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Technological Development for Innovation and Challenges for Brazilian Industry

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Prof. Gabriel Mario Rodrigues

Gabriel Mario Rodrigues – Chairman of the Advisory Board at Kroton Educacional and Chairman of the Board of Directors of ABMES (The Association of Owners of Private Higher Education Institutions)

Veja magazine 2575 this week in the article “From Piracy to Innovation” shows the transformation that China had in a few years. From a seller of trinkets to a world competitor of innovation.

In 2017, for the first time, it was among the five countries with the highest number of patents accepted in the United States, behind only the USA itself, Japan, South Korea and Germany.

Who explains why technology is so behind in Brazil is Prof. Marcos António Formiga in a realistic and historical analysis. Formiga is one of those bullies who cannot see anyone relaxing and being at peace with everything. Faced with this, he comes with pinpricks and needles to bring a new subject, well explained, to lead us to reflections. This time he reports on research in Brazil and the lack of technology.

The Brazilian research, in its origins, is related to the scientific expeditions and visits of artists and scientists related to nature. In 1637, Maurice of Nassau brought a plethora of naturalists, botanists, biologists, painters, mineralogists, and entomologists.

Brazil was an open-air laboratory available and unknown. The richness of its natural resources and the virgin beauty of the vegetation, along with the diversity, offered the exuberance of the fauna and the flora, besides minerals and much water in mighty rivers, full of fishing varieties. In this way, researchers, intellectuals and clergymen of different Catholic denominations were responsible for the diverse collection of atlases and geographical maps, anatomy and physiology of animals and plants that, along with the discovery of the unpublished and exotic, were classified in families and species also linked to nature in the form of artistic descriptions.

Only in the 19th century did some research institutes emerge as scientific entities. It was in this context that the Botanical Garden (1808), the National Observatory (1827), the Museu Paraense Emílio Goeldi (1866) – the first unit to do social research in Brazil -, the Agronomic Institute of Campinas (1887) of Mineralogy of Ouro Preto and, at the threshold of the 20th century, Manguinhos (1900), now Fiocruz in Rio de Janeiro, and Instituto Butantã (1900) in São Paulo were instituted.

After several attempts and constant discontinuities, Brazil awakened to the importance of the University, still as an institution for training human resources and for encouraging research. And, on the initiative of Governor Armando Salles de Oliveira, with the support of businessmen led by the Journalist Júlio de Mesquita Filho, in 1934 the University of São Paulo was created, with, from its inception, a strong concern for scientific research. However, the Brazilian case differed from the countries that made the Industrial Revolution between the eighteenth and nineteenth centuries, and which were awakened to the importance of technology and the need for industries to associate themselves with technological research, even if timidly, with the existing universities. The concept “Technology” went unnoticed by the Brazilian University until the end of the third quarter of the twentieth century.

The Brazilian Academy of Sciences (ABC), created in 1917, and the Brazilian Society for the Advancement of Science (SBPC), in 1948, as well as CNPq and Capes, both created in 1951, praised Science but forgot about Technology. These examples identify the fragility of the Brazilian Research System focused on technology. Paradoxically, Brazil was able to industrialize without having strong institutions in technology; hence the adoption of the “easier” model of import substitution.

Technology is the practical application of knowledge. Only during the military regime does CNPq change its profile: it changes from a National Research Council to a National Council for Scientific and Technological Development. The terminological change was an advance, but Brazil’s focus on technology was still in its infancy. The government, with the absence of industry, opted for a model centered in basic sciences, hence its explicit preference for scientism focused on institutes in Physics (CBPF), Mathematics (IMPA), Biology (INPA-AM), Space Research (INPE) etc.

In this way, Brazil is a rare, perhaps unique, case of a country that industrialized without the participation of its University. In 1985, CNPq gave up its recognized scientific competence and human capital to install the new ministry, created by President José Sarney:  the Ministry of Science and Technology (MCT). Technological research continued to be incipient, even with a set of sectoral or specialized institutions that supported the development of the industry: Finep (1967), Inpi (1970), Inmetro (1961), Inmet (1909) ), ITA (1950), IEAPM (1984), Cepem (1955), Embrapa (1972). With the evolution of the Brazilian industry and the strong presence of international industries, these companies preferred to install their plants and assemblers (automobile sector) without having R & D or R & D units. Only the largest Brazilian and state owned companies hired researchers and engineers for their laboratories.

Even so, Brazil was able to develop world-class technological research  institutions in recognized sectors, responsible for the main items of our agenda exports with technological content: on land, Embrapa; at sea, Petrobras; and in the air, Embraer.

The challenge: without technological development there is no innovation. Countries of marked industrialization after the Second World War, such as Germany and Japan (cases of reindustrialization), and during the Cold War, the so-called Asian Tigers (Hong Kong, South Korea, Taiwan and Singapore) deliberately opted for and developed strong technological research entities. Initially, they copied cases of industrial success: Japan was reference, but then gained autonomy. China is a shining example whose protagonism qualifies it, at the turn of the twentieth century, as the “great factory of the world.” The preference for technological development in Southeast Asia is now increased by Indonesia, Vietnam, Malaysia and Macao. The dynamism and accelerated rhythm of these countries correlate with the preferential option for technology, without dispensing with basic scientific research.

This model of technological bias had already proved successful in the United States and Western Europe, places that make up their PhDs, preferably for the productive sector. In Brazil, this relationship is the opposite: industry employs only 20% and the Academy monopolizes 80% of national PhDs.

Brazil, in the second half of the twentieth century, thanks to the work of CNPq, Capes, Finep and Fapesp, was able to build the second largest post graduate network among developing countries, with Master’s and PhD courses, mostly in universities and public research institutes. This gave rise to a sort of “Crown Jewel” of national education. However, such an advance created an inverted pyramid. The national education system has neglected, unjustifiably, and sacrificed basic education, a pillar of scientific and technological development for all countries that have attained the status of rich, advanced economies. Brazil remains trapped in the “middle income trap”, with a predominantly endogenous economy based on small or moderate technological intensity (except for the honorable cases cited) and the massive export of raw materials (commodities) with low added value.

Brazil, with its graduate network and promotion of scientific production, stands out for the number of papers published in internationally indexed publishers (13th place). However, when we analyze the impact and the capacity of the country to transform scientific knowledge into wealth and business, the classification acquires little qualitative emphasis, to the point that a Minister of the area has affirmed that “Brazil does not know how to transform knowledge into wealth.”

This reality produces technological backwardness (deindustrialization, followed by loss in the rankings of competitiveness between industrialized countries); industry idleness (currently around 30%); inability to participate and compete in global industrial chains, and a low complex industrial park (51st position). Therefore, our technological development does not match an economy still among the 10 largest in the world, measured by nominal GDP.

We lack a number of requirements to overcome these “competitive disadvantages”. As a consequence, we face the difficulty of innovating. Perhaps the most serious is that the indispensable Triple Propeller does not work here: the union and action between the academy, government and business.