Core Arguments and Facts of the 2017 Benchmark Report: Innovation

10 Mar 2017


  • Edmund Tang
  • Benchmark Report

INNOVATION is one of the six major reasons for investing in Australia underlined in Austrade’s 2017 Benchmark Report (BMR) (in previous posts I covered Growth, Industry, Talent, Location and Business). The BMR also highlights our world-class scientific and academic institutions and our strong commitment to research and development (R&D).

Australia recognises the contribution of innovation and science to the nation’s growth, economic prosperity and ability to create jobs. Public and private sector organisations in Australia are major sources of funding for R&D. The Australian Government also provides generous R&D tax incentives.

Australian researchers are driving or collaborating on cutting edge research and their findings are regularly cited in many of the world’s leading publications[1].

Global organisations have numerous opportunities to collaborate with Australian research institutions, invest in or incorporate Australian solutions into existing products, or enter into joint ventures to take them to the global market.

Below is one of the BMR charts[2] to show how Australia compares with leading OECD economies:

How Australia compares with leading OECD countries: Key innovation indicators

  • Australia’s annual gross expenditure on R&D (GERD) rose by 9 per cent per annum between 2000–01 and 2013–14 to exceed A$33 billion. Business expenditure on R&D accounts for 56 per cent of Australia’s total R&D expenditure, expanding from A$5 billion in 2000–01 to about A$19 billion in 2013-14. This represents a compound annual growth rate of 11 per cent since 2001, well above Australia’s nominal GDP growth rate of 6.4 per cent. Total GERD represents 2.11 per cent of Australia’s nominal GDP, up from 1.48 per cent in 2000[3].
  • Higher education expenditure on R&D also expanded by three and half fold to A$10.1 billion between 2000 and 2014 (latest data available) and was ranked the 10th highest among 37 OECD economies[4].
  • Almost 43 per cent of our population aged 25 to 64 attained a tertiary education qualification in 2015. That ratio was up from 27.5 per cent in 2000, and represented the seventh highest among 35 OECD economies[5].
  • Australia also has a higher percentage of employed persons in knowledge-intensive services than the USA, Canada, Germany, France, Japan and South Korea (see table above).

Australian researchers are driving or collaborating on cutting-edge research and regularly publish their findings in many of the world’s most cited publications.

  • With strong R&D expenditure as a percentage of GDP in Purchasing Power Parity terms and a high proportion of researchers, Australia’s GERD places it among the leading innovative countries in the world, including France, Germany, the US, the UK, Canada and Netherlands (see chart 1 below).
  • Australia’s share of world research publications rose to 3.85 per cent in 2015 from 2.45 per cent in 1995. And we now rank in the top nine among 37 OECD and other countries[6].
  • In particular, our share of the world’s top one per cent of highly cited publications attributed to international collaboration in all disciplines surged to 5.68 per cent in 2015 from 1.02 per cent in 1995. Australia was rated the seventh highest among 37 OECD and other economies[7].
  • Across 22 scientific research fields, almost 80 per cent of Australia’s major scientific research publications have a relative impact of at least 20 per cent above the global average, according to the latest data from InCitesTM, Thomson Reuters (see chart 2 below)[8]. Among Australia’s strongest categories of published research are computer science, multidisciplinary, physics, environment/ecology, space science, clinical medicine, engineering, materials science, geosciences, plant & animal science and molecular biology & genetics[9].

World of research and development

Relative impacts of Australian scientific publications by research field 2011-15

While the BMR emphasises that Australia already demonstrates a range of strong innovation credentials, Innovation and Science Australia (ISA) on 27 February 2017 released its review of Australia’s innovation, science and research system. The Review looks at what Australia is doing well and what needs to improve for us to become a top tier innovation nation. It finds we are good at knowledge creation but that we need to do more to transfer and apply knowledge. ISA will use the review as a base-line to develop a big-picture vision for Australian innovation out to 2030.

Since December 2015 the Government launched the A$1.1 billion National Innovation and Science Agenda (NISA) to capitalise on the nation’s strengths and turn Australia into an innovation leader, major initiatives have been underway to boost investment and generate jobs.

More information is available on the NISA website.

[1]  BMR 2017, page 61
[2]  Ibid, page 57
[3]  Australian Innovation System Report (AISR) Tables February 2017, Table A7 (updated 28 February 2017)
[4]  Ibid, Table A7
[5]  Ibid, Table A6
[6]  Ibid, Table A9
[7]  Ibid, Table A9
[8]  The impact of Australia’s research publications is measured by the number of research fields in which Australia has a higher citation rate than the world average in the given field.
[9]  BMR 2017, page 61