Wspólnotowy Serwis Informacyjny Badan i Rozwoju - CORDIS

Access in foreign technology (by Greece, Turkey, Hungary and Mexico)

This chapter analyses the various forms of international technology inflows to the four sample countries in their process of development or transition to a fully-fledged market economy. The paper considers ‘internalised’ forms of technology transfer, such as foreign direct investments (FDI) and inter-firm alliances and co-operation, and ‘externalised’ forms such as licensing and ‘outward-processing trade’ (OPT) by Western European firms. Evidence is presented for each of these technology flows for the relevant periods, including liberalisation years as well as years of (incipient or consolidated) integration with the European Union (and the US for Mexico). The comparative analysis illustrates the wide variety of possible ways to acquire foreign technology, and the different requirements for a country’s industrial and technological development.

Greece appears as an ‘early opener’ within the context of European integration, but it has not been very successful in attracting foreign investments. Moreover, FDI has persistently concentrated in activities with low technology, with no signs of structural change towards higher technology sectors. Licensing of foreign technologies has also been relatively limited, and the OPT arrangement cannot apply to Greece. This manifest inability to link with technologically dynamic foreign enterprises may be a crucial obstacle to the country’s technological upgrading and development.

Mexico has received large foreign investment inflows for several decades, and is characterised by a broad variety of inter-firm relationships and alliances. However, the relationship with the EU is less important for the Mexican economy than that with the US, a tendency strengthened by the NAFTA agreement. The evidence on large foreign technology inflows is promising for the country’s industrial and technological development, but it remains to be seen the extent to which these flows will translate into effective deepening of local technological and industrial activities. Hungary has been the ‘late-opener’, but is now very welcoming to foreign investors. It has been one of the most successful countries in its region in attracting FDI, and the sectoral distribution shows a large presence of advanced activities such as machinery and equipment and chemicals. It has also used OPT arrangements intensively to link up with European firms and gain access to their technologies.

Turkey opened earlier than Hungary, but FDI stayed at very low levels by international standards for many years. However, in recent years FDI has risen, and its sectoral pattern looks promising for the country’s technological development. The share of FDI in traditional products has fallen over time, whilst the share of science-based activities has increased; FDI in scale intensive products has stayed relatively high throughout the period (1975-95). Moreover, it is using OPT in textile and garments effectively to build up local production capabilities and raise local value added.

In order to draw out the implications of the different patterns of access to foreign technologies, it is necessary to take into account the macroeconomic context, the S&T structure and industrial performance; this is done in the individual country studies.

Reported by

University of Oxford
St Giles 21
OX1 3LA Oxford
United Kingdom
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