Developing states must foster technology

“There is no development without technological development. There cannot be a free and competitive market in the technology market because every product is unique,” the PM said in his lecture as part of the “African Economic and Business Summit”.

He said low-level of technological development has been one of the major factors hampering the economies of African countries.

PM Zenawi said the technology market exists and operates in so far as government actively and effectively intervenes at such processes.

In the absence of such intervention, he said, there can be no technological development and hence “non-development”.

“This is the case everywhere and indeed developing countries suffer even deeper problems in technology market...because of low-level of accumulative knowledge.”

Prime Minister Zenawi describes such a situation as a “vicious circle” developing countries are caught in to date.

His paper gives an in-depth analysis of the ramifications of technological advancement or the lack of it on overall economic development of countries and their capabilities to harness global markets.

In his presentation, Zenawi said, “Developing countries accumulate technological capabilities primarily through adoption and adaptation of technologies already discovered by developed countries.”

As one of the setbacks of such processes of adoption and adaptation, he cited the costs of time and money spent on research as those who want to embark on it “will have to carry out extensive search for the best awareness...and the best suppliers of the technologies”.

“Once the technology has been bought, the company and its personnel will have to learn to use it properly through learning by doing.”

“This is an extensive process (of) making mistakes and learning from them,” he said.

Those who adopt or adapt any such technology, he said, will have no patent right over it. “Sooner or later, others will acquire the same technology without going through the same process by simply poaching employees of the pioneer company.”

“From the point of view of the pioneer company, however, it forces the cost of introducing the technology and competes with those who copy from it without carrying the cost in time and money.”

Because of “the unique nature of market failure they face”, the PM indicated that developing countries have been intervening in technological markets even more than developed ones.

Article published courtesy of BuaNews