The importance of R&D to help Australian businesses escape an economic slump
14 Dec 2020
Those who focus on Research and development (R&D) are best placed to launch out of a crisis In a report released today by Austrade and CSIRO’s Data61 Trade and Investment Megatrends is a strategic foresight study exploring changes in the global trade and investment landscape as the global economy recovered from the 2020 pandemic and recession.
The report also presents a set of strategic actions for Australian governments and industries to capitalise on significant shifts in the global trade and investment landscape. Companies that excel at R&D are using the crisis to a build a defendable competitive edge, build a global brand, and create new product lines and market opportunities.
R&D is one of the key engines of sustained economic growth Australia shouldn’t be complacent and be left behind in the race. R&D gives companies a defendable competitive edge, build a global brand, and create new product lines and market opportunities. Global R&D spending is worth $3.08 trillion per year.
Following the global financial crisis, global corporations ramped-up R&D investment. This helped them survive the crisis develop by developing new products and services. We’ve also seen advanced economies such as the United States, the United Kingdom, Singapore and New Zealand announce large R&D fiscal stimulus programs.
This points towards an opportunity for Australia to attract investment and supply R&D services to the world. The action would involve collaboration across universities, research organisations, industry, and government for a new, refreshed, and targeted R&D foreign direct investment program.
Australia is highly capable and a global leader in innovation. Australia comes in first for technological readiness and fifth for global entrepreneurship. Almost 50% of Australian firms rate as innovation active, and around 44% of Australia’s workforce has a tertiary qualification.
R&D is and productivity improvements is the way out of the crisis
Australia needs to use this moment to focus on productivity improvements and making the economy flexible and adaptable. To get results, Australia will need to collaborate across universities, research organisations, industry, and government to create new, refreshed, and targeted R&D foreign direct investment program.
Australia will need to look to expand into new markets and act quickly to jump on market trends as they happen. For example, automation could increase Australia's productivity and national income – adding up to $2.2 trillion to the economy by 2030.
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