IMPORTANCE OF TECHNOLOGY IN THE DEVELOPMENT OF A COUNTRY:

Can underdeveloped countries afford not to have a global competitive industry?

By Edgar Snchez-Sinencio Analog and Mixed-Signal Texas A&M University 1

 Technological artifacts are products of an economy, a force for economic growth, and a large part of everyday life. Technological innovations affect, and are affected by, a society's cultural traditions.

Source:

http://en.wikipedia.org/wiki/History_of_technology
2

KNOWLEDGE AN ECONOMICS FORCE FOR GROWTH

In Soft revolution, knowledge is replacing physical resources as the main driver of economic growth. The OECD calculates that between 1985 and 1997 the contribution of knowledgebased industries to total value added increased from 51% to 59% in Germany and from 45% to 51% in Britain. The best companies devote at least a third of their investment to knowledge-intensive intangibles such as R&D, licensing and marketing. Universities are among the most important engines of the knowledge economy. Not only do they produce the brain workers who man it, they also provide much of its backbone, from laboratories to libraries to computer networks.

Background
Queen Victorias Diamond Jubilee,held in

London on June 22,1897 The grandest fest: attendances included 46,000 troops and 11 colonial prime ministers. She ruled over a quarter of the worlds population and 20% of its territory The empire was all connected by latest marvel of British technology, the telegraph, and patrolled by the Royal Navy, which was larger than the next two navies put together.
4

Background (continues)
Why was Great Britain at the top and

not China, which was the worlds technological leader for about thousand years, between A.D 500 and A.D. 1500?

Britains advantages were marked by a

combination of social, political, and geographical factors. British society was relatively free and politically stable. Scientific thinking was dynamic.
5

Background (continues)
It was said; well, here we are on top of the world, and we have arrived at this peak to stay there

forever! The world is now flat and other players have surged. US has replaced the British Empire Of the worlds 20 top universities, 18 are American How about other players, China, India and the former Soviet Union? They are poorer, hungrier and have a good number of well trained people, they will compete with US for a slice of the pie.
6

Background (bad news for USA)

A Goldman Sachs study concludes that by 2045, China will be the largest economy in the world, replacing the United States. What current problems exist in the US industry world dominance? The National Academy of Sciences, Engineering and Medicine reported that the scientific and technical building block of our economy leadership are eroding at the time when many nations are gathering strength
7

Background (Bad news for USA)

China and India combined graduate 950,000 engineers

yearly. US produces 70,000 engineers per year. How many

are educated to work for transnational companies?

More people in the USA will graduate in 2006 with sports-exercise degrees than electrical engineering degrees. USA is loosing interest in the basics-math, manufacturing, hard work, savings and becoming a

postindustrial society that specializes in consumption and leisure

8

Background (Good news for USA)

The USA invests 2.6 % of its GDP on higher education, compared with 1.2% and 1.1% in Europe and Japan, respectively. US remains by far the most attractive destination for students, nearly 30 % of the total number of foreign students globally. The US economy is excellent at taking technology and turning it into a product that people buys.
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Background (Good news for USA)

The USA has the most flexible labor laws in the

world. The easier it is to fire someone in a dying industry, the easier it is to hire someone in a rising industry that no one knew would exist five years earlier. Flexibility to quickly deploy labor and capital where the greatest opportunity exists,and the ability to quickly redeploy it if the earlier deployment is no longer profitable, is essential in a flattening world Note the current low unemployment rate in the USA is one of the lowest in the world, around 4.6%
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 China and India represent a 2.3 billion people with a significant number of highly skilled engineers with low salaries in comparison with

Global Competition

Western standards. USAs top 1% of earners now receive 16% of all income, up from 8% in 1980. How the USA become competitive and leading research in the world, what was the driving force behind that? The challenges to which US responded were: a) in 1950 the Soviet Unions launch of the Sputnik satellite, b) in 1980 Japan was growing to become the technologically and economical dominant superpower of the future. 11

USA Companies are transformed to transnational companies !

For example HP currently has nearly 143,000 employees in 178 countries. It is the largest consumer technology company in the world and in Russia, Middle East,South Africa and Europe.
Very few non-USA companies are truly transnational.

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Let us study how successful countries developed their industries and education
Is there an strategy to become an industrial power country?
What are the key elements to accomplish these goals?

13

China PRC
Scientists born in China won four Nobel Prizes in Physics. Science and technology have long preoccupied China's leaders; indeed, the People's Republic of China's third and fourth generations of leaders come almost exclusively from technical backgroundsboth Jiang Zemin and Zhu Rongji were trained as electrical power engineersand have a great reverence for science. Hu Jintao was trained as a hydraulic engineer. Deng Xiaoping called it "the first productive force." Distortions in the economy and society created by Communist Party of China rule traditionally has hurt Chinese science, according to some Chinese science policy experts. Before the 1990s, the Chinese Academy of Sciences, modeled on the Soviet system, placed much of China's greatest scientific talent in a large, under-funded apparatus that remains largely isolated from industry. However, as a result of Chinese economic reform, most Chinese scientific institutions have been encouraged to commercialize their activities, and Chinese scientists have increasingly begun to go into business
http://en.wikipedia.org/wiki/Science_and_technology_in_China#Communist_Party_of_China_oversight

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 Chinese university undergraduate and graduate enrollments more than doubled in the decade 1995 - 2005. The revival of a research in PRC universities has already
given the universities the edge in the number of most cited PRC papers in the Science Citation Index. The average age of Chinese researchers at the Chinese Academy of Sciences has dropped by nearly ten years between 1991 and 2003 as the older generation retired and younger researchers, many educated in the United States and other foreign countries, took their place. The Communist Party of China Central Committee and the State Council, on May 6, 1995 issued the 'Decision of the Central Committee of the Communist Party of China and the State Council on the Acceleration of Progress in Science and Technology'. The 'Decision' set the goal of overall (both public and private) to attain Chinese R&D spending equivalent to 1.5 % of GDP by the year 2000. It urged scientific academies and institutes of higher education to set up high tech companies. The 'Decision' noted that science and technology are 15 the chief forces of social and economic development.

 Girls , when I was growing up, my parents used to say to me, Tom, finish your dinner people in China and India are starving. My advice to you is: Girls, finish your homeworkpeople in China and India are starving for your jobs

Bill Gates said: The Chinese have risk taking down, hard work down, education, and when you meet with Chinese politicians, they are all scientists and engineers. You can have a numeric
discussion with them-you are never discussing give me a one-liner to embarrass [my political rivals] with. You are meeting an intelligent bureaucracy.
http://www.nsfc.gov.cn/e_nsfc/desktop/nsfc2004.aspx@tabindex=448&modelid=257.htm 16

China needs her students back

The number (in 000 )of Chinese students has grown 1985 2 1995 5 2000 8 2002 20 2004 25

trained talent is the yeast that transforms a society and makes it rise was said by Singapores city-state elder statesman
Source: The battle for brainpower, The Economist October 7th 2006
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 McKinsey calculates that in 2003, US had far more young engineers who were capable of working for Multinational companies than China-540,000 against 160,000

The sum of Chinas total exports and imports amounts to around 70% of its GDP, against only 25 to 30% in India and US. In 2007, China will account for nearly 10% of world trade, up from 4% in 2000

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Taiwan is a barren rock in a typhoon-laden sea, with virtually no

natural resources and it has the third largest financial reserves in the world.
Brief Summary about her technological development 1.What is the GDP in 1980 and in 2005? 1980 GDP: $41.423 Billion 2005 GDP: $345.105 Billion From http://www.econstats.com/weo/C157V019.htm Population: 22.6m Adult literacy: 96.1 2. Was there a national strategy to promote her industrial development? Strategy changes through stages on industrial development. At the current stage of enhanced industrial technology capability and phased-out substantial government support, as well as ever-intense global competition, the strategy of forming an industry-directed research consortia (ASTRO) has been adopted in the hope of integrating industrial R&D resources, accelerating the uptake of R&D, promoting technology exchange, accumulating long-term technology capabilities, stimulating Collaborative research among up-/downstream sub-industries and boosting overall industrial competitiveness.
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3. Is there a strategy to promote startup companies? Government grants, low interest loans, technology development and transfer, angel funds are tools commonly employed. 4. What is the percentage of the industrial output of the semiconductor industry? about 10% GDP.

5. How many engineers are produced per year in your country? From ministry of education statistics, about 90,000.
6. Who are the leaders that promo the industrialization in your country? Chief of Executive Yuan, Minister of Economical Affairs, Council for Economic Planning and Development, National Science Council, Private sectors. 7. Another important factors in the industrial development and university cooperation in your country? The government has sought to integrate scientific and technological resources, elevate academic standards, strengthen industrial technology, and support innovation. Innovation index 6.06 second best (USA has 6.41)
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INDIA
Key issues:

Indian Institute of Technology History

The history of the IIT system dates back to 1946 when a committee was set up by Hon'ble Sir Jogendra Singh, Member of the Viceroy's Executive Council, Department of Education, Health and Agriculture to consider the setting up of Higher Technical Institutions for post war industrial development in India.
The 22 member committee headed by Sri N.R.Sarkar, in its report, recommended the establishment of four Higher Technical Institutions I n the Eastern, Western, Northern and Southern regions, possibly on the lines of the Massachusetts Institute of Technology, USA, with a number of secondary institutions affiliated to it. The committee also felt that such institutes would not only produce undergraduates but they should be engaged in research, producing research workers and technical teachers as well. The standard of the graduates should be at par with those from first class institutions abroad. They felt that the proportion of undergraduates and postgraduate students should be 2:1
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 NASSCOM estimates that in 2001-04 some 25,000 Indian techies returned home, and the number is rising rapidly. 68% of Indian executives living in the US were looking for opportunities to return home, and 12% had already decided to do so.
1.

What is GDP of India in 1980 and in 2005?

GDP recorded in USD-Billions, based on Purchasing-Power-Parity [1] 1980 => 434.28 2005 => 3602.89
[1] http://www.econstats.com/weo/C075V013.htm

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Brief summary about the technological developmen in India

2.

Was there a national strategy to promote industrial development?

Two Stages of Economic Reforms [2]:

The pro-business measures of 1980, initiated by Gandhis (Indira and Rajiv) removed price controls and reduced corporate taxes. The economic liberalization of 1991, initiated by then Indian prime minister P. V. Narasimha Rao and his finance minister Manmohan Singh. It removed restrictive license policies, initiated disinvestments and ended many public monopolies. It also facilitated the foreign direct investment in many sectors including infrastructure and technology.
[2] http://en.wikipedia.org/wiki/Economy_of_India
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Brief summary about the technological development in India

3.

Is there an strategy to promote start up companies?

Some Incentives [3] Setting up of Special Economic Zones (SEZ) in the country with a view to provide an internationally competitive and hassle free environment for exports. Giving early tax incentive to technological companies. Relaxing rules about Foreign Direct Investment in certain sectors.
[3] http://www.sezindia.nic.in/
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Was there a national strategy to promote industrial development?

India's industrial economy continues to invest heavily in advanced technology initiatives such as digital communications and space research. India's energy requirements are met by oil, most of which is imported despite the growth of indigenous production and hydroelectric schemes, mostly based amid the powerful northern rivers. Mining is a relatively small sector, but does produce iron ore and cut diamonds for export. India's main industrial development has been in engineering, especially transport equipment (a major export earner), iron and steel, chemicals, electronics and textiles.

Economic reforms have been underway since the beginning of the 1990s, under which trade has been liberalized, the public sector scaled back, and state-owned industries privatized. These reforms were developed with and approved by the IMF, which has supplied substantial credits to India. 25

Key Strategies and reforms taken by the government in 1991: - The reservation of many areas of economic activity for the state was abolished. - The restrictions on the inflow of foreign capital and technology transfer were significantly relaxed. Foreign participation in companies up to 51% was permitted automatically in 34 industries. Clearance for higher levels or in industries outside the 34 were processed speedily, and foreign equity inflows jumped rapidly after 1991. - The restrictions on the large industrial houses (designed to curb monopoly) were significantly relaxed, and large companies became able to expand existing units and construct new ones. - Quantitative restrictions on imports of raw materials, intermediates and capital goods were abolished. Considerable restrictions on the import of consumer goods remained, although by 1995 an increasing number were being put on Open General License, albeit subject to tariffs.

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Is there an strategy to promote start up companies?

Technopreneur Promotion Programme (TePP) Introduction As a new initiative during 1998-99, the Ministry of Science & Technology has launched a novel programme, known as Technopreneur Promotion Programme (TePP) jointly operated by the Department of Scientific & Industrial Research (DSIR) under its plan scheme Programme Aimed at Technological Self-Reliance (PATSER) and the Department of Science and Technology (DST) under its Home Grown Technology Programme (HGTP) of Technology Information Forecasting and Assessment Council (TIFAC) to tap the vast existing innovative potentials of the citizen of India. Objectives To promote and support untapped creativity of individual innovators To assist the individual innovators to become technology based entrepreneurs To assist the technopreneur in networking and forge linkages with other constituents of the innovation chain for commercialization of their developments.

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Is there an strategy to promote start up companies?

Activities The activities under TePP includes providing financial support to selected & screened Individual innovators having original ideas for converting them into working models, prototypes etc. The assistance under TePP includes to undertake the activities like, R&D / engineering consultancy, Small equipment, tools etc. Raw Material / Accessories (for prototype/process trials), Fabrication cost (for prototypes) Patent guidance and support Manpower Testing & Trials Any other relevant costs TePP support to the innovators is limited to 90% of the total cost of the project & remaining 10% is to be borne by the innovator/inventor. Software Technology Parks of India (STPI) are also helping to promote start-ups.
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How many engineers are produced per year in your country?

According to the All India Council for Technical Education, India produced 401,791 engineers in 2003-04, 35 per cent being computer engineers. In 2004-05, the number of engineering graduates increased to 464,743, of which 31 per cent were computer engineers. Compared to India and China, the United States produces only 70,000 engineering graduates every year. All of Europe produces just 100,000. India currently has 113 universities and 2,088 colleges, many of which teach various engineering disciplines. Engineering colleges in the country have been growing at 20 per cent a year, while business schools have grown at 60 per cent.

(Engineering education: Can India overtake China? George Iype | June 09, 2006) 29

Recent news from India 2007

Cellular phones pay about 5 US cents per minute. Special phones for illiterate people use special codes so they can dial with one button. It costs 10cents per minute to dial from India to US. From Internet to a USA phone is 1.7 cents per minute, access to broadband cost $5 US per month. GSM is the dominant standard but new local standard are being proposed. India has the largest railway network in the world, one of the primary means of transportation for long distances for people and cargo. It has 3 (10) domestic airlines in 2005 (2007) The Medical tourisms as well as Dental tourism continue growing.

Very cheap medical cost, i.e, $500 brain surgery and hospital.
Initial salaries for undergraduate, MS and Ph D are $8K-10K, $10K$12K, $15K-$18K , respectively. After 8 years salaries could reach $40K ( for management ladder)
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Who was the leader (s) that promote the industrialization in your country?
J. R. D. Tata (1904-1993) Most famous industrial pioneer of modern India. Father of Indian civil aviation. He founded India's first commercial airline, Tata Airlines, in 1932, which in 1946 became Air India, now India's national airline. Tata directed the Tata Group of Companies, with major interests in many industries in India, including steel, engineering, hospitality and electrical companies. G. D. Birla (1894-1983) Founded BITS, Pilani. In collaboration with Caesar, an American friend, he set up an Aluminum Plant 'Hindalco'. He also started many educational Institutions. To his credit go many temples, planetariums and hospitals. During the decades of 70's and 80's, The Birlas were among the topmost Industrial Houses of India. 31

Another important factors in the industrial development and university-industry cooperation in your country?
Traditionally, this used to be a niche area involving government educational institutions and government projects in the past With the liberalisation of the economy in the recent years, there are more such cases involving private industrial establishments and universities as well. e.g. OLAB in BITS is a semiconductor R&D lab and is the first campus based VLSI Design facility in India.
http://eetimes.com/news/semi/showArticle.jhtml;jsessionid=ASETUTI3TRYL4QSNDL OSKHSCJUNN2JVN?articleID=18402777&_requestid=394263 Texas Instruments sets up second development facility in India

(proximity to IIT, Chennai).

http://www.networkworld.com/news/2006/071306-ti-sets-up-seconddevelopment.html

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4. What is the percentage of the industrial output of the Semiconductor industry? Direct Impact of Semiconductor Technology Driven Industries on Output of Indian Economy [4]-[5]: 14.25 billion USD => 2% of GDP =>6.8% of industrial output
[4] Economic data from ISA,Frost and Sullivan [5] http://www.answers.com/topic/list-of-countries-by-industrial-output

5. How many engineers are produced per year in India?

284,000 in 2005 [6]

6.

Who was the leader (s) that promoted the industrialization in India?
No single leader, venture capitalists or individual investors though some pro- business policy makers are highlighted in Q-2
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[6] http://www.sunmediaonline.com/indiachronicle/infotech.html

Brief summary about the technological development in India

7. Other important factors in the industrial development and university-industry cooperation in your country?
Industry growth in IT sector seems to be mainly driven by low-cost Outsourcing and availability of large English speaking engineering workforce. University Industry relation is still weak in IT sector. [7] [7] http://www.hindu.com/edu/2006/09/04/stories/2006090400580100.htm

Observe that the driving force for industrial growth, in India, has been private companies and local natives returning from abroad and putting ideas, creativity and money.Recently the government is adding strength and efforts for this economical growth
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SOUTH KOREA
Korean GDP between 1970 and 2005
GDP 900 800 700 600

billion $

500 400 300 200 100 0 1970 1975 1980 1985 1990 1995 2000 2005

year

Innovation Index : 7th, 4.62

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Korean national strategy to promote industrial development

The major national strategy is Select and Concentrate Growth Engine

Background: Korea has

very limited natural resources limited financial resources small domestic market small land highly educated human resources

Can not invest for every field.

Strategy: Select major fields that is suitable for Korea Invest all the national resources for the selected fields Concentrate and speed-up Globalization : be the world best in the selected field in 10 years Success in the selected field will power other fields in the future Now, this philosophy has been spread over almost everything and been being a part of Korean culture
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The percentage of the industrial output of the Semiconductor industry

GDP per head $12,690
Electronics product
2003: 23% of GDP, 40% of total export

Semiconductor
2001: 5% of GDP, 15% of total export

Current : even higher

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TOP UNIVERSITIES IN LATINAMERICA

2 1 3 4 7 8 5 6 9 11 12 15

2006

World Ranking UNIVERSITY OF SAO PAULO 112 UNIVERSITY NACIONAL AUTONOMA DE MEXICO ** 110 STATE UNIVERSITY OF CAMPINAS 192 UNIVERSITY OF CHILE 230 TECNOLOGICO DE MONTERREY 374 HOW CANOF WE MAKE UNIVERSITY BUENOS AIRES MEXICAN 376 FEDERAL UNIVERSITY OF SANTA CATARINA UNIVERSITIES MORE COMPETITIVE FEDERAL UNIVERSITY OF RIO DE JANEIRO 366 FEDERAL UNIVERSITY OF RIO GRANDE DO SUL
PONTIFICAL CATHOLIC UNIVERSITY OF RIO DE JANEIRO PONTIFICAL CATHOLIC UNIVERSITY OF CHILE UNIVERSITY OF GUADALAJARA 692
http://www.webometrics.info/top200_latinamerica.asp

?342
379 539 572

** UNAM has been ranked among the best 100 universities in the world by another ranking
organizations

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Top Universities Distribution by Continent

CONTINENT USA & Canada Europe Oceania Asia Latin America Middle East Africa RANK 1 2 3 4 5 6 7 8 13 20 Top 200 118 67 6 5 3 1 228 209 23 23 9 7 1 Top 200 101 25 17 13 8 6 6 4 2 1 Top 500 201 51 27 40 10 19 10 8 5 2
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Top 500

Distribution by Country
COUNTRY United States of America Germany Canada United Kingdom Netherlands Australia Sweden Switzerland Brazil Mexico

http://www.webometrics.info/Distribution_by_Country.asp

Spending per student, 000,PPP

20 18 16 14 12 10 8 6 4 2 0

pre-primary primary lower secondary upper secondary Tertiary United States Japan European Union
40

Source: OECD

41

What are some potential solutions to create (HT) High Technology industry in developing countries? Background A maquiladora (or maquila) is a factory, that imports
materials and equipment on a duty- and tariff-free basis for assembly or manufacturing.
The maquila must be a temporary step towards developing high technology. It is not a final solution.

An own foundry of semiconductor is not needed to

develop HT.

Many successful semiconductor companies are fab less

42

Indicators about Mexico

1/10

15th largest country 1,973,000 sq km The economy Economic freedom index 2.89 ( > 50 world position) GDP per head $6,050 (61 world position) GDP per head in purchasing Power parity (USA=100) 23.8 (~ 75 world position) Human development index 80.2 ( 51 world position) Origins of GDP % of total Agriculture 4.0 Industry, of which: 26.4 Manufacturing & mining 19.5 Services 69.6

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Indicators about Mexico

Total expenditure on R&D % of GDP 2002 1. Israel 4.66 2. Sweden 4. Japan 3.12 6. USA 29. Brazil 1.04 31. Spain 43. Venezuela 0.45 44. Mexico Largest market capitalization $m, end 2003 1 USA 14,266,266 15 South Korea 2 Japan 3,040,665 19 Brazil 6 Canada 893,950 27 Mexico 4.27 2.64 0.95 0.41

329,616 234,560 122,532

Most tourist arrivals 000 1 France 75,048 3. USA 41,212 8. Mexico 18,665

2. Spain 4. Italy 38. Brazil

51,830 39,604 4,091 44

Indicators about Mexico

Largest tourist receipts $m 1. USA 64,509 3. France 37,038 14. Mexico 9,457 2. Spain 12. Canada 17. Japan

10/10

41,770 10,579 8,848

Daily newspaper per000 population 1 Japan 551 2 Norway 12 Singapore 234 17 USA 20 Canada 157 29 Spain

544 188 110

Mexico is not in the top 30 countries my guess of newspaper per 1000 population is about 20

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Indicators about Mexico

Trade ($bn fob) Principal exports Manufactured products 160 (Maquiladora 77.5 Crude Oil& products 20.5 Agricultural products 5.2 Total incl. others 164.9 Main export destinations (%) United States 88.8 Canada 1.7 Spain 0.9 Principal imports Intermediate goods 129.2 (Maquiladora 68.4) Consumer goods 21.5 Capital Goods 20.2 Total 170.5 Main origins of imports(%) United States 61.8 China 5.5 Japan 4.5
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Indicators about Mexico

Health & education
Health spending, % GDP 6.1 Doctors per 1,000 pop 1.6 Hospital beds per 1000 pop 1.0 Education spending, %GDP 5.1 Enrolment,%: primary 110 secondary 79 tertiary 21 Obesity (17M,16W in the world ) 19.4, 29 % Diabetes ( 1 in the world) 14.2 % 11th largest pop. 103.5 M Highest tertiary enrolment in the world 1 Finland 86 5 Australia 2 South Korea 85 13 Estonia 3 United States 81 16 Denmark 4 Sweden 74 18 Poland

74 64 63 60
47

A mathematic study for 15 years olds placed Mexican students in the last place 29/29 in countries belonging to the OECD

What are some potential solutions to create (HT) High Technology industry in developing countries?
Who are the players in this creation of a HT industry? Who should lead and pay for this national initiative?

What should be provided to create a suitable

environment to develop this industry? What level of commitment is needed with the participants of this initiative?

48

What are some potential solutions to create (HT) High Technology industry in developing countries?
The players must be from university-industry-government

Government and industry should lead and pay for this national initiative.

Make different regions and states compete to attract

industry by tax exempt and providing financial support including real state. Improve infrastructure, roads, schools, and health Facilitate importing and exporting permits for this industrial sector. Provide financial aid and simplify bureaucracy.
49

What are some potential solutions to create (HT) High Technology industry in developing countries?
Serious long term level of commitment is needed with the participants of this initiative.
This should be an initiative at the national level and independent of the government in office.

Put someone in charge based on experience, technically capable and world recognized. Do not put in charge a politician or someone without the credentials. Increase the number of qualified undergraduate and graduated students in science and engineering

50

Remarks on creation of (HT) High Technology industry in developing countries.

There is no single approach to accomplish this goal and is adaptable to variation in the world market. Previous approaches followed by Japan, India, China and Korea should be studied and come with one that suits the local culture and maturity of society. The main national goals should be set independent of government in office and should have plans for 5 to 10 years. Encourage the local industry to become a partner of these goals. This industry should move from being distributors, maintenance, assembly and manufacturers to world leaders 51 in some key high technology niches.

 The first group of people that will form this high tech industry could come from natives working abroad at industry and academia.
Attract the best people from all over the world with experience to help to develop this industry, provide the proper financial benefits with a constructive and intellectual environment. Creation of well educated and trained human resources should become the highest priority of the national priorities. What is need to accomplish this?
52

How to transform classical university environment into the current world situation?
An international survey offers two pieces of advice for countries that are trying to create successful higher-education systems, be they newcomers such as India and China or failed old hands such as Germany and Italy. First: diversify your sources of income. The bargain with the state has turned out to be a pact with the devil. Second: let a thousand academic flowers bloom. Universities, including for-profit ones, should have to compete for customers. A sophisticated economy needs a wide variety of universities pursuing a wide variety of missions. These two principles reinforce each other: the more that the state's role contracts, the more educational variety will flourish.
http://www.economist.com/displaystory.cfm?story_id=4339960

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Undergraduate programs at university should be up dated to reflect the needs of the international industry, not just the local needs which often do not have a large market. Faculty members at universities should have MSc and Ph D. degrees. A drastic renovation program should be in place. They should have periodic stays at industry supporting their research.
Salaries of professors must be competitive with industry salaries. Promotion should be based on results and guided graduate students. Talent resides in the brains of individual, but it is also nurtured by organizations.
54

 A typical Mexican home earns $10,244 pesos monthly The national income grew 0.8% per year in the last 5 years

The difference in income between the 10% richest and the 10% poorest is about 22 times 50% of the poorest Mexican population lives with less than $ 3 US dollars per day
18.2% (19M) of the population leaves in extreme poverty, about $72 and $52 monthly in urban and rural areas, respectively.
From the Encuesta Nacional de Ingreso y Gastos de los Hogares 2005 http://www.cronica.com.mx/nota.php?id_nota=265296 55

The World's Richest People

Rank Name Citizenship Age Net Worth ($bil) Residence

1 William Gates III United States 2 Warren Buffett United States 3 Carlos Slim Helu Mexico 4 Ingvar Kamprad Sweden 5 Lakshmi Mittal India 6 Paul Allen United States 7 Bernard Arnault France 8 Prince Alwaleed Bin Talal Alsau 9 Kenneth Thomson & family Canada 10 Li Ka-shing Hong Kong 11 Roman Abramovich Russia 12 Michael Dell United States

50 75 66 79 55 53 57 49 82 77 39 41

50.0 42.0 30.0 28.0 23.5 22.0 21.5 20.0 19.6 18.8 18.2 17.1

United States United States Mexico Switzerland

United Kingdom

United States France Saudi Arabia Canada Hong Kong Unite Kingdom United States

http://www.forbes.com/lists/2006/10/Rank_1.html
56

http://www.businessweek.com/pdfs/2005/0548_philsco.pdf

Many talented people not only create jobs and wealth, They turn their hands to philantropy

57

Promote philanthropy among the richest people in the country. Increase donations to private and public universities coming from former students and industry. Provide an easy legal and financial path to establish high tech start up companies. Implement measurement for identifying the best undergraduate students in the country. A national entrance exam? Increase exchange of graduate students and faculty,
attract top foreign students to study in Mexico, of course make attractive Fellowship offers.

58

 Industrial growing must be accompanied by social responsibility, continuing education, parental support and encouragement, medical care, promotion for career development.
Modern companies to win the talent wars should turn themselves into learning organizations. The success of advanced economies is increasingly dependent not on their physical capital but on their capacity to mobilize their citizens brainpower
59

Conclusions

As a society one can choose to shift the responsibility or to choose to change the paradigm. The preconditions for development and progress involve basic infrastructure ( ports, power and roads) and human capital ( health and education) Technology has been the main force behind the long-term increases in income in the rich world, not exploitation of the poor. Consider the cases of Korea and Japan. This not to say that human exploitation has not occurred and is occurring. 60

Conclusions (continues)
Governments must invest heavily, especially in the early stages of Research and Development and should maintain the momentum as a part of a permanent national strategy.

Break the cycle: The rich move from innovation to greater wealth to further innovation; the poor do not. Collective action, through effective government provision of health, erase impunity and corruption, enhanced and invest heavily on education and R&D.
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References
[1] F. Zakaria, How long will America lead the World Newsweek.
http://www.msnbc.msn.com/id/13123358/site/newsweek/page/3/print/1/displaym ode/1098/

[2] T. L. Friedman, The World is Flat, Farrar, Straus and Giroux, New
York, 2005

[3] http://www.enchantedwebsites.com/maquiladora/ [4] http://www.iitkgp.ac.in/institute/history.php

[5] The Economist, Pocket World in Figures, Profile Books, Ltd,London, Edition 2006 [6] J. D. Sachs, The End of Poverty ,Economic Possibilities of Our Time. Pinguin Books, New York, 2005. [7] http://video.google.com/videoplay?docid=4237353244338529080

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Appendix I 1. Top number of graduate students in different universities at different levels 2. Tertiary education by field for OECD countries Reading Comprehension Finland 543.5 Korea 534.1 Mexico 399.7 Basic Sciences Finland 548.2 Japan 547.6 Mexico 404.9
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Bachelor's Degrees Awarded by School:

1. Pennsylvania State University 2. Georgia Institute of Technology 3.Purdue University 4. North Carolina State University 5. Univ. of Illinois, Urbana-Champaign 6. University of Michigan 1,396 1,372 1,261 1,240 1,198 1,127

7. Virginia Tech
8. Texas A&M University

1,098
1,044

9. Ohio State University

10. University of California, San Diego 11. University of Florida 12. Iowa State University 13. University of Texas, Austin

892
883 882 868 865

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Master's Engineering Degrees Awarded by School 1. University of Southern California 2. Stanford University 3. University of Michigan 4. Georgia Institute of Technology 5. Massachusetts Inst. of Technology 6. Johns Hopkins University 7. University of Texas, Arlington 8. San Jose State University 9. Univ. of Illinois, Urbana-Champaign 10. Purdue University 11. Texas A&M University 12. University of Florida 13. Cornell University 1,244 930 894 838 808 777 661 625 577 525 522 503 490
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Doctoral Engineering Degrees Awarded by School 1. Massachusetts Ins. of Technology 2. Stanford University 3. Georgia Institute of Technology
273 251 250

4. University of Michigan
5. Univ. of Illinois at Urbana-Champaign 6. University of California, Berkeley 7. Purdue University

226
220 201 165

8. Pennsylvania State University

9. Texas A&M University 10. University of Florida 11. University of Texas, Austin

151
148 145 143

12. Univ. of California, Los Angeles

13. Univ. of Maryland, College Park 14. Cornell University 15. University of Minnesota, Twin Cities

137
131 116 115
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Chart A3.6. Tertiary graduates, by field of education (2004) Graduates with tertiary-type A and advanced research qualifications
Lif e sciences, phy sical sciences and agriculture Engineering, manuf acturing and construction Humanities, arts and education Other
Korea Germany Finland1 Sweden Slovak Republic Greece France1 Austria Russian Federation2 Japan2 Czech Republic Spain Mexico3 Switzerland Belgium4 Chile United Kingdom Italy Ireland Israel Portugal Australia Canada Turkey New Zealand Denmark1 Netherlands Iceland Norway United States Poland Hungary5 Brazil6

Mathematics and computer science Health and welf are Social sciences, business, law and serv ices

0% 20% 40% 60% 80% 100% 1. Y ear of ref erence 2003. 2. Phy sical sciences, mathematics, statistics and computing are included in lif e sciences. 3. Excludes tertiary -ty pe A second degree programmes. 4. Excludes tertiary -ty pe B second degree programmes (f or the Flemish community in Belgium). 5. Excludes tertiary -ty pe B second degree programmes. 6. ISCED 5B programmes are included with ISCED 5A/6. Countries are ranked in descending order of the proportion of qualifications in life sciences, physical sciences and agriculture; mathematics and computer science; and engineering, manufacturing and construction. Source: OECD. Table A3.3. See Annex 3 f or notes www.oecd.org/edu/eag2006 ( ).

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Appendix II:

Indicators about Mexico

Color TVs per 100 households 1. USA 99.5 26 South Korea 39 Mexico 90 47 Russia Computer per 100 people 1. Switzerland 70.9 10 Canada 48.7 ? Mexico < 19

93.3 75.8

8 South Korea 34 Spain

55.8 19.6

Telephone lines per 100 people 8 Canada 65.1 17 South Korea ? Mexico < 28

53.8
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Indicators about Mexico

Book Sales $m 1 United States 32,264 5 Mexico 3,567 2 Japan 20,818 15 South Korea 821

Nationality of asylum applications in indust. Countries ( in 000, 2003) 3 Turkey 29.2 11 Colombia 12.4 4 China 26.3 13 Mexico 10.7 Highest foreign debt $m, 2003 1 Brazil 235,431 2 China 193,567 6 Mexico 140,004

25 Peru 39 Ecuador 47 Iran

29,857 16,864 11,601

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Indicators about Mexico

Agriculture Biggest producers 000 tonnes Meat 1 China 70,899 6 India 2 United States 38,911 9 Mexico Fruit 1 China 76,893 6 Italy 3 Brazil 34,298 7 Mexico

5,941 4,908
15,727 14,743

Sugar top ten producers 1 Brazil 26,000 2 India 21,700 7 Mexico 5,400 Coffee top producers 1. Brazil 1,729 5. Mexico 273

top ten consumers 1 India 18,600 2 EU15 14,100 7 Mexico 5,300 top consumers 1 USA 1,230 70 2 Brazil 825

Indicators about Mexico

Metals Lead producers 1 China 955 5 Mexico 135 Zinc 4 Canada 788 6 Mexico 427 Silver 1 Peru 2,921 2 Mexico 2,551 6 Canada 1,309 Oil 000 barrels per day 1. Saudi Arabia 3 USA 5 Mexico consumers 1. USA 1,494 7 Mexico 307 3 Japan 619 5 South Korea 438

producers consumers 9,817 1 USA 20,071 7,454 7 South Korea 2,303 3,789 11 Mexico 1,864 71

Indicators about Mexico

Innovation Index is a measure of human resources skills, market incentive structures and interaction between business and scientific sectors. 1. USA 6.41 2. Taiwan 6.06 3 Finland 5.74 7. South Korea 4.62 11 Canada 4.36 20. France 3.81 Mexico is not in the top 44 Information and communication technology index 1 Iceland 6.36 2 Denmark 3 Sweden 6.23 7 USA 15 Japan 5.79 18 South Korea Mexico is not in the top 44

6.26 6.07 5.74

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Appendix III

Korean National Growth Engines

Digital TV Broadcasting standard, broadcasting system, TV, camera Display LCD, PDP, organic EL Semiconductor process, nano-device, memory, SOC Mobile Communication 4G standard, system, cell phone, wireless network, telemetics, Intelligent Home Networks home server/networking, intelligent consumer electronics, ubiquitous computing, USN Digital Contents contents development tool, digital contents, contents distribution Robotics home, medical, military application, intelligence, HCI Automobile electrical car, hybrid car, fuel cell, safety, sensors, intelligent driving assistant, part Battery fuel cell, next generation battery Bio-technology medicine, artificial organ, bio chip

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Korean strategy to promote start up companies

Various government funding programs are available
Startup, research, manufacturing, marketing, office, equipment, consulting

Almost all the start-up companies take benefit from these funds Fluent of government research fund especially for 10 growth engines

(refer previous page)

Most of government research program require/encourage the participation

of start-up companies by the law

Exemptions of mandatory military service for researchers who are

employed in a start-up company (limited for qualified researchers with Masters degree)
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How many Korean engineers are produced per year?

<Graduates in Engineering and Science>
year BS. MS. /Ph.D. 1997 79,908 13,644 Total Korea USA 46,146 357,200 1998 82,442 15,770 Industry 5,351 147,900 1999 82,129 18,190 University 35,141 175,900 2000 85,546 20,211 2001 96,979 22,007
*total number of people in Korea: 50 million

<Current Ph. D. : 2001>

National Lab. 5654 33,500

<Ph. D. expected : total during: 2001~2010 >

Science Mathematics, Computer Science Physics Chemistry Earth Science Biology 2,735 1,830 2,272 745 2,681 Engineering Mechanical / Aerospace Material Electrical Chemical. Bio / Food 5,199 2,471 10,132 1,546 919

Others

597

Fabrics Nuclear / Petroleum Architect / Civil

Others

357 400 4,663

3,285 75

Who promoted the industrialization in Korea?

1960~1980 : President Junghee Park promoted/emphasized <bright side> - Social Overhead Capital deployment - Heavy Industry - Export - Education/ cultural enlightenment <dark side> - prolonged one-man rule - overemphasized uniformity - too strong government control on industry - infringement of human right

Thereafter : not a specific person, it runs by itself

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Another important factors in the industrial development and university-industry cooperation

Very little amount of money from the industry is donated to university for pure research and education (example: Yonsei university only 10% out of 140million$ research fund comes from industry) However, industrial research fund for practical application is active The topic and specification are generated by industry need. (very short term research : around 1~2 years)

Almost all the government research fund requires participation of industry (even in the research/education program for university)
Technology that was developed by the university itself is rarely transferred to the industry (Industry prefer to employ the student rather than technology licensing) However, the industry-initiated research outcome is easily integrated with the product. Naturally, Industry have the initiative of research.
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