SA business spending on R&D in decline
Before 2006, businesses used to match the government’s spending on research and development in South Africa, now the government spends more.
Business funding for research and development almost halved between 2017/18 and 2019/20, down from R16-billion to R9-billion.
This is according to a report published by the Human Sciences Research Council (HSRC) in September 2022.
Is this a trend?
This downward trend in R&D is likely to continue into 2020 because of the effect of the Covid-19 lockdowns on the economy, said Dr Nazeem Mustapha, chief research specialist for the HSRC’s South African National Survey of Research and Experimental Development.
The latest survey for 2020/21 will be released in December.
Who is funding R&D now?
In 2019, the total expenditure in South Africa for R&D was R34.5-billion. The government accounted for 58% of that (R19.4-billion), business 28% (R9.4-billion) and foreign companies and countries 14% (R4.7-billion).
Which sectors lost business R&D funding?
The financial services sector lost about a third of its R&D funding between 2015 and 2019, dropped from R5.9-billion to R4-billion.
Funding for manufacturing also dropped from R4.4-billion in 2015 to R3.5-billion in 2019.
Mining R&D spending dropped by 44% between 2018 and 2019 – from R1.748-billion (2018) to R686-million (2019). This was “a direct result of the sale of mining companies and their assets or restructuring in R&D performing mining entities”, the HSRC survey noted.
Annual report
The HSRC conducts the survey every year. It interviews business, government institutions (state-owned enterprises, universities and science councils) and non-profits about spending on research and what type of research is being done.