The Caribbean has been at the forefront of the ongoing COP26 climate change negotiations taking place in Glasgow, Scotland.
We have seen representation at the highest levels and our leaders such as Barbados Prime Minister Mia Mottley, having a massive impact. The theme of climate financing has been a constant, alongside the acute climate-induced challenges faced by small islands like ours in the Caribbean. Even if some of the promised but elusive financing becomes available, key questions remain unanswered: Who will implement? Who are the essential partners? One key variable is the role of innovation, especially as it relates to the private sector which has been insufficiently emphasised. We in the Caribbean cannot undertake effective climate action and a green economy transition without partnering with an innovative private sector.
At this crucial time and now more than ever we need to nurture innovation in the Caribbean private sector for a green economy transition which will also create jobs and opportunity for our people. Innovation is vital since it also drives productivity and competitiveness, two areas where we need to do much better. Indeed, the ability to develop new products and services, develop and enter new markets and alter internal routines has always been at the core of entrepreneurial success.
Given the importance of innovation, how are we doing as a Caribbean? The World Intellectual Property Organisation’s Global Innovation Index (GII) ranks the innovation ecosystem performance of 132 economies and provides a useful perspective. The top 15 ranked countries are predominantly developed countries, except for Singapore and China. The only countries ranked from the Caribbean Community and the Dominican Republic also known as the CARIFORUM Caribbean are Jamaica, Dominican Republic and Trinidad and Tobago, which were ranked at 74, 93, and 97, respectively. Given that those that are on the list are in the bottom half of the 132 ranked countries, there is much room for improvement to help our private sector become more innovative. This in turn will help fast-track a green economy transition creating jobs and opportunity for our people.
A useful start will be to focus on a few high priorities starting with investment in research and development. We need to strive to improve the region’s innovation performance. The data is sparse, but it is evident our region underperforms compared to other parts of the world. During the period from 2008 to 2018, Latin America and the Caribbean’s combined expenditure on research and development as a percentage of GDP averaged 0.71 per cent, according to the World Bank. By comparison, developed countries invested 2.41 per cent of GDP in this important area. More specifically in terms of our region, Trinidad and Tobago, which is one of the largest economies, spends just 0.06 per cent of GDP on research and development, which though perhaps is one of the highest in the Region, is still inadequate for these times. Unless the entire Region makes a bigger commitment, we will continue to lag.
We also need to embrace technology where our micro, small and medium-sized enterprises are left behind to enable them to become greener and also take advantage of new opportunities. To address this, we must seize the opportunity to leverage the upswing of technologies and industries of the future such as artificial intelligence (AI), blockchain technology, digital platforms and cloud computing. These technologies and others have the potential to radically transform existing enterprises and create new ones including precision agriculture and generating new opportunities for the services sector in areas such as the business of music.
In fact, these kinds of technologies have cross-sectoral applicability and for this reason, they have the potential to reshape energy systems through the integration of distributed, low-carbon energy generation and new demand-side energy management services. At the same time, another key technological shift is taking place in more efficient energy systems, as countries all over the world contend with the necessity of low-carbon energy transition. The steady march of environmental, social and governance considerations as a strategic priority for enterprises is causing sustainability to be increasingly prioritised. This is expected to be further heightened in the post COP26 period.