World Intellectual Property Day Highlights Risks To Innovation In Brazil

Private sector investment in innovation in Brazil won’t be unlocked if the government won’t do the same.

This year’s World Intellectual Property Day (26 April) celebrates sports to illustrate how intellectual property (IP), innovation and creativity support its enjoyment and development globally.

Given that Brazil reached the first 100 days of its new government this month, it is helpful to use the date and the metaphor to reflect on the measures in place so far to ensure the country’s success in the race for innovation leadership.

Similarly to sport, having commitment, investment and access to talent, as well as fairness in the rules of the game – IP being one of them – is essential in enabling innovators to thrive.

An article from last year featured the views of intellectual property and innovation lawyer Luiz Ricardo Marinello about why it is so difficult to innovate in Brazil.

Since then a new government came into power, with Marcos Pontes, an Air Force pilot and engineer and the first South American to into space, being appointed as Minister of Science, Technology Innovation and Communications.

So what has changed for innovation? According to Marinello, the first few months of the new administration ticked along slowly, but brought a handful of good news.

“The introduction of a testing center for desalination technologies in the Northeast can help address the drought issue in the region and a partnership with the Ministry of Education to boost attractiveness of science careers to students is also positive,” the lawyer says.

The technology agreement signed with Israel and the deal to allow satellite launches from Brazil’s Alcantara rocket complex with the United States this year could potentially lead to tangible results, Marinello says, but the impact of these partnerships is yet to be seen.

“Brazil has a huge unmet demand for science and technology-based innovation and we have seen very little progress made so far,” he adds.

More pragmatism is needed to foster innovation in Brazil, Marinello says, highlighting that is even more important given the government’s ambitions to increase the amount of international business.

“Brazil needs to grow and show preference for this or that country is not helpful. The country needs to agree on technology transfers with more advanced nations but on an equal footing rather than distributing disproportionate concessions,” the innovation expert points out.

“The Amazon can be a gateway to external resources, but that won’t be of any use if there is no respect towards traditional peoples and communities, as well as mechanisms in place to prevent further deforestation,” he adds.

“Can Alcantara serve as a foreign military base? Yes, it can, as long as we know how to negotiate technology transfers in a way that positively impacts the livelihoods of the local community.”

In order to allow the innovation ecosystem to thrive in Brazil, more commitment and investment in research and development is needed from the government. Marinello observes that, contrary to “less myopic” countries, Brazil has been investing no more than 1.3 percent of its GDP in science and technology for the last 15 years.

The situation is unlikely to change, the expert adds, with major cuts in public sector spending announced last month being indicative of the disregard of the current administration towards innovation.

The cuts will see Brazil’s Ministry of Science, Technology, Innovation and Communications having its funding slashed by almost half, down from the 5.1 billion reais (US$1.45 billion) forecast down to 2.9 billion reais.

This, according to Marinello, will have serious consequences for the agencies and institutes fostering innovation that rely on public funds. One of them, the Brazilian National Council for Scientific and Technological Development (CNPq), has said it only has funds to pay for scholarships until September.

“Lack of investment in science, technology and innovation doesn’t seem to be a problem caused by this or that political party. Those in power in Brazil clearly see those areas as an expense rather than investment,” the expert says.

“Clearly public resources are scarce and the administration should not compromise investment in areas such as health and public security. However, a country that invests in science, technology an innovation has a better educated and qualified workforce, as well as better opportunities,” he adds.

Private sector investment will only be unleashed if the government sends clear signals of its own belief in innovation, Marinello points out. “If public sector investment in that area is significantly reduced, companies will be prone to doing the same.”

Just as detrimental as lack of investment is the absence of clear public policies for investment in research and development, says Marinello. This could materialize in, for example, fiscal incentives, public procurement or incentives to the private sector to hire researchers.

“It seems that the government has been placing all its bets in the social security reform and the less-discussed anti-crime measures. Meanwhile, all other government projects await the outcomes from those two areas of focus,” the lawyer argues.

“A radical social security reform is needed in order to allocate resources to other government sectors, but that should run in parallel with other initiatives,” he adds.

“The country just can’t be indefinitely on hold.”