Methodological and Technological issues in Technology Transfer

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4.1 Introduction

As discussed in Chapter 2, international financial flows have strongly influenced technology transfers between countries. Since UNCED in 1992, three major trends in finance for sustainable development have occurred. First, there has been increasing interest and activity in developing innovative domestic and international financial mechanisms. Second, both official development assistance and domestic resource mobilisation have fallen short of the commitments made. Third, private flows of financial resources from developed to developing countries have expanded enormously (Lin See Yan, 1997).

To improve the quality and efficacy of the transfer of environmentally sound technologies for the purposes of the UNFCCC, these trends need to be set in a broader context. That context-for promoting successful, sustainable technology transfer-implies multi-facetted enabling environments in both developed and developing countries. Enabling environments for technology transfer include national institutions for technology innovation, the involvement of social organisations, human and institutional capacities for selecting and managing technologies, macroeconomic policy frameworks, the underpinnings of sustainable markets for environmentally sound technologies, national legal institutions that reduce risk and protect intellectual property rights, codes and standards, research and technology development, and the means for addressing equity issues and respecting existing property rights. Enabling environments are inclusive, with all stakeholders potentially affected - governments, research institutions, national NGOs, technology developers and businesses. And actions to promote enabling environments are required in both developed and developing countries.

Any discussion of enabling environments inevitably conjures up the long-standing debate about "good government." Good government has been increasingly recognised as essential for promoting the environment and development agenda. Yet sharp disagreements have existed about what good government means; a wide range of actions have taken place in response to "simultaneously too much state and too little state" (Merquior, 1993). In both developed and developing countries in the 1980s and early 1990s, many governments committed themselves to market-oriented approaches for generating economic growth as a response to "too much state." Economic and political pressure forced governments to limit or eliminate economic interventions. This response to decades of "too much state" reduced the size, expenditures, and responsibilities of public sectors (Grindle, 1997). Reform priorities turned to the stabilisation of macroeconomic conditions, liberalisation of domestic and international trade, privatisation, and the reduction of state bureaucracies.

Over time it became clear to many that government also had to be strengthened to make it efficient, effective and responsive.

The most significant obstacle to the pursuit of social objectives is what may be described as the crisis of governance. The crisis of governance includes an excessive degree of centralisation; overburdening and rigidity of the government machinery; the absence of local participation which can provide the requisite attention to detail; deterioration in the professionalism, competence and integrity of public functionaries and the weakening of judicial and quasi-judicial institutions (Banuri et al., 1997, p. 9).

Governments not only had to have the capacity to manage macroeconomic policy but also had to be able to actively regulate market behaviour. So the trend towards market-oriented economic policy inevitably led to new (or rediscovered) roles for the state (Naim, 1995). In addition, reformers began to recognise that well-defined and functioning institutions of governance were important for the stability and legitimacy of new modes of public and community participation.

By the mid 1990s, good government had been added to the development agenda precisely because of greater awareness that neither markets nor democracies could function well--or perhaps function at all--unless governments were able to design and implement appropriate public policies, administer resources equitably, transparently and efficiently, and respond to the social welfare and economic claims of citizens. Although a general consensus developed on the imperative for good government, how to get good government has not been clearly understood (Grindle, 1997, p. 5).

Past experience with technology transfer in a variety of sectors can be used to suggest policy tools for providing enabling environments for the transfer of technologies for mitigation and adaptation to climate change that is supportive and sustainable. Evidence exists both of barriers and ways in which barriers can be avoided and overcome. Experience also shows that technology transfer offers many opportunities for sustainable economic and social development. Perceptions of the role of technology transfer in development have been transformed in the past twenty years, as the focus has switched from externally supplied hardware to people, processes, and the importance of local knowledge. Experience also has shown that technology transfer can be made more sustainable by ensuring that long-term learning and adaptation takes place, that conditions for market sustainability exist, that stakeholders continue to be involved, and that replicable financing mechanisms continue to function.

The sustainable use of environmentally sound technologies (ESTs) for climate change has to fulfill not only social but also economic and development objectives through a complex process of technological change. Chapters 4 and 5 explore what enabling conditions government can establish to facilitate this change in support of the Climate Change Convention, and how other stakeholders in the private sector, lending institutions, multilateral agencies, and non-governmental organisations can perform within this framework. This chapter identifies the key elements and broad relationships and Chapter 5 focuses on the crucial financial partnerships needed.

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