96 | Agricultural Innovation in Developing East Asia
nascent; see the section titled “Building private sector capacity for market-based innovation is necessary for agri-food system transformation” in this chapter). The public and private sectors also jointly invest in agriculture R&D (box 6.8). Private agricultural R&D is also increasing in entrepreneurially active Indonesia and the Philippines. Indonesia is a frontrunner among its peers regarding private R&D, co-innovation, experience with associated instruments (for example, competitive research grants, PPPs, contract research), and commercialization of innovations (for example, patent licensing) (Hall et al. 2016; OECD 2013, 2017b). Indonesian agencies are actively searching for PPP models (box F.6 in annex F), yet the activity can be considered nascent. The plantation companies account for most of the private R&D (close to 60 percent) (Stads, Haryono, and Nurjayanti 2007). The private sector (mostly firms and private HEIs) also plays a relatively important role in conducting agricultural R&D in the Philippines. Private sector R&D primarily addresses plantation crops such as bananas and pineapples, agrochemicals, pest management, and plant and livestock breeding (OECD 2017a, 2017b). The transformation of Vietnam’s agri-food system is hampered by limited engagement of the private sector. To date, private sector activity and private R&D—by state-owned enterprises, small and medium enterprises, and foreign firms—have played a limited role (box 6.6), focused mostly on plant varieties, agrochemicals, and production technologies. Despite the importance of
BOX 6.8
Collaboration models between public agricultural research and development and the private sector in China In China, public research and development (R&D) institutions have been collaborating with the private sector since the early 2000s to complement research funding and to apply R&D outcomes in practice. In general, five categories of collaboration exist. Restrictions apply to collaboration with foreign firms, but acquisition of firms has served as a way to address this challenge. 1. Research staff in public R&D institutions engage in R&D activity in private enterprises on a part-time basis. This is one of the simplest and most feasible modes of cooperation. 2. Joint development of new technology has become a common model of cooperation: public R&D institutions, higher education institutions, and enterprises work together to develop new materials, products, technology, and equipment. 3. Indirect cooperation between public R&D institutions and the private sector through intermediaries Sources: Fuglie 2016; OECD 2018a.
such as brokers, consulting firms, industry associations, federations, and government agencies and departments has become increasingly common. These intermediary institutions play a major role in bridging, monitoring, and coordinating the cooperation. 4. Public R&D institutions and the private sector sometimes establish joint research institutions. This model of cooperation can clarify the direction of R&D and reduce the waste of resources, thus shortening the research cycle. It also can spread the responsibility between researchers and the private sector, thus shortening the industrialization cycle of R&D outcomes. 5. Public R&D institutions and the private sector could set up enterprises. In the current legal framework, three types of companies are the most practical: limited liability companies, joint stock limited companies, and cooperative organizations.
