Methodological and Technological Issues in Technology Transfer

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2.2.2 Actions for Developed countries and countries with economies in transition

Creation of global EST markets
Developed countries can play special roles in stimulating global transfer of ESTs. In particular they can:

  • Stimulate fair competition in EST markets by discouraging restrictive business practices such as product dumping to strive out competitors; overly restrictive conditions on the use of patents and refusal of licencing;
  • Reform export credit, political risk insurance and other subsidies for the export of products or production processes to encourage direct foreign investment in ESTs and discourage export that lower environmental quality in developing countries;
  • Reduce the use of export controls, export cartels, licensing restrictions;
  • Reduce or eliminate tied aid as trade policy measure;
  • Ensure requirements of host countries are adequately reflected in project design.

Strong and open R&D structure
Governments play an important role in providing funding for public R&D programmes as part of their industrial policies or science and technology development strategy. To promote the development of ESTs that lack short-term commercial viability, government funding and public R&D programmes are vital, and appropriate, reflecting the high rate of social return. For example, governments have been investing for three decades in R&D for environmentally sound energy technologies in the energy sector. These programmes are implemented either by government institutions or in joint partnership with the private sector. Over the past decade, about 40% of annual national R&D spending within a number of OECD countries was publicly funded. To increase the rate of development of EST, governments should therefore increase public funding for R&D in cleaner technologies.

The issue of publicly owned technology transfer and the role that national regulatory frameworks play in creating demand and market for ESTs was addressed both in the Rio Summit of 1992 and the UNGASS of 1997. Major findings of the UNCTAD study are that governments are funding public R&D programmes as part of their industrial policy aimed at improving their industrial competitiveness. Strong emphasis is placed on the commercialisation of those technologies developed from public R&D. In many cases, co-financing with the private sector also plays an important role. Many governments either transfer or license the patents of the publicly funded technologies to the private sector as part of their industrial policy and then the transferred patents follow the rules of the privately owned technologies and behave just like the other ordinary private IPRs. As a result, instead of focusing on technologies held by governments, the focus should rather be on public R&D programmes for ESTs and exploring the feasibility of enhancing the transfer of such technologies.

Developed countries could enhance flows of technology transfer arising from their public funded R&D programmes by encouraging or requiring where appropriate the recipients of such support to transfer the technology as soon as practical; by entering into co-operation with developing countries on R&D partnerships and international research institutions.

National and multilateral assistance flows
There is substantial scope for increased flows of ODA aimed at addressing genuine development objectives. Within this context there is potential to support activities which assist the transfer of ESTs, also among developing countries, but the overall development objectives must remain paramount.

Trade assistance programmes supportive of ESTs
ODA is not the only form of public sector finance from developed countries to support technology transfer. Substantial assistance is provided in the form of export credit, political risk insurance and other subsidies for the export of products or production processes. Little of this assistance is provided specifically for the transfer of ESTs and substantial volumes may transfer environmental inferior technology or support environmentally damaging projects. Developed countries can explore ways, such as developing environmental guidelines for export credit agencies, to refocus their trade assistance activities to avoid a bias against and promote the transfer of ESTs, and discourage the transfer of obsolete technologies.

Coordination within donor governments
One major issue regarding the effective transfer of environmentally sound technologies through public finance is the fact that foreign aid expenditure tends to be institutionally divorced from other powerful agencies that also have a huge influence on technology choice and investment patterns, such as trade, industry and science ministries. It is not uncommon to find governments pursuing seemingly contradictory international financial policies, and one of the strongest recommendations in this area is for greater institutional coherence within donor governments to promote transfer of ESTs.

Intellectual Property Rights and promotion of ESTs
In general, developing countries and their companies tend to have fewer resources to purchase licenses and fear that strong IPR regimes would impede their access to patented technologies. To meet this concern, bilateral and multilateral financial assistance could provide funds for licensing of relevant technologies. This could be one way for the international regime to support technology transfer in cases where market-driven, grants, equity investment, and joint venture solutions are inadequate or infeasible.

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