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KEYNOTE by Mr. Georgi Parvanov, President of the Republic of Bulgaria National Innovation Forum October 22, 2004, 09:00, the Sheraton Hotel, Sofia

Dear ladies and gentlemen,
Let me first of all express my appreciation to the work done by the initiators and the organizers of this forum. I am certain that the correct way to taking decision about innovation and technology development of Bulgaria is through open dialogue between representatives of the state administration, the real business, universities, scientific organizations, and NGOs.

Thank you for inviting me to speak to the participants in this forum. My intention is to bring your attention to some long-term issues strategic for the Bulgarian economy, part of which are the ones related to innovation.

At various events I have stated the following thesis and I will do the same today –Bulgaria will complete a very important stage of its development when joining the EU but will enter another quite challenging one during which we will not only have to apply the EU rules but will have to work on building our own unique Bulgarian policy, which should enhance the reduction of economic and social differences between us and the rest of the member states. This policy should turn into the main task and the criterion for successful performance of the state institutions, politicians, of the whole Bulgarian community. Thus the EU membership will have a real positive impact on the life of Bulgarians. Yet, this will not come easily – experts expect difficulties and strong competitive pressure upon the Bulgarian economy immediately after joining the EU. And we have to be prepared for that. The membership of Bulgaria in the European Union will open new opportunities but their successful take up will not be automatic and will demand continuous efforts.

The new policy with the new objectives should be developed and implemented even before Bulgaria’s accession in the EU becomes a fact. It is very important that they be discussed and adopted by the Bulgarian community. This will be one of the main positive results of the referendum suggested by me on the future membership of Bulgaria in the EU. During its preparation I expect the state administration, the policy makers, NGOs and experts to conduct an extensive public debate and provide true and complete information to the Bulgarian citizens and companies and to develop adequate policies and strategies.

Regretfully it is a fact that at present Bulgaria is far behind the average European levels in terms of different economic and social indicators. Even more alerting is the lack of adequate state policy which contributes to the deepening of the gaps especially in areas such as funding of scientific research activities for instance. In other spheres like education, where we have long traditions and good achievements, we are increasingly regressing and losing our competitive advantages. This is to show that our first priority should be to adapt our economic policy to the common EU policy. The Bulgarian economy and the social sector should strive for a maximum cohesion with the requirements of the economic policy common framework and the Lisbon strategy.

It is high time we gave up repeating and reminding of our good education and capacity in developing high technologies from the past. It is now much more important how we shall develop those opportunities in the future, in the years when the EU will be striving to become the most competitive economy of the world based on knowledge and social balance.

The key to successful accelerated development lies in knowledge economy. The Bulgarian policy makers lost precious time in conducting a passive economic policy using as excuse the need of financial stability in the country. In this way they secured for themselves comfortable governance at the expense of suppressed local authorities, bad quality of public services like education and healthcare, and slow economic development. Our own experience shows that the active economic policy aiming at enhancing the competitiveness and the export potential of producers does not confront with financial stability. Instead of having repeated political discussions on how to spend the considerable budget reserves and surpluses, we could have had by now clear priorities of the economic policy backed up financially with these funds. The knowledge economy demands for strong science. The long years of underestimating the science and its application aspects in particular, lead to significant damages. Regretfully being a scientist nowadays is no longer prestigious. Only 5 out of 1000 people in active age are involved in the R&D activities today in Bulgaria, whereas the respective figure for the Central European countries is twice as much, and for the EU15 they are thrice as much. The very small relative share of scientists in Bulgaria is far from compensated with allocation of higher expenses for R&D. Having in mind that 2% of the GDP in Europe is allocated to R&D and these funds continuously increase aiming to reach 3% of GDP, in Bulgaria this share is about 0.5%. Additionally, only over the last 2 out of 7 years there has been a slight increase in these expenses compared to the same during the previous year. Quite alarming but not surprising is the fact that scientific career becomes less and less attractive to young people. The list of alarming facts could be continued.

Over the last few years the Bulgarian government and the Parliament are making efforts to create adequate legal framework and ensure some minor increase of the expenses for science. These efforts as well as some initiatives for procuring equipment to schools and the introduction of e-services in the public sector are well appreciated but far from sufficient for bringing the needed qualitative development.

Dear ladies and gentlemen,
The formation of high pro-innovation culture and potential, and the enhancement of the competitiveness of the Bulgarian economy have to become the main focus of our economic, educational and scientific policy during the next years. This absolute priority should be supported with appropriate legal, administrative and financial instruments.

I will not go into details describing each concrete measure necessary to be taken. There are certain documents and strategies developed by the Government in this respect. What is important are not the strategies themselves but the results stemming from their implementation through specific actions. I expect concrete results to be sought in several areas.

First, we should develop the present scientific potential of the country which means considerable increase in the resources dedicated to science that are to reach 1% of the GDP in the next in 3-4 years (half of the present rate in the EU). These expenditures should be made for clearly identified scientific priorities on the basis of competition. In order to increase their efficiency the state budget should with high priority ensure the co-financing of projects approved and receiving financing from the framework programmes of the EC.

Second, there should be a mechanism for stimulating the interest of the business in innovations and financing of applied research activities. This could be done through financial mechanisms as well as through establishing high-tech business incubators in universities and scientific institutes which are to support the development and commercialisation of the innovative products. Unfortunately Bulgaria already missed the chance on a number of occasions to utilize resources from EC grant schemes. There are very good examples of creating and running similar technology incubators in Europe.

Third, we should create the appropriate environment for technology transfer. Bulgaria has to become active part of the European Research Area and the European market for technologies. This could become a fact if the now existing efforts of NGOs and scientific units and organisations are supported and enhanced by the state administration.

Last but not least, a qualitative increase should be made in the number of new technologies and modern utilities at disposal of the education and the public services sector. In this regard, furnishing schools and universities with modern equipment providing for the development of computer skills and application of high technologies in processing of information is not an ultimate goal but a necessary minimum.

I would like to stress once again that all these objectives have to be attained over the next 3 to 4 years. Otherwise Bulgaria will not only fail to reduce the disparities with the EU but will further deepen them at the high expense of the Bulgarian people.

Along with these short-term efforts it is of key importance to determine the long-term objectives and policies. It will be very useful for Bulgaria if we apply a mechanism for setting long-term objectives (with time horizon of 15-20 years ahead) in policy development in the field of innovation and building a knowledge economy. Let us draw lessons from the experience of the EU member states (including some of the new member states) and attain our goals through the application of the Foresight approach in close cooperation with and networking between institutions and experts. There is no doubt that the aforementioned policy will demand maximum efforts, concentration and support. Yet, it is absolutely feasible and the critical mass of expert, institutional and public support has already been accumulated. What is important to me and to all of us is not whether but how we shall join the EU. In my capacity of President of the Republic of Bulgaria I have always supported and I will continue to support all initiatives and efforts leading to accelerated educational and technological development of Bulgaria. I wish you success in your work today!
Thank you for your attention.


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