Visitors acquainted with the history of the Brazilian city of Campinas will probably find it hard to imagine that it was once home to ancient wooden sugar mills and slave-run coffee plantations. Remnants of this colonial and monarchic past are difficult to spot in an urban area profoundly transformed by an industrial boom in the 1940s, and that today is a dynamic scientific and technological hub.

Considered one of Brazil’s “Silicon Valleys" (a title not every Campineiro is happy with as it underestimates the city’s uniqueness), Campinas houses Unicamp—Latin America’s best university, research and development (R&D) centres of multinational behemoths such as IBM and DuPont, and top-notch federal research institutions as the Bioethanol Science and Technology National Laboratory.

Campinas is one example—among many—of Brazil’s mature National Innovation System. Vale dos Sinos (engineering; in the extreme south), Campina Grande (IT; north-east) and Santa Rita do Sapucaí (microelectronics; south-east) are other regional successes that have contributed to the country’s technology development capabilities over decades. Recent changes of both institutional and legislative nature have further increased Brazil’s innovation power.

This year, the country advanced five places to reach the 64th position in the Global Innovation Index. Like in India, which impressively managed to jump from the 81st position to 57 in just three years, a mix of new laws, incentive programmes and private investments have boosted Brazil’s ability to convert ideas into solutions.

On the legislative front, Brazil enacted its “Legal Framework on Science, Technology & Innovation" in February 2016, followed by a regulatory decree two years later. The new law encourages ties between industry and public scientific institutions by allowing, for example, university researchers to work for a limited period in private R&D firms. Further, it facilitates the requirements companies need to fulfil in order to rent lab spaces in renowned institutes. One of the major changes introduced by the framework is the right of public institutions to buy minority stakes in start-ups, with the aim of encouraging technological spillover to the market.

New institutions devoted to promoting technological innovation have also been created in recent years. EMBRAPII, the Brazilian Company for Industrial Research and Innovation, was established in 2011 and has been acting as a “matchmaker" between the private sector and R&D institutions. Inspired by the German Fraunhofer model, it coordinates a network of more than 25 technological units scattered throughout Brazil and supports trilaterally-funded technological innovation projects. One of the most notable results of this scheme is “FlatFish", an underwater robot for inspecting offshore drilling infrastructure developed by CIMATEC institute in the state of Bahia in partnership with an European oil company.

Brazil is also witnessing the emergence of a vibrant indigenous start-up ecosystem. São Paulo is home to the largest community of young tech entrepreneurs in South America, according to the Global Startup Ecosystem Report 2017. Verticals such as finance and agriculture are particularly dynamic. One of the country’s unicorns is a digital bank that has no physical branches and offers clients a credit card and an account at no cost. Breakthrough solutions for harvest control, irrigation and smart farming based on Artificial Intelligence and the Internet of Things have been developed by companies run by graduates of traditional agronomy institutes.

Besides start-ups, technology parks are also mushrooming in the country. Porto Digital (Digital Harbour), located in north-eastern Recife, is a perfect example of a “triple helix" endeavour that involved government, academia and the private sector. With an initial investment of $18 million obtained from the privatization of a local discom, it today houses over 300 companies (creative economy, IT and smart cities) with a total yearly turnover of $500 million. The Itaipu Technological Park (PTI), located close to the triple border with Argentina and Paraguay, is another notable enterprise. In May, PTI signed an agreement with India’s Centre for Development of Advanced Computing to build a high-performance computer and attract R&D companies to its facilities. Based on the understanding that parks are an essential source of innovation, Brics countries (Brazil, Russia, India, China and South Africa) decided last July to form the “Networks of Science Parks, Technology Business Incubators and SMEs".

Despite recent achievements, Brazil still needs to overcome challenges to improve its innovation system. In addition to increasing the number of undergraduates, the country has to make sure a higher percentage of students opt for a STEM (science, technology, engineering and mathematics) career. Indigenous patenting also needs to be promoted, since only 20% of the applications to INPI, the Brazilian patent office, come from local companies and institutions. On a more general note, the private sector needs to be encouraged to innovate further, as around 60% of the country’s R&D is publicly funded.

As the world moves from a resource-based to a knowledge-based economy, innovation becomes the main development strategy for the years and decades to come. Brazil, like India, is taking concrete steps to further climb the innovation ladder.

Tovar Da silva Nunes and Pedro Ivo Ferraz Da silva are, respectively, ambassador of Brazil to India, and head of the energy, environment and science and technology section at the embassy of Brazil in New Delhi.

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