Professional paper
https://doi.org/10.21857/yk3jwhkeo9
Innovation as Foundation for the Competitiveness of the Croatian Food Industry
Dragan Kovačević
; Prehrambeno-tehnološki fakultet Sveučilišta J. J. Strossmayera u Osijeku, Osijek, Hrvatska
Abstract
When looking at success in innovation (Summary Innovation Index (SII)), which is based on 25 indicators, including human resources, successfulness of the research system, investments by private and public sectors in research and development (R&D), intellectual property (brands, patents, industrial design), and economic effects (exports, employment) – Croatia was at the bottom of the EU list in 2015, i.e. the results of success in innovation were at half of the EU-28 average and 2 or 3 times lower than the results accomplished by the leaders in innovation: Sweden, Finland, Denmark, Germany, and the Netherlands. In contrast to the trend of an increased percentage share of R&D in GDP of the EU and the EU innovation policies declared in the Lisbon Strategy (2000), the conclusions of the Barcelona European Council (2002), and Horizon 2020, aimed at resolving the problems caused by the so called “European Paradox” and insufficient investment, especially by the private sector, in R&D and in strengthening the interaction between science and the economy, according to the example set by economic leaders Japan and the USA – there were several years of continuous decrease in R&D investments, which resulted in Croatia’s position at only 1/3 of the EU average, with 0.76% of GDP dedicated to R&D. The mentioned low levels and years of reductions in R&D investments, low interaction between R&D, insufficient connectivity with primary production, low levels of foreign investments, low absorption capacity, the demand for innovation due to insufficient investments in technology, and the reduction in the share of HT and MHT industries – are the most serious problems of the Croatian processing industry, including the food processing industry as its largest part (according to its GVA). The food industry demonstrated its resistance to recession in 2015; at the yearly level, it had a growth rate of 4%, increase in productivity of 5 – 6% and in exports of 19%, and it made significant regional acquisitions, mostly by using the advantages like tradition in food and beverage production, brand recognition on the regional market, and good raw material base. On the other hand, productivity is still at 70% of the EU average and it is mostly the consequence of passive restructuring, and to a lesser extent, the result of innovation activities, which, in more than 80% of the cases, include acquisitions of facilities, equipment, and software. Croatia needs re-industrialisation and the development of food industry based on new technologies and innovations, and on the production oriented at larger markets and exports, but also at tourism demand and at better utilisation of raw material potentials (agricultural production). In order to increase the competitiveness of the Croatian food industry, based on technological, organisational, and marketing innovations, by using the existing comparative advantages (tradition, agricultural production, tourism demand), the state must play a key role by significantly increasing investments in R&D, introducing tax breaks and direct measures to incentivise developmental research and R&D interaction, ensuring more efficient R&D coordination in institutions and industry, and the diffusion of innovation (e.g. by forming a state run Innovation Administration), incentivising investments and improving the investment environment, and in cooperation with the industry – introducing changes in the education system to increase the absorption capacity for innovation.
Keywords
food industry; competitiveness; research and development; innovation
Hrčak ID:
216402
URI
Publication date:
28.9.2017.
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