2.8 R&D is the foundation upon
which we will build Singapore’s competitiveness.
Just as investment in education builds up our human
capital, so will investment in R&D build up
our intellectual and knowledge capital base. The
Research, Innovation and Enterprise Council (or
RIEC) which I chair will spearhead this critical
national effort. It will be supported by the National
Research Foundation (or NRF) led by Dr Tony Tan.
The RIEC will review our overall R&D framework
and our R&D plans for three key sectors - the
Biomedical Sciences sector, the Interactive and
Digital Media sector, and the Environmental and
Water Technologies sector.
2.9 R&D requires long-term commitment. To
develop new capabilities, we must support projects
on a sustained basis, buffering them from the
vagaries of year to year budgetary pressures,
and judging results over several years. I will
establish an R&D Trust Fund, to be administered
by the NRF, and will regularly allocate a portion
of our budget for this Trust Fund. I aim to inject
$5 billion into the Fund over five years and will
start with an initial injection of $500 million
this year. As worthwhile projects emerge, many
of which will be multi-year commitments, we can
tap on this fund to support them.
2.10 The R&D Trust Fund, together with MTI’s
Science & Technology Plan 2010 and MOE’s
academic research plans, will help raise Singapore’s
gross expenditure on R&D from 2.3% of GDP
in 2004 to 3% by 2010. This will put us on par
with the European Union economies and close the
gap with world leaders in R&D like the Nordic
countries and the US.
2.11 Increased R&D investment will generate
more intellectual capital which can be exploited
and commercialised. We have already begun to do
this. For example, Rolls-Royce and a Singaporean
consortium jointly invested US$100 million in
developing a commercially viable power system
based on fuel cells. The Singaporean companies
were able to supply cutting-edge technologies
that met the high expectations of Rolls-Royce.
Thus Nutek, a local SME that manufactures automated
manufacturing systems, used its in-house engineering
expertise to improve the production process for
fuel cells.
2.12 A safe and reliable environment for the
protection of Intellectual Property Rights (IPR)
is a critical factor in persuading international
companies to base their R&D activities here.
Because of our reputation as a trusted partner
for businesses, companies and other institutions
are creating and hosting their intellectual property
in Singapore, assured that their IP will be protected.
Global Brands is the exclusive licensing agent
for FIFA worldwide and Warner Brothers Consumer
Products in Southeast Asia. Last year Global Brands
announced the establishment of its global HQ here
to manage their IP representation portfolio. BASF,
one of the top two chemical companies in the world,
is setting up its first R&D laboratory in
the Asia Pacific here, to conduct fundamental
research in nanotechnology. We must continue to
provide a safe IPR environment for such companies.
2.13 We must also take a broader approach to
recognising ownership of IP. Multinational corporations
based in Singapore often have substantial economic
rights in the form of regional control over their
IP, although the legal title is held by the foreign
parent. We will recognise and incentivise such
economic ownership of IP, which is at least as
important as legal ownership of IP. I will extend
writing down allowances for IP acquisition to
these economic (not just legal) owners of IP,
on an approval basis. To encourage R&D collaborations,
I will also accelerate the write down period for
qualifying capital expenditure under cost-sharing
arrangements from five years to one year.
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