Last week I spent three days in Santiago, the capital of Chile. Santiago is a large, modern, cosmopolitan city of around 6 million people, which is roughly 40% of the population of the country. The key reason for my visit was to attend the World Computer Congress, which is organized by IFIP - the International Federation of Information Processing, an international umbrella organization for national societies in Information Technologies. I gave a keynote talk on Innovation in the 21st Century: Challenges and Opportunities, which focused on the historical context and changing nature of innovation, as well as some of the major changes taking place in technology, business and society.
One of the pleasures of visiting another country is that you get to meet with different people and learn something about the country. In Chile, I was able to spend time with people from universities, business and the press, as well as colleagues from IBM. The fact that we were able to talk in Spanish, my native language, made it that much easier to communicate and understand each other.
After my keynote, I had lunch with a number of faculty members from different universities in Chile, and joining us was a very special guest, Fernando Flores, who is a member of the Chilean Senate. Senator Flores is a truly remarkable individual, so let me say a few words about him.
In 1968, Flores graduated with a degree in civil engineering from the Pontifical Catholic University of Chile. Two years later, at the age of 27, he joined the government of Salvador Allende, where he held a number of positions, including Finance Minister. After Allende was deposed and died in 1973 in a violent military coup d'etat led by General Augusto Pinochet, Flores spent three years in jail as a political prisoner. He was eventually released through the efforts of Amnesty International. He then moved to the US, conducted research in Computer Sciences at Stanford University, received a PhD in Interdisciplinary Studies from UC Berkeley, and became a successful entrepreneur, consultant and writer. He later returned to Chile and was elected to the Senate in 2002. In addition to all that, he has an excellent blog where he frequently writes (in Spanish) on a variety of topics from innovation to politics.
Senator Flores attended my keynote presentation and then joined us for lunch, where we had a fascinating discussion. The themes were ones that came up throughout my visit to Chile: Can a relatively small country like Chile, with only 16 million people, compete successfully in the world's increasingly global economy? How can the Chilean economy move beyond its reliance on natural resources -- e.g., mining (especially copper), forestry, fishing, agriculture and wine -- and establish an innovation economy based on talent? What should the government do to foster the development of such an innovation economy?
These are very important questions not just for Chile but for many countries around the world. Most will agree with the recommendations of the US National Innovation Initiative and similar panels that to enable a successful climate of innovation requires serious attention to talent, investment and infrastructure. The crux of the debate, in Chile and other countries, revolves around the role of government in fostering innovation and competitiveness -- in particular, on the proper balance of efforts and investment between the public and private sectors.
In the US, for example, unquestionably a market economy, the 2005 National Academies study Rising Above the Gathering Storm urged the US government to act: "A comprehensive and coordinated federal effort is urgently needed to bolster U.S. competitiveness and pre-eminence in [science and technology] so that the nation will consistently gain from the opportunities offered by rapid globalization." In some countries the government has already taken a stronger role in encouraging innovation and economic competitiveness, such as in Korea where the government has built the world's most advanced broadband infrastructure.
I believe that as long as a small country has the proper talent, investments and infrastructure it can be a successful participant in the world's global economy. This is evident in Finland, Sweden, Ireland, Israel, Singapore, Taiwan and New Zealand, among others. To do so requires a well thought out strategy, since small countries can only become world-class players by selecting the niches where they will focus their efforts and investments, becoming part of the global networks of expertise in the chosen areas, and creating strong export markets.
Senator Flores believes that Chile is not quite in the position to be internationally competitive because it does not have such a focused development strategy and lacks the necessary entrepreneurial business experience. Due to its recent political past - first Allende's socialist programs and then Pinochet's military dictatorship - there is less cooperation between the public and private sectors than is required to successfully compete in global markets. Moreover, the Chilean business community has weak links between research and investment - that is, taking innovative ideas and quickly transforming them into new business ventures capable of competing in an integrated global economy.
Senator Flores is fighting hard to move his country along this path. Chile may not quite be there yet, but it definitely feels to be on the verge. It is a stable democracy, with relatively little poverty, corruption and crime. It has a market economy, and strongly supports free trade agreements. It has the resources to enable it to invest in the future. While hard work is needed and much can go wrong, it is hard to leave Chile without feeling hopeful for the future of the country.