2.1

INTRODUCTION The Dubai Innovation Index was first launched in 2015 as a framework to enable the achievement of sustainable economic growth by measuring innovation in Dubai and identifying areas of improvement by benchmarking Dubai against 28 global innovative cities. In the 2015 study, “Building innovation capability for the future” emerged as the key theme. The 2016 study emphasizes collaboration between public and private sectors to achieve higher performance in innovation outputs than in 2015. Hence, “Strengthening public and private sector collaboration” is the theme of this year’s study. The 2016 Dubai Innovation Index sees the addition of two new cities Bangalore and Nairobi, which have replaced Mumbai and Istanbul (featured in 2015) given the following selection criteria: • The city’s contribution to global innovation • The city’s economic significance • The prominence of the city in previous innovation and city competitiveness studies • How the city addresses the five global megatrends Cities worldwide compete and differentiate themselves based on their ability to innovate in order to address the five global megatrends. The five global megatrends represent global challenges that require innovative solutions. Therefore, cities that were selected in the 2016 Index have demonstrated initiatives to find solutions to these global challenges. As demographics are shifting globally, we see rapid population growth from emerging countries as well as a decrease in the number of children per household, resulting in a growing global senior population aged 65 and above. The extent of change varies by region, with Africa witnessing the fastest growing youth population. Therefore, these developments will have implications on labor force participation and will require effective policies to maximize the contribution of these individuals to domestic economies. The global economy has experienced volatility due to a decline in commodity prices (notably oil) and an economic slowdown in major emerging economies such as China. These economic developments will ultimately have implications on global capital flows and has made diversification a priority for commodity dependent economies such as Saudi Arabia. Major technological breakthroughs such as virtual reality and block-chain (components of “Industry 4.0”), have placed added pressure on corporations to adapt to remain relevant and compete globally. Furthermore, the emergence of these new technologies has increased the need for cities to future-proof existing infrastructure. Shifts in populations toward urban centers have placed added pressure on the capacity of existing infrastructure and transportation systems. Global cities therefore require innovative solutions to accommodate this increased growth in an era of strained capacity. Climate change is becoming a focus of domestic and international agendas hence, the emergence of the Paris COP 21 agreement, which gathers all the countries of the world with an aim to mitigate the impacts of climate change and malicious greenhouse gas emissions. Cities will ultimately require innovative solutions to establish clean technologies and ecofriendly practices to reduce their contribution to global emissions. Furthermore, an increasing global population is placing a strain on natural resources, aggregating the need for sustainable practices to mitigate scarcity. Dubai’s vision is to become the world’s most innovative city in the coming years. By benchmarking Dubai against other leading global innovative cities (using macroeconomic data) and exploring the five megatrends, opportunities and development areas can be identified to improve Dubai’s innovation position globally.

19

2. MACROECONOMIC: CITY LEVEL ANALYSIS continued

2.1.1 INNOVATION INDEX RANKING Dubai has risen by one place in the Innovation Index rankings from 2015 primarily due to an increase in FDI inflows and continued efforts by the Dubai Government to define the city’s innovative vision. In the 2016 Innovation Index rankings, New York City has claimed the top position (up four places from 2015). An increase in the number of joint ventures and venture capital deals made New York City a favorable destination for start-ups in 2016. In contrast, the 2015 leader, London, has fallen by three places in 2016 notably due to a decline in its total value of stocks traded and a lower labor force participation rate from 2015.

Index Rank 16’

Index Rank 15’

New York City

1

5

Paris

2

10

Hong Kong

3

2

London

4

1

Tokyo

5

6

Paris has experienced the most significant movement in the 2016 rankings (up eight places from 2015) as a result of the city’s new policies designed to support innovation in businesses. These initiatives have made Paris an attractive destination for Foreign Direct Investment, (FDI), resulting in an increase in FDI inflows fr0m 2015, which increased city funding.

Singapore

6

3

Stockholm

7

7

Seoul

8

4

Zurich

9

8

Copenhagen

10

9

San Francisco

11

13

In the Asia-Pacific region, Kuala Lumpur has experienced a decline by five places from 2015 as a result of high political instability, which caused a decline in tourism, contributing to a decline in economic growth. Seoul additionally has experienced a decline by four places from 2015 due a decline in labor force participation in 2016.

Berlin

12

14

Toronto

13

11

Sydney

14

12

Dubai

15

16

Madrid

16

21

Riyadh

17

20

Among the European cities, Madrid has experienced the largest decline by five places from 2015 due to a significant decline in investment - namely FDI inflows and Greenfield investment.

Doha

18

19

Shanghai

19

17

Kuala Lumpur

20

15

Beijing

21

18

Milan

22

25

Moscow

23

23

Mexico City

24

24

Johannesburg

25

27

Sao Paulo

26

26

Nairobi

27

N/A

Bangalore

28

N/A

Finally, in the Middle East, Dubai leads the region at 15th place, going up one place from 2015 as mentioned earlier. This rise is largely attributed to the city’s favorable tax climate and regulatory environment which has made Dubai an attractive destination for investors, as well as increased FDI inflows from 2015. Riyadh has also seen significant improvement, climbing up three places from 2015, mainly due to significant developments in infrastructure, increasing FDI inflows from 2015 as part of the city’s initiatives to diversify income from nonoil sources.

20 2016 Dubai Innovation Index

City

Table 2.1.1: Dubai Innovation Index ranking comparison 2015 & 2016

The Dubai Innovation Index macroeconomic city-level analysis measures innovation at a global scale across the leading innovative cities of the world. The figure below shows a map view of the innovation Index ranking per city:

10 4

13 11

16

1

2

23

7

12 9 22

21

8

5

19 18 17 15

24

3 28

27

26

20 6

25 14

Figure 2.1.1: 2016 Dubai Innovation Index ranking

1. New York City

11. San Francisco

21. Beijing

2. Paris

12. Berlin

22. Milan

3. Hong Kong

13. Toronto

23. Moscow

4. London

14. Sydney

24. Mexico City

5. Tokyo

15. Dubai

25. Johannesburg

6. Singapore

16. Madrid

26. Sao Paulo

7. Stockholm

17. Riyadh

27. Nairobi

8. Seoul

18. Doha

28. Bangalore

9. Zurich

19. Shanghai

10. Copenhagen

20. Kuala Lumpur

21

2. MACROECONOMIC: CITY LEVEL ANALYSIS

NORTH AMERICA

EUROPE

• New York City (1st)

• Paris (2nd)

• San Francisco (11th)

• Madrid (16th)

continued

• Milan (22nd)

The US continues to be one of the mostinnovative countries, with an improvement in political, economic and social environment and particular strengths in computer software spending and creation of innovation culture. A common theme between the American cities that has helped boost their rankings is the increase in cultural exports, such as film and TV tape distribution, and favorable corporate employee policies.

Europe has seen an improvement in its political, economic and social environment. The region has witnessed an increase in funding, particularly from Chinese investors who poured a record setting $40bn in Europe in 2015. It has also seen an improvement in tangible and intangible outputs, including rise in knowledge intensive jobs, increase in labor-force participation rate and manufacturing value added.

New York City’s success can be attributed to the significant increase in joint ventures and venture capitals, making it a new favorite for start-ups.

A common theme in the European region is the increase in business density and higher investments in existing firms. This has created jobs for people at all skill levels, thereby increasing investments in skills and talent.

Inward FDI for San Francisco improved significantly and the city continues to invest in the ecosystem. For example, a new innovation lab, dubbed Super-public, that aims to bring together different levels of government, private technology firms, nonprofits and universities to solve problems facing urban communities, was inaugurated in July this year.

22 2016 Dubai Innovation Index

In particular, Paris’ success is primarily due to the huge increase in funding, mainly from foreign direct investments, resulting from the city’s new policies that support innovation in business.

ASIA PACIFIC

MIDDLE EAST

• Singapore (6th)

• Dubai (15th)

• Seoul (8th)

• Riyadh (17th)

• Kuala Lumpur (20th)

• Doha (18th)

• Beijing (21st) Kuala Lumpur has declined significantly in ranking due to a large drop in tourism, resulting from high political uncertainty. Common themes that arise in Asia are the decline in political economic and social environment and a decrease in funding and labor force participation. The political, economic and social environment was also a challenge for Shanghai and Beijing. Generally, China’s economy is slowing down, with credit growth continuing to outpace real GDP growth by significant margins. Imports are continuing to decline, reflecting the decrease in domestic spending. China is trying to move from a manufacturing and export driven economy to a service and domestic driven one. Hence, Shanghai experienced a drop in private investments, specifically value of Greenfield investments; whereas Beijing experienced a drop in inward FDI flow. China’s private investment has grown by only c. 2.1 percent in the first seven months of 2016.

Despite the economic slowdown, which has impacted the Middle East region, Middle Eastern countries have managed to improve innovation ranking in this year’s study. Dubai has moved up one place, primarily due to an increase in funding, specifically through an increase in foreign direct investment. Dubai continues to be an attractive hub for foreign investment due to its flexible business laws and legislations. Riyadh has also seen a significant improvement in ranking, moving up 3 places this year. Research shows that despite the oil slump, Saudi Arabia has seen economic growth of c. 1.4% since last year, which despite being slower than developing Middle East and North African countries, is still at pace with the global average.

23

2. MACROECONOMIC: CITY LEVEL ANALYSIS continued

2.1.2 INNOVATION OUTPUT RATIO RANKING City

Innovation Output Ratio ‘16

Enabler Score ‘16

Performance Score ‘16

Output Rank 16’

Output Rank 15’

Tokyo

0.96

51.69

49.64

1

4

Shanghai

0.94

36.11

34.06

2

1

Beijing

0.91

35.87

32.52

3

2

Nairobi

0.86

21.27

18.22

4

N/A

Paris

0.83

58.62

48.82

5

13

Seoul

0.76

53.89

40.75

6

5

Hong Kong

0.76

60.85

45.99

7

12

New York City

0.75

62.04

46.80

8

7

London

0.68

61.27

41.39

9

6

Stockholm

0.67

57.41

38.68

10

18

Bangalore

0.67

22.19

14.89

11

N/A

Singapore

0.66

58.74

38.87

12

15

Doha

0.65

42.69

27.68

13

26

Dubai

0.63

45.22

28.48

14

11

Zurich

0.63

57.14

35.92

15

16

San Francisco

0.61

55.66

33.78

16

21

Toronto

0.60

54.00

32.62

17

19

Sydney

0.59

54.03

32.00

18

24

Kuala Lumpur

0.58

43.76

25.59

19

9

Riyadh

0.58

44.72

26.01

20

17

Mexico City

0.58

36.80

21.41

21

23

Copenhagen

0.58

58.31

33.82

22

20

Sao Paulo

0.58

26.76

15.45

23

3

Johannesburg

0.56

27.07

15.23

24

22

Berlin

0.56

55.71

31.21

25

25

Moscow

0.55

38.74

21.26

26

14

Milan

0.53

42.89

22.70

27

28

Madrid

0.52

48.26

25.00

28

27

Figure 2.1.2: Comprehensive Output Ratio Overview

24 2016 Dubai Innovation Index

To measure innovation in cities, two main goals were considered. The first goal was how to measure the environment created to foster innovation and how conducive it was for innovative thinking. The second goal was to quantify the amount of innovation being generated and determine whether that is being translated into real output. To measure innovation inputs, an ‘enabler’ score was calculated, based on the six macroeconomic pillars outlined in Figure 1.1.3. In contrast, to measure innovation output, a ‘performance’ score was calculated for each city based on the tangible and intangible outputs presented in Figure 1.1.4. The innovation output ratio is calculated by dividing a city’s performance (output score) by its enabler (input score). This ratio is an indicator of a city’s ability to translate its investments in creating an innovative ecosystem into innovative outputs. Looking at the 2016 rankings, we see a decline in innovation output ratio scores across majority of the cities from 2015. The decline in the scores was attributed to factors such as a volatile global economy, which was impacted by declining oil prices and slowdown in growth in major global economies in 2015. Furthermore, political instability in regions caused the innovation output ratio scores for cities to decline in 2016. Tokyo claimed the top position in the innovation output ratio rankings (up three places from 2015), due to improvements in skills and talent, which enriched the city’s ability to innovate. In 2016 rankings, Shanghai (which topped the innovation output ratio table in 2015) and Beijing both fell by one position. The decline in the rankings for these cities can be attributed to the economic slowdown of the Chinese economy, where credit growth outpaced real GDP growth and domestic spending declined in 2015. These conditions caused a decline in private investment into these cities, negatively impacting the innovative environment, causing innovation output for these cities to decline in 2016. Paris experienced a significant rise in the innovation output ratio rankings due to city’s ability to foster innovation by business, which translates into a strong intangible innovation output. This is reflected through a number of joint venture and strategic alliance deals in 2016, such as the Renault-Nissan Alliance and KLM Air France Alliance with Chinese Eastern Airlines. The most significant drop in ranking was experienced by Sao Paulo, which went down by twenty places in 2016 due a significant decline in tangible outputs, namely new products and services in contrast to 2015. Additionally, Kuala Lumpur’s unstable political environment, created an adverse environment for innovation, causing the city to decline by ten places in the 2016 rankings. Although Nairobi is among the top cities in the innovation output ratio rankings, the city’s low enabler score indicates that the city is not necessarily investing in an innovative ecosystem. This is further evident by the city’s low performance score relative to other cities, indicating that the city’s low innovative output is reflective of its innovative environment. In the 2016 rankings, Dubai declined by three positions. Although Dubai’s score declined, its output ratio is an indicator that the city is developing an innovative ecosystem as demonstrated by a number of initiatives (please refer to section 2.1.3) and will see returns (in terms of innovation) output in the coming years.

25

2. MACROECONOMIC: CITY LEVEL ANALYSIS continued

2.1.3 DUBAI’S INNOVATIVE EFFORTS ACROSS ALL PILLARS OF THE INDEX The section below showcases innovation initiatives in Dubai through the pillars of the Innovation Index: enablers (inputs that create an innovative environment) and performance (tangible and intangible innovation outputs). These initiatives demonstrate Dubai’s commitment to create an ideal innovation environment in order to achieve its vision to become the most innovative city globally in the years to come.

Dubai’s Innovation Enablers Appointment of New UAE Cabinet

PES

55.33

In February 2016, HH Sheikh Mohammed Bin Rashid Al Maktoum appointed the 12th UAE cabinet. The 29 member cabinet, saw the addition of new ministers for Tolerance, Future, Youth, Happiness and Climate Change. The new ministerial positions reflect the UAE’s ongoing commitment to ensure its policies are relevant in the ever-changing social, economic and environmental landscape. http://www.emirates247.com/news/government/uae-cabinet-reshuffle-new-ministeries-for-tolerance-happiness-and future-2016-02-11-1.620575

New UAE Bankruptcy Laws In October 2016, the UAE established a new bankruptcy laws that will lift the legal ramifications against Small and Medium Enterprises (SMEs) facing solvency issues and will improve SME access to credit during periods of financial distress. http://www.thenational.ae/business/economy/qa-what-you-need-to-know-about-the-uae-bankruptcy-law

The Dubai Future Accelerator Program

Government

68.32

In October 2016, Dubai launched its AED 1 billion Future Accelerator Program, which seeks to develop innovative solutions across eight sectors including: education, health, infrastructure, transportation, security, and energy and finance through collaboration between the government authorities and the private sector. http://gulfbusiness.com/dubai-officially-launches-future-accelerators-programme/ http://gulfnews.com/news/uae/government/mohammad-unveils-future-accelerators-programme-1.1906302

26 2016 Dubai Innovation Index

The Mohammed Bin Rashid Innovation Fund Funding

35.13

In November 2016, the Sheikh Mohammed bin Rashid Al Maktoum Fund to Finance Innovation was launched. The AED 2 billion fund provides support to resident individuals and companies in the UAE that offer innovative ideas in the form of products, services and processes. https://www.mof.gov.ae/En/About/programsProjects/Pages/MohamedBinRashidInnovationBox.aspx http://www.thenational.ae/business/economy/dh2-billion-fund-to-finance-innovation-projects-launched-in-dubai

Dubai Science Park Sees the Addition of New Business Partners

Infrastructure

16.98

In July 2016, the Dubai Science Park announced the addition of new cross-sector global business partners: Cooper International (a Morocco-based pharmaceutical company), Getz Pharma (a pharmaceutical company focused on research, development and manufacturing), First Solar (a solar provider) and Dayarn FZ-LLC (a quality sales, marketing and regulatory organization). The addition of these firms, reflects Dubai Science Park’s ambition to become the leading community for scientific development in the Middle East. http://www.zawya.com/mena/en/story/ZAWYA20160725063515/

TRA Signs AED 42m Agreements with Dubai University

Skills & Talent

31.92

In October 2016, the Telecommunications Regulatory Authority (TRA), signed a series of agreements with Dubai University to establish an engineering college (worth AED 35m) and offer scholarships worth 7.1m through its financing entity, the ICT Fund. The ICT Fund was established in 2008 to promote the development and progression of the ICT sector in the UAE. http://www.tra.gov.ae/ictfund/en/about-us.aspx http://www.tra.gov.ae/ictfund/en/news/2016/10/16/tra-signs-two-new-agreements-worth-aed-42-million-with-dubai-university. aspx

MIT Helps Launch New Design Institution in Dubai In October 2016, the Massachusetts Institute of Technology (MIT) and Dubai Institute of Design and Innovation (DIDI) established a partnership to launch a new undergraduate design institution in Dubai with the support of faculty from MIT’s School of Architecture and Planning. http://news.mit.edu/2016/mit-helping-launch-dubai-institute-for-design-and-innovation-1024

Innovation Week & Innovation Month Held for the first time in 2015, Innovation Week hosted series of events such as workshops and seminars to encourage and support innovation in the UAE. Culture

63.62

Following the success of the 2016 edition of the event, HH Sheikh Mohammed bin Rashid Al Maktoum announced that the event will become the UAE Innovation Month starting in 2018. http://gulfnews.com/news/uae/government/innovation-week-80-activities-lined-up-in-dubai-1.1932967 http://www.thenational.ae/uae/government/sheikh-mohammed-orders-uae-innovation-week-to-become-innovation-month http://gulfnews.com/news/uae/government/uae-innovation-week-extended-to-one-month-1.1936224

27

2. MACROECONOMIC: CITY LEVEL ANALYSIS continued

Dubai’s Innovation Performance Noon.com In November 2016, Mohamed Alabbar, Chairman of Emaar announced the launch of an online shopping platform, Noon.com that will feature 20 million products such as books, electronics and toys. The $1 billion venture will be introduced in the UAE, Saudi Arabia and then worldwide from January 2017, with the website’s logistics center being housed at Dubai World Central.

Tangible

37.31

http://www.arabiangazette.com/noon-com-revolutionize-ecommerce-middle-east

Dubai Now Dubai Now, the Smart Dubai Government's app won the Best Government Mobile App of the Year at the 2016 .GOV Awards. The mobile app offers 50 smart services from 22 government entities under a single platform, covering areas including: payments and invoices, security and public transportation. http://www.khaleejtimes.com/nation/general/dubai-now-is-the-app-of-the-year http://www.smartdubai.ae/partner_story_nv4.php

Hyperloop One In November 2016, Hyperloop One and the Dubai Roads and Transport Authority (RTA) established an agreement to determine the feasibility of introducing a Hyperloop One system in greater Dubai and the UAE and to develop prototypes of autonomous vehicles powered by Hyperloop technology. http://www.emirates247.com/news/emirates/rta-hyperloop-one-sign-deal-to-bring-high-speed-transport-from-dubai-to-abudhabi-in-12-minutes-2016-11-09-1.643316

28 2016 Dubai Innovation Index

UAE Grants 185 Patents in the First 10 Months of 2016

Intangible

19.66

Between January and October 2016, the Ministry of Economy’s International Centre for Patents Registration, ICPR, granted 185 patents out of 1,368 registered applications. Additionally, the ministry received 700 request for industrial design certificates, from which 251 were granted. http://gulfnews.com/business/sectors/government/uae-granted-185-patents-in-first-ten-months-of-2016-1.1940096

Mohammed Bin Rashid Space Centre Launches Research Grants To encourage research and study in the field of space science, the Mohammed bin Rashid Space Centre (MBRSC) established a new research grand program in December 2016. The Mohammed bin Rashid Space Centre was established in 2015 to promote scientific innovation, technological advancement and sustainable development within Dubai and the wider UAE. http://www.space.gov.ae/mohammed-bin-rashid-space-centre-mbrsc http://gulfnews.com/news/uae/education/space-centre-launches-research-grants-1.1949716

DEWA Memorandum of Understanding with Tata Consultancy Services In May 2016, the Dubai Electricity and Water Authority (DEWA) established Memorandum of Understanding (MoU) with Tata Consultancy Services to help establish DEWA’s strategy in research & development, sustainability as well as the diversification of energy sources. https://www.dewa.gov.ae/en/about-dewa/news-and-media/press-and-news/latest-news/2016/05/dubai-electricity-and-waterauthority-signs-a-mou-with-tata-consultancy-services

3D Printing on Dubai Construction Projects In November 2016, the Dubai Ministry of Infrastructure Development's Project Execution Department, announced that future developments by the Ministry would be constructed using 3D printing techniques as part of the UAE 2021 vision. http://www.arabianbusiness.com/uae-ministry-pledges-3d-print-all-its-buildings-654239.html

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2. MACROECONOMIC: CITY LEVEL ANALYSIS continued

2.1.4 INNOVATION LEADERS AROUND THE WORLD Consistent focus and investment in innovation in Dubai may eventually result in outputs at the scale that currently exists in leading innovative cities of the world. According to CITIE (City Initiatives for Technology, Innovation and Entrepreneurship), New York City announced in early 2016, before the comparable cities, that innovation and entrepreneurship is a priority, thus taking an active stance toward its startup and tech communities. New York City provides support for local start-ups across a wide range of activities, ranging from funding to skills development. Digital.NYC – The world’s first comprehensive online hub for a regional innovation ecosystem. Since its inception Digital.NYC has inspired other leading innovation centers around the world such as London and Boston to deploy similar platforms in support of entrepreneurship and innovation. Digital.NYC provides information and resources to transform deals into businesses, delivering valuable tools for startups and entrepreneurs, and connecting New Yorkers to opportunities and jobs in the City's tech ecosystem. NYC Tech Talent Pipeline – A public-private partnership designed to support the growth of New York City’s technology ecosystem. New York City is working collaboratively with industry and academic partners to train homegrown talent for technology sector careers and ensure that entrepreneurs have access to the skilled workforce they need to grow their businesses. Partnership Innovation Council – A panel of industry experts who seek to ensure that New York’s legal and regulatory environment is keeping pace with the technological revolution. iZone – In 2010, New York City’s Department of Education (NYCDOE) launched its innovation strategy – the iZone – which acts as an incubation lab and works on three levels: supporting innovation in schools, creating and stimulating external markets, and fostering wider systemic innovation.

NEW YORK CITY

30 2016 Dubai Innovation Index

Innovation Score:

Innovation Ratio:

PES:

54.42

0.75

55.95

Government:

Funding:

Tangible:

75.94

56.48

56.81

Innovation Score Rank:

Innovation Ratio Rank:

Infrastructure:

1

8

57.26

Skills & Talent:

Culture:

Intangible:

50.86

75.72

36.79

PARIS

•A  drastic increase in the number of joint venture strategic alliance deals that have taken place over the year, such as the Renault Nissan alliance and the KLM-Air France Alliance with China Eastern Airlines, have contributed to Paris’ rise in innovation score. •P  aris’ success is primarily due to the huge increase in funding, mainly from foreign direct investments, resulting from the city’s new policies that support innovation in business. •P  aris is investing in a digital incubator named Station F (expected to open in 2017), that will support domestic entrepreneurial initiatives and enhance the city’s capabilities in the digital space. •P  aris is home to an innovation cluster named Paris-Saclay, which was a designated as one of the world’s eight major innovation clusters by the Massachusetts Institute of Technology (MIT) in 2013. The research center is home to 19 institutions of higher education including HEC Paris and additionally houses major corporations including EADS and Siemens.

Innovation Score:

Innovation Ratio:

PES:

53.72

0.83

54.24

Government:

Funding:

Tangible:

66.50

56.08

44.26

Innovation Score Rank:

Innovation Ratio Rank:

Infrastructure:

2

5

36.95

Skills & Talent:

Culture:

Intangible:

61.77

72.42

53.38

31

2. MACROECONOMIC: CITY LEVEL ANALYSIS continued

HONG KONG

•T  he national government subsidizes domestic companies that invest in new technologies and integrate innovative initiatives to their operations as part of its Innovation and Technology Fund (ITF). •T  o improve the technical capabilities of its workforce, the national government subsidies vocational training for companies that wish to train employees in new technologies (including technologies that are not widely used domestically) that would supplement business operations and perceived to benefit the Hong Kong economy. •T  o encourage research and development by domestic corporations, the national government subsidies patent applications to protect the Intellectual Property (IP) for new inventions.

32 2016 Dubai Innovation Index

Innovation Score:

Innovation Ratio:

PES:

53.42

0.76

61.67

Government:

Funding:

Tangible:

86.46

53.86

55.67

Innovation Score Rank:

Innovation Ratio Rank:

Infrastructure:

3

7

46.75

Skills & Talent:

Culture:

Intangible:

68.57

47.77

36.31

LONDON

• Idea London is an accelerator which provides support to startups to grow through training programs, mentorship and consultancy services. • Innovation Warehouse, established in 2010, is business incubator for digital startups in London, offering mentorship programs to advise startups on investment readiness and office space in its 10,000 sq foot facility. •L  evel39 is a technology accelerator offering small businesses guidance in translating products into potential market opportunities in the areas of finance, cyber-security, retail and smartcities. • Imperial Innovations, a subsidiary of Touchstone Innovations plc, in partnership with Imperial College London seeks to commercialize Intellectual Property developed at the university.

Innovation Score:

Innovation Ratio:

PES:

51.33

0.68

62.15

Government:

Funding:

Tangible:

86.15

42.05

41.05

Innovation Score Rank:

Innovation Ratio Rank:

Infrastructure:

4

11

50.60

Skills & Talent:

Culture:

Intangible:

57.24

69.42

41.73

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2. MACROECONOMIC: CITY LEVEL ANALYSIS continued

2.1.5 SUMMARY To select cities for the Dubai Innovation Index, factors including: cities’ contribution to global innovation, economic significance, the prominence in previous innovation and competitiveness studies in addition to the approaches in addressing the five global megatrends were thoroughly examined. Globally, cities compete and differentiate themselves based on their ability to innovate to address the five global megatrends which represent global challenges that require innovative solutions. Changes in demographics will influence future labour force participation. Additionally, economic volatility will influence global capital flows and has made diversification a priority for resource dependent economics. Major technological changes are placing pressure on corporations to adapt to remain relevant and cities to future-proof existing infrastructure. Furthermore, as populations shift toward urban centres, this have implications on the capacity of existing infrastructure and transportation systems. Finally, climate change and resource scarcity has made environmentally friendly practice and sustainability a priority for cities. The economic slowdown experienced in 2016 has further increased competition amongst cities to attract Foreign Direct Investment (FDI) and the top global talent to enable innovative activities. The Dubai Innovation Index is calculated as the average of enabler (input) and performance (output) scores. Following the launch of the Index in 2015, New York City replaced London at the top of the Dubai Innovation Index rankings thanks to an increase in joint venture capital deals, which made the city a favorable destination for startups in 2016. Notable movers in the Innovation Index rankings include Paris, which rose eight places from 2015 due to an increase in FDI inflows into the city. The top three cities in the 2016 Dubai Innovation Index rankings: New York (#1), Paris (#2), and Hong Kong (#3), have all demonstrated initiatives to create an innovative environment. New York has made efforts to support start-ups through initiatives such as Digital.NYC. Similarly, Paris made efforts to support start-ups through the creation of a new digital incubator and policies to promote innovation amongst businesses. Similarly Hong Kong has made effort to promote innovation amongst domestic businesses through a number of government initiatives. Additionally, an innovation output ratio was calculated by dividing a city’s performance score by its enabler score, which illustrates a city’s ability to translate its investments in creating an innovative ecosystem into innovative outputs. Given the volatile global economy and political instability experienced in 2015, each city experienced a decline in the innovation output ratio rankings. The 2015 output ratio leader Shanghai fell by one position in 2016, due to economic slowdown faced by the Chinese economy. In 2016, Tokyo topped the output ratio rankings due to an improvement in its skills and talent, improving the city’s ability to innovate. In 2016, Sao Paulo experienced the most significant movement in the output ratio rankings (a decline by twenty places from 2015) due to a decline in new products and services. In the 2016 Innovation Index, Dubai ranked higher by one place from 2015, but declined by three places in the innovation output ratio rankings. Looking at the rankings, it should be noted that Dubai is taking the necessary steps to create innovative environment as demonstrated by the numerous government initiatives and strategies such as Innovation Month and Future Accelerator Program. These initiatives will play a crucial role in supporting Dubai’s vision to become the most innovative global city in the years to come.

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