Our life is ruled by ideas. Among the greatest inventions believed to have changed the course of human progress are the printing press invented by Johannes Gutenberg in Germany; the pencil (Konrad Gesner, Switzerland); astronomical instruments (Maharaja Jai Singh, India); the telegraph and Morse code (Samuel Morse, US); dynamite (Alfred Nobel, Switzerland); the telephone (Alexander Bell, UK), radio (Gugliermo Marconi, Italy); airplane (Orville and Wilbur Wright, US); television (Vladimir Zvorykin, Russia); ball point pen (Ladislao Biro, Hungary); the anti-AIDS drug AZT (Gertrude Elion, US), and the compact disk (James Russell, US).
There is an obvious connection between a genius’s country of birth and its current socioeconomic status. In developed countries, innovative activities are a number-one priority in so far as official policy is concerned. Generators of ideas are treated well; they are lured from other countries and offered the best working conditions. Business structures cooperate with them, and of course the state takes good care of them because it knows that its future depends on the brains of brilliant people.
Ukraine has never lacked clever minds. In the last few years the Intellectual Property Department of Ukraine’s Ministry of Education and Science has been holding annual competitions for best invention of the year. This year’s competition produced more than 40 winners whose inventions span the fields of medicine, the agroindustrial complex, the food industry, construction, and metallurgy. The youngest inventor — the creator of a new car lighting system — is only 16 years old.
The awards ceremony of the nationwide competition Invention 2006 was part of the third international exhibition Innovations 2007, held in Kyiv by the State Intellectual Property Department on April 16-18.
What is the future of Ukrainian inventions? How does our state treat the national creative and intellectual potential? These and other questions are answered in the following interview with Mykola PALADII, head of the State Intellectual Property Department.
“JUST SET YOURSELF FOUR GOALS”
Paladii: Innovative activities are a sphere in which one can earn money and improve Ukraine’s economy. Our state must be interested in making intellectual property work for our economy. If we are talking about competitiveness, we must introduce motivating mechanisms to make our businesses interested in new technologies, so that certain preferences will be envisaged for them in terms of taxes or other incentives. A motivating mechanism is very important: if a state wants to create something, it starts by introducing such mechanisms. If it wants a certain sphere of business to evolve, it provides favorable conditions. What we need now is a new national policy aimed at supporting innovative efforts to create competitive products. We must have a clear- cut goal for what we will be selling: spacecraft, timber, or grain; what prospects we will secure ourselves; how Ukraine will be represented on the world market. One company says: “We are selling mobile phones. Another company sells cars. They are concerned about getting ahead of their competitors and are taking steps to crowd them out. We must start talking about goals and drafting plans in order to make Ukrainian goods more competitive than Polish or American products.
A Ukrainian delegation recently visited a Geneva-based institute on development strategy and policy. The representatives of this institute asked us, “What does Ukraine want?” In other words, they can help us determine our strategy, depending on what we are actually after. If we want to join the WTO, we must do such and such things; if we want to join the EU, we must do something else in addition. This is the principle. This institute has a special subdivision whose staff deals with the future. There is no such subdivision in our country. Our state is not doing anything about its future.
What should be done?
Paladii: First, there must be a law providing for a new policy on the sphere of innovations. If such a law is adopted by the Verkhovna Rada, the government will have to implement it, and directives will be forwarded to the central executive authorities, instructing them to implement this law.
What our society needs now is not talk about who will win — the Orange people or the White-and-Blues. It is necessary to rally our society around a certain idea that may well become a national one. For example, we could say that a nuclear power plant with an alternative energy source will be a Ukrainian project, conceived and built by Ukrainians, and that there is nothing like it in the world. We will build the world’s best automobile engine and introduce agricultural technologies that can’t be found in any other country. Or take the struggle against cancer and tuberculosis. Just set yourselves four goals: that will be enough. Many of our people could be put to work on this.
If we are not talking about political forces but about building a factory that will yield two billion dollars’ worth of revenues a year, or a power plant that will earn us 200 billion dollars, we will be able to unite Ukraine. After that we won’t be talking about political colors but personnel and administration. People who will work on this will say, “We’re the best because no one has what we have.” We have to talk about the fact that Ukrainians are talented, clever, and competitive people. Look at the Americans, their self-respect and love of their country; how they feel pride in themselves and their achievements. We don’t have America’s military might, but we can say what the Swedes, Finns, and Germans say: We have technologies that the Americans don’t have. After all, this is something our speaker, parliamentarians, prime minister, and president should be saying.
If people see that we have actually started building something, introducing innovative structures, I think that they will realize half a year later — thanks also to journalists — that our prospects are not about joining or failing to join NATO, but about being one of the top 10 competitive countries. This would mean an entirely different status for Ukraine.
Are we content that in terms of development Ukraine is 84th on a list of countries? I think that a minimum task should be assigned first, namely to move up a few positions a year, from 84th to 80th, and so on. We will see that in 10 years we will be listed among the 50 or even 30 most developed countries. When we talk about Swedish socialism, we note that Sweden boasts the world’s most advanced economy, alternating with Finland every year. They have this kind of socialism because they have extremely high taxes, the most modern technologies, a competitive economy, and a matching social “train.” Their young people have apartments. There are social payments, very good salaries, insured medicine, and so on.
In other words, innovative technologies make it possible to provide for all social needs, so there is no problem with getting money for doctors, teachers, and scientists. The government’s sole objective — innovative development — requires experts on outer space, agriculture, jurisprudence, and management. Generally speaking, if we adopted this development model and such priorities for the state, our economy would be able to show some growth, all by itself, in a year or two. What we need is not lawyers — we already have 180 per vacancy — but technologists, engineers, good mechanics, drivers, and so on. We need people who will not only generate ideas, but also translate them into life.
Our top leaders don’t seem interested in any Ukrainian innovative endeavors.
Paladii: Right now we are discussing a project with Deputy Prime Minister Dmytro Tabachnyk: an intellectual town somewhere in the scenic environs of the Kyiv suburbs for our researchers and inventors, which would be equipped with every convenience. Such intellectual towns are nothing new. Russia implemented these kinds of projects in Soviet times. The most scenic and ecologically safe localities were selected in the vicinity of Moscow, where comfortable homes and modern labs were built for researchers. Similar projects are underway in Estonia, Russia, Finland, and everywhere. There is nothing new about this idea. I would like our center to be a gathering place for Ukraine’s scientific potential, where ideas could be generated and existing ones studied. Here the government must make it clear whether or not it is interested in a given technology, for example, a supermodern nuclear power unit, that will actually generate so much electricity as to make Ukraine independent of external power supplies, or new drugs that will cure people of cancer or tuberculosis. That’s the technology that interests me.
The government provides funding, builds premises, labs, install communications, provide Internet access, and so on. Here 100-percent government subsidies won’t be necessary because businesses will help. By and large, the government won’t have to fund more than 10 percent. Business says it doesn’t need the government for financing, but it needs it as a partner. It needs government involvement in projects. This is practiced all over the world.
90,000 PATENTS IN 15 YEARS
We already have inventors. Maybe it is difficult for them to work in our conditions, but aren’t their ideas being translated into life?
Paladii: We have the following scenarios: someone finds a businessman; another one finds a banker, who agrees to finance a given project. This person builds an enterprise that starts functioning and making products. We have such cases, but they are few and far between. I know of some 20 people in Ukraine who are fortunate enough to have had their projects financed and launched like that. Imagine: 20 individuals out of the 46 million people in Ukraine!
Are there many inventors in Ukraine? Who are they?
Paladii: Over the past 15 years we have issued 90,000 patents on behalf of the state for scientific and world inventions. Oleksandr Nikolaienko is an inventor and winner of our competitions, who set up his own company and is independently manufacturing Erbisol, a drug that he invented, which acts as an immunomodulator in insulin-dependence and cancer. His drugs are being sold normally; he got a bank loan and founded his company with a staff of 20. Another inventor, Academician Anatolii Zaviriukha, created Leikozal, an effective drug for leukosis. Another winner of our competitions is Volodymyr Kliosov from Donetsk, whose private business developed an internal-combustion engine that is superior to its Japanese analogs. Unfortunately, he is still looking for an investor to move his project forward. In contrast, Stanislav Adamenko, the inventor of a technique to extract energy from new sources (a power plant to extract such energy has already been built) found an investor to finance him. Tens of millions of dollars have already been channeled into this project. I think they will soon demonstrate their power plant.
What path does an inventor have to travel from conceiving an idea to seeing his invention launched into mass production?
Paladii: It’s a thorny and winding path. They say in Finland, “We are working 15 years in advance.” There it takes 11 or 12 years for an invention to be implemented in the form of goods on the market, and they want to reduce this period to 8 years. In Ukraine it takes much longer, sometimes up to 50 years. Then the whole concept turns out to be obsolete and utterly useless. We must keep trying to approach European standards. As it is, no one is keeping track of inventions in Ukraine. We are staging these competitions and making arrangements for World Intellectual Property Day to be marked in Ukraine on April 26 (as originally determined by the World Intellectual Property Organization), but our businesspeople are showing little interest in domestic inventions. Sometimes they do, but never on a regular basis.
Another reason is that every invention has to be assessed by experts, checked not only for novelty but also for possible financing sources and profitability. For example, an invention may yield a hundred million dollars’ worth of profit, but the businessman must be told exactly how much has to be invested in his project. There are no such experts in Ukraine. They are only starting to be trained as managers of innovative activity. Graduates will appear only in a few years. Then they still have to intern abroad so that they can see how to push such projects forward.
INNOVATIVE SPHERE NEEDS CATALYST
It is also necessary to consider this aspect: my colleagues in Europe say that it is possible to come up with a super-interesting invention without being able to present it on the market. You can also invent a not so interesting product that is marketed, advertised, and promoted so well that you could sell snow to the Inuit. What I mean is that we have to train talented specialists who will promote our goods. There are firms that do this on a commercial basis abroad, but none in Ukraine. We must have a business market.
These specialists should be intermediaries between inventors and businessmen?
Paladii: Yes, because in Ukraine an inventor has to be a technologist, engineer, financier, accountant, and investor all at the same time. This is impossible. Ask an investor how much it will take to launch a product. He won’t know. Nor will he know how much profit an invention will generate. He may say a hundred million dollars, but who will confirm this sum? All this must be the responsibility of managers. We don’t have them yet. I agree with our education minister, who says that we need to combine three components: education, science, and production. To make all of them work we must introduce a catalyst, the manager.
How often do you receive copyright infringement claims?
Paladii: Very often. The State Intellectual Property Department, acting as the third party, sometimes appears in court during such lawsuits. Out of some 500 cases being litigated, some 90 percent have to do with trademark violations. I think that if our economy will reach the proper level, we will see only 10 percent of such cases, and the rest will relate to patent issues, like in Europe. These factors will be used to analyze the economic situation in Ukraine. For example, five years ago we were handling between 50 and 70 cases a year. I think that in the future we will have even more of them. In other words, the more you drive your car, the more problems you have. Someone steals something from somebody; others use someone else’s property; others say, “No, this is mine.”
But I would say that we are in a specific situation. No one in any developed country would ever think of patenting the McDonald’s trademark or that of any other universally acknowledged company, but we have cases like this in Ukraine. Maybe we have some illnesses, but I would say that these are growing pains that have to be endured. Ukraine had problems with copyright violations and sales of pirate CDs. We have gone through all this and more. We have outgrown this and said that we can cope with such problems, although we haven’t been able to solve them 100 percent.
You named the winners of the 2006 competition. What’s in the offing for them?
Paladii: All the winners will bid in government-run tenders for using or introducing of certain technologies. Investments can be made only once businessmen say that they are ready to do so. They will never invest in projects with more risks than future profits. The state must secure venture capital, funds, enterprises, and so on, while the businessman can cooperate only with the stock market.
Won’t this situation prompt our inventors to start looking for investors abroad?
Paladii: As far as I know, there are only a couple of people who have done this. I don’t think that we are facing a problem of manpower drain. There is no such notion in Europe’s scientific world. Some researchers travel here and there. A large number of scientists live in Switzerland, and the Swiss are being accused of luring them to their country. The fact remains that Switzerland provides the best conditions for them. Once we create an attractive environment for scientists in Ukraine, we will have the same situation, with venture funds mushrooming and businesses willingly collaborating with inventors. As it is, we have inventors and business, but they are leading separate lives. There is no catalyst.
The state must say, “I am showing you exactly how things should be done.” Today we aren’t moving in any direction. There are only slogans. There is no other path. Dozens of competitive business are functioning in the US thanks to a theory formulated by Nobel laureate Robert Solow. Every developed country has a Nobel laureate to its credit, a person who launched a certain project — and most importantly when a task was set by the state. If the state does not want to do this, does not understand this issue, or is unable to do anything, there will be no result. What happens to a company that does not care about its future, its competitiveness? It does not survive. The same is true of every business, every country .
