{"id":7223,"date":"2017-05-01T16:00:06","date_gmt":"2017-05-01T10:30:06","guid":{"rendered":"https:\/\/www.enago.com\/academy\/?p=7223"},"modified":"2018-05-21T23:11:44","modified_gmt":"2018-05-21T17:41:44","slug":"israel-edges-out-south-korea-to-become-global-leader-in-research-and-development","status":"publish","type":"post","link":"https:\/\/www.enago.com\/academy\/israel-edges-out-south-korea-to-become-global-leader-in-research-and-development\/","title":{"rendered":"Israel Edges Out South Korea to Become Global Leader in Research and Development"},"content":{"rendered":"

Israel and South Korea have been very close since 2012 in terms of the percentage of Gross Domestic Product (GDP) invested in Research and Development (R&D). In 2015, the Organisation for Economic Co-operation and Development (OECD) reported that Israel had edged out South Korea<\/a>, with Israel investing 4.25% of its GDP compared to South Korea (4.23%).<\/p>\n

Although the statistical differences between these two countries may be small, their investment represents a national emphasis on R&D that is far greater than any other country in the OECD. The United States comes in at 2.8%<\/a>\u00a0followed by China at 2.07%. Recognizing their common values in this area, Israel and South Korea formed the Korea-Israel Industrial R&D Foundation in 2001. In fact, Samsung\u2019s first R&D centers were in Israel.<\/p>\n

In both countries, industry-led research represents most of the R&D investment. \u201cBasic\u201d research, as defined by the OECD, is the \u201cwork undertaken primarily to acquire new knowledge without any particular application in view,\u201d represents 0.73% of GDP investment in South Korea and just 0.39% in Israel, according to Nature<\/a>. Thus, South Korea is the clear leader in this arena, but the economies of both countries have benefitted enormously from foreign investment, owing to their governments\u2019 fundamental R&D advocacy.<\/p>\n

The Startup Nation<\/h2>\n

Israel has also become known as the Startup Nation<\/a>. This transformation is largely the result of four factors:<\/p>\n

    \n
  1. Culture and History<\/li>\n
  2. Military Requirement<\/li>\n
  3. Educational System<\/li>\n
  4. Government Prerogative<\/li>\n<\/ol>\n

    Culture and History<\/h3>\n

    The nation of Israel is young and was officially declared a state in May 1948. It has had a turbulent yet fertile history since that time. It is a nation of immigrants who have given up a lot and have not much to lose. They are fighters searching for better lives in the face of adversity. This tends to produce creative thinkers, problem solvers, and resilient survivors \u2026 the perfect foundation for a nation of innovators.<\/p>\n

    Military Requirements<\/h3>\n

    Israel\u2019s two-year military requirement provides its citizens with the experience of living in a highly-disciplined environment, learning new and valuable skills, and establishing a network of friends and acquaintances who will be important resources in the future. In addition, the Israeli Defense Forces place less emphasis on hierarchy and rank and more on the value of good ideas and good work. Young soldiers are encouraged to debate and challenge their superiors, an attitude that carries over into the business world.<\/p>\n

    Educational System<\/h3>\n

    Israel\u2019s educational system is robust and world-class. Start-Up Nation<\/em> states that among Israel\u2019s population of 8 million, there is the \u201chighest concentration of engineers and PhD holders per capita in the world.\u201d The system also promotes an interdisciplinary approach. Rather than selecting a single area of focus, students are encouraged to get creative and forge a dynamic mixture of science and the liberal arts.<\/p>\n

    Government Prerogative<\/h3>\n

    Innovation is fundamental to Israel\u2019s economy. Invest in Israel<\/a>\u2019s Eyal Eliezer, Senior Director of Strategy and Marketing, says that the \u201cIsraeli Government seeks to offer maximally supportive conditions for companies and investors looking to invest in Israel.\u201d This support includes grants, reduced tax rates, and tax exemptions, primarily aimed at international investors. According to the APCO<\/a> Forum, these 2017-18 government tax benefits were attached to a clause that would protect them for 10 years.<\/p>\n

    Rise in Foreign Investment<\/h2>\n

    Over 350 of the world\u2019s premier Multi-National Corporations (MNCs) do business in Israel. It is also the home base for thousands of startups. Some statistics from World Finance<\/a>:<\/p>\n