Meanwhile, Sweden and South Korea are now excelling economically on the basis of R D spending of around 3.5 of GDP, while Israel s R D outlays stand at a remarkable 4.7 of GDP.

They supported the identification of local level capacity building needs for synergistic implementation, and highlighted the importance of strengthening linkages between scientific research and local level synergistic implementation, so that the results of research could profit local activities and in order to facilitate the generation of success stories.

To do that, they have to complement FDI in R D with efforts by local public institutions and the private sector.

Governments should therefore invest in R D a minimum of 1 per cent of GDP.

Faced with intense competition to contribute to GDP growth, local governments were compelled to seek other ways to augment fiscal revenue.

Serbia spent 0.64 of GDP on scientific research in 2012, which is one of the lowest R D budgets in Europe.

The Inter Academy Council recommends that developing countries increase their R D expenditure to at least 1 per cent of GDP.

(None of this is to deny that there are other key actors in many countries engaged in R D, namely the public sector and the local private sector).

This fits with the 12th Five Year Plan s new focus on innovation based strategic emerging industries energy conservation, new generation information technology, biotechnology, high end equipment manufacturing, renewable energy, alternative materials, and autos running on alternative fuels.

It remains a shame that only two of the EU s 27 countries have met the target of spending 2 of GDP on research and development.

This is untrue. During the massive investment associated with the Kyoto treaty, the participating countries investment in R D as a percentage of GDP has declined , not increased.

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For example, while US monetary policy intervention (yes, monetary policy is also intervention) has done little to boost domestic demand, it has spurred domestic capital to search for yield around the world.

What was called for was an intensely competitive environment in which priority was given to new institutions based on scientific research and the mastery of technology, on which Tunisia spent 1 per cent of GDP.

Moreover, China is set to outpace the US in investment in research and development. Since 2001, China s R amp D expenditure has been growing by 18 annually and has more than doubled as a share of GDP.

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