South Africa’s gross domestic expenditure on research and development (GERD) declined for a third consecutive year in 2020/21, compounded by a weak economy.
This is based on data from the 2020/21 National Survey of Research and Experimental Development, released by the Department of Science and Innovation (DSI).
According to the survey findings, GERD was R33.5 billion for the 2020/21 period, based on the rand value for the period in review. In constant 2015 rand prices, GERD fell from R28.1 billion in 2019/20 to R25.9 billion in 2020/21, which is a year-on-year decline of -7.6%.
By comparison, the country’s GERD slid from R36.8 billion in 2018/19, to R34.5 billion in 2019/20, to the current value of R33.5 billion.
South Africa’s spending on R&D was last at its highest during the 2017/2018 period, when it amounted to R38.7 billion.
GERD is an aggregated measure of R&D expenditure performed domestically across five institutional sectors; namely business enterprise, government, higher education, not-for-profit, as well as science councils.
Commonly referred to as the R&D survey, the report is carried out on behalf of the DSI with the support of Statistics South Africa. It is conducted by the Centre for Science, Technology and Innovation Indicators, which is based at the Human Sciences Research Council.
The annual survey provides an update on SA's R&D statistics, measuring the size, growth and composition of R&D in terms of expenditure, funding and personnel.
The survey, which is published a year after it has been compiled, aims to reflect actual expenditure and not projections.
While the business sector has dominated in terms of funding research and development, spend by the sector declined, together with higher education and science councils.
According to the R&D survey, the business sector reported the largest decrease in nominal expenditure for 2020/21 by R657 million (-6.1%). It was followed by the higher education and science council sectors, with R393 million (-2.8%) and R296 million (-4.8%), respectively.
Despite the overall decline in R&D expenditure, government led the way when it came to the sector that contributed the most spend. The state funded 56.3% of R&D in South Africa, while business funded 26.9%, with foreign funding contributing 13.3%.
“In nominal terms, funding decreased by R944 million. There was a R545 million (-2.8%) decrease in government funding, including science councils and university own funds, in 2020/2, and a R325 million decrease in business funding in 2020/21.
“Funding from abroad decreased by R201 million, while funding from other South African sources increased by R127 million.”
Dr Blade Nzimande, minister of higher education, science and innovation, commended the high proportion of R&D funding from government.
“Higher education and the science councils are the main beneficiaries of government funding. It is notable that the proportion of R&D funding received from government by these institutions has increased significantly, from 26.3% in 2019/20. There is a need for greater investment in R&D from South Africa's private sector.
“Innovation is necessary to drive the economic renewal, growth and transformation needed for South Africa's sustainable and inclusive development agenda. Without it, our national economy will be unable to restructure and reposition itself in a highly dynamic and disruptive global economy.”
According to the report, the manufacturing, agriculture and transport sectors recorded decreases in R&D expenditure, with the financial and mining sectors recording increases.
Manufacturing and financial intermediation are often considered as the two sectors with the highest R&D expenditure within the business sector.
“Nominally, the financial sector increased R&D expenditure by R218 million, while the mining and quarrying sector increased by R241 million to R927 million in 2020/21.
“The manufacturing sector recorded the single largest sectoral decrease in R&D expenditure of R561 million, from R3.456 billion to R2.895 billion in 2020/21.
“The agriculture and transport sectors reported decreases of R256 million and R229 million, respectively.
“In the case of state-owned entities’ contribution to R&D activity in the business sector, it decreased by five percentage points to 14.2% in 2020/21, a decrease of R394 million.”
On a provincial level, Gauteng continued to provide most of the R&D, with its share increasing by R332 million to R14.7 billion in 2020/21, states the survey.
“The Western Cape (25%) and KwaZulu-Natal (9%) were the second and third largest contributors, respectively, but decreased by R71 million and R351 million in 2020/21.
“The Free State province decreased its expenditure by R469 million (1.3%), from R1.7 billion to R1.2 billion in 2020/21.”
Despite the decline in R&D expenditure, the survey indicates some gains in terms of R&D personnel, after a large decline in 2019/20.
“The business sector increased its personnel by a headcount of 1 429. A substantial component of this increase came from R&D initiated in response to the COVID-19 pandemic, with the majority of these being personnel directly supporting R&D.
“However, 131 researchers and 193 technicians were shed in the business sector. Personnel in the government sector remained essentially unchanged. The higher education sector decreased its headcount by 666 R&D personnel (mainly researchers), while the not-for-profit sector shed 130 R&D personnel, science council personnel decreased by 41.
“The number of FTE researchers per 1 000 in total employment was 1.8 in 2020/21, down by just 0.1 of a percentage point. The proportion of female researchers increased by two percentage points, reaching 43.9% in 2020/21.”
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