The innovative performance of an economy depends on how individual institutions and actors (e.g. education and research organisations; firms; funding institutions) perform in isolation and how they interact with each other as elements of a collective system of knowledge creation and use. Without adequate development of these actors and institutions in the domestic and regional settings the innovation system remains underdeveloped and anaemic.

The model below presents four possible distinct connections among the science, technology and innovation triad (i.e. domains A, B, C and D) together with a reactor (domain E), within which all of these take place. STI activities have to exist within the framework of the National Innovation System (NIS) (domain E).

The National Innovation System (NIS) has been defined by Freeman (1987) as “the network of institutions in the public and private sectors whose activities and interactions initiate, import, modify and diffuse new technologies.” Freeman’s definition places emphasis on the interaction between the production system and the process of innovation. Ilori (2006) defines it as a constitution of elements and the relationships located within or rooted inside the borders of a nation state, which interact in the production, diffusion and use of new and economically useful knowledge. This definition emphasizes the economic usefulness of science and technology (S&T) activities. The success achieved by any nation in exploiting new, especially scientific, knowledge for growth and development depends on the effectiveness of the nation’s National Innovation System (NIS). 

A = Science and Technology B = Technology and Innovation C= Science and Innovation D = Science, Technology and Innovation E =National Innovation System (NIS)

Domain A, which represents the link between science and technology results in the generation of new, improved and cutting-edge knowledge and methods without obligatory regard to economic benefits. While this can bestow leadership upon any nation, it will not translate automatically into observable economic benefits. Global experiences have shown that the possession of advanced scientific capability does not robotically translate into development. As a matter of fact, huge expenditures in science do not equal to knowledge-intensive activities and industries. While science and technology will hold some benefits for the developing nations of Africa, notably the creation of a critical mass of human resource, this alone does not guarantee the kind of growth that these nations seek.

In domain B, the kind of activities that would typically take place would relate to the acquisition of embodied technology and an aggressive pursuit of foreign direct investment (FDI) as a way to drive growth. The domain tells of a nation’s potential for exploiting knowledge developed elsewhere. This potential which we may call “absorptive capacity” or “diffusion” is particularly beneficial for developing nations as it lessens time and cost required to catch up. In fact, according to Polcuch et al (2005), in developing countries, technology transfer from multinational corporations and from abroad is a fundamental source of innovation. Acquisition of embodied technology/equipment for both product and process innovation is a major component of innovation. The crucial importance of capital goods as a source of innovation even in developed countries is confirmed by a survey of European enterprises, which shows that 50 percent of total innovation expenditure is embodied in plant, machinery and equipment purchased by industrial firms, with own R&D accounting for just 20 per cent (Evangelista et al., 1998, quoted by UNIDO, 2002).

Nevertheless, the advantages in this domain for African countries are limited by two main factors. First, to secure latecomer advantages, firms (and nations) must be very fast in developing and deploying their capabilities to source and access relevant technologies Resource constraints and institutional deficiencies make it unnecessarily difficult for most African countries to even develop let alone achieving speed in deploying capabilities. Secondly, the development of “special institutions” that accelerate and facilitate the catch up process is paramount. These institutions; such as the 19^th century Deutsche Bank, Japan’s Ministry of International Trade and Industry (MITI), Taiwan’s Industrial Technology Research Institute (ITRI) and India’s Ministry of Non-Conventional Energy Sources, among others; are largely absent in Africa and where they exist, are either under-funded or “overloaded” with responsibilities beyond acting to bridge the gap between the technology resources of the developed world and the aspirations of the developing nations to catch up.

The Science-Innovation link of domain C suggests the creation of new economically useful knowledge in a country. However, with the absence of technology, it becomes a particularly difficult and nearly impracticable link, for science will seldom yield any economic benefits in the absence of technology. Indeed, certain major scientific advances are even driven by technology. A classic example was given by George Porter (Nobel Laureate in Chemistry) who pointed out that "Thermodynamics owes more to the steam engine than the steam engine owes to science.”

In D, the triad of science, technology and innovation co-exist. This, no doubt, should be the aim of every nation in Africa. National scientific and technological efforts must be directed with clear economic benefits in mind. In fact, technological learning – a major component of innovative knowledge application – is recognised as the critical factor that underpins successful industrial development. The rapid development recorded in East Asia in the second half of the last century and more recently, that of China, India and Brazil are illustrative of this.

Economic globalisation has changed the world economic order, bringing new opportunities and challenges (Commission of the European Communities, 2006) and significant changes in the conditions for catch-up with dire consequences for developing countries. In this new economic order, developing nations can no longer compete based only on their natural resource endowments and local advantages. The experience of Brazil with sugarcane suggests that building scientific capacity and competences in the fields of natural resource endowment and local advantages is a surer way to development.

For a nation to withstand competition in this era of globalisation there is need for such to identify its niche areas and build on it by the application of scientific methods. New technologies and industries may then be built around these areas of core competences. To achieve the foregoing, however, certain systemic weaknesses must be taken into consideration. This is especially so because the NIS, which acts as the reactor for all of the efforts discussed so far, ultimately determines to a reasonable extent how much results can and will be achieved. Within this context, it is useful to review some of the key challenges to STI development in Africa, with a view to proffering solutions.