MORE MONEY: Prof David Kaplan wants more state spend for R&D in SA. Picture: FINANCIAL MAIL

PRESIDENT Jacob Zuma yesterday highlighted the need to increase funding for research and development as a percentage of gross domestic product (GDP), in order to make SA more competitive.

Mr Zuma was speaking at the African National Congress's policy conference. Research and development (R&D) is considered a key driver of growth, competitiveness and job creation, and the foundation of building a knowledge economy.

However, investment in the area was 0,93% of GDP in 2009-10, according to the Department of Science and Technology's annual report.

This falls short of the ambition to have spend 1% of GDP on research and development by 2008. The state also lags business's investment in research and development.

David Kaplan, an economics professor at the University of Cape Town, said business was the main contributor to research and development in the country.

"Approximately two-thirds of the increases in total research and development in the last 10 years, 1997-98 to 2007-08, have been accounted for by the business sector," he wrote in a World Bank report entitled Inputs and Performance of Technology Innovation, which was published in 2010.

"The business sector dominates total research and development expenditure accounting for almost 58% of total expenditures," he said.

SA is also trailing its Brics partners, with Brazil, Russia and China spending more than 1% of their significantly larger GDPs on research and development, according to World Bank indicators.

"On science and technology, the proposal is to increase our gross expenditure on research and development as a percentage of GDP, to make the country more competitive so that we can move rapidly into a knowledge economy and information society," Mr Zuma said.

"Knowledge-based economies have the potential to stimulate growth, provide higher wages and greater employment opportunities, as well as enhance a country's competitiveness," said William Blankley and Irma Booyens, researchers with the Human Sciences Research Council, in the HSRC Review last year.