Innovation the tool to double GDP - InnovaChile

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Tuesday, June 21, 2011

Innovation is the key element in the Chilean government's goal to double productivity in 10 years, but the state ought to foster this development in order for it to happen, Adrián Magendzo, deputy director at Chilean promotion agency Corfo's InnovaChile program, said during a presentation.

"The government expects to see GDP to grow from US$15bn to US$30bn in 10 years, when historically this doubling of GDP has taken 50 years. Innovation is the path to achieve this goal. We have a stable financial system, proper regulation and institutions. We need to take a step forward and produce more as a country, and for this innovation in terms of intelligence and knowledge is essential," Magendzo said.

Chile's productivity is "stuck," and the way to revert this issue is through the trade of knowledge versus raw material, he added. Currently the country depends heavily on commodity exports, led by copper and followed by basic goods with little added value, such as fruit, forestry and fish.

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"The problem we have is that our productivity is not expanding. For example, an iPod costs US$830, but the copper or plastic or glass to produce that iPod costs on average US$8.... What we need to sell is intelligence, knowledge. The more Chile manages to trade knowledge, the more our productivity will increase," Magendzo said.

The presentation was part of a seminar sponsored by Chilean IT industry association Acti to encourage IT ventures.