Norwegian social model benefits value creation

A new leader for Norwegian industry-oriented research has taken the helm. The recently appointed Minister of Trade and Industry Trond Giske believes in user-driven research and seeks to encourage private companies to increase their R&D investments.

Trond Giske (Photo: Henrik Kreilisheim)

Trond Giske (Photo: Henrik Kreilisheim)

Trond Giske is minister for a business sector that is thriving and an economic situation that is somewhat of a paradox. The OECD has difficulty explaining why Norway has high levels of both value creation and productivity, despite lower levels of research investment than other member countries.

Unique social model

“I am certain that the Norwegian social model can explain some of this paradox,” says Minister Giske. He believes that a combination of trust between the social partners, a competent labour market, creativity, independent workers, limited bureaucracy and good channels of information promotes the success of Norwegian companies and high productivity.

“Our shipyards are a good example of this. They are both competitive and profitable. The reason is that they are adept at organising large, complex projects and the distance between theory and practice is short. I think the Norwegian social model is a highly attractive export commodity!”

Wants to enhance research competence

The Research Council’s funding instruments for industry are financed largely by the Ministry of Trade and Industry. The ministry is also responsible for the government white paper on innovation, which stakes out the course for much of the activity carried out in this area.

Minister Giske believes in user-driven research. Research by and for industry is crucial if Norway is to achieve its objective of a total investment in research equalling three per cent of GDP. Trade and industry is to provide two of these three per cent.

But the real importance of industry-oriented research lies in its ability to enhance research competence in the Norwegian business sector.

Instruments that stimulate investment

“Public funding of research is now close to reaching its target of one per cent of GDP. Unfortunately the private sector is lagging behind,” says the minister.

He explains that this is due in part to the structure of Norwegian industry, which has very little research-intensive industry, and in part to the lack of research expertise in some segments of the sector.

“In this challenging situation, public funding for user-driven research is an effective instrument, and one that the private sector itself can direct. It triggers self-financing and builds relevant expertise. Once the expertise is established, it becomes easier to implement new research activity. And this will gradually generate more activity that is not publicly funded,” says Minister Giske.

Exciting future

What does the minister think Norwegian industry will look like in ten years?

“Most trade and industry will definitely be about the same as today, but we will see a clear move in the direction of renewable energy. The Government’s environmental policy will place stricter requirements on emissions for example, and high environmental taxes will encourage the private sector to develop new technology. I also think that Norwegian solar cell manufacturers will achieve great success,” says Minister Giske.

The minister also touts the benefits of industries based on Norwegian raw materials such as fish, timber and the natural surroundings. This is in keeping with the Government’s inaugural address, which expressed support for the development of national strategies in areas where Norway has particular competitive advantages, such as the marine and maritime sectors, travel and tourism, energy and the environment.

“The Government has decided to put special focus on these five business areas, but it does not prioritise among them. Personally I see great potential in the marine sector. Just think about the significance of the large amounts of omega-3 fatty acids found in many fish species! Today we are already deriving value from what used to be residual and waste products from the fishing industry. This is the kind of resource utilisation that we want to see more of in the future,” concludes the minister.

Source: The Research Council of Norway

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