GOVERNMENT yesterday indicated that it will make funds available in the national budget for the pursuit of research and development (R&D) as of financial year 2019/20, and that, effective September 2020, it will take research and development spending into account in the calculation of the country’s Gross Domestic Product (GDP).
The announcement came from Minister of Finance and the Public Service Dr Nigel Clarke in the keynote address at the opening of UWI Research Days on The University of the West Indies (UWI) Mona campus. He did not disclose the amount to be set aside in the budget, saying only that it was a “modest allocation”, and that details will be shared when the Estimates of Expenditure are tabled in Parliament next week.
With respect to computing R&D as a share of GDP, the minister said the move will stimulate greater investment in the sector, which will in turn drive innovation.
Referencing data from the UNESCO Institute for Statistics, Clarke said that global spending on research and development has reached a record high of almost US$1.7 trillion, with about 10 countries accounting for 80 per cent of spending. That’s because, as part of the Sustainable Development Goals, countries have pledged to substantially increase public and private R&D spending as well as the number of researchers by 2030.
The reclassification has had a positive effect on GDP where it has been applied. In the first year of its application, the European Union increased its GDP by 3.5 per cent by virtue of the inclusion of research, while the US recorded 3.6 per cent.
For Jamaica, the move represents more than the checking of the SDG box and increased economic activity. As Dr Clarke articulates it, it is seminal to the development of home-grown policy and innovation.
“We want to get to a place where policy is driven by research into our own unique situations,” said Clarke.