Published 23 June 2015

The interplay between innovation and trade promotion

– Switzerland at home and in the field

Switzerland has no specific strategy combining the coordination of trade and innovation promotion; instead there is a trading strategy and an international strategy for education, research and innovation. The same ministry, but various secretariats, is responsible for the strategies.

There is no clear linkage between trade and innovation in the trade strategy. The trade strategy is focused on free trade agreements and access to foreign markets, rather than on actively assisting companies to conclude business deals. In the internationalization strategy, which deals with the promotion of innovation, focus is on facilitating the mobility of students and researchers, facilitating science and educational institutions, creating networks, and spreading a good image of Swiss education and innovation. Switzerland is largely decentralized, with a general idea that the companies and scientists can fill their own needs the best if a good framework is at place.

The policy framework that Switzerland works by is affecting both the support organizations and operations. Switzerland’s strong decentralization and tradition of limited government interference makes the promotion largely driven by business needs while the government’s task is to ensure that the framework is workable and reducing trade barriers. The responsibility for the strategies lies on the Department of Economic Affairs, Education and Research and its Secretariat for Economic Affairs (SECO) and the Secretariat for Education, Research and Innovation (SERI), but despite this, there is no common strategy of innovation and trade promotion.

At the organizational level, interviews with Swiss representatives say that the coordination between areas is done quite informally, which is eased by Switzerland’s relatively small departments, and that many functions are physically close to each other. An interministerial working group serves as a platform for discussion on how to achieve the goals in the innovation strategy. The Department of Economic Affairs, Education and Research is responsible for the policies which could be included in an interacting innovation and trade promotion strategy, but seems to not really be able to take advantage of the organizational structure to create and implement a more holistic approach to promotion.

Switzerland organizes the implementation of the promotion in a number of ways. For trade, SECO use Switzerland Global Enterprise (S-GE), a not-for-profit organization with a similar function as Business Sweden in foreign markets. S-GE has about 80 people in its international organization called Swiss Business Hub (SBH) which is responsible to implement the trade and export promotion abroad. The organization is working to help companies identify sales opportunities through a variety of consulting services and the primary target group is small and medium-sized enterprises. In 2015, they put a special focus on food, ICT and Life Science, but will work with any industry asking for their services. S-GE is also working to attract foreign investments to Switzerland.

For research and innovation promotion the international strategy for education, research and innovation forms the base. The Secretariat for Education, Research and Innovation (SERI) is responsible for the implementation and organizes it through 18 Science and Technology Offices (STO) and the six Swissnex around the world. STO is operated in close cooperation with the Swiss embassies. The offices will analyze policies in science, higher education and innovation, as well as to stimulate cooperation between Switzerland and the countries in these areas.

Swissnex offices are placed in what Switzerland has identified as the world’s most innovative areas: Boston, San Francisco, Singapore, Shanghai, Bengaluru and Rio de Janeiro. Swissnex promotes collaboration and exchange of science, higher education, art, innovation and support R&D-based startups. The offices include access to networks but also office space and different types of analyses. Swissnex is considered by many other European countries as a “success model” for operational support work at the intersection of trade, higher education, research and innovation. Although Swissnex is a government initiative, partners and donors contribute a large part of the funding.

Swissnex and S-GE are governed by the same department, which does not seem to significantly influence their coordination at home. The two organizations often share locations and there is an ongoing dialogue and coordination at the operational level. Many of Swissnex’ services are free of cost, however companies that have entered into a commercial process are referred to SBH, where services come with a fee. Swissnex and Swiss Business Hub can help businesses move from innovation to trade.

A number of interesting efforts from the various countries can be highlighted. Swissnex in India offers Swiss innovators, entrepreneurs and small-and medium-sized enterprises (SME’s) three services. “On-boarding and initial handholding” providing access to infra-structure in India Swissnex, market intelligence, logistics, easier market research, help with housing and recruitment. “Start-up Advisory” helps to understand the market out of a startup perspective, developing the business model and a sharper communication message to investors and “Access to information and network” which supports entrepreneurs to establish a network of contacts including business partners, mentors and accelerators.

Investment promoters on SBH in Japan constitute a link between Japanese stakeholders and the 26 cantons, by being a “one-stop shop” to reduce complexity for Japanese investors. The cantons, which can meet the requirements of the Japanese investors, are identified and may then present their offers.

Switzerland cooperate locally in South Korea, through STO, with Germany and Austria to gain critical mass in promotion and to increase visibility in South Korea in order to highlight the nations as Europe’s most prominent countries in engineering and science.

Sino Swiss Science and Technology Cooperation (SSSTC) is an agreement on research between the Secretariat for education, research and innovation on the Swiss side, and the Ministry of science and technology (MoST) on the Chinese side. Between the years 2008–2012, 36 joint research projects have been set up within the areas of renewable energy, nanotechnology, life sciences, sustainable urban development and medicine.

Switzerland abroad

Switzerland is seen as an innovative country in Japan, and it is primarily within the research on drugs, chemistry and precision engineering that the countries do business. The business promotion in Japan is dominated by Swiss Business Hub, including export to Japan and for investments to Switzerland. The organization is a “one-stop-shop” for Japanese investors vis-à-vis the 26 cantons. Cooperation with STO occurs when to promote collaborative research. Co-location of the two organizations at the Embassy facilitates collaboration, but the ambassador does not play a major role in the promotion of innovation and trade.

The Swiss Embassy in South Korea houses the Science and Technology Office Korea, established in 2012 after a bilateral agreement in the field of research and technology, and the Swiss Business Hub Korea established in 2010. STO has, in line with the wishes from SERI, put more emphasis on innovation issues, which means a focus on applied research, rather than basic research in South Korea. STO and SBH have overlapping agendas and networks both in Switzerland and in South Korea, the offices work together when it comes to matchmaking between the countries. Both STO Korea and SBH Korea experience having a very high level of autonomy to choose focus areas, and most projects are initiated directly by the offices.

Switzerland benefits from its free trade agreement with China. The agreement has been made possible thanks to the fact that Switzerland is outside of the European Union, and it is towards EU countries Switzerland has its competitive advantage. Switzerland’s passive promotion strategy can be problematic when the country faces such a strategic counterpart as China. The promotion of research, education and innovation is done through the Science and Technology Office at the Embassy in Beijing as well as by Swissnex in Shanghai. The organizations work closely together and the office in Beijing sometimes act as Swissnex. STO at the Embassy also supports Swiss universities to get high quality on students going to Switzerland.

Swissnex is established in India’s most important innovation hub Bengaluru where it has built up a strong network of key individuals within their areas of responsibility. Swissnex has been able to establish strong contacts with several Indian universities and create cooperation agreements with Swiss universities, such as the University of Zurich, and to develop relationships with key organizations in India, such as incubators. Swissnex has also connected Swiss startup companies in India with established Swiss companies in India. Switzerland also has business promotion by Swiss Business Hub at the consulate general in Mumbai, with employees at the Embassy and at the consulate general in Bengaluru.

In the United States, the Swiss promotion is made up by three elements – the Science and Technology Office, Swissnex and Swiss Business Hub United States. STO is responsible for political coverage on research and innovation, high-level contacts at Government level as well as to promote Switzerland as a prominent research nation and cooperation partner. Swissnex offers office space for innovators, researchers, entrepreneurs and mentors for Swiss start-up technology/innovation companies. If the company is not in the target group of Swissnex it is handed over to Swiss Business Hub, which also assists small and medium-sized enterprises with various services. The division between the two is not entirely clear.

Title
The interplay between innovation and trade promotion – Switzerland at home and in the field

Serial number
Direct response 2015:12

Reference number
2015/033

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