Address by President of the Republic Tarja Halonen at the Finnish-German Innovation Dialogue Seminar in Berlin on May 4, 2007

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It has been most interesting to follow the dialogue that has been going on here. It is obvious that Germany and Finland engage in a good deal of cooperation in the innovation sector. It is our common feeling that this cooperation should be carried further. I am pleased also to see many practical actors present here today. This will make it possible for us to make rapid progress in deepening and expanding, cooperation between Germany and Finland on the basis of this seminar.

Expertise, education, research and technology are factors that lay the foundation for long-term social development. These factors are also prime movers in the promotion of productivity and economic growth. Innovation will play a key role in responding to global challenges – whether in relation to economic growth, or to human health, the challenges of climate and environmental change, or security issues.

Key principles of Finland’s education and training policy

Education and culture have been held in high esteem in Finland for hundreds of years. Educational equality, equal access to education and equal access to self-improvement regardless of wealth are guaranteed in the Finnish Constitution. The principle of equality has directed the development of our educational system since the 1960s when Finland changed gradually over from a parallel school system to a comprehensive school system.

Comprehensive school is part of a child’s basic security. High achievement levels and reduction of differences in achievement are important educational policy goals. In the light of international and national surveys, Finland has been successful in combining these goals.

Finland is an education-friendly society in which prosperity has been built systematically on a foundation of knowledge and expertise. Successful educational policy requires a strong national commitment – that education and training are esteemed and are guaranteed sufficient resources.

It is extremely important to work for children and young people – they are the experts of the future. In addition to an increasing quantity of information and knowledge, the new generation must also acquire the right attitude. Even the most up-to-date education becomes outdated, and people must be prepared for lifelong learning. It is up to us adults to pay more attention to how we go about arousing the desire to learn. We must be able to stimulate the natural curiosity and creativity of our children successfully. We must succeed in nurturing in them the resolve and persistence required for the acquisition of skills. And finally: children and young people must be encouraged to cooperate with others.

Education, training and innovation

Finland has promoted a comprehensive innovation policy both nationally and in international forums. It includes the idea that innovations and their application are increasingly linked with networks where education, research, production and services work in close interaction.

On the basis of our own experience, we have stressed that the benefits of technology will not materialize without sufficient training for the people who use it. An economy based on innovation needs highly trained human resources, both entrepreneurs and corporate employees. An innovative society cannot exist without schools that encourage people to be creative, to take risks and lay prejudice aside. A high-quality educational system based on equality is a basic requirement for adopting technology, since without equality the fruits of technology and innovation can never be fully exploited.

Recent European debate has focused on excellence of research, and not without reason. In this context, Finland has emphasised that in a functioning innovation system, education and training must be easily accessible and of a high quality at all levels and in all forms. This continues to be a major challenge, since there are significant differences in the educational levels of those involved in working life. Nevertheless, it is worth the effort to develop adult education. As forwarders of knowledge and expertise, teachers, bank clerks, nurses and forest machine operators are ‘innovators’ in the same way as engineers and researchers are. It is also worth bearing in mind that educated and critical-minded citizens are actors in a ‘demand-driven innovation policy’. This holds good for social innovations in particular.

It is important that inputs are made in innovation and in the advancement of innovation policy at both national and EU level, and that these levels complement and support each other. During her EU Presidency, Finland was active in the sector of innovation, and we believe this trend will continue during Germany’s Presidency and beyond. We hope, for instance, that during the German Presidency we will be able to make concrete progress in the ARTEMIS initiative. In keeping with the Lisbon strategy, innovation has a key role in building European competitiveness.

Finland’s policy outline

Finland’s policies appear to be continuing along consistent guidelines. The new Government, which started work two weeks ago, has issued the policy outline that the proportion of Finland’s GDP accounted for by research should rise from 3.5 to 4 per cent by 2011. The Government has also decided in its Programme to start preparing a new national innovation strategy as soon as possible.

Finland’s massive – public and private - investments in research, development and innovation have produced concrete results. I mention just a few:

According to international comparisons, Finland’s competitiveness is excellent, and we are in the top class in many other international comparisons, too, for instance in sustainable development.

Finnish society and Finnish business have been quick to move over to a knowledge-intensive, expertise-based economy and society.

Productivity in Finland has increased rapidly. In the 1980s, Finland’s productivity was 20% below that of the United States, but since the late 1990s Finland has been at the same level as the United States. Growth in the productivity of work has also been considerably faster in Finland than in the EU-15 or EU-25 countries.

And in addition, economic growth has been distinctly faster in Finland than in the OECD countries on average, both before the recession of the early 1990s and after it.

Why has Finland’s innovation policy been so successful?

For a couple of decades now, there has been a clear consensus in Finland on innovation policy and its potential. In practice, all political parties and all the various government coalitions have pursued a uniform innovation policy. Industry, its organisations and labour market organisations have all given strong support to this policy. For instance our most important employee organisation, the Central Organisation of Finnish Labour Unions, has given active long-term support to our technology and innovation policy. The private-public partnership works transparently and extremely effectively here.

Cooperation, networking and social capital improve effectiveness. Goals relating to the economy, the environment and welfare have been properly balanced. The various phases of innovation development – basic research, applied research, industrial research – are well balanced and engage in transparent, active cooperation. In addition to research and development funding, the venture capital sector has also advanced and works now in close interaction with research. This will boost the utilization of research findings.

Importance of international cooperation

As globalisation has proceeded, international cooperation has gained importance in the progress of innovations, too. The research, development and innovation operations of companies are increasingly international. Not only major companies but also small and medium-sized companies must make better use of international networks and markets in their innovation activities and in renewing their business operations. The challenges faced by universities and the research community are similar. International strategic partners are needed to achieve and maintain international competitiveness. For the moment, innovation in business operations, for instance, is less pronounced in Finland and Europe than in the United States.

In the Sixth Framework Programme of the European Union, Finland took an active part in more than 800 joint projects. Today, Germany is Finland’s most important partner. Finland and Germany have more than 600 joint projects. The next biggest cooperation partners are the United Kingdom (530), Italy and France (460). These figures reflect the fact that innovation cooperation with our German partners has got off to a good start. In view of the future, we should now openly discuss our strengths and weaknesses, or, if we put it in more optimistic terms, what we can get from each other and what we can develop further between us or with third parties.

It seems obvious to me that the European Research Area is in a way a domestic research market for Finland that we must make efficient use of – I would be inclined to call it our home area. Its level should be raised, and I am pleased to see that you here in Germany are also interested in it. It is nevertheless important to build increasing and more extensive innovation cooperation with the United States, Japan, China, India and Russia, for instance, and to be active within the European Union and at the national level at the same time. Personally, I am also interested in regional cooperation between small countries all over the world.

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I started out by saying that education, training and innovation are undeniably the cornerstone of social development, not only of economic growth. It is also an important instrument in responding to global challenges, and there are plenty of such challenges: climate change and environmental goals, targets relating to health and welfare, and security issues. A moment ago I spoke about helping children and young people towards the joy of learning and towards creativity and partnership. I hope that we adults, too, can make use of these essential components of a better future.