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Joaquín CorduaJoaquín Cordua

Washington DC, February 2007Washington DC, February 2007

THE CASE OF

FUNDACION CHILE

30 YEARS BUILDING INNOVATION CAPACITY

IN THE NATURAL RESOURCE SECTORS

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TOPICS

Chile 1975-2006 How Fundación Chile works Selection of opportunities Fundación Chile’s financing Focus in key clusters (ei: Aquaculture) Development of human resources Impact evaluation of F.Ch.’ programs Replicability of FCh.

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CHILE: FREE TRADE AGREEMENTS (2006)

CanadaUSA

ArgentinaBrazil

Mexico

UruguayParaguay

China

European Union

(25 countries)

South Korea

New Zealand

EFTA:SuizaNoruegaIslandiaLiechtenstein

India

Japan

Panama Brunei VietNam

SingapurBoliviaColombiaEcuador Perú

El SalvadorCosta RicaHondurasNicaragua

Cuba

54 countries : 86% of world trade

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CHILE’S EXPORT DEVELOPMENT 1975-2006 (in million US$ dollars of 2006)

1975 2006 Times

TOTAL EXPORT 7.464 59.000 8

(per capita export) 726 3.656 5

NATURAL RESOURCES SECTORS

Agriculture 455 8.400

Forestry 452 3.600

Aquaculture 0 2.330

Total of 3 sectors 907 14.330 16

Innovation capacity has be key in the development of natural resources sector.

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CHILE: SOCIAL ADVANCES 1976-2006

1976 2006PER CAPITA INCOME 3.923 7.002

(in 2006 US$ dollars)

EDUCATION : enrollment rate of

Secundary Education 51% 94%Higher Education 12% 38%

POVERTY 1987 2006Porcentage of population 44% 18%

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FUNDACIÓN CHILE

Fundación Chile is a privately owned, non- profit institution, created in 1976 through an agreement between the Government of Chile and ITT Corporation.

To add economic value to Chile’s products and services by promoting innovation and technology transfer activities, aimed at taking better advantage of Chile’s natural resources and human capital

Mission

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ExternalSources of Technolog

y*

Strateg. Alliances

with Comp./Partners Companie

s in Expansio

n

Sales Tech. Licensing

Wide dissemination

Internal Sources of Technology

Company scale-ups /Spin-offs

Technology services and certification

Management of Innovation

* Universities, Research Centers, Sector Experts. Etc.

Technology Center Technology Center

Business UnitsBusiness Units

Final Clients

Fundación Chile

FUNDACION CHILE’S WORK PLAN

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FUNDACION CHILEKEY AREAS AND PRODUCTS

Agribusiness Aquaculture Forestry Education Labor Competences

Biotechnology Environmental Technology Information Technology Human Capital Development Financial Engineering Management Technology

Products

Technology broadly disseminate to multiple clients (as a technological antenna) through seminars, specialized magazines, internet portals, and technical assistance.

Technology sold to private & public clients in Chile and abroad.

Companies created to apply new technologies transferred or developed by FCH.

Standards and certification systems.

Technologies Sectors

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FUNDACION CHILE’S FINANCING

Financing has a strong influence in performance.

An initial endowment of US$ 50 million

(later additional US$25 million)

Actual self-financing: 88%

Project support from public and private sources

Sale of services and technologies

Additional contributions:

an annual contract to develop new capacities (10%)

profits from the sale of companies

Benefits of self-financing

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SEARCHING FOR OPPORTUNITIES TO INNOVATE

Learning from other countries

Studying relevant markets

Analyzing value chains

Protecting infant ideas

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THE DIFFUSION OF TECHNOLOGY

Replicability: achieving the social benefit of innovation

In addition to using traditional diffusion methods: Organizing fairs and seminars Publishing technical magazines Providing consulting services

FCH developed an innovative diffusion instrument: creating companies that apply the new technology (70 companies since 1982)

Main benefits: risk reduction; investment recovery; prestige in the private sector

Example: starting the salmon industry in 1982, now second largest exporter: US$ 2.2 billion/year

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DIVERSIFICATION OF AQUACULTURE

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EDUCATION

FCH’s contribution through better school management and use of ICT’s

School Management:

Has high impact on learning and allows fast improvements

A management model developed by FCH is used by more than thousand schools

Average learning improved 13% in three years.

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EDUCATION

The use of ICT’s:

A public educational portalServing the educational community

60% of teachers registered as users in five years More than 4 million visits per month

International network of portalsSeventeen Latin American countries agreed to a free interchange of contents (RELPE)

A US$ 2 million grant from IADB to develop the network

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LABOR COMPETENCES

Introduction in Chile of Labor Compentences approach for development and managemet of human capital (Supported by the Chilean government, IADB and WB)

Achievements in seven years: Definition of 200 standards for 10 sectors of the

economy (mainly natural resources) 20.000 workers certified Design of educational and training programs based

on competences A National System of Labor Competences

Certification presented before Parliament

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IMPACT EVALUATION OF 7 PROGRAMS

Fundación received only US$ 30 million.

US$ 1300 million.

US$ 430 million.

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COULD FCH’S EXPERIENCE BE ADAPTED TO ANOTHER CONTEXT?

Some success factors:

A non-profit public-private institution

Focused on:

Technological innovation by transfer of proven technologies

Development of human resources

Role of honest broker connecting technologies with applications.

Market oriented

Working always with partners (national/international)

With high level of self-financing

Protected from political pressures