Top GCC companies step up R&D spending globally 

(MENAFN - Times of Oman) The only companies that have survived the onslaught of the recession are the ones that have reinvented themselves. Innovation has become the name of the game. Corporates worldwide are thinking out-of-the-box to ready themselves for the upturn.

A study shows that amid the global downturn, the world's 1,000 largest publicly-traded corporate research and development spenders increased their spending on research and development (R&D) in 2008, affirming the importance of innovation to their corporate strategies.

R&D outlays for these companies have risen by 5.7 per cent to $532 billion, even as sales were up only 6.5 per cent, says global consulting firm Booz & Company in its fifth annual analysis of global innovation spending, released recently. Like the rest of the world, the Middle East region, is also boosting R&D activities for commercial results. In the Middle East, "Gulf Cooperation Council countries are moving ahead with plans to spur innovation through R&D," says Hatem Samman, director (Ideation Centre), Booz & Company, Middle East.

"In Oman, the Knowledge Oasis Muscat (KOM) intends to become home for international and domestic institutions to encourage creativity and innovation in a number of technology areas," he says.

Many units

Since its inception in 2003, KOM already houses units of firms such as Oracle, NCR Corporation, Microsoft, Motorola, Oman Air, Qatar Airways, NCR and Huawei Technologies.

KOM is trying to establish itself as a one-stop destination and an enabler for information, communication and technology (ICT) companies as part of the government's Oman 2020 initiative, which is focusing more on technology and knowledge-based industries instead of oil and gas.

Recently Riyam Computer Services LLC, part of the Omar Zawawi Establishment Group (OMZEST), signed a lease agreement to develop an ICT hub inside KOM. With an investment of RO10 million the construction is expected to start next year.

In Saudi Arabia, the Dhahran Techno-Valley (DTV) drives the kingdom's dream of an Arabian Silicon Valley. International companies that are renowned for innovation like Schlumberger, Baker Hughes, Honeywell, Yokogawa were invited to set up shop in DTV and collaborate with King Fahad University of Petroleum and Minerals (KFUPM) and national companies like Saudi ARAMCO, Naizek on a host of research objectives.

In Riyadh, King Abdul Aziz City for Science and Technology (KACST) is aiming to become a world-class science and technology organisation that fosters innovation by promoting R&D in higher education and linking it to the Saudi market. The report says additional billions in financial support, unabated by the global recession, are budgeted for R&D across the kingdom.

Saudi plans

In September 2009, King Abdullah University of Science and Technology (KAUST) opened its doors to students and faculty from around the world to promote research and development. Backed by a $10 billion endowment fund and partnership with internationally renowned research universities, KAUST is expected to partake in the fulfillment of the region's innovation aspirations.

"Over the past few years, several initiatives have been taken by the GCC leadership to strengthen research and development and to better link it with the private sector," says Samman. Innovation is viewed as increasingly vital to corporate strategy. More than 90 per cent of those surveyed say that innovation is critical as their companies prepare for the upturn, and fully 70 per cent of respondents state their companies are either maintaining or increasing their spending on R&D in 2009, according to Booz.

In Qatar, a science and technology park hosts international and national companies (TATA, ExxonMobil, Rolls-Royce, Qatar Petroleum and Qatar Robotic Surgery Center), start-ups and universities with the aim of spurring research and innovation activities.

The Kuwait Institute of Scientific Research (KISR) is being restructured to promote science and applied research to Kuwaiti industries and provide technology-policy recommendations to the Kuwaiti government. In the UAE, the Dubai Technopark aims to provide an environment that spurs innovation through the collaboration of businesses, research and academic institutions. Partners include Fraunhofer-Gesellschaft, the leading applied research organisation in Europe as well as Boston University, one of the world's leading private research universities.

"These momentous steps to promote knowledge and creativity may well represent the tipping point for GCC countries in a new direction towards an innovative society, if strategies and related policies move in tandem with this momentum," says Samman.

By Debojyoti Ghos