In the late 1990s the SA government recognised that what it needed more than roads, hospitals and schools from well-intentioned aid programmes was technological co-operation and support in upgrading this country's information and knowledge societies.
Where better to get it from than Finland? It's the world's most competitive country, according to the World Economic Forum. It has more than 30 years' experience in innovation systems; it's the home of Nokia, the world's leading mobile phone company; and it's a country where more than 43% of companies are habitually involved in some kind of innovation activity.
This wasn't always the case. Finland was historically a poor country. "As a nation we had to pull together, pool resources and invest heavily in education and research & development," says Helena Tapper, a counsellor at the Finnish embassy in SA.
SA's shift in development thinking coincided with a critical examination in Finland of its own external development efforts and in 2000 a declaration of intent was signed between President Thabo Mbeki and Prime Minister Paavo Lipponen.
As a result of this the Finnish government established a new diplomatic position at its embassy in Pretoria. Ilari Lindy, appointed to the job, arrived in SA with a unique mission: to work with government to identify priority projects that the two countries would jointly focus on and to which Finland would allocate about R100m in development funding.
The end result of a number of bilateral consultations was that Finland would make its innovation system available for SA to learn from. "This is the first project in this area and of this magnitude," says Lindy, speaking from his current position as a senior expert at the European Network & Information Security Agency in Greece.
A cluster of partnership programmes have been identified. Of these, the flagship project is the Co-operation Framework on Innovation Systems (Cofisa), which aims to strengthen SA's national system of innovation and to which Finland is contributing the bulk of the R30m project cost.
The other priority projects are: Safipa, an ICT capacity building programme to be implemented through the CSIR's Meraka Institute; a project to build the capacity of the Southern African Biotechnology Network; and a project called Inspire that will help to build provincial information societies, starting with Limpopo and the Northern Cape. The common theme in all these projects is the focus on institutional skills and capacity development instead of infrastructure investment.
While agreements relating to these projects are being completed, the Cofisa programme is moving ahead.
It has four components: enhancing the SA national system of innovation; supporting innovation at a provincial level, specifically in Gauteng, the Western Cape and the Eastern Cape; piloting rural innovation mechanisms; and sharing knowledge on systems of innovation with sub-Saharan Africa.
"This is not about building your innovation system for you," says Tapper. "It's a strategic intervention to help SA make its innovation system work better. You have a fairly high-level system - but not in all areas."
One big challenge is to get ministries to work together at a national level. "Your department of science & technology has a vision for innovation, but what about the departments of communications, education and trade & industry, which all work in various aspects of the innovation system?" Tapper does not underestimate the size of the challenge. "It's a huge issue; we know it's not easy and we know it will take time to get the players to see SA's national system of innovation as one system with many actors."
"We have realised that what is important is getting the conversations right," says Neville Arendse, chief director for international resources at the department of science & technology. "Getting government, industry and academia to talk requires confidence, trust and regular networking. This is where the Finns differ from so many countries - they have got this conversation right."
Other weaknesses identified in SA's national system of innovation include: the lack of foresight capabilities at national and provincial levels; the lack of a shared understanding between the system's stakeholders; insufficiently developed provincial systems of innovation, which are poorly integrated with the national system; lack of institutional support structures like funding agencies and science parks; and a failure to recognise the potential of science and technology to solve problems in poor and rural communities.
Translating the lofty goals of the partnership into a project with tangible delivery and output targets has been the focus of more than two years of discussion and deliberation. "This is not about buying hardware," says Tapper. "It's about transferring best practices and supporting intellectual capabilities in SA institutions - particularly in science and technology and innovation policy."
The Helsinki Consulting Group was awarded the contract by the Finnish government to operate as technical consultants working with the department of science & technology. "Where necessary we will draw in other experts from Finland," says chief technical adviser Lauri Kuukasjärvi, who will be in SA for the 30-month duration of the Cofisa project.
Finland has a population of 5,2m and 24 science parks; SA has a population of 44m and one accredited science park.
One of the tasks for this year, he says, will be to do a feasibility study into the development of science parks in SA.
"Science parks are internationally recognised mechanisms for the promotion of innovation," adds Nirvashnee Seetal, SA's national co-ordinator on the Cofisa programme.
At the provincial level, foresight exercises, to be conducted in close co-operation with experts from Finland, will assist in the development of scenarios for provincial innovation systems. "We will hold foresight exercises in our three pilot provinces [Gauteng, the Western Cape and the Eastern Cape] to transfer skills to them," says Seetal. "The goal is to empower them to develop their own provincial roadmaps for technology and innovation development."
The process will bring together key players to enhance collaboration and build common ground. "The key players must be on board at the planning stage," says Kuukasjärvi, "so that every organisation recognises its own role and opportunity."
Finland has concluded its own foresight exercise called FinnSight 2015. The project used 10 expert panels, which included about 120 external experts, to help identify important joint future areas of expertise for science, technology, business and society. This knowledge will lay the foundation for new centres and clusters of expertise.
The centres of expertise programme is another part of the Finnish innovation system that has been particularly successful. SA has 13 centres of excellence, but these are small institutions with a specific research competence. In Finland, about 18 "coalitions of expertise" have been aligned in specific industry sectors and include all three parties (government, business and academia). Though government will support these coalitions with seed funding, their sustainability depends largely on their ability to bid for competitive funding, both Finnish and European. Those that aren't convincing don't get the funding, explains Arendse. The programme will be piloted in Gauteng. Finland's experience shows that this is one important way of fostering collaboration and integration across sectors.
In addition to the development funding that has been channelled through Finland's foreign affairs ministry, other Finnish institutions are getting involved in SA. Finnfund, a development finance company that provides long-term risk capital for profitable projects in developing countries, has made a R500m commitment to a new fund established by Horizon Equity. Horizon is a private equity company with a strong track record in technology and its new fund will provide equity capital to small and medium enterprises (not start-ups) in higher-growth sectors of the SA economy, including the ICT sector.
In addition, Finnfund runs a programme called Finnpartnership which supports commercially viable partnerships between companies in Finland and in developing countries.
Last year its programme director, Sari Nikka, met some SA companies with a view to finding partners for them in Finland. The idea is that they will then invest in setting up commercialisation structures between the Finnish and SA entities, forging new business networks and creating business opportunities.
As these emerging business relationships suggest, SA is not simply a taker in this relationship. Finland hopes to benefit too.
It hopes to learn from this new development approach and apply these lessons in other countries in which it operates.
Also, SA offers a cultural and geographical diversity not available in Finland. "SA is a more complex environment," says Lindy, "which makes it a good test bed for technology applications.
"It is a challenge to achieve relationships that go beyond partnerships based on development aid and are closer to more formal business partnerships. Achieving economic growth and prosperity in SA and Africa benefits everyone."
