Many economies face the challenge of developing into knowledge-based economies in order to remain competitive. Advanced countries are well on their way to developing knowledge-based industries which are intensive in technology and human capital. Other countries have made progress in developing sectors based on information and communication technologies (ICT), including semiconductors, computers, electronics and communications equipment and services. Other sectors now receiving attention include aerospace, biotechnology and environmental equipment and services.
Malta Enterprise has recently launched a programme to support innovative start-ups. The programme encapsulates two schemes branded as START and STARTplus. Both schemes provide matching funds to cover half the costs of general training and consultancy provided by a professional start-up coach.
This assistance is designed to help the innovative entrepreneur with his/her business planning in readiness for the next crucial stage of financing. The STARTplus scheme has been specially developed for knowledge-based start-ups and provides a matching fund of Lm1,000 per accepted enterprise. The selected start-ups would also have access to a loan guarantee of 50 per cent (75 per cent for first time entrepreneurs) of the total loan up to a maximum of Lm50,000 for up to 10 years. The programme also includes training support and industry secondments.
The STARTplus also provides the option for select start-ups to join the Kordin Business Incubation Centre (KBIC) where as a resident, along with the other 26 companies already at the KBIC, they would have access to a variety of assistance schemes including the use of a secure facility complete with broadband internet, phone as well as other business assistance services.
KBIC has now also launched a KBIC Affiliate programme where start-ups can access the full service without them having to pay the full service charge. Affiliates would have access to a “hot desk” which is a shared desk in an open plan office environment. This model has proven to be very popular with science parks and incubators overseas.
Along with other efforts, Malta Enterprise recognises the Innovative Start-ups programme as one way of addressing the national commitment to assist entrepreneurship and to further reduce the bureaucracy associated with starting-up a company. These are clear objectives detailed in the EU Commission’s Lisbon Agenda. Malta Enterprise recognises that local indigenous start-ups, along with Foreign Direct Investment, have a strong potential to eventually contribute to the local economy.
Further information on the START and STARTplus is available on www.malta
enterprise.com/start or by e-mailing [email protected].
At a glance: Knowledge Based Industries (KBIs)
Although there is no general definition, it is generally accepted that it embodies the ability to constantly innovate through accessing, processing, using and creating knowledge. This strategy is recognised by many economies as being a strong driver for growth, wealth creation and employment across all industries.
A KBI can be in one of the following basic formats:
Knowledge creation and acquisition
New knowledge is fundamental. It can be new ways of increasing efficiency in the production of goods and services. Typically such knowledge is acquired from the more developed economies as best practices.
Knowledge creation typically refers to research and development departments, institutes and enterprises. The national indicators on this are percentage of the GDP spent on R&D; researchers per capita and patents per capita.
Knowledge acquisition typically refers to technology transfer including licence or franchise agreements; transfer of designs and trademarks. Such a service is offered by the Innovation Relay Centre located at the KBIC, Kordin Industrial Estate.
Knowledge dissemination
The ICT revolution has significantly helped the dissemination of knowledge at even faster speed, larger volumes and lower costs.
Moreover the usefulness of knowledge-intensive products such as software is subject to network economies, that is, they become more useful as the user-base increases.
Knowledge dissemination is measured through the ICT spending as a percentage of the GDP and the internet access cost as a percentage of per capita GDP. An indirect indicator is the percentage of workforce with at least a secondary school education.
Knowledge application
The benefits of knowledge are only truly realised when they are adopted and applied by the labour force in the production of goods and services. Knowledge, in the different formats, helps compress product cycles and increases competitiveness. It also provides feedback to the knowledge production community driving the next round of innovation, diffusion and absorption.
Knowledge application indicators include the percentage of the workforce with a university degree as they have the ability to seek out, process and use relevant knowledge.
Examples of KBIs are finance, business and ICT services; education; communication; port services and healthcare. Manufacturing related KBIs include media and publishing houses; machinery and equipment; electrical machinery and apparatus; electronic products and components; medical, precision and optical instruments; and transport equipment.
Ing. Joseph P. Sammut is head technology development and innovation, Malta Enterprise.