Innovation is essential at all stages of development, specifically the creation and diffusion of technologies are important for economic growth and welfare across all economies. Opportunities for effective innovation experiments and a possibly different framework for development are emerging.
These opportunities result from the rise of information and communication technologies, the development of global value chains, the increased significance of some emerging countries in the global innovation system, the growth of service-based economies and a more prominent receptiveness to trade and foreign direct investment. Today a key challenge for development policy in emerging countries is to encourage inclusive growth and support research addressing major social difficulties.
Regardless of its demonstrated benefits for meeting the immediate and long-term development goals of rising and developing countries all around the world, the significance of innovation for these countries is sometimes questioned. Such reasoning is often based on a fairly restricted understanding of innovation as “high technology.”
Without a doubt, an exclusive focus on high-tech industries “high-tech myopia” can be costly if the potential for innovation in different parts is disregarded (OECD, 2011). Countries can bring high costs without receiving any benefits if they choose sectors that require expertise they lack and are highly competitive internationally.
However, innovation happens in various sectors, including administrations, agriculture and mining (OECD, 2010). Numerous opportunities for innovations have emerged in low-technology sectors with high export opportunities, for example the production of palm oil and derivative products in Malaysia.
Also, innovation in agriculture is particularly applicable for addressing socioeconomic challenges at the same time as fostering growth. There is proof that agriculture R&D has greater impact on poverty reduction than most other public investments.