I visited Brazil in December 2011 for the first time in three years. In 2007 I lived more than a year in Brazil, learned speak fluent portuguese (after living two years in Argentina learning spanish and making Latin American Business studies) and worked in Finpro Brazil. I visited University of Sao Paulo (USP) Instituto de estudos Avançados (IEA) to understand better the historical development of Brazilian innovation system and future prospects.  During the flight back to Finland I decided to write on recent developments in Brazil.

Brazil is the only emerging BRICS (Brazil, Russia, India, China, South Africa) country that have not been discussed widely in Finland from innovation perspective. This is understandable as Brazil is seen distant geographically, culturally and linguistically to Finns and Finland poses weak historical political and economic relationship with Brazil. Other reason is that Brazil has been performing relatively weak in innovation performance caused by lack of coherent innovation policies, and protective legislation have been creating challenges for foreign investment (Brazil ranked 129th out of 183 countries in the World Bank’s latest Doing Business report) and innovation cooperation. However, there are signals on emerging innovation culture in Brazil and context related systemic approach need to be taken to increase strategic cooperation between Finns and Brazilians. This blog focuses on Brazilian innovation system and policy from social, economic and environmental perspectives to understand educational, scientific, technological, business model and service innovations emerging from Brazil and its fellow Latin American countries, mainly Chile.

Brazil has many times in its history praised to be the land of the future. Let’s look first on some recent developments in Brazil why it might finally fullfil the promises. First, Brazil with population of 190 million, the past eight years “Bolsa Familia” social program have lifted over 40 million Brazilians out of poverty and into middle class. This creates interesting platform for creating context related innovations and scaling bottom-of-the-pyramid innovations (disruptive and reverse) globally. Second, Brazil was almost non-effected by financial crisis 2008, a signal for strong and stable macro-economic policies. This means that Brazil, first time in its history, is becoming an interesting country for long term investment and strategic cooperation. Third, Brazil is hosting Football World Cup in 2014 and Summer Olympics in 2016. This will increased investments on infrastructure development and pressure for Brazil to show its true nature internationally. Growth Acceleration Program (PAC) 2011 – 2014 invests US$526 Billion to sanitation, crime prevention, basic health clinics, savings and loan systems, electricity and water for all, logistics, and energy. Fourth, deep sea oil field discovered 2007 will double or in most optimistic estimates tenfold Brazil’s current 16 billon barrel oil resources. Combined with bioenergy and wind energy production and hydroelectric resources Brazil is becoming a global energy power and profits from these resources create funds for future investments and development. End of 2011 U.S. finally opened its markets to Brazilian ethanol which will boost the sales in the future. Fifth Brazilian climate change law requires reduction of greenhouse emissions by year 2020: 36 – 39% below 2005 levels and 80% reduction in deforestation puts Brazil in forefront on fighting against climate change. And last strong primary economy from iron ore to soy beans will continue to boost national financial resources driven by explosive demand growth in China and India. In 2005 there were only 3 companies (Petrobrás, Banco Bradesco and Banco Do Brasil) in Fortune Global 500 list as in 2011 there were total 7 companies (4 new companies Vale, JBS, Itaúsa-Investimentos Itaú and Ultrapar Holdings). Other primary economy companies are Aracruz, Votorantim and Gerdau. Emerging higher technology Brazilian companies are aeronautic company Embraer, automobile part producer Marcopolo, cosmetics company Natura and Information technology provider Totvs.

To change course from primary economy to knowledge based economy Brazil have implemented several science, technology and innovation (STI) policies. Brazilian innovation, technology and international trade policy including Innovation Law was launched in 2004 and it followed Good Law 2005, PAC da Ciência 2007 and Productive Development Policy 2008. Innovation Law is designed to university-industry research relationship, promote shared use of R&D infrastructure, allow direct government grants for innovation in firms and increase mobility of researchers within the system. Good Law provides fiscal incentives for private R&D investment and funding for firms hiring Masters degrees and PhDs. The subsidy can reach 60% of the salary in remote underdeveloped are such as North East and Amazonia and 40% in rest of the country up to 3 years. PAC da Ciência growth action plan for science and technology funding has increased R&D funding from 1.0% of GDP in 2006 to 1.13% of GDP in 2009. This percentage and growth can be considered remarkable as 30 years ago there was almost no infrastructure for scientific research.

Corruption referred as “mensalão” is the only single threat slowing down the Brazilian development and cause of high inequality! In end of 2011 Brazil passed UK becoming 6th largest economy globally. Continuing these developments, Brazil is expected to become the world’s fourth largest economy by 2030, behind China, US, and India. All this have not been and not will be possible without improvements in innovation performance. Future blog posts weekly will focus on different aspects of innovation in Latin America. Even “innovation” is considered many times confused term refering to political, economic, social and environmental development, I will carefully follow state-of-the-art academic and intellectual stream on using this term and provide insight on using this term in development rethorics.

I hope the Finnish approach to Brazil will change and take strategic stance when Finnish education-research-business delegation lead by Minister for European Affairs and Foreign Trade of Finland Alexander Stubb and Prime Minister of Finland Jyrki Katainen will visit Brazil in second week of February!

Please comment and add your insight on recent develpments in Brazil!

After 12 hour bus trip from Kampala to Nairobi I arrived to Nairobi at 5am in the morning. It was my first contact to the country side and real African people. I had change to talk with side road people when bus stopped and also had change to have talks with local people in the bus. People seem to have positive feeling about their future, especially Kenyans. Nairobi’s morning reminded me of chilly Finnish summer mornings while I headed to my hotel to get ready to meet Jussi Impiö from Nokia Research Center. Jussi gave me valuable designer and anthropological perspective on mobile services and people’s everyday life. Finally he answered best way to my question I have been looking answer: Why mobile innovations are now coming from developing countries? “In developed countries we need to innovate on problems (needs), here we don’t have to do that!”

Next day I went to visit Jessica Colaco in iHub. We met with Jessica last month in Mobile Africa event I was organizing in Helsinki and now was my turn to finally see what is this place called iHub that everyone is talking about. IHub really is a nice place situated in fifth floor of new building with lot of sun light and with great view over the city, and moreover armed with fastest connection in the region. However, most importantly it was nice to see a group of enthusiastic young people wondering around and talking about new ideas while master mind Whiteafrican A.K.A Erik Hersman was sitting with his laptop in the middle of the space like father bear keeping watch on younger generation romping around. Here comes the capacity to solve the problems Jussi was indicating! Kenya matters! We initialy talked with Jessica to start cooperation on mobile learning. See the demo on learning dictionary Ledi we developed last spring in Aalto Service Camp with students from design, technology and business backgrounds.

Even most of the iHub member seem to be university students, my biggest worry is that iHub is located far away from universities making day to day informal encounter less likely to happen with non-core people. The same applies to big companies. Even companies such as Nokia, Google and Microsoft have been actively participating to iHub activities actual corporate offices lay far away. Last I was surprised that there were no small companies or start-up representatives hanging around or located to same building. Well, this will change soon in the future if culture and activities keep developing with same speed as lately.

Mobile communicate!

November 16, 2010

M4D conference ended on Thursday with great discussions on e-governance and corruption. Johan Hellström published an interesting study on corruption and democrazy and singing Swede Torbörn Fredriksson presented conclusions from UNCTAD Information Economy Report on ICTs, enterprises and poverty alleviation. I had inspiring discussions with Johan during the conference week, and we will continue our journey on making M4D world known concept among young mobile developers, researchers and NGO workers as well as private sector and public sector oriented young minds. Johan’s other report on the innovative use of mobile applications in Eastern Africa is also great reading!

Johan Hellström

Other interesting discussion I had was with Jonathan Donner in conference dinner table. He gave me valuable feedback on my research and strenghenth my passion on hermeneutics as philosophy of science. To say, we cannot understand what “football” means if we don’t know who playes it, where and what time. Concept of football is very different in U.S., U.K and Australia even these countries share same cultural history. For Ken Banks managing football teams meant open innovation model on breakfast table 🙂

Panel discussion on M4D conference

Donner challenged me on discussion on individualism and identities. Were we Finns first to adopt mobile phones as they supportted the individualist behaviour? With mobile devices in our hands we become master of our lifes anytime and anywhere, or notime and nowhere. Finns living in post-industrialized society were already used to individualism when mobile phones arrived. What about rural communities in Africa where collectivist mindset is still favoured?

Quatro SIM

Collectivism may have many social implications. Many argue that dual SIM popularity is based on behavioural economic decision making caused by expensive cross operator calls. Donner argued that we also need to consider social aspect of multible SIMs. People might want to have multible indentities, like we carry personal phone and work phone in Finland, or have Facebook profiles and Linkedin profiles. Later, Jonathan send me mail on reading list on philosophy of mobile studies. I already had honnor to meet Kristo Nyiri in Hungary while I was working there for Nokia and have his books in my bookshelf and Donner adviced me to continue my readings on James Katz.

Reverse Brain Drain

November 9, 2010

The morning started with great discussion during the breakfast and continued while refressing rain hindered us to go for a walk. Mike and Nason gave interesting insight for programmer and technology perspectives as master mind Ken Banks clarified how donor funded start-ups can grow unsustainable. However, the most fun we had when using football metaphor to clarify the mobile ecosystem. ”Arsenal is the open source model for Premier League” concluded Mr. Banks. These guys have beautiful minds and have contributed and will sure continue to contribute on global development.

However, the fundamental change comes from somewhere else. I had an honor to meet Ali Jjunju who is the CEO of Buddusoft which he runs with my research collegue in Aalto University. Both Ugandan in origen, they are developing mobile services for Eastern Africa.

So, what makes Ali so special? Lets take a deeper look. Ali has spend 14 years studying and working in Finland and Denmark. Now he is bridging the knowledge rich and technology saturated Finland to resource scarce and demand saturated Eastern Africa. To better understand importance of Ali’s work, we need to look on history. Finland industrialized while paying their war dept to Russians. South Korea turned brain drain to US in 50s and 60s to reverse brain drain in 70s. Finland worked hard to build their society, but South Korean case is the most interesting. In early 1960s most of the South Korean PhDs resided in USA, while only few remained in South Korea. Progressive policies promoted by higher level politics from late 1960s, started to bring brain power back home. It was not an accident that company like Samsung discovered new industries as consumer electronics in late 60s. In addition, Chile created a base for relalitively sustainable economic growth with the help of ”Chicago boys in 70s”.

Ali has a strong drive on contributing on global well-being while building his own capacity on telecommunication industry. He has never got any funding. He moves like a feather and stings like a bee. Be aware World Bank when you call these people as the most laziest in Eastern Africa.

computer labs
Makerere University computer labs

Three letters describe this World Bank ivory tower report –> WTF! It is not going to hurt so much to come down here to see what is happening. Lets give Ugandans freedom to build their own society with their own resources.

Happy Science Uganda

November 8, 2010

Two days ago I arrived first time to Africa to present my first research paper in mobiles for development (M4D) conference. Caused by blackouts and connection problems yesterday, I am writing only today for my first days in Uganda. Sea cable is reaching Uganda soon hopefully. So, after breakfast and gym I headed for a walk. First thing that put me wondering was the add below:

Happy Science Uganda
Happy Science Uganda

How can we contribute on happiness with science and technologies is my question here. When we are talking about mobiles for development (M4D) we need to consider the ”D” very carefully. In development and happiness I would refer to two prominent young master minds. Simo Vassinen with his collegue argues that happiness is a process in TEDx Amazonia presentation and Clint Rogers wonders asks who defines the development, we or them. These are relevant question in my journey to mobiles in developing regions and use of mobiles in socially excluded ”customer” segments. Development is freedom of mind and freedom to build your life.

Little side walk here. I was talking in earlier post on busines view on ICT4D and M4D. One wonderer last night gave me some relevance for my arguments. Mr. Brennan is building low cost houses to low-income segments in Eastern Africa. He has been doing that for 8 years and said that first two years he lived in low cost hotels before he got his business running. He argued that as government does not understand how to build low cost houses, he will make good living with this in future when he can scale his business with very low margins. He said that stereptype NGO can only works for 3 years for one goal and wasting most of the resources on expensive hotels, have fun social networking and report writing. I don’t know if this is true, but he might have point. Just to remind that I am first time in Africa and stay in 5 star hotel. He has done “business” here 8 years and he is staying in his friends house. Still, in the bar he acted like a world class businessmen. Is this social entrepreneurship? If you only want to make the world better place you will fail in long run, but if you want to make a fortune and just have good heart, the world will change. The socially oriented business model conceptualization will follow.

Next I picked up Heli, who works for Nokia, from her hotel to see how mobile looks in Uganda. We ended up talking with operator store keepers. Arguments followed that Tecno, Spice are Chinese and Indian new commers to Africa, and Samsung and Blackberry are known mainly in corporate life. Nokia was unanimously named as the number one brand in all segments, exept very high end phones. Chinese Tecno was critisized on bad usability and interoperability as Indian Spice copies Samsung with same defiencies as Tecno. Only real value of these two new commers was the standard dual SIM specification. High taxing was named as main reason for lack of affortability.However, PCs sold to educational sector get tax benefits accordingly. 82% of Ugandans does not have access financial services so M-Pesa and other mobile banking services have huge potential here. I will report more on this next week when I will visit Kenia, the land of mobile banking.
Aasian mobile invation
Store selling Asian brands Tecno and Spice, and of course M-Pesa

The sun started to shine so we headed to discuss our findings to hotel pool. Next I read what local media had to say about Uganda. Elections are coming and everyone are affraid of violence, similar what happened in Kenia 2007. World Bank names Ugandans as the laziest people in Eastern Africa. Could some wise man help me to understand objective of this research? Accordingly, Ugandans ignored this classification. Is it because they consider this study so irrelevant or that Ugandans agree to be lazy? Reference was made to demonstration that started when homosexuality was criminalized with penalty of dead sentence. Young people are future of the nations and productivity seem to be issue here. Young should learn to work already when they are in school: ”It is not advisable to get a car or cell phone for a school going teen because that is not best way to teach responsability”. This argument is quite contrary on telecommunication and M4D studies that find many times correlation between mobile use and economic development. Maybe we should ask how mobile use increases when economy grows and stop taking mobiles for granded.
Serena pool
Sunday relaxing in Serena hotel pool

When I walk back home and give short visit to shopping I realize that security is a big issue here. Al Shabeeb from Somalia can be blamed for this. According the taxi driver who took me to hotel on Sunday, the security has been the only thing that current goverment has done well. He was a huge Liverpool fan but was complaining on the government for lack of support for sports.
Security check
Entrance to shopping

%d bloggers like this: