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131. Technology and Industrial Policy in an Age of Systemic Competition: Safeguarding Germany’s Technology Stack and Innovation Industrial Strength

Author:
David Hagebölling and Tyson Barker
Publication Date:
11-2022
Content Type:
Special Report
Institution:
German Council on Foreign Relations (DGAP)
Abstract:
As one of the world’s most globalized economies, Germany is confronting a challenging international environment characterized by ag-gressive subsidies, a global race for control of key technologies such as advanced chips, and vulnerable supply chains for critical compo-nents. Increased energy costs – induced by Russia’s war on Ukraine – are also straining Germany’s industrial model. Germany’s industrial economy is simultaneously undergoing a fundamental transformation from precision-based engineering to sys-tems-based manufactured products. With this shift, a competitive digital technology stack is becoming a key repository for future industri-al competitiveness. Yet, the country struggles to capture value in fast-growing markets like that for cloud and edge infrastructure. It also faces risks from its exposure to untrustworthy technology vendors and potential geopolitical disruptions to fragile hardware supply chains. The German government is consequently drawing the contours of a new technology-industrial policy. This effort, however, suffers from uneven implementation and the complexities of eff ectively coordinating subnational (across the Länder) and supranational (across the EU) industrial policy. To effectively preserve its economic competitiveness, the German government should conduct a systematic assessment of the country’s strengths and vulnerabilities in critical technology, increase the cohesiveness between federal and state government initiatives, and work internationally – within the EU and with like-minded partners beyond – to leverage comparative advantages.
Topic:
Industrial Policy, Science and Technology, Innovation, and Competition
Political Geography:
Europe and Germany

132. The Geopolitics of Digital Technology Innovation: Assessing Strengths and Challenges of Germany’s Innovation Ecosystem

Author:
Tyson Barker and David Hagebölling
Publication Date:
11-2022
Content Type:
Special Report
Institution:
German Council on Foreign Relations (DGAP)
Abstract:
The COVID-era public and private investment influx into Germany’s digital technology R&D is reversing amid inflation, fiscal consolidation, and geopolitical pressures coming from the Zeitenwende. Germany’s future in an EU that is among the top-tier technology powers requires a profound and rapid transition of the country’s R&D strengths into data-intensive, systems-centric areas of IoT and deep technology that are linked to the domestic manufacturing base. New policy approaches in three areas – money, markets, and minds – are needed. New technologies such as robotics, artificial intelligence (AI), advanced material science, biotech, and quantum computing tend to have broad general-purpose applications. But uncoordinated funding vehicles, universities’ civil clauses, and restrictive visa and onboarding guidelines for skilled foreign workers slow innovation in these sectors and hamper German techno-geopolitical competitiveness. In the mid-term, Germany could look at a scheme to bundle the Future Fund together with new institutional investment in a sort of embryonic German Sovereign Wealth Fund, with a proportion of funding specifically geared toward strategically important VC endeavors.
Topic:
Science and Technology, European Union, Geopolitics, Innovation, and Digital Policy
Political Geography:
Europe and Germany

133. Determinants and Effects of Foreign Direct Investment in Austria: Spillovers to Novel Innovative Environmental Technologies

Author:
Mahdi Ghodsi and Branimir Jovanovic
Publication Date:
10-2022
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
This study investigates the determinants of FDI in Austria, as well as their spillovers to innovating technologies, productivity, and employment, using firm-level data, for the period 2008-2018. The findings point out that a decrease in the costs of trade increases investment in foreign-owned subsidiaries in Austria, and that FDI is pre-dominantly carried out in industries characterised by greater capital-intensity, higher wages, more agglomeration and regional concentration. Furthermore, FDI is higher in regions with a larger GDP and with a larger share of the population with upper secondary and post-secondary non-tertiary education. The study also finds that there are positive spillovers of FDI to the domestic economy, which are strongest and most positive for innovative activities in environmental technologies. In other words, FDI helps Austrian firms to become more innovative in major environmental technologies. Such innovative efforts are best supported at the firm-level by supporting the total assets and investment of domestic firms, and at the regional level by increasing the share of the population with higher levels of education and employing more R&D personnel. The active presence of innovative foreign MNEs that enjoy extensive technological capacities, high-skilled labour, experienced management, and large-scale resources are also conducive to innovative activities.
Topic:
Environment, Science and Technology, Foreign Direct Investment, Innovation, and Trade
Political Geography:
Europe and Austria

134. How Can We Achieve Europe’s Ambitions in terms of Research?

Author:
Maria Leptin
Publication Date:
12-2022
Content Type:
Policy Brief
Institution:
Robert Schuman Foundation (RSF)
Abstract:
A year ago on 26 November 2021, the Competitiveness Council adopted Conclusions on the governance of the European Research Area (ERA) and a Recommendation for a Pact for Research and Innovation in Europe. The European Research Council (ERC) welcomed this positive step forward[1] . However, the Conclusions and the Recommendation are the latest in a long series of efforts to complete the ERA, an objective first declared in 2000 with subsequent relaunches in 2007, 2012 and a new roadmap agreed in 2015. What lessons can we learn from past attempts to achieve the ERA to ensure better results?
Topic:
Science and Technology, European Union, Research, and Innovation
Political Geography:
Europe

135. Blockchain Technology: An Innovative Policy Tool for Enhancing Conventional Arms Control and Verification

Author:
Nicolo Miotto
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
The Geneva Centre for Security Policy
Abstract:
Blockchain represents an unprecedented opportunity for enhancing conventional arms control (CAC) and verification. Based on the principles of transparency, verifiability, and predictability, this state-of-the-art technology could build confidence and facilitate the implementation of arms control mechanisms. Blockchain-based so-called “smart contracts” have advantageous practical implications for CAC. They could improve the verification of countries’ compliance with their CAC obligations by enhancing monitoring procedures and could strengthen arms export controls by improving treaty signatories’ ability to monitor weapons and ammunition supply chains. Reinforcing the Organization for Security and Cooperation in Europe (OSCE) framework for conventional ammunition control with a permissioned blockchain would provide greater confidentiality and improve monitoring and data verifiability, thus strengthening the OSCE’s CAC regimes.
Topic:
Security, Arms Control and Proliferation, Science and Technology, Innovation, and Blockchain
Political Geography:
Europe

136. The Technology of Terror: from Dynamite to the Metaverse

Author:
Christina Schori Liang
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
The Geneva Centre for Security Policy
Abstract:
Non-state actors have always been interested in obtaining and mastering innovative weapons. According to “lethal empowerment theory”, new technologies will be rapidly adopted and adapted by violent non-state actors when they are accessible, cheap, simple to use, transportable, concealable, and effective. Terrorists are interested in weapons that are useful in a wide range of contexts – “that magnify effects, are symbolically resonant and can be given to unexpected uses.” It is thus important to be vigilant in analysing how actors will leverage and innovate new technologies for malicious purposes, in order to confront the “unknown unknowns” and not repeat the mistakes based on a “failure of imagination”, as highlighted in the 9/11 Commission Report.
Topic:
Science and Technology, Terrorism, Governance, Social Media, and Innovation
Political Geography:
Global Focus

137. Our Digital Future: The Security Implications of Metaverses

Author:
Jean-Marc Rickli and Frederico Mantellassi
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
The Geneva Centre for Security Policy
Abstract:
Although the concept of a metaverse or metaverses is not new, current developments in the creation of possible metaverses offer credible prospects of generating increasingly immersive digital experiences that will also provide people with more information, connections and knowledge than ever before. However, metaverses are also likely to exacerbate existing risks surrounding the increased digitalisation of our lives and the role of social media companies in our societies, such as the spread of disinformation or increased societal polarisation. Similarly, technology companies’capacity to collect private data and profile users will also increase. Growing levels of immersivity will reinforce risks such as increased digital crime or extremist radicalisation, but will also create new ones that pertain to cognitive manipulations. This could lead to the transformation of social organisations and a questioning of the legitimacy of traditional institutions. Metaverses also offer new dimensions for power politics and geopolitical confrontations, and a platform for conducting cognitive warfare. Responsible innovations and security-by-design must be the guiding principles of efforts to develop metaverses.
Topic:
Science and Technology, Social Media, Innovation, and Digital Culture
Political Geography:
Global Focus

138. The COVID-19 Catalyst: Learning from Pandemic-Driven Innovations in Immigrant Integration Policy

Author:
Jasmijn Slootjes
Publication Date:
06-2022
Content Type:
Special Report
Institution:
Migration Policy Institute (MPI)
Abstract:
Despite talk of COVID-19 as a “great equalizer,” the pandemic and its economic fallout have hit certain segments of European and North American societies particularly hard. Among them are immigrants and refugees, and especially groups with distinct vulnerabilities, such as refugee children, irregular migrants, and migrant women. Without swift government intervention, the twin public-health and economic crises risk jeopardizing immigrant integration and creating durable rifts in diverse societies. Yet precisely at a time when bold and agile policy responses are needed, the pandemic has disrupted governments’ usual ways of working. When lockdown and social-distancing measures were introduced in 2020, many in-person integration services were suspended, and both these programs and the day-to-day work of governments and civil-society organizations shifted online. This opened new opportunities but also hindered the engagement of migrants, policymakers, and other stakeholders with limited digital access or literacy. This report examines how governments’ immigrant integration strategies, partnerships, and policy priorities have changed in the two years since the pandemic began. It explores how this period of forced adaption has worked as a catalyst for innovation at the local, national, and (in Europe) EU level, drawing on interviews with senior policymakers and other experts in North America and Europe. The report then distills recommendations on how to leverage these innovations to durably improve the governance of immigrant integration.
Topic:
Education, Employment, Innovation, COVID-19, and Immigration Policy
Political Geography:
Europe and North America

139. Donor Funding Models for Innovation: A Review

Author:
Conor M. Savoy
Publication Date:
06-2022
Content Type:
Special Report
Institution:
Center for Strategic and International Studies (CSIS)
Abstract:
Donors have rhetorically supported the importance of innovation in global development, but the level of resources committed has seldom matched the level of this rhetoric. There are clear barriers to expanding funding for the innovation ecosystem: (1) innovation remains under-resourced, and models that are providing clear results are not properly supported; (2) pathways to scale remain limited because of the total funding available; and (3) the risk appetite of donors remains too conservative to properly support and scale innovation. Recent impact evaluations suggest that innovations supported by the United States Agency for International Development’s (USAID) Development Innovation Ventures (DIV) and the Global Innovation Fund (GIF) have yielded impressive returns. But more importantly, innovation also leverages scarce funding resources and engages with locally based partners.
Topic:
Development, Natural Resources, Innovation, and Donors
Political Geography:
Global Focus

140. How Innovative Financing Models Can Support the Scaling of Supply Chain Innovations

Author:
Allie Dichiara and John Simon
Publication Date:
10-2022
Content Type:
Special Report
Institution:
Center for Strategic and International Studies (CSIS)
Abstract:
Substantial progress has been made toward achieving Sustainable Development Goal (SDG) 3: Health and Well-Being for All. However, progress is plateauing as global health development funding decelerates, and much of the remaining gaps are among the hardest to address, especially for the most vulnerable and hardest-to-reach communities. A key element to reigniting progress toward SDG 3 is significantly improving the effectiveness of the current fragmented health commodity supply chain, through which billions in spending—approximately $6 billion in donor funds in 2015 and $50 billion in overall spending in 2017—flow each year to low- and lower-middle-income countries (LMICs). Fortunately, there is a growing number of innovative supply chain solutions available across sub-Saharan Africa that could have the potential to dramatically improve the underperforming status quo.
Topic:
Economics, Science and Technology, Innovation, and Supply Chains
Political Geography:
Africa