CPROST. mc? The Development of Albanian S&T Policy

Transcription

1 A Report to the Ministry of Higher Education and Scientific Research of the Government of Albania by Mullin Consulting Ltd and CPROST, Canada Supported by the UNESCO/UNDP Project ALB 93/008 Tirana, July 29-August 9, 1996 mc? CPROST Table of Contents Introduction 1 Part I - Science Policy in Albania Notes on the current organization of S&T in the Albanian Government 3

2 The Resources Applied to Albania s National Programs 5 Preliminary Observations on Albania s National System of Innovation 6 The Functions of Albania s National System of Innovation 8 Some Initial Analysis of Albania s Stated Science and Technology Policy. 12 International S&T Policy 19 The Importance of International relations for Albanian Science and Technology Policy 19 Albania s Relations with the European Union 19 Albania s S&T relations with countries outside the context of European Union Programs 22 Albania and the Internet 23 Key Policy Issues 24 Processes for the Development of Government S&T Policies 24 Scientific Research and Technological Development 26 New Modes of Research 27 Understanding the Functioning of Albania s National System of Innovation 28 Government Financing of R&D and the role of Research Foundations 31 Funding of S&T by Foreign Donor Agencies 34 The Future Management of National Programs 35 The Promotion of Technological Change in Small & Medium Enterprises 36 Appendix 1 - Ministries of the Government of Albania, as of late July Appendix 2 - Some Data on Albania s International S&T Relations 46 Appendix 3 - Characteristics of Innovative and Static Organizations. 58 Part II - Measurement of Science and Technology Background 60 The Measurement of S&T Activities 60 S&T in Albania 62 Estimates of Albanian S&T Spending 63 Table 1 - The Albanian Science Budget 63 Table 2 - Funding and Performance of Albanian S&T 64 Table 3 - Albanian S&T Personnel 35 Quantitative Analysis of S&T Activities - the Albanian Context 66 Future Work on S&T Indicators in Albania 67 Conclusion and Acknowledgements 69 Appendix A - Selected Sources of Material on Indicators for S&T Policy Development. 70 Appendix B - OECD socio-economic objectives for Government S&T spending. 71 Appendix C - Sample Questionnaire for Institutes 72 Appendix D - Sample questions on innovation for a survey of enterprises. 73 Final Report, September 15, 1996 Page ii

3 Introduction Project ALB 93/008 was designed to assist what was originally the Committee on Science and Technology of the Government of Albania and is now, as of July 1996, the Ministry of Higher Education and Scientific Research. It encompasses elements of training, study tours and technical assistance. In July of 1996, Mullin Consulting Ltd of Canada was retained to organise the provision of advice on four identified topics: the formulation of national science policy; international relations in science and technology; science and technology statistics; and the formulation of a science budget for the Government of Albania. The work was carried out by Mr J. Mullin of Mullin Consulting Ltd (topics 1 and 2) and Mr J.A.D. Holbrook of the Centre for Policy Research on Science and Technology, Simon Fraser University (topics 2 and 4). Field work was carried out in Tirana during the period of July 28 to August 9, 1996, and this period encompassed the first major workshop on S&T Policy held by the Government of Albania. The aims of the mission, in each of the four topic areas, were to assess the current state of work on the topics in Albania; to provide comparative information on activities in other countries at different levels of development; and to make suggestions to the government of Albania on desirable future activities in each of the topic areas. During the period of the Mission, interviews were conducted with senior officials of; the Ministry of Higher Education and Scientific Research; the Ministry of Industry, Transport and Trade; the Ministry of Agriculture and Food; the Ministry of Mineral and Energy Resources; the Ministry of Finance; the Academy of Sciences; The Institute for Informatics and Applied Mathematics of the Academy of Sciences; The Centre for Information and Documentation of the Ministry of Higher Education and Scientific Research; the Institute of Statistics, which is responsible to the Prime Minister and to the Council of Ministers; the Institute of Mining and Processing Technology of the Ministry of Mineral and Energy Resources; the Institute for Chemical Technology of the Ministry of Industry, Transport and Trade. The two Mission members wish to express their gratitude to all of the officials who participated in the interviews, for their openness and patience in the face of many questions. Final Report, September 15, 1996 Page 1

4 Part I Science Policy in Albania by James Mullin, Mullin Consulting Ltd. Final Report, September 15, 1996 Page 2

5 Notes on the current organization of S&T in the Albanian Government Within Parliament, there is a Commission on Science, Education and Sports, whose Chairmen is the former Chairman of the Committee on Science and Technology (CST). The CST went out of existence with the creation of the new Ministry of Higher Education and Scientific Research. Within Government there is a Council for Scientific Research and Technological Development, created under Article 27 of the Law on Science and Technological Development of 22 December, The Council is chaired by the Prime Minister, and has as members * seven Ministers (Minister of Higher Education & Scientific Research; Minister of Agriculture and Food, Minister of Mineral and Energy Resources; Minister of Industry, Transport and Trade; Minister of Health and Environment Protection; Minister of Finance; plus the State Secretary for Local Organs of Power - a position which may have disappeared in the recent reorganisation. ); * the Chairman of the Committee on Science and Technology (but this position is disappearing in the current reorganization) * the President of the Academy of Sciences (where the Academy s institutes cover both the natural sciences and the Humanities) * five distinguished scientists drawn from the universities and an Academy institute. The Council, which meets twice yearly, is responsible for: * defining national priorities in S&T: * endorsing national programs; * defining budget limits for S&T and making recommendations to government thereon; * endorsing plans for human resource development. The Council will be supported in its work by the new Ministry. The employees of the former Committee on Science and Technology (CST)[created under Article 28 of the Law on S&T] constitute the nucleus of the Scientific Research activity of the new (two weeks old) Ministry of Higher Education and Scientific Research. The Ministry of Higher Education and Scientific Research consists of * A Directorate for Higher Education, formerly part of the Ministry of Education; * Five directorates which had constituted the principal staff groupings of the former Committee on Science and Technology, namely: a Directorate of Science Policy and National Programmes; a Directorate of Program and Project Implementation; a Directorate of Organization and Financing; a Directorate for (participation in the European Union s) TEMPUS Program and a Directorate for International Cooperation and Training; Final Report, September 15, 1996 Page 3

6 * two other bodies which previously were related to the CST, A Patent Office (created to administer its own legislation), and A Centre for Information and Documentation (which exists because of a Ministerial Decree and so is in some ways separate from the main Ministry) The Ministry of Higher Education and Scientific Research, MHESR, is one of fifteen Ministries in the Government (a list is provided in Appendix 1) The Academy of Sciences [defined in Article 18 of the Law on S&T as a central national scientific institution] having both an Assembly of distinguished scientists and a set of Institutes of Research. There are 44 research institutes within government (down from 65 in the pre-1992 era), distributed among a variety of Ministries.[ The management structures of these institutes are set out in Articles 19 to 22 of the Law on S&T] The institutes and their scientific staff receive funding from at least three potential sources: * the budget of the institute, provided by government via the parent Ministry; * a series of ten National Programs, described below, and * R&D grants currently administered by MHESR (but which have developed into an apparently permanent support system for existing recipients, primarily in the institutes of two Ministries); National Programs There are ten National Programs which have been established on the initiative of CST and which received much of their funding from CST - or now from the Ministry. The roles of MHESR in respect of these programs have been in defining the Programs ( in conjunction with the line Ministries who manage them) and having them approved by the Council for Scientific Research and Technological Development; in supplying funding for them (which has involved negotiations with Finance on the availability of resources); conducting annual reviews of progress based on technical reports provided by the programs and organizing both mid-term and (eventually, at some later date) final peer evaluations intervening in programs perceived to be in trouble (eg biotechnology, energy) with the power to redefine program and project objectives Three Directorates of MHESR play different roles in the creation, funding and monitoring of the National Programs. They are The Directorate of Science Policy and National Programmes, which is responsible for managing the Program Definition and Approval processes; The Directorate of Program and Project Implementation, which monitors on-going programs, carries out mid-term and will, at some future date, final evaluations... The Directorate of Organization and Financing which does budgeting for the Programs on behalf of MHESR and possibly allocates funds when it receives notification to do so from the Directorate of Program and Project Implementation; Final Report, September 15, 1996 Page 4

7 The Table which follows sets out the available information on the subjects of, and resources allocated to, the ten existing National Programs. The Resources Applied to Albania s National Programs Program Ministry Budget (millions of Lek) 1995 Budget (millions of Lek) 1996 # of Institutions Involved # of Scientists # of Tech Support Staff # of Projects Agriculture & Food Agriculture and Food Energy Geology: Extraction & Processing of Minerals Mineral & Energy Resources Mineral & Energy Resources Biotechnology Agriculture and Food Science for Life Health and Environmental Protection NA NA NA 2 Information and Information Technologies Academy of Sciences Transport Environment Urban Development Industry, Transport & Trade Health and Environmental Protection Public Works, Territorial Management & Tourism NA NA Albanologic Studies Academy of Sciences Reserve 1 retained by MHESR Total Budget Available Reserved for a program of economic studies or social studies Final Report, September 15, 1996 Page 5

8 Preliminary Observations on Albania s National System of Innovation In the industrialised countries, and in a growing number of newly-industrialising countries, policy makers have found that the concept of a national system of innovation provides a useful framework for technology policy formulation since it makes explicit the many different kinds of inputs which are necessary to produce an economy which is innovative and hence competitive in today s increasingly globalized markets. (See for example recent policy announcements in Canada, Australia, Singapore and South Korea). While such an approach may seem premature in the transitional economy of Albania in mid-1996, a discussion of a national system of innovation could serve to orient policy thinking to the longer term, in which questions of productivity and competitiveness will become as important as are today s discussions of capacity rebuilding. The use of the concept of a national system of innovation as a framework for policy is an attempt to signal a radical departure from the current situation and understanding, relacing older approaches with a new view of the role and status of the sciences, engineering and technology in national development. The perception by many countries that technical change is the primary source of economic growth means that economic and S&T policies have to recognize as central concerns the two processes - innovation and technology diffusion - which are the agents driving that technical change. The rate of technical change in a country depends not only on the amount of R&D done in the country, but also on important factors such as the ways in which available resources (including skills) are organized at both the national and firm level, and on the availability of technologies from both domestic and foreign sources. It is within this context that technology diffusion is a highly important concept and so the promotion of the effective distribution of available knowledge is a critical function of a national system of innovation. A well-functioning process of technology diffusion can allow countries to make improved progress through appropriate combinations of domestic and imported technologies, but this in turn will be highly dependent on the receptor capacity of local firms. A national system of innovation can be thought of as a set of functioning institutions, organizations and policies which interact constructively in the pursuit of a common set of social and economic goals and objectives, and which use the introduction of innovations as the key promoter of change. The four key interests, then, of any country can be thought of as being: to ensure that it has in place a set of institutions, organizations and policies which give effect to the various functions of a national system of innovation; to ensure that there is a constructive set of interactions among those institutions, organizations and policies; to ensure that there is in place an agreed upon set of goals and objectives which are consonant with an articulated vision of the future which is being sought; and to ensure that there is in place a policy environment designed to promote innovation. The elements of a national system of innovation - the individuals, organizations, and policies - are to be found in most countries. What distinguishes the successful from the unsuccessful national system of innovation is its capacity to promote constructive interactions among these many elements to overcome past patterns of lack of coherence, fragmentation of effort, and imbalances in access to resources. This capacity, in turn, has to spring from the mind-set of the individuals and organizations within the system - it is not something which can be created by Final Report, September 15, 1996 Page 6

9 decree. Equally, a national system of innovation can be at its most useful in a society which has some clearly-articulated and shared goals. The identification of the importance of such a system is a product of years of thinking about the conditions which are necessary to allow national investments in science, engineering and technology to fully contribute to economic competitiveness and the quality of life of a country's citizens. The preliminary discussion which follows of Albania s national system bases its approach on the use of a Policy Framework for a National System of Innovation which has been developed by Mullin Consulting Ltd, applying the experience of the industrialised countries. The framework has recently been utilised successfully in policy development activities in two significant developing countries - the Peoples Republic of China and the Republic of South Africa 2. The approach sets out a series of six sets of functions which need to be present in an effective national system of innovation, and then identifies the institutions which are responsible for their implementation. The six sets of functions are: Central Government Functions Policy Formulation and Resource Allocation at the National Level; Regulatory Policy-making; Shared Functions Performance-level Financing of Innovation-related Activities; Performance of Innovation-related Activities, including R&D and other related scientific activities; Human Resource Development and Capacity Building; and The Provision of Infrastructure. In the tables which follow, an attempt has been made to indicate which Albanian institutions perform which functions. Once the institutions have been identified, it is then important to understand the extent to which they interact, in a constructive manner, in the pursuit of some common objective(s). 2 See Ten Years of Reform of Chinese Science and Technology: An International Review of Experiences commissioned by the State Science and Technology Commission of China and the International Development Research Centre, Canada - in Press, and the Government of South Africa s White Paper on Science and Technology Policy, Pretoria, May 1996 Final Report, September 15, 1996 Page 7

10 The Functions of Albania s National System of Innovation Exclusive Functions of Government 1: Policy and Resource Allocation Functions Function Formulation, implementation monitoring, and review of policies and, in some countries, plans concerning national S&T activities; Linkage to other policy domains(eg dealing with the economy, trade, education, health, environment, defence etc). Allocation of resources to S&T from overall budgets and first order allocation among activities Creation of incentive schemes to stimulate innovation and other technical activities; Provision of a capacity to implement policies and to coordinate appropriate activities Provision of a capacity for forecasting and assessing the likely directions of technical change Organization(s) Responsible * Council for Scientific and Technological Development Policy; * Ministry for Higher Education and Scientific Research No formal allocation of responsibility. No science budget process a this time. Overall management of government budget process belongs to the Ministry of Finance. None in place Ministry of Higher Education and Scientific Research None in place 2. Regulatory Functions: Creation of a national system for metrology, standardization, calibration Creation of a national system for the identification and protection of intellectual property. Creation of national systems for the protection of safety, health and the environment National Directorate of Metrology and Calibration; Directorate of Standardisation and Quality; both report directly to the Council of Ministers Legislation in place; function is a responsibility of MHESR Committee for Environmental Conservation and Protection (Ministry of Health) Final Report, September 15, 1996 Page 8

11 Shared Implementation Functions 3.Performance-level Financing of Innovation-related Activities: Management of financing systems appropriate to the implementation of the other functions of the system Use of Government's purchasing power as a stimulus to innovation in the production of the goods and services which it requires Limited function of MHESR at this time; other Ministries also provide partial financing of R&D within the Institutes for which they are responsible. Not done 4. Performance Functions: Execution of scientific or technological programs, including R&D and the provision of scientific services; Provision of mechanisms to link R&D outputs to practical use; Provision of mechanisms to improve access by small and medium scale enterprises to needed technology; Provision of linkages to regional and international S&T activities; Provision of mechanisms for evaluating, acquiring and diffusing best-practice technologies; Creation of innovative goods, processes and services embodying the results of S&T activities About 44 institutes in government; some limited activity in 8 universities and 3 Higher Institutes. Extremely limited activity in private sector An Agricultural Extension service is being established SME Directorate, Ministry of Industry, Transport & Trade plus the arm s-length SME Foundation. However, no industrial extension service for technology. Directorates exist within MHESR and other Ministries. Cooperation is mainly with neighbouring countries and with countries of the European Union. The responsibility of individual enterprises; little is known about how successfully private enterprises are functioning. State enterprises are in great difficulties. Limited activity, but good examples of technological services at INIMA and at the Institute of Mineral Processing. Final Report, September 15, 1996 Page 9

12 5. HRD and Capacity-building Functions: 5.1 Provision of programs and facilities for the education and training of S&T personnel; 5.2 Provision of programs to promote international training of S&T personnel; 5.3 Provision of programs to promote improved management of technology; 8 universities; 3 Higher institutes Participation in EU programs such as TEMPUS, via MHESR. Also bilateral agreements and UNDP Programme. Two EU/Tempus Projects are seeking to upgrade university management. No equivalent programs are in place for other sectors. 5.4 Creation of institutional capacity in S&T This is a goal of the National Programs managed by MHESR. 5.5 Provision of mechanisms to maintain the vitality of the national S&T community; 5.6 Stimulation of public interest in and support of national initiatives in S&T There are a few scientific societies Limited effort by MHESR, via a Newsletter. 6. Infrastructure Functions 6.1 Establishment, operation and maintenance of information services (including libraries, data bases, statistical services, a system of indicators, communications systems.) 6.2 Establishment, operation and maintenance of technical services (eg metrology, standardization, calibration) and services to promote improved industrial design; 6.3 Establishment, operation and maintenance of mechanisms to promote productivity and/or competitiveness 6.4 Establishment, operation and maintenance of a system of awarding, recording and protecting intellectual property 6.5 Establishment, operation and maintenance of mechanisms to ensure the protection of safety, health and the environment. 6.6 Establishment, operation and maintenance of major national facilities for research MHESR has a Documentation Centre, mainly for Albanian materials; the National Library is a repository; there are some others. Work has begun on providing Internet linkages. National Directorate of Metrology and Calibration No such programs exist in Albania at this time. Bureau of Patents within MHESR Some activities on urban and industrial pollution are financed by Committee on Environmental Protection. No major facilities in Albania. Final Report, September 15, 1996 Page 10

13 The discussion of innovation in any policy document, such as this report, tends to be rather dry, analytical and lifeless, but this does not need to be so. To give a better sense of what innovation is all about, the following quotation from the 1994 Annual Report of the Auditor General of Canada gives a more colourful description: Innovation has become a crucial survival issue. A society that pursues well being and prosperity for its members can no longer treat it as an option. Innovation tends not to arise by itself; it is generated and sustained through the efforts of people: innovation is where the spirit is. It cannot be legislated, or brought about by edict. It comes from individuals and from creative and interactive communities. Like happiness, innovation wilts in a climate of criticism and repression yet thrives in an environment of encouragement and support. Government therefore needs to work hard at creating an environment that is supportive of innovation. Otherwise innovators will either not innovate - they will "play safe" - or they will leave for more encouraging societies. In an innovative society, individuals, groups, organizations, government and Parliament recognize that they are partners, rather than opponents, controllers or contenders. The ideas of community, networking, collaboration and common purpose, of playfulness, fun and excitement, but also of healthy competition, openness and accountability need to be guiding principles. An important element of innovation is resolving dilemmas, that is, reconciling apparently competing values. Truly innovative societies can, at the same time, meet real needs and control costs, address individual choices and satisfy societal priorities, considering both economics and compassion. To survive and prosper, that is, to achieve and maintain a high standard of living for its members, a society must do four things well. First, it must build and sustain social, legal and economic structures and processes that support innovation, that are competitive while sustaining the natural environment, and that lead to well being for the greatest number of people. Second, it must ensure that its members develop and continually update the knowledge, competencies, abilities and skills that are required to produce innovative products and services. Third, it must nourish and support the effective potential of its members [and their] commitment to a common purpose, trust, collaboration, enthusiasm, caring and loyalty; this includes defining meaningful roles for those who are outside conventional work structures. Fourth, it must build and sustain relationships, within itself and with other societies, that enable it to interact productively, both for its own and for mutual benefit; and it must do so with a long term view, considering spans of generations. Furthermore, an innovative society is willing and able to discuss and examine openly all issues, even controversial matters and "sacred cows"; it retains the suppleness to explore and experiment; and it has the wisdom and persistence to pursue selected options in the quest for desirable results. It is able to envision a desired future, examine its possibilities, select preferred results, and pursue its choices vigorously. Final Report, September 15, 1996 Page 11

14 Some Initial Analysis of Albania s S&T Policy A statement on Albania s Science and Technology Development Policy, was adopted by the Council for Science and Technology Development Policy, 25 January, In Section III of that document it was declared that The main objective of the science and technological development policy is to provide the greatest possible support to the process of the country s transition to a free market economy and to create the foundations of an S&T system that will fully integrate itself with the country s economic and social development after the transition process has been [completed]. It is important to note that this objective refers to two time-frames - to the period of transition, which is still on-going, and to a longer-term future when the transition to a free market system will have been achieved. The policy statement goes on to articulate eleven more specific objectives: 1 Formulation of legislation on scientific development 2 The identification of priorities for scientific research and technology development; 3 Conceptualization of science and technological development activities through national programs on R&D and relevant projects and resource mobilization (financial, human, institutional, infrastructural, informational); 4 Installation of a new funding system for science and technological development activities and the appropriation of a separate budget share for S&T development; 5 The identification and operation of an adequate statistical system for the organization and management of scientific and technological development activities; 6 Re-shaping of scientific institutions for the purpose of increasing efficacy and adapting to new conditions. An important aspect is the strengthening of research and development capacities in the higher education schools, which are expected to engage ever more into scientific and research activities in the fields they cover; 7 The strengthening of S&T cooperation with abroad, with a view to integrate R&D activity with R&D activities carried out at the international level; 8 The formation and training of R&D Personnel and the upgrading of management capacities at different levels; 9 Keeping the concerned public informed of the results of the science and technological development policy and informing the public at large of the country s efforts in this respect; 10 The strengthening of the R&D activity to support the selection, importation, adaptation and operational use of foreign technology and its transfer to the sectors in need of it; 11 Privatisation of science and technological development activity. In what follows, comments are offered on each of the eleven objectives. Final Report, September 15, 1996 Page 12

15 1 Formulation of legislation on scientific development Notes and Comments During the present phase of Albania s transition to a full market economy, its Parliament has enacted a series of laws which are either fully or substantially concerned with activities of the national system of innovation. They include Law on Higher Education (# 7810) of 6 April, 1994 (which identifies the training of scientists and the development of scientific research as two key goals) Law on Industrial Property (#7819) of 27 April 1994, which sets up a Patent Office Law on National Science and Technological Development (# 7893) adopted 22 December 1994 sets out organizational structures and principles for Albanian S&T; it will need minor revision as a result of the recent reorganization of government. Laws have been enacted to create and define the responsibilities of the National Directorate of Metrology and Calibration and the Directorate of Standardisation and Quality, both of which are directly responsible to the Council of Ministers. Other laws which create specialised S&T services include those dealing with the National Veterinary Service; Management of Hydrocarbon Resources; Weights and Measures; Forestry; and Seeds. While this growing legal structure is being put in place, there is need for further work on more administratively oriented matters, such as on the basic charters which will define the functions and ways of operation of Albania s universities and the system of government regulations which determines the ways in which government S&T institutes can work. In a later section of this report (See New Modes of Research in the Section of Key Policy Issues) some suggestions are made concerning use of technical assistance still available to Albania via Project ALB 93/008 and which could assist by providing insight into ways in which these issues are dealt with in other countries. 2 The identification of priorities for scientific research and technology development; Notes and Comments The first attempt to identify priorities was that which led to the launching of the first ten National Programs ; however, priorities should be reviewed again in the light of the priorities announced in the Prime Minister s Speech to the new parliament on July which sets out a government program for the next four years. This speech states that Emphasis shall be placed on the orientation of scientific research towards the priorities of the Albanian economy. However, specific non-economic areas shall not be neglected. Therefore, agriculture and food, geology and mineral production, energy, sciences for life, biotechnology, telecommunications, economic, social and Albanological research shall continue among the priorities of scientific research. Note that this statement reaffirms the priority of existing programs, leaving new programs to compete for new resources. Characteristics of National Programs: Final Report, September 15, 1996 Page 13

16 They are defined in the Law on Science and Technological Development [Law on S&TD] of 22 December 1994 which states, in Article 9, that The objectives of the S&T policy are attained through national R&D programs. National R&D Programs shall: identify R&D objectives under the relevant fields; identify the institutions and scientific relevant and cooperating teams, including foreign partners; identify necessary improvements in infrastructure to facilitate attainment of objectives; identify budgetary and eventual extra-budgetary funds; identify expected results and time limits. Their fields of activity are agreed to by the Council on Scientific Research and Technology, on the advice of the [Ministry of Higher Education and Scientific Research,] after consultation with other Ministries; Specific (project) proposals are approved by the Council, on the advice of MHESR. MHESR issues instructions on preparation, submittal, evaluation and approval procedures for the national R&D Programs [Law on S&TD, Article 10]; National R&D Programs are applied through R&D projects. [ MHESR] is responsible for issuing instructions on the formulation, evaluation and approval of R&D Projects. The subjects, Ministries responsible, and resources applied to the present ten National Programs have been set out earlier (see page 5) 3 Conceptualization of science and technological development activities through national programs on R&D and relevant projects and resource mobilization (financial, human, institutional, infrastructural, informational) Notes and Comments Ten National Programs have been identified and launched but they need to address a series of questions: Is it the intention of the national programs to increase or restore research capacity, at the individual or institutional level, in selected fields or to produce specific technological outputs for application in Albania s development or to do both? At present, the Public Investment Program of the Government states that the emphasis has been on the rehabilitation of scientific research facilities and the retraining of staff in modern research methods. For the period , it sets out as priorities Reorganisation of Scientific research and technological development network of institutions; Creation of infrastructure and training of scientific teams to modern standards for scientific research; Research for identification and utilisation of the country s natural resources and spiritual riches. Final Report, September 15, 1996 Page 14

17 Will the National Programs serve different purposes during and after the transition to a market economy? How important a role is to be assigned to university-based researchers? Could university researchers become project leaders in the present system of financing National Programs? Is there any interest in adopting a systems approach to the solution of national problems through the National Problems? Does Albania have a capacity to do systems analysis? If yes, where is it located? It is important to note that Albania has no National Program to deal with the needs of Manufacturing Industry, despite the fact that there are listed four institutes relating to the Ministry of Industry, Transport and Trade which should have a capacity to carry out at least parts of such a program. [ ie the Institute of Studies and Design for Light Industry, the Institute of Mechanical Technology, the Institute of Studies and Design for Chemical Technology, the Bureau of Studies and Design for the Lumber Industry] and despite the fact that there has been created, with foreign help, a Small Business Foundation to provide wideranging support to emerging SMEs. According to the Ministry of Industry, Transport and Trade, the industrial priorities of Albania at this point in time are Food and Food Processing; Textiles, Clothing and Footwear; Construction of Infrastructure; Tourism; and Evaluation and Upgrading of Minerals and Energy Sources. The ten National Programs selected to date relate to the first, the third, and the last of these priority areas. 4 Installation of a new funding system for science and technological development activities and the appropriation of a separate budget share for S&T development. Notes and Comments Work is beginning on examination of the means available to establish a separate science budget within the overall budget of the Government of Albania. In the last two (three?) years, the CST has provided a funding system for some projects and for the ten National Projects. However, there is no explicit statement of the objectives of this funding (eg no choice is made between capacity building at either an individual or institutional level and the search for applicable outputs) and the mechanism at present does not appear to take into account the part of the Prime Minister s statement to Parliament of July 22 which asserted that...efforts will be made to link higher education and scientific research into one, single, functional system. To this end, special importance will be given to the organizational and institutional homogenisation of higher education with scientific research, by gradually bringing scientific and research institutions closer to the departments and faculties at the universities through the creation of a unified institutional basis as demonstrated by international standards in the field. Final Report, September 15, 1996 Page 15

18 While there has been some discussion inside MHESR about creating a Foundation to support research, the present Budget Law would not permit the creation of an arm s length agency such as is common in most industrialised countries. However, the Ministry of Finance is reviewing this matter and changes may be introduced to the Budget Law. 5 The identification and operation of an adequate statistical system for the organization and management of scientific and technological development activities. Notes and Comments The development of an S&T statistical system is an objective of the present project (See Part II of this Report) 6 Re-shaping of scientific institutions for the purpose of increasing efficacy and adapting to new conditions. An important aspect is the strengthening of research and development capacities in the higher education schools, which are expected to engage ever more into scientific and research activities in the fields they cover. Notes and Comments This intention is repeated in the Prime Minister s statement to Parliament of 22 July, but no concrete program of activities to give effect to the decision has been developed. In particular, the matter of funding the new expected activities will need to be addressed as a priority. As discussed later in this Report (Section on Key Policy Issues) Albania should take into account the new and more complex ways in which scientific research is being organised in many countries today, as it moves to strengthen the capacities of its universities to participate in R&D. 7 The strengthening of S&T cooperation with abroad, with a view to integrate R&D activity with R&D activities carried out at the international level. Notes and Comments Some institutes, such as the Mining and Processing Technology Institute of the Ministry of Energy and Mineral Resources are building up a series of linkages to projects organised within the European Union However, no comprehensive source of information has been identified by this Mission, either concerning Albanian participation in bilateral or multilateral R&D projects or on the receipt of foreign funding by Albanian S&T institutions. An additional element of international cooperation should focus on the identification of opportunities for the sale of scientific services by Albanian Institutes, as a means of generating additional income to finance research and the upgrading of facilities. An impressive example of what can be achieved is provided by the Academy of Science s Institute of Informatics and Applied Mathematics, (see below in comments on objective 11) which is using a very large project involving data entry services for a consortium of Italian Companies to generate employment for young Albanians, important funding for the Institute and additional salary income for its staff. It would be useful for the Government of Albania to consider broadening the statement of this objective to go beyond R&D Cooperation to include a goal of providing S&T services on the international market, at suitable prices. 8 The formation and training of R&D Personnel and the upgrading of management capacities at different levels Final Report, September 15, 1996 Page 16

19 Notes and Comments Consideration is being given to the establishment of formal post-graduate programs in some universities, to supplement the present system in which theses are developed as part of the work of an individual in an institute or university. Only short-term management courses are available, and the Mission has not developed information on the extent to which people within the Albanian S&T system have receive such training. 9 Keeping the concerned public informed of the results of the science and technological development policy and informing the public at large of the country s efforts in this respect. Notes and Comments CST published two editions of a newsletter, but the third edition is stalled somewhere within government. This activity was the only public information activity discussed with the Mission 10 The strengthening of the R&D activity to support the selection, importation, adaptation and operational use of foreign technology and its transfer to the sectors in need of it. Notes and Comments This may be a function of some institutes (eg The Mining and Processing Technology Institute) but there was no mention, during interviews concerning the technology needs of Small and Medium Scale Enterprises, of such a role being played by the various institutes which report to the Ministry of Industry, Transport and Commerce. In addition, Albania has no industrial extension service to promote the diffusion of technology to SMEs. The Institute of Statistics (INSTAT) may be open to including some questions concerning innovation related activities in its future industrial surveys. Final Report, September 15, 1996 Page 17

20 11 Privatisation of science and technological development activity. Notes and Comments To the extent that this objective deals with the sources of funding of R&D, rather than the ownership of existing institutes, there has been progress made in some specific cases: The Institute for Informatics and Applied Mathematics (INIMA) of the Academy of Sciences has two significant contracts with a consortium of Italian firms, involving the sale of services, and sells training courses on the local market; the profits from these activities have yielded a return to government on its investment in the institute, have permitted the institute to upgrade facilities and staff training, and have allowed the institute to reward its staff at levels closer to those in the private sector. But note that INIMA is not required to transfer any of its income back to the Academy of Sciences, leaving INIMA much better equipped and financed than other Academy Institutes. The Mining and Processing Institute of the Ministry of Energy and Mineral Resources estimates that 40% of its research budget is now financed via contracts with the Mining Industry. As privatization of that industry proceeds, the Institute hopes to increase the volume of contract research which it undertakes. Some institutes of the Ministry of Agriculture and Food have generated some revenue from the sale of instructional manuals to farmers. These examples indicate that there are cases in which revenue is being obtained from private sector sources. However, there is no data available to allow an estimate to be made of the share of total R&D expenditures being financed by private (or foreign government) sources. It is likely that the proportion of total R&D financed by such sources is still a small share of the total. As suggested earlier, the Government of Albania should consider a policy which actively encourages institutes (and universities) to generate additional revenues by the sale of S&T services. If this course of action is followed, it would also be necessary to review existing government restrictions on supplementary income which can be earned by institute staff. The capacity to earn supplementary income is a powerful incentive to encourage participation in such schemes, particularly in a country in which salary levels are so low in comparison to other European countries. Removal of the current restriction - which limits an employee s supplementary income to the equivalent of two months salary per year - would also work to slow down the Brain Drain, particularly from the public and university sectors. Final Report, September 15, 1996 Page 18

21 International S&T Policy The Importance of International Relations as an element of Albanian Science and Technology Policy In the early 1990's, Albania emerged from a lengthy period of isolation, imposed upon it by its former government. This isolation left Albania impoverished - due to repeated misallocation of both human and financial resources - and deprived of the physical facilities of modern scientific research and technological development. To its immense credit, the country has embarked on a transition to becoming an open market economy in a world which places a great premium on technological competitiveness. To bring about the transition with as much speed as possible, and to provide the underpinnings for an economy which will provide for all of its citizens, Albania will need to look beyond its borders for support as it tackles the task of upgrading its S&T system and of moving to having a functioning national system of innovation. To do this, Albania will, of necessity, be dependent on external help. Given the present financial situation of the government of Albania, its international activities in S&T, including training abroad, will have to be financed by external resources. During its time in Albania, the Mission was able to collect an array of data on international activities financed by the European Union, but almost no information on support from other sources, whether multilateral or bilateral. This analysis will therefore focus first on relations with the European Union and then later turn to relations with other bodies. Albania s relations with the European Union Albania has begun the process of obtaining some of the necessary help by its participation, with European partners, in the various elements of the European Union s PHARE Program, most notably in the TEMPUS, COPERNICUS and PECO Programs 3. As it continues along this course, it needs to do two important things:- first, it must understand and compensate for the pressures which it will experience as a result of the need to reconcile donor priorities with Albanian interests; and second, it must develop its own, articulated strategy - to be implemented by all Albanian S&T institutions - to ensure that donor assistance is channelled towards a consistent set of Albanian priorities. Donor agencies from the industrialised countries - both bilateral and multilateral - have had to develop sets of priorities in response to various forces, most particularly the pressures from the electorates in the industrialised countries which expect donor agencies to be accountable for the developmental impact of the activities which they finance and expect that Official Development Assistance Projects will provide opportunities for participation by nationals of the donor countries. As a result of these pressures, donor agencies will develop - sometimes in consultation with recipient countries, but sometimes alone - lists of priority areas for action and administrative rules to shape the activities being supported. A recipient country needs to have a clear sense of its own priorities before it begins negotiations with a donor, and must have 3 Brief descriptions of these programs and data and information concerning Albania s participation in them are set out in Appendix 2 Final Report, September 15, 1996 Page 19

22 arrived at a conclusion that there is sufficient common interest between its priorities and those of the particular donor to make negotiations worth while. In addition, many of the EU programs insist that an EU institution provide the management of any activity financed by the program, leaving the country to be assisted in a secondary position. In such cases, success is very dependent on the knowledge which the lead organization has concerning the country to be assisted and the sensitivity which the lead organization has for that country s priorities. A second concern for recipient countries lies in the fact that the administrative rules adopted by different agencies tend to be different, a fact which adds to the administrative burden faced by recipient countries which deal with several donors. A recipient will find great variations of accounting rules and reporting requirements among donors and so aid - coordination at a national level becomes an important task. The Mission was unable to identify how aid coordination was achieved in Albania and came across no evidence of extensive efforts of domestic coordination. The analysis of available data, presented in appendix 2, has led the mission to identify a small set of countries which seem to be playing key roles in Albania s international relations with the member states of the EU. Consider the following table. Linkages between Albania and Major EU Partners. Partner Country # and % of Long-term trainees sent by MHESR (1-3 years) Trainees # and% of Albanian TEMPUS IMG holders (<1 year) # of projects under Bilateral Agreement Collaborative Projects and Networks # of TEMPUS Projects (universities only) # of PECO Projects and Networks # of Copernicus Projects France 41 (28%) 109 (17%) No Bilateral Agreement Germany 47 (32%) 38 (6%) Greece 0 95 (15%) Italy (48%) No Bilateral Agreement Netherlands 0 8 (1%) No Bilateral Agreement United Kingdom 0 62 (9%) No Bilateral Agreement Albania should consider development of a long-term strategy for its relations with EU countries which would see the sending of trainees abroad as the first step in developing institutional linkages which in turn could lead to Albanian participation in collaborative projects and European networks. From past practice, it would appear that such a strategy should focus its attention on five target countries - France, Germany, Italy, Greece and the United Kingdom. MHESR should consider creating an inter-ministerial working group to develop an overall set of Albanian objectives for its relationships with this set of countries and Final Report, September 15, 1996 Page 20