The UAE – the Arab world’s second-largest economy – jumped two places in the Global Innovation Index 2020 to rank 34th out of a total of 131 countries.
The index, released on Wednesday by the World Intellectual Property Organisation, placed the UAE at the top spot among Arab nations for the fifth consecutive year.
The index ranks the countries based on their capacity to innovate and is calculated based on detailed measures of innovation inputs and outputs – consisting of 80 indicators.
“Innovation will play a fundamental role in accelerating the wheel of growth and overcoming various economic challenges.”The UAE has “an advanced innovation-incubating environment, achieved by pioneering legislation and institutional development”, Minister of Economy Abdullah bin Touq Al Marri, said.
In the UAE, a key pillar of the National Innovation Strategy is promoting skills and establishing a national culture of ideas and entrepreneurship, the report said,
“Spreading information about public and private instruments to finance innovation projects can also help to strengthen the innovation finance landscape,” it added.
The UAE was placed at the 22nd position on the innovation input sub-index, ahead of countries such as Iceland, Luxembourg, China, Spain and Russia.
Meanwhile, it was ranked 55th in the innovation output sub-index, three places higher than the last year.
Under the theme of ‘who will finance innovation’, this year’s report measured the performance of 131 economies that represent 99 per cent of global gross domestic product.
Building on initiatives like the Abu Dhabi Economic Vision 2030, the UAE’s National Innovation Strategy was launched in 2014 with the aim of making the nation one of the world’s most innovative within seven years.
In the five years from 2014 to 2018, the country’s information and communications sector grew by 27.2 per cent and at an average annual rate of 5.4 per cent, according to a report by the Ministry of Economy.
Beyond funding innovation, the UAE is building a pathway to raise future capital with stock exchange listings, the GII report said. The number of listed companies in the UAE continues to grow, rising from 130 in 2017 to 137 in 2018, it added.
Authorities in the UAE are also looking at ways to allow SMEs to use an initial public offering to raise funds - a “very welcome strategy as unicorns emerge from the local innovation ecosystem and rise into global players”, the report said.
In the Arab world, the UAE was followed by Saudi Arabia that was placed 66th, increasing its rank by two positions. Other regional economies that feature in top 100 include Qatar (70th), Kuwait (78th), Bahrain (79th), Jordan (81st), Oman (84th) and Lebanon (87th).
The report noted that the coronavirus pandemic has triggered an “unprecedented global economic shutdown”.
However, it has also highlighted the importance of innovation to corporate and national economic growth strategies, the report said. “Fundamentally, the pandemic has not changed the fact that the potential for breakthrough technologies and innovation continues to abound.”
“Our efforts to promote innovation further will continue in the long-term and today … in light of the changes posed by the impact of the Covid-19 pandemic, the importance of these efforts has increased,” Mr Al Marri said.