Firms that import high-tech intellectual property (IP) are much more productive than those that do not, small to medium-sized enterprise (SME) finance institution Spartan nonexecutive director Claire Busetti says.

Those firms that are importing IP, if they are using royalties or licences, are 20% more productive. If they are foreign-owned, they are 15% more productive. But if they are also doing their own research and development (R&D), then they are 6% more productive.

Firms are, therefore, three times more productive importing IP and doing their own R&D locally,” Busetti told delegates at the inaugural Science, Technology and Innovation (STI) Policy Colloquium, held in Pretoria on September 8.

“I’m not saying you shouldn't do your R&D locally, but if you [also] import your IP you will be much more productive,” she said.

These findings were part of a study that Busetti was involved with that looked at the potential benefits of importing technology into South Africa.

The statistically significant econometric study reviewed more than 40 000 firms.

“I’ve heard at least three Ministers say that we have a negative technology balance of payments. What that means is that we pay more for royalties and licence fees for IP than we export, and we perceive that as being negative.

“However, what we found is that, internationally, all the high-growth countries have negative technology balance of payments. In fact, their negativity is much higher than ours – ours is not high enough,” she said.

She also revealed that the study contradicted the widely held assumption that the importation of technology would result in a reduction in employment.

“What we found is that across all firms, employment actually increased. We also found that if you imported equipment, products and IP, your exports went up – not only in terms of volume but also in terms of value.

“The exports also became more diversified,” she said, noting that the 9% of firms who imported technology were also more profitable and contributed 77% of the income tax.

“They employed more people, they exported more, and they paid higher taxes,” she said.

The two-day colloquium, hosted by the National Advisory Council on Innovation, was hosted against the backdrop of inadequate and uneven development in South Africa and globally.

"The world is emerging from the global Covid-19 pandemic, which exposed the inadequacies of many countries' national systems of innovation, especially at their intersection with the health sector.  The pandemic deepened the economic, ecological and social crises," Higher Education, Science and Innovation Minister Dr Blade Nzimande said at the event.

The colloquium featured several reports and panel discussions. Additionally, presentations on the new STI decadal plan; education, training and innovation; and STI, development, sustainability transitions and inclusivity were among the topics covered.