PANEL ON INDICATORS OF TECHNOLOGY DEVELOPMENT

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PANEL ON INDICATORS OF TECHNOLOGY
DEVELOPMENT Geneva, 22-24 May 2002

The UNIDO Industrial Development Scoreboard
Presentation made by Frédéric Richard Director,
Strategic Research and Economics Branch
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OBJECTIVE

• To provide governments, industries and support
  institutions with a simple analytical tool to
  benchmark
• The performances of their national industries
• A selected number of drivers of industrial and
  technological capabilities

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Why benchmark?

• Valuable aid to policy analysis and design by
  locating each country in global, regional and
  competitive scene
• Useful supplement to broad competitiveness
  analysis by focusing on industry
• Most developing countries lack comparative
  information (even published data)
• Analytical framework helps focus on some critical
  variables

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Coverage of the Industrial Scoreboard
1985 (80 countries) 1998 (87 countries)
Ø Industrialised countries (22) Austria,
Australia, Belgium, Canada, Denmark, Finland,
France, Germany, Greece, Ireland, Israel, Italy,
Japan, New Zealand, Netherlands, Norway,
Portugal, Spain, Sweden, Switzerland, United
Kingdom and United States. Ø Transition
economies (7) Albania, Czech Republic, Hungary,
Poland, Romania, Russian Federation and Slovenia.
Ø Sub-Saharan Africa (16) Cameroon, Central
African Republic (CAR), Ethiopia, Ghana, Kenya,
Madagascar, Malawi, Mauritius, Mozambique,
Nigeria, Senegal, South Africa, Tanzania, Uganda,
Zambia and Zimbabwe. Ø East Asia (9) China,
Hong Kong, Indonesia, Korea, Malaysia,
Philippines, Singapore, Taiwan Province and
Thailand. Ø South Asia (5) Bangladesh, India,
Nepal, Pakistan and Sri Lanka. Ø Latin America
and the Caribbean (18) Argentina, Bolivia,
Brazil, Chile, Colombia, Costa Rica, Ecuador, El
Salvador, Guatemala, Honduras, Jamaica, Mexico,
Nicaragua, Panama, Paraguay, Peru, Uruguay and
Venezuela. Ø Middle East and North Africa (10)
Algeria, Bahrain, Egypt, Jordan, Morocco, Oman,
Saudi Arabia, Tunisia, Turkey and Yemen.

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The Analytical framework
Productivity Growth
Competitive Industrial Performances
Industrial Capabilities
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Manufacturing Value Added per capita (US)
6,000
5,000
1985
4,000
1998
3,000
2,000
1,000
0
World
Developed
Transition
Developing
Sub-Saharan
South Asia
Middle East
Latin America
East Asia
countries
economies
countries
Africa
North Africa
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Manufactured exports per capita (US)
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• Technological Classification of Industries
• Resource-based industries (prepared food, wood
  products, petroleum rubber products)
• Low technology industries (textiles, clothing,
  leather, toys)
• Medium technology industries (automotive parts,
  chemicals, metal products and machinery,)
• High technology industries (electronics,
  pharmaceuticals, aerospace, precision
  engineering,)

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Share of Medium- and High Tech Exports in Total
Manufactured Exports ()
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How is the index constructed (1)?

• Unweighted average of the 4 index components.
  This requires 2 steps
• Step 1 Standardisation of the 4 index components
• Formulae
• Range between 0 and 1 (lowest and highest values
  in sample)

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How is the index constructed (2)?

• Step 2 Construction of combined index

Industrial Complexity Upgrading
Industrial Capacity
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Main Conclusions of the CIP Index

• Stability of national industrial performances
  between 1985 1998
• However a few middle-income developing countries
  have enhanced their performance China, Costa
  Rica, Malaysia, Mexico, Philippines, Thailand
• LDCs remain at the bottom of the index and the
  gap between LDCs and other developing countries
  has widened
• 42 developing countries had a similar technology
  structure in 1998 to that of 1985
• Only 16 developing countries have upgraded their
  industrial structure toward technology-intensive
  products
• Industrial production and manufactured exports
  within the developing world are highly
  concentrated the top 5 countries account
  respectively for 60 and 61. By contrast the
  bottom 30 countries only account respectively for
  2 and 1.

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Highlights of the Scoreboard analysis

• The analysis of industrial performance and
  drivers points to the following main messages
• The correlation between the CIP index and the
  drivers of industrial performance is positive and
  significant
• There is a surprising degree of consistency in
  the relationship between the CIP index and the
  drivers over time
• Most drivers are also related to each of the
  others, so that it makes sense to have more of
  everything
• There are many ways of combining the drivers,
  however, and successful countries have used
  varying strategies
• The rankings of economies by the drivers are
  stable over time, as would be expected for such
  structural variables

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Highlights of the Scoreboard analysis(continued)

• Despite the general stability in rankings, some
  countries changed their relative position
  significantly
• The impact of the drivers on industrial
  performance also changes over time, with foreign
  direct investment gaining in significance
• Domestic technological effort, as measured by RD
  financed by productive enterprises, is the most
  consistent and significant of the drivers
• Physical infrastructure is strongly associated
  with industrial growth and technology upgrading
• The drivers are unevenly distributed in the
  developing world, and the distribution is growing
  more uneven. East Asia dominates in almost every
  variable, while Sub-Saharan Africa is
  consistently the weakest.

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http//www.unido.org
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For further information, please contact Mr. A.
Di Liscia, Assistant Director-General and
Director UNIDO Liaison Office Le Bocage 79-80,
Palais des Nations Geneva 10, 1211 Switzerland
Telephone [phone] Fax 41
22 9170059 E-mail a.diliscia_at_mbox.unicc.org M
r. F. Richard, Director, Strategic Research and
Economics Branch UNIDO P.O. Box 300 A-1400
Vienna, Austria Telephone [phone], Fax
41 1 26026-6859 E-mail f.richard_at_unido.org