Weak innovation performance for Bulgaria, according to a report of the National Innovation Forum
The National Innovation Forum presents its annual report on innovation results and awards to successful Bulgarian companies at a special ceremony. The report has both positive statistics and worrying trends.
In 2022, Bulgaria is again in the penultimate place among the member countries. The country’s innovation performance is weaker than that of a number of candidate countries for membership that do not have access to a European funding structure, which Bulgaria mainly relies on to subsidize its science and innovation policy.
For the first time, investments in research and development activities have crossed the threshold of BGN 1 billion, noting the increase on an annual basis of BGN 50 million. The share of expenditure on development and scientific activity in the last year has fallen to 0.77% of GDP. Against this background, the competitiveness of Bulgarian organizations in pan-European programs for science and innovation increases.
Against this background, the competitiveness of Bulgarian organizations in pan-European programs for science and innovation increases. Despite the series of strategic documents and reforms in the field of human resources development in Bulgaria, the challenges in this field are becoming more and more serious, and the country’s abandonment of international creation is deepening.
The report considers the demographic collapse and the negative migration balance as negative because they have led to a drop in the number of secondary school graduates. And together with the preferences to apply to foreign universities, this has reflected on the decrease in the number of completed bachelors in 2021.
For all areas of education that are defined as scientific and technological, there is also a decline, in most cases more serious in the direction of the general decline of completed higher education.
Deterioration of the profile of completed higher education in terms of readiness for development and implementation of technological innovations, the report states. Below 4% is the share of the population that participated in adult learning, compared to 10.8% on average for the EU. This condemns the country to further abandonment within the EU on the indicators of innovation potential and on the developed competitive opportunities it offers based on new technologies.
In 2021, the personnel engaged in scientific research and development (R&D) in Bulgaria is 34,600 people. Almost half of R&D personnel work in enterprises (46%) and they have 66% of R&D funding. It is almost entirely directed towards covering running costs, including wages. This makes the professional implementation of highly qualified staff in the business sector more attractive compared to budget-supported research units. The second largest employer of 28% of researchers is the Higher Personal Education sector, which includes 52 accredited public and private higher education institutions. In contrast to this sector, it has only 6% of the funding for R&D in the country, 20% of which is directed for investment purposes.
With the help of EU funds, Bulgaria is developing a dynamic start-up entrepreneurial ecosystem. Bulgaria has over 1,600 start-up companies. For comparison – in South-Eastern Europe, Greece has 1700, and Romania – 2800. At this time, Bulgaria has the most created jobs (per 100,000 people) in start-up companies – 80, while Greece has 60, and Romania – 45.
Bulgaria provides 20% of the total market of start-up jobs in Southeast Europe, but there is every reason for growth, especially if the country makes it easier to attract foreign students to universities. The decline in investment in start-up companies in 2022 deserves special attention, and the reasons can be traced to both the decline in public support and the uncertainty created by Russia’s war against Ukraine.
It was found that 54% of enterprises in Bulgaria use at least one of 10 artificial intelligence technologies, compared to an average for Europe of 42%, which places the country in the top 3 of Europe. Over a third of the enterprises in Bulgaria used at least two technologies, with an average for Europe of 25% (or 8th place on the continent). Artificial intelligence technologies cannot be used without the presence of reliable and secure cloud systems. And despite the fact that in Bulgaria the offer of cloud services and virtualization is developing seriously, only 12.8% of SMEs share that they use cloud services compared to 41% in Europe. In this regard, the distance between SMEs and large companies in Bulgaria is sensitive.
An important feature that has been observed in the last year is the increased share – almost a third (32%) of small and medium-sized enterprises that sell online not only in Bulgaria, but also in other countries of the low union. This shows a significant internationalization of businesses that are online and can be considered one of the positive effects of the pandemic. In comparison, less than 5% of all enterprises in the economy export.
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