Global Innovation Index 2021: resilient investments despite the pandemic

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Image by Gerd Altmann from Pixabay

As the Global Innovation Index 2021 shows, governments and enterprises in many parts of the world scaled up investments in innovation amid the massive human and economic toll of the Covid-19 pandemic. Scientific output, expenditures in research and development (R&D), intellectual property filings and venture capital deals continued to grow in 2020, building on strong pre-crisis performance. Notably, R&D expenditures showed greater resilience during the pandemic-linked economic downturn than in previous slumps. However, the impact of the crisis has been highly uneven across industries, according to a new GII feature, the Global Innovation Tracker. Firms with outputs including software, internet and communications technologies, hardware and electrical equipment industry and pharmaceuticals and biotechnology amplified their investments in innovation and increased their R&D efforts. In contrast, firms in sectors heavily hit by the pandemic’s containment measures and whose business models rely on in-person activities – such as transport and travel – cut back their outlays, the tracker showed.
In its annual ranking of the world’s economies on innovation capacity and output, the GII shows that only a few economies, mostly high income, consistently dominate the ranks. However, selected middle income economies, including China, Turkey, Vietnam, India, the Philippines, are catching up and changing the innovation landscape. Switzerland, Sweden, U.S., and U.K. continue to lead the innovation ranking, and have all ranked in the top 5 in the past three years. The Republic of Korea joins the top 5 of the GII for the first time in 2021, while four other Asian economies feature in the top 15: Singapore (8), China (12), Japan (13) and Hong Kong, China (14).

The geography of global innovation is changing unevenly
Northern America and Europe continue to lead the global innovation landscape as regions by far. The innovation performance of South East Asia, East Asia, and Oceania has been the most dynamic in the past decade. It is the only region closing the gap with the leaders. China is still the only middle-income economy that makes it to the top 30. Bulgaria (35), Malaysia (36), Turkey (41), Thailand (43), Vietnam (44), the Russian Federation (45), India (46), Ukraine (49), and Montenegro (50) make it to the GII top 50. However, only Turkey, Vietnam, India and the Philippines, are systematically catching up. Beyond China, these larger economies have the potential to change the global innovation landscape for good.

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