The Way Forward

IOB: Caribbean
Society and Business
Mary K King
March 2005
MAry K King

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The Present Situation

The

Economy of T&T at the moment is

broadly defined as
Modern day Plantation with the oil/gas
sector being the main earner of foreign
exchange and contributor to GDP
Today however, the oil/gas sector does not
provide much employment; 3% of the
labour force
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The Present Situation

Earnings

of this off-shore sector supports

in the main the commercial and industrial
activities of the on-shore sector
A sustainable economy is defined by the
PYRAMID of activities that start at the top
with research and development which
spawns new ideas and inventions, hence
new IP and the accompanying firms that
create employment
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The Present Situation

A sustainable economy then goes through the

various layers of the PYRAMID from research

and development downwards through
professionals, innovators, entrepreneurs and
finally to semi and non-skilled workers
In T&T today this PYRAMID is truncated and at
the plateaus top is the energy sector together
with the traders, operators, construction,
maintenance and the assembly of the on-shore
sector
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The Present Situation

Both the onshore and local energy sector activities

are characterised by non-innovation driven

employment and entrepreneurship
Hence the amount of IP, patents and copyright for
software etc. is virtually non-existent
If for any reason the energy sector was to collapse
for a sustained length of time (as it did after the
1970s boom) the economy will implode. The
volatility funds will at best lead to a soft landing
to poverty.
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Intellectual Property
Sustainable

development depends on
continuous innovation in the economy to
maintain competitiveness. This demands
the creation of Intellectual Property (IP)
The kinds of IP of importance to us are,
Patents, Copyright, Trademarks and
Industrial designs and Integrated Circuits.

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Patents
A Patent is a document, issued upon application

by a government office or a regional office acting

for several countries which describes an
invention and creates a legal situation in which
the patented invention can normally be exploited
with the authorisation of the owner of the patent.
An invention is a solution to a specific problem
in the field of technology and may relate to a
product or process
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Patents
The

owner is not given the right to practice her

invention she has the right to prevent others from
commercially exploiting the invention. The
protection is usually limited to 20 years
The State may give patent rights but does not
automatically enforce them. It is up to the owner
to bring an action for infringement of her rights.
Some countries gives protection under Utility
Models which are really patents in the mechanical
field.
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Copyright
Copyright

deals with forms of creativity primarily

with all forms of public communication, printed,
sound and television broadcasting, films and also
computerised systems for the storage and retrieval
of information. Some countries (incl. T&T)
protects software by copyright.
Copyright protects only the form of expression of
the ideas and not the ideas themselves. The
creativity protected is in the choice and
arrangement of words, musical notes, colours.
Computer programs etc
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Copyright
The

law protects the owner against those

who would take and use the form in which
the original work was expressed by the
author without her authorisation
The work is protected irrespective of its
quality and she may use it as she wishes
and may exclude others from using it.

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Trademarks
A Trademark

is a sign that individualises the

goods of given enterprise and distinguishes them
form that of its competitors.
The two aspects of the trademark are that it must
indicate the source of the good and that it
separates it from others.
WIPO has used the concept as any visible sign
capable of distinguishing the goods or services of
an enterprise from those of another
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Service Marks
These

are marks that distinguish among

the different services such as insurance
companies, car rental firms, airlines etc.
They fulfill essentially the same function
for service as trademarks do for goods.
These marks can be registered, renewed
and cancelled. Also they can be assigned
and licensed.
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Collective Marks
A Collective

Mark may be owned by an

association whose members may use the collective
mark
These marks may be used by an enterprise in
addition to its own trade mark.
Collective marks play an important role in the
protection of customers against misleading
practices
These marks are admitted for registration in
countries other than the country of the
organisation that owns the mark
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Certification Mark
This

Certification Mark can only be used

in connection with standards.
This differs from a Collective mark in that
it can be used by anyone that complies
with the defined standard
The organisation that applies for the mark
must be competent to certify the products
concerned and becomes the representative
for the products that bear the mark.
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Industrial Designs
An

Industrial Design in the legal sense is the

right given, pursuant to a registration process, to
protect the original ornamental and nonfunctional features of an industrial article or
product that result from a design activity
Since visual appeal is one way a consumer
chooses a product this protection serves as an
important function of protecting one of the
distinctive features by which an enterprise
achieves market success.
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Industrial Designs
The

design must be applied to utilitarian articles

which distinguishes it from copyright which refers
mainly to aesthetic creations.
The rights of the owner of a registered industrial
design accords to the owner the exclusive right to
prevent unauthorised exploitation of the design in
industrial articles
The ownership of the design lies with the employer
of the person who does the design whether she is an
employee or a contractor. The idea here is that the
design is what is being paid for, not the product.
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Industrial Design
It

is worth noting that in the case of a

contractor making a product and in so
doing implements a novel design owns the
design since she was employed to build a
product to certain specifications.
If the person that did the novel design
were an employee whose job it is to do
such work then the employer owns the
design (e.g. computer software).
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Integrated Circuits
The

layout designs of integrated electronic

circuits is the product of the human mind and are
driven by the need to reduce their size and
increase functionality
The investment required for coming up with the
design may be enormous while the cost of
copying is small, hence protection is required.
Such designs are protected for at least 10 years.
15 years may used by certain countries and this
right includes articles incorporating the integrated
circuits.
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The Innovation Diamond

The

Task ahead of the T&T economy is to

build the top of the PYRAMID, i.e to
produce the SMEs that utilise knowledge
and innovation to generate quality jobs and
global competitiveness.
The country has to put in place a Scientific
Innovation system.
This has already been described as the
Innovation Diamond.
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The Innovation Diamond

This

Diamond is made up of the four vertices,

viz, Human Resource development, Centres of
Excellence and Business Development Units,
Access to Venture Capital and the Test Market.
An important property of the diamond is that if
any of the vertices does not exist then economic
development is severely inhibited.
The new Prometheus fund for the energy sector
exists in a vacuum and will not help in the
building of the PYRAMID without, say, the
community of developers and researchers.
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The Innovation Diamond

Innovation

based on knowledge depends on the

existence of highly educated and trained people
e.g. university graduates.
But the required education/training should not be
what is typical in T&T, i.e. the certification of our
people.
Education /training must be about doing and
building for economic development. Our training
institutions must be very closely aligned to
industry, existing and planned.
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The Innovation Diamond

UWI

is at the moment talking about becoming

student friendly, about becoming among the best
in the world in research, about offering
consulting and contract research to the region to
help in development, about earning money to
help pay its own way.
UWI has not yet begun to talk about the part it
has to play in the Innovation Diamond nor the
creation of the market it thinks exists in the
region.
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The Innovation Diamond

UWIs

proposed support for the region is not

required since industry at the plateau of the
truncated PYRAMID does not require research and
development, and UWI is looking at its involvement
with inward looking eyes, earning income.
Economic development in the region is about the
creation of new SMEs that may look to the plateau
for elements of the test market.
UWI or even UTT has to gear its basic training and
education to the creation of not employable people
but those that create employment

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Centres of Excellence
Traditional

university graduates even if they are well

trained will not on their own create the community of
scholars and innovators required for the growth of the
PYRAMID.
Centres of Excellence have to be created that are
closely allied with the universities, that source their
people from these graduates of the university and
their motivation from the professors and researchers
and vice versa.
Centres of Excellence have to be specialist
institutions that reduce the risk of industrial research
and development and are directly related to the
present and envisioned industrial sector
These Centres of Excellence are akin to the S. Korean
industrial universities.
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Centres of Excellence
But

these Centres of Excellence have to be focussed on

various chosen sectors of the economy. As in Cuba they
will be of the following types:
Areas in which we intend to be world leaders in
Research; the new knowledge to be used in innovation
In areas that we have to import and/or license
technology that we can apply to create industrial
applications with the hope of creating proprietary
technology as we develop global com- petitiveness.
In areas that we must work because of our culture or
need to be self sufficient because of social or economic
needs.

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Centres of Excellence
We may wish to pause here to
discuss candidates for the
areas mentioned.

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Business Development Units

Emerging

from the Centres of Excellence there

will indeed be the source ideas that can be taken
to market. But what is required are
institutionalised environments that are
specifically designed to make the transition from
knowledge to business opportunity.
The accent will be on integrated support for
entrepreneurs to reduce cost and build a family
of interacting innovative entrepreneurs, hopefully
like what evolved in Silicon Valley of the US.
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Business Development Units

What

is envisioned is not a hard boundary

between the Centres of Excellence and the
Business Units but rather a progression of people
and ideas from the Centres into the business
environment where the accent changes from only
knowledge application to entrepreneurship.
But these fledgling businesses have to be
supported by investment, by Venture Capital,
either informally via Angels or formally by VC
companies.
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Venture Capital
Venture

capital as required will be necessarily high

risk funding. Traditionally our financial sector has
had no experience with this kind of funding and has
funded business mainly via debt
Our Stock Market has not proven to be the place to
raise capital and its second tier has one firm on it at
present.
Both Singapore and S. Korea have found it necessary
to involve their governments in the provision of
Venture Capital funds (as much as 60% of available
funding). In this way the risk is spread over the
country as a whole.
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Venture Capital
Another

source of funding is via existing plateau

firms that are unable to change their industrial
culture to get involved in innovative activities.
Hence they may be able to sponsor SMEs via a
varied suite of funding instruments.
The business units would be of help to such firms
in improving the efficiency of the use of its funds
in developing entrepreneurial ideas.
Such schemes fall under the heading of Corporate
Venturing, a suggestion now before our
Parliament, stalled however since the present
Venture Capital Act seems unable to
accommodate it.
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The Test Market

You

will recall that Porter placed a significant

amount of importance on the local market.
However T&Ts market is small and ways must
be found to magnify its impact.
But even in its smallness it serves a relatively
large FDI energy sector that at present attracts
international service industries at the cutting
edge of technology. Further T&T is not the first
choice of FDI to provide these services either
because of custom or local inexperience.
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Local Content
Comment

has already been made on the T&Ts

Government intention to facilitate the use of
local content in the energy sector. As a
prerequisite to this is the renegotiation of
agreements it has made with the US and WTO so
as to favour its local institutions over others.
These ideas have to be expanded to the areas
concerned in the economic development of the
country.
For example concessions have to be offered to
the world class industrial players located in T&T
and the region to use the products and services of
the Centres of Excellence and their related
business Units.
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The Pilot Fish

But,

as is Singapore, T&T is situated in an area

with a large mass of people around it, the
Americas (north, South and Central) and the
Caribbean.
Some of these countries are investors in T&T
already, hence any products and services we may
be able to sell to them locally could have a
market image beyond our shores.
But of particular significance is attracting
venture capital from abroad to start up firms in
T&T (via the business units) that have markets
that span the globalised region.
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The Pilot Fish

Many

countries are building industrial parks with the

hope that the MNCs will establish industrial presences
there.
Unfortunately many of these presences are
manufacturing under concessions and the firms move
on when the concessions run out or they get better
offers.
We are building Wallerfield Park, the purpose is still
unclear at the present time.
However it will be situated next to the new university
UTT and there appears to be the potential to do
something different with the Park.

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A Venture Capital Park

Every

single firm in the world today has to

continue to innovate if it is to remain competitive.
Innovation is people intensive and the cost of
human resources in the developed world is high
and even more so for developers and researchers.
Hence we in T&T should be looking to attract
both capital and companies to start new SMEs in
T&T where our contribution is well trained staff
and good infrastructure at Wallerfield.
Clearly companies to make aluminium wheels, do
medical transcription and downstream manufacturing at Wallerfield are visions of a past age.
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A Venture Capital Park

Let us pause here again to
brainstorm as to what kind of
firms we should attract at the
Wallerfield VC Park since
clustering is the key to sustained
development.
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A Venture Capital Park

The

potential investors will not come to T&T to

train our people hence we have to train them
ourselves.
We cannot expect to train our people if we do not
stretch them. They have to attempt projects that
they have never done before.
We have to reduce severely our dependence on
consultants who may have done it before but who
did not see it fit to look for outside help when it
was needed in the first instance in their countries.
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Wallerfield VC Park
How

do we build a High Tech Park by simply

paying for the infrastructure without we ourselves
building and innovating to provide both good
service and experience for our people.
Good telecommunications are of importance to the
country in these days of globalisation. But how can
we build our broadband network by using North
American consultants and construction firms. We
will get the technological artefacts but not imbibe
the technology and the ability to innovate.
Public telecommunications is now the domain all
over the world of the super companies. What is our
role as entrepreneurs and innovators in this
environment?
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Management of the Innovation

System
The

disparate vertices of the Innovation

System needs some co-ordination if
anything useful is to come about.
For example the Venture Capital Act was
supposed to encourage VC Firms that
would have spawned SMEs.
Nothing happened and neither firms nor
money became available.
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Management of the Innovation

System
The

SBDC and it evolutions were supposed to

spawn small and micro enterprises, nothing useful
as far as global competitiveness has happened.
The government procurement policy is supposed
to spawn SMEs but it appears to be related to a
small part of standard purchases.
UWI should play a fundamental part in this
economic restructuring but to date UWI has not
got the point.
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Management of the IS
Local

content in the energy sector does not appear

to be looking at improving the economic factors of
the country
Wallerfield Park and the UTT appear to be
evolving with the past as a model
Agricultural policy appears to be non-existent
The Heritage fund (and whatever) appears to be
stuck in the less than innovative ideas of a
volatility or heritage fund with no vision of
economic transformation, the heritage we owe our
progeny.
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Management of the IS
Government

has not appreciated that it has to be a

major investor in Venture Capital resources.
Hence the Management of the IS requires a coordination among all four of the vertices of the System.
A clear vision has to be articulated to the Universities
by the T&T Government that funds them. The Centres
have to be established.
The Wallerfield Park has to be given the direction in
concert with the IS.
Negotiations have to be started with the various trade
bodies and legislation put in place to implement the
market conditions, and concessions.

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Management of the IS
We have seen in two of our major
examples, Singapore and S. Korea, and to
a lesser extent in Ireland that the
government had to take a decisive role in
managing the economic restructuring of
the country. Our private sector does not
have the experience to make the diamond
work, and in the past have taken the easy
way out. Our future then is in the hands
of the public sector decisions.
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Caribbean Business and

Society
This

Course has been about the ideas that I

have been developing over many years and
have had the opportunity to discuss them in
the press.
This class has given me the ideal
opportunity to discuss them with a group of
very intelligent people but moreso a group
of people that can do something about
making the economic changes that are
necessary.
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Caribbean Business and

Society
All that is left for me to do is wish that you
enjoyed this rather intensive set of
sessions and that you do well in your
exams.
Thank You.
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