Omar Al-Ubaydli is a Bahraini economist and a columnist for The National
February 20, 2024
The Gulf countries are aware of the need to improve innovation as they prepare for the post-oil world. However, in seeking to emulate the knowledge ecosystem of the world’s most innovative country, the US, they risk repeating American businesses’ erroneous decision to dismantle their corporate labs, something caused by the growth of venture capital. Learning from this mistake will be critical to successfully transitioning to a knowledge economy.
Throughout history, there have been many innovative societies, but nothing comes close to the performance shown by the US economy from the end of the 19th century to the present day. The contributions of giants such as Samuel Morse, Alexander Graham Bell, Orville and Wilbur Wright, Henry Ford, Philo Farnsworth, Steve Jobs and Elon Musk continue to affect our lives in innumerable ways. By maintaining the best higher education system in the world, America’s conveyor belt of talent remains strong, confirming its status as the model that emerging economies seek to emulate when they want to boost innovation.
This desire to replicate the drivers of US innovation can be seen in many of the Gulf countries’ economic policies: establishing excellent universities; building knowledge clusters that link inventors with businesses; as well as offering exceptional expatriates long-term residency.
However, despite its continuing supremacy, cracks have begun to show in America’s innovation ecosystem. It is not just a case of other countries catching up – even taken in isolation, the US does not seem to be producing path-breaking discoveries at the breathtaking pace seen during the middle of the 20th century. Fortunately, due to its academic excellence and intellectual openness, the US has been able to study its weaknesses in real time, and it would be prudent for other countries to monitor this emerging literature.
One such contribution is a fascinating article published in the Issues in Science and Technology journal last year by technology experts John Paschkewitz and Dan Patt. Both authors used to work in the US government’s Defence Advanced Research Projects Agency, giving them profound insights regarding the underpinnings of success in the American innovation ecosystem. Among the many factors they cited for the recent decline in performance was the gradual extinction of American corporate labs.
The purported design of Neom suggests Saudi Arabia appears to be on the right track to embracing the open, blue-sky innovation that used to be embodied by US corporate labs. Photo: Neom
The Gulf countries should not wait for America’s lethargic institutions to work out that they need less venture capital and more dynamic corporate labs
Paschkewitz and Patt single out diffusion as being one of the key multipliers of innovation in a vibrant modern economy. Though an invention usually starts off in a quite narrow silo linking the applied researchers to the associated commercial venture, things really take off when other businesses become aware of the innovation and start emulating and modifying it. The speed of this diffusion is maximised by two elements.
The first is putting lots of applied interdisciplinary researchers in the same place and making them collaborate, helping them break out of the esoteric sub-fields that they inadvertently siloed themselves into at modern universities. The second is to have businesses develop innovations where the belief is that competitors viewing, modifying and upgrading those innovations is a source of further commercial success for the original innovator, rather than a threat to the corporate bottom line.
This is the mindset that led to the establishment and flourishing of 20th century corporate laboratories such as IBM Research Labs and Bell Labs. They spawned exceptional innovations including the transistor, the laser and the photovoltaic cell, all of which are at the heart of many 21st century innovations. Many of these inventions lay well outside the bounds of the sort of incremental innovation that modern research and development tends to emphasise, and they relied on an environment of open innovation unencumbered by corporate suits anxiously reading share price updates on their smartphones.
Unfortunately, Paschkewitz and Patt confirm the decline of the corporate lab, despite the continued growth in aggregate R&D expenditure. The increasing importance of venture capital in the financial landscape has led to more myopic corporate decision-making in general. In the case of R&D, this has led to a fixation on projects that yield quick returns (three to five years), with little encouragement for the sort of blue-sky thinking that yielded the transformational innovations of Bell Labs and others. Moreover, the mentality has switched from embracing technological openness as a vehicle for innovation to favouring technologies that create consumer lock-in, and that are fortified by constricting patents designed to limit diffusion.
The US political system has become dysfunctional and introduces reforms at an anaemic pace, in contrast to the remarkable agility demonstrated by Gulf governments of late, most notably Saudi Arabia and the UAE. Accordingly, the Gulf countries should not wait for America’s lethargic institutions to work out that they need less venture capital and more dynamic corporate labs, as well as less short-term thinking and more diffusion of new technologies. If the Gulf countries want to realise their ambitious targets, they need to absorb the observations of leading experts such as Paschkewitz and Patt and introduce the necessary reforms.
The purported design of Neom – official information remains limited – suggests that Saudi Arabia appears to be on the right track, as it seems to emphasise the kind of open innovation that used to be embodied by US corporate labs in the middle of the 20th century. Nevertheless, this model cannot be restricted to one monolithic city because true innovation powerhouses boast several geographically disparate centres of excellence.
At the end of the 20th century, when the Gulf economies were still highly reliant on oil, and the US was the unquestioned economic hegemon, it would have been unthinkable for the Gulf countries to learn from the America’s errors quicker than the Americans themselves, and potentially leap-frog it technologically. However, times have changed, and that unimaginable opportunity has materialised a lot quicker than anyone expected. Seizing it requires the Gulf countries to pay as much attention to what the US does badly in innovation to what it does well. Or, as the American author Gina Greenlee once quipped: “Experience is a master teacher, even when it’s not our own.”
SUNDAY'S ABU DHABI T10 MATCHES
Northern Warriors v Team Abu Dhabi, 3.30pm
Bangla Tigers v Karnataka Tuskers, 5.45pm
Qalandars v Maratha Arabians, 8pm
Last five meetings
2013: South Korea 0-2 Brazil
2002: South Korea 2-3 Brazil
1999: South Korea 1-0 Brazil
1997: South Korea 1-2 Brazil
1995: South Korea 0-1 Brazil
Note: All friendlies
MATCH INFO
Tottenham 4 (Alli 51', Kane 50', 77'. Aurier 73')
Olympiakos 2 (El-Arabi 06', Semedo')
Results
United States beat UAE by three wickets
United States beat Scotland by 35 runs
UAE v Scotland – no result
United States beat UAE by 98 runs
Scotland beat United States by four wickets
Fixtures
Sunday, 10am, ICC Academy, Dubai - UAE v Scotland
Admission is free
MATCH INFO
Manchester United 1 (Greenwood 77')
Everton 1 (Lindelof 36' og)
Dirham Stretcher tips for having a baby in the UAE
Selma Abdelhamid, the group's moderator, offers her guide to guide the cost of having a young family:
• Buy second hand stuff
They grow so fast. Don't get a second hand car seat though, unless you 100 per cent know it's not expired and hasn't been in an accident.
• Get a health card and vaccinate your child for free at government health centres
Ms Ma says she discovered this after spending thousands on vaccinations at private clinics.
• Join mum and baby coffee mornings provided by clinics, babysitting companies or nurseries.
Before joining baby classes ask for a free trial session. This way you will know if it's for you or not. You'll be surprised how great some classes are and how bad others are.
• Once baby is ready for solids, cook at home
Take the food with you in reusable pouches or jars. You'll save a fortune and you'll know exactly what you're feeding your child.
5pm: Maiden (PA) Dh80,000 1,200m
Winner: Shafaf, Sam Hitchcott (jockey), Ahmed Al Mehairbi (trainer) 5,30pm: Wathba Stallions Cup Handicap (PA) Dh70,000 1,200m
Winner: Noof KB, Tadhg O’Shea, Ernst Oertel 6pm: The President’s Cup Listed (TB) Dh380,000 1,400m
Winner: Taamol, Jim Crowley, Ali Rashid Al Raihe 6.30pm: The President’s Cup Group One (PA) Dh2,500,000 2,200m
Winner: Rmmas, Tadhg O’Shea, Jean de Roualle 7pm: Arabian Triple Crown Listed (PA) Dh230,000 1,600m
Winner: Ihtesham, Szczepan Mazur, Ibrahim Al Hadhrami 7.30pm: Handicap (PA) Dh80,000 1,400m
Winner: AF Mekhbat, Antonio Fresu, Ernst Oertel
The burning issue
The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.
Chennai Knights, Lahore Sikandars, Pakhtoon Blasters, Abu Dhabi Stars, Abu Dhabi Dragons, Pakhtoon Warriors and Hyderabad Nawabs.
Squad rules
All teams consist of 15-player squads that include those contracted in the diamond (3), platinum (2) and gold (2) categories, plus eight free to sign team members.
Tournament rules
The matches are of 25 over-a-side with an 8-over power play in which only two fielders allowed outside the 30-yard circle. Teams play in a single round robin league followed by the semi-finals and final. The league toppers will feature in the semi-final eliminator.
France has organised a delegation of leading businesses to travel to Syria. The group was led by French shipping giant CMA CGM, which struck a 30-year contract in May with the Syrian government to develop and run Latakia port. Also present were water and waste management company Suez, defence multinational Thales, and Ellipse Group, which is currently looking into rehabilitating Syrian hospitals.
In the village of Mevagissey in southwest England the housing stock has doubled in the last century while the number of residents is half the historic high. The village's Neighbourhood Development Plan states that 26% of homes are holiday retreats. Prices are high, averaging around £300,000, £50,000 more than the Cornish average of £250,000. The local average wage is £15,458.
The biog
Full name: Aisha Abdulqader Saeed
Age: 34
Emirate: Dubai
Favourite quote: "No one has ever become poor by giving"
Women & Power: A Manifesto
Mary Beard
Profile Books and London Review of Books
The Written World: How Literature Shaped History
Martin Puchner
Granta
UAE v Zimbabwe A
Results
Match 1 – UAE won by 4 wickets
Match 2 – UAE won by 5 wickets
Match 3 – UAE won by 25 runs
Match 4 – UAE won by 77 runs
Fixture
Match 5, Saturday, 9.30am start, ICC Academy, Dubai
Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
The biog
Birthday: February 22, 1956
Born: Madahha near Chittagong, Bangladesh
Arrived in UAE: 1978
Exercise: At least one hour a day on the Corniche, from 5.30-6am and 7pm to 8pm.
Favourite place in Abu Dhabi? “Everywhere. Wherever you go, you can relax.”
World Sevens Series standing after Dubai
1. South Africa
2. New Zealand
3. England
4. Fiji
5. Australia
6. Samoa
7. Kenya
8. Scotland
9. France
10. Spain
11. Argentina
12. Canada
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14. Uganda
15. United States
16. Russia
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Send “thenational” to the following numbers or call the hotline on: 0502955999
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PROFILE
Name: Enhance Fitness
Year started: 2018
Based: UAE
Employees: 200
Amount raised: $3m
Investors: Global Ventures and angel investors
South Africa v India schedule
Tests: 1st Test Jan 5-9, Cape Town; 2nd Test Jan 13-17, Centurion; 3rd Test Jan 24-28, Johannesburg
ODIs: 1st ODI Feb 1, Durban; 2nd ODI Feb 4, Centurion; 3rd ODI Feb 7, Cape Town; 4th ODI Feb 10, Johannesburg; 5th ODI Feb 13, Port Elizabeth; 6th ODI Feb 16, Centurion
T20Is: 1st T20I Feb 18, Johannesburg; 2nd T20I Feb 21, Centurion; 3rd T20I Feb 24, Cape Town
The Disaster Artist
Director: James Franco
Starring: James Franco, Dave Franco, Seth Rogan
Four stars
The Breadwinner
Director: Nora Twomey
Starring: Saara Chaudry, Soma Chhaya, Laara Sadiq
Three stars
The biog
Name: Gul Raziq
From: Charsadda, Pakistan
Family: Wife and six children
Favourite holes at Al Ghazal: 15 and 8
Golf Handicap: 6
Childhood sport: cricket
Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
Liverpool’s Uefa Champions League bid: “They’re great. With the attacking force they have, for me, they’re certainly one of the favourites. You look at the teams left in it - they’re capable of scoring against anybody at any given time. Defensively they’ve been good, so I don’t see any reason why they couldn’t go on and win it.”
Mohamed Salah’s debut campaign at Anfield: “Unbelievable. He’s been phenomenal. You can name the front three, but for him on a personal level, he’s been unreal. He’s been great to watch and hopefully he can continue now until the end of the season - which I’m sure he will, because he’s been in fine form. He’s been incredible this season.”
Zlatan Ibrahimovic’s instant impact at former club LA Galaxy: “Brilliant. It’s been a great start for him and for the club. They were crying out for another big name there. They were lacking that, for the prestige of LA Galaxy. And now they have one of the finest stars. I hope they can go win something this year.”
RESULT
West Brom 2 Liverpool 2
West Brom: Livermore (79'), Rondón (88' )
Liverpool: Ings (4'), Salah (72')
Our legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
UAE Team Emirates:
Dan Martin, Alexander Kristoff, Darwin Atapuma, Marco Marcato, Kristijan Durasek, Oliviero Troia, Roberto Ferrari and Rory Sutherland
Second ODI
England 322-7 (50 ovs)
India 236 (50 ovs)
England win by 86 runs
Next match: Tuesday, July 17, Headingley
The Vines - In Miracle Land
Two stars
Real estate tokenisation project
Dubai launched the pilot phase of its real estate tokenisation project last month.
The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.
Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.
David Haye record
Total fights: 32 Wins: 28 Wins by KO: 26 Losses: 4
The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.
iPhone XS
With a 5.8-inch screen, it will be an advance version of the iPhone X. It will be dual sim and comes with better battery life, a faster processor and better camera. A new gold colour will be available. Price: Dh4,229
iPhone XS Max
It is expected to be a grander version of the iPhone X with a 6.5-inch screen; an inch bigger than the screen of the iPhone 8 Plus. Price: Dh4,649
iPhone XR
A low-cost version of the iPhone X with a 6.1-inch screen, it is expected to attract mass attention. According to industry experts, it is likely to have aluminium edges instead of stainless steel. Price: Dh3,179
Apple Watch Series 4
More comprehensive health device with edge-to-edge displays that are more than 30 per cent bigger than displays on current models.
World record transfers
1. Kylian Mbappe - to Real Madrid in 2017/18 - €180 million (Dh770.4m - if a deal goes through)
2. Paul Pogba - to Manchester United in 2016/17 - €105m
3. Gareth Bale - to Real Madrid in 2013/14 - €101m
4. Cristiano Ronaldo - to Real Madrid in 2009/10 - €94m
5. Gonzalo Higuain - to Juventus in 2016/17 - €90m
6. Neymar - to Barcelona in 2013/14 - €88.2m
7. Romelu Lukaku - to Manchester United in 2017/18 - €84.7m
8. Luis Suarez - to Barcelona in 2014/15 - €81.72m
9. Angel di Maria - to Manchester United in 2014/15 - €75m
10. James Rodriguez - to Real Madrid in 2014/15 - €75m
