as soon as possible,” assures DST director-general Dr Phil Mjwara. Indeed, to expedite the start of operations by the TIA, the DST is seriously considering appointing an interim CEO to provide direction until a permanent CEO can be appointed. Once up and running, the TIA will be expected to stimulate the development of technology-based products and services, by both public- and private-sector technology-based enterprises, thereby developing a significant technology base for the country’s economy.

It will also stimulate investment, including facilitation of early-stage venture capital and foreign direct investments, as well as promoting the development of the human capital required for innovation. It will be an interface for, and actively seek to promote, cooperation between industry, academia, government, and foreign investors. The agency will further monitor technological innovation trends both in South Africa and across the world, so that it will be able to provide accurate management information for decision-makers in all the sectors. And it will connect technology entrepreneurs and companies with opportunities that will make them more competitive.

The TIA will be a funding agency, not a research and development (R&D) agency. It will exist to fund R&D that promises, at the end of the day, to deliver commercial products and services. The entire R&D and innovation continuum can be divided into basic (or pure) research, not intended to produce commercial goods and services (although basic research often provides knowledge breakthroughs that, some decades later, result in the creation of not merely new products but of entirely new industries), applied research, technology development, and, finally, manufacturing. The TIA is intended to fund applied research and early- to midstage technology development. By that point, the technology should be sufficiently advanced and proven to attract commercially minded investors (although these might include State-owned companies and public–private partnerships – PPPs) to invest in the final stages of technology development, commercialisation, and manufacture.

“The TIA is a funding agency that will issue calls to the scientific and technological sector in general,” explains Mjwara. “It will function like the National Research Foundation (NRF), which does no research itself but funds basic research at universities. The NRF issues calls for proposals for research projects, sets milestones for the approved research projects, and receives progress reports. The TIA will do the same.” Staff within the TIA will need to have certain ‘skills sets’, such as the skills to develop, manage, and sell intellectual property (IP). “The TIA will need to be able to provide complementary skills that will assist in taking an idea and turning it into a commercialisable product,” he stresses.

At first, the TIA will manage a total of R500-million a year. “We hope to grow this over time,” he says, “in part, through accessing cofunding from international partners, in return for their gaining some benefit from the resulting innovations, including through PPPs. We should easily be able to reach a total of around R700-million, R800-million, by the fifth year of the agency’s operation. In fact, we believe we could reach R1-billion by then.”

The TIA will incorporate some existing agencies. These are the Innovation Fund and the Biotechnology Regional Innovation Centres (Brics). Hitherto administered by the NRF, the Innovation Fund is effectively a smaller-scale precursor to the new TIA. It was set up in 1999 in direct response to government’s National Research and Development Strategy, to stimulate technological innovation by investing in projects with the potential to bring social and economic benefits to the country and increase the economy’s international competitiveness. Brics are sectoral, being focused on biotechnology.
Three of them are also regional – the Gauteng- based Biotechnology Partnerships and Development, or BioPAD for short; the Cape Biotechnology Initiative; and the East Coast Biotechnology Consortium (EcoBio). The fourth is the Plant Biotechnology Innovation Centre, or PlantBio. They were created to help implement the 2001 National Biotechnology Strategy and, despite their decentralised nature, they do not work independently. Cooperation takes place among all of them.

“We are seriously considering the transfer of the Tshumisano Trust, which runs the Tech-nology Stations Programme, to the TIA,” adds Mjwara. The trust was established in 2002. The Technology Stations Programme is responsible for the Technology Transfer Stations, located at the country’s universities of technology, which exist to transfer technology to small and medium-sized enterprises (SMEs). There are 12 such stations, plus three Institutes for Advanced Tooling (IAT), spread around the country. The IATs focus on tool design, tooling technology transfer, research and innovation, to benefit SMEs in the tooling sector.

The Technology Station in Electronics and a Technology Station in Chemicals, plus the IAT:Industrial Services and Technology are hosted by the Tshwane University of Technology. The Cape Peninsula University of Technology is the location for three technology stations – in clothing and textiles, in ‘agrifood’, and in agrifood technology. The Central University of Technology has the technology station in metals and manu- facturing, while the Vaal University of Technology hosts the technology station in materials and processing technologies. The Mangosuthu Technikon is the site for a second technology station in chemicals, with the Durban Institute of Technology having the technology station in reinforced and moulded plastics. The technology station in automotive components is at the Nelson Mandela Metropolitan University, the technology station in metal casting technology is located at the University of Johannesburg, and the University of Limpopo hosts a second technology station in agrifood technology. Stellenbosch University has the IAT: Research, Development, and Innovation, and the Walter Sisulu University hosts the IAT: Tool Design and Project Management.

Another element of the TIA will be competence centres, which the agency will fund and in which the private sector companies will be able to work with the science councils on high-risk, early-stage research on innovatory, products. “This will reduce the risk to the companies concerned, which, I think, is very important,” he points out.

“We are also considering incubating a new entity, which we are calling the Public Benefit Fund, that would look at technology transfer to communities,” he reveals. “But it is not yet finalised.” The DST has been running a number of poverty alleviation projects, and the idea is that these would be consolidated into the new entity or fund. “It would also work with other science councils, and seek funds from philanthropic agencies interested in such projects,” he highlights. To give just one example of the DST’s poverty alleviation projects, the department has been running a project in Giyani, in Limpopo province, which extracts essential oils from plants. Members of the local community are involved in the collection and processing of the plants. “This is technically proven, and the essential oils produced could be useful for the perfume and other industries,” reports Mjwara. “We could see commercial plantings and the possible development of SMEs.”

The fact that the TIA will incorporate Brics means that it will inherit a focus on the biotech-nology sector. “Another sector we see as important to the country is information and communication technology (ICT),” he cites, “and we may have a sectoral fund for ICT. Biotechnology and ICT are new sectors where we can grow new industries, but proposals from any and all sectors can be brought to the agency.” But while there may be a “little bit” of focus on biotechnology and ICT, that will not apply to nanotechnology as such. There is a good reason for this – nanotechnology is going to be everywhere.
“Nanotechnology is a sector on its own regarding basic research, but its applications cut across many sectors,” he explains. “It is a cross-cutting technology and, concerning the development of new products, it will form part of all sectors, and not a separate sector.”

The TIA will be headed by a CEO and overseen by a board, composed of a chairperson, the CEO as an ex officio member, and not fewer than six, nor greater than nine, members. One of the functions of the board will be to prepare an investment framework policy and to review this policy every year. “For the TIA board, we’re looking for a variety of skills sets,” says Mjwara. “We’ll be very happy if one-third of the board could be entrepreneurs who have already taken ideas and converted them into products. We’d like to have a third from the technology development arena – people from, for example, the Council for Scientific and Industrial Research, Mintek, the Agricultural Research Council, and the Medical Research Council. One-sixth should be people who understand the management of IP locally and internationally, and one-sixth from the venture capital sector. We have people in South Africa in all these sectors; it is just a matter of whether or not they’’re available.”

Inspired by successful experiences in other countries, the TIA should create an enabling environment for the stimulation and exploitation of technological innovation. That technological innovation should, in turn, give rise to new products and services, expanding and diversifying the South African economy, thereby bringing economic and social benefits to the country. The final objective is the improvement of the quality of life of everyone in the country. “The message is that we hope to work with all stakeholders, including the private sector, where they have the ideas but have difficulty raising the funds,” concludes Mjwara. “Now, there is a new home for innovation funding.”