Thursday 30 November 2006

The Innovation Hub

So off I went to the “National Stakeholder Seminar on a proposal for a Botswana Innovation Hub” in Gaborone this week.

Hundreds of people were there to hear what Government were proposing. At the workshop were Government Ministers, academics, senior people from BEDIA, BOCCIM and the TEC, endless “Captains of Industry” (I think I am more of a corporal frankly), stakeholders (useful for killing vampires) and me.

The proposal for the Hub has wonderfully ambitious and lofty goals. The draft report states that the “Botswana Innovation Hub’s mission is to ‘put Botswana on the map’ as a location for world-class businesses engaged in knowledge intensive activities. The BIH will act as a catalyst for knowledge intensive industry to improve Botswana’s ability to compete in the global market with a technically skilled labor force.”

Sounds impressive and when you look at the success of these things elsewhere in the world they are very impressive. They are all over Finland and attract all sorts of Research & Development (R&D) companies and genuinely seem to foster a creative, dynamic environment that produces real results.

The Hub, as envisioned by the consultants and the various Ministries would act as an “incubator” as much as anything else. The plan is that start-up companies can begin there, soak up the creative atmosphere, partner with all the rich, successful companies that will have been attracted to come here to be part of the great experiment.

But I kept asking myself why they would come here when they can go elsewhere? What’s so special about Botswana that we will attract foreign investors? Yes, we all know about our relatively low levels of corruption. We all know about our long history of genuine democracy, low levels of crime and what thoroughly nice people we are.

But we, and now most of the rest of the world, understand that at the moment we have a number of genuinely impressive disincentives. Bureaucracy, red tape and queues really do put investors off.

If we want the big guys to come here we’ve got to offer them something different, something special, something unique. The trouble is that our history isn’t quite enough. It needs to be something new, something radical, something exciting and genuinely business-friendly.

Also I confess that I’m sceptical about the proposed involvement of Government. I genuinely mean no disrespect to them but they are not actually themselves business experts. I think that Government has a role to play but that it’s limited to painting white lines on the road to the Hub, stopping people from speeding on their way there and making sure that the companies pay their taxes on time.

I’m also not convinced that academia has a huge role to play. The atmosphere I think that we want in an innovation park is not academic, studious and peer-reviewed. It should be fast, reactive and entrepreneurial, none of which are frequently found at universities. I also don’t think that innovation and entrepreneurial spirit can be taught. Everyone at business school is taught the stories of Bill Gates, Steve Jobs, Ray Croc and Larry Ellison but that doesn’t mean we can all become them. The entrepreneurial spirit is something you either have or you don’t have.

As our business environment stands today I don’t think the Hub stands any chance of success. At least not until we face a few facts and decide to take action.

We need a massive overhaul of business regulations. In fact we need a radical deregulation. If we want to become somewhere like Singapore or Hong Kong we have to adopt some of their approaches. Take a pair of scissors to the rule book and cut out everything that gets in the way of anyone, Motswana or expatriate, from doing legitimate business here.

We need Government to be brave and take a step back. Let them retain responsibility for what they do best like policing and building schools and hospitals. If this sounds scary, remember that they actually did this a few years ago when they completely abolished foreign exchange controls. It took guts but the signal it sent to investors was powerful. We are confident that our currency is sound, solid and stable. Why can’t we do that again with business deregulation?

We need a real set of incentives for businesses. NOT handouts, not huge loans, not licences to buy flashy cars. Instead give new companies tax breaks. Start by reducing corporation tax for everyone a little bit but give genuine investors major breaks. Other countries trying to do this have offered 0% corporation tax for the first year or two, just to get a company stable. IFSC companies get a few things like this but we don’t go nearly far enough.

Two final points. Charles Tibone, Minister for MEWR said at the launch that we need to change out mindset and start to adopt risk and change as the way forward, not stability and “business as usual”. 100% correct and SO refreshing to hear something like that from a senior politician.

Secondly something truly impressive. A very young woman stood up at the workshop and took us old-timers to task for not including youth in the plan for the hub. As she pointed out, it’s a project lasting longer than a decade so she and her follow youngsters will inherit this eventually. She also pointed out that what works elsewhere will only work here in Botswana when we have adapted it to our local, specific needs. Best practice elsewhere is not necessarily best practice here. So if that was you wearing that red and white stripy top then email me. I want to offer you a job when you finish your education.

This week’s stars!

  • Kabelo at BTC, yet again for the usual excellent service. Frankly it’s getting a little tedious how often he gets celebrated!
  • Daniel at BSPCA for showing that we DO care for animals and yes, the Watchdog HAS adopted a new puppy thanks to him!
  • Mr Jain at Gaborone City Council for fixing a problem amazingly quickly.
  • Lorraine at FNB Head Office for “wonderful service”.

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