Minister Olli Rehn's speech in Millennium Technology Prize Gala Dinner 2016

Ministry of Economic Affairs and Employment 24.5.2016 15.42

Dr. Olli Rehn, Minister of Economic Affairs of Finland 2016 Millennium Technology Prize Gala Dinner Finlandia Hall, 24 May 2016

Ladies and Gentlemen,

Welcome also on my behalf to the Millennium Technology Prize Gala Dinner. Let me first congratulate the winner of this year’s Millennium Prize, Frances Arnold, awarded for her discovery of “directed evolution”. This innovation is close to my heart and of particular interest for Finland, as it enables clean technology and supports two key goals of the Government: the promotion of bio-economy and cleantech.

The Finlandia Hall is the right place to underline the significance of innovation in the story in Finland. Finland is essentially a nation that believes in and is built on education and technology – in science we trust! The Millennium Technology Prize is our country’s tribute to this spirit of Enlightenment. It is awarded for groundbreaking technological innovations that enhance the quality of life in a sustainable way. I don’t possess a crystal ball, but nevertheless I predict that the awarded innovations will have a significant role in further stimulating cutting-edge research and development in science and technology.

Last week, I led a Team Finland mission to Japan and Korea, and felt there that we have much in common: a profound passion for technology and a strong emphasis on science. No wonder, as we are all catching-up nations in economic history. It is not so long ago when Finland became a smooth adapter and fast developer of technology.

Our first railway was built in 1862. Electricity and the telephone were taken into use in the early 1880s. Last century’s innovations included the Molotov Cocktail and the mobile phone.

Fast-forward to the 1980’s, when the Technology Development Centre Tekes, our key agency for funding applied research and innovation, was established. Ever since, along with the consistent funding of basic research by the Academy of Finland, there has been a strong commitment to funding research, development and innovation. It has played an important part in the development of industrial clusters and ecosystems, such as the game industry and health-related biomaterials.

Another state institution, VTT Technical Research Center of Finland, is an essential part of success stories of several innovations. These include Rovio’s games, featuring Angry Birds; Raisio’s Benecol for cholesterol control; St1’s bioethanol; and Polar Electro’s wrist computer. All these reflect leadership in the area of consumer innovation.

The private sector has followed suit, and maintained a high level of R&D&I funding over the years. Our R&D expenditure exceeded the level of 3 per cent of our GDP twenty years ago, and despite some necessary budgetary savings, has done so every year after that, continuing to rank at the top level globally.

It is not my intention, however, to bypass the significance of Finnish innovations in the global business-to-business market - such as the meteorological measuring and monitoring equipment by Vaisala since the 1930’s or elevators and escalators by Kone.  

Nor is my intention to make this the first innovation speech in the Finnish history that does not mention Nokia. In fact, Nokia just completed a merger with French Alcatel-Lucent to become the second largest telecom network equipment supplier of the world. It now owns the world-famous Nobel-labeled Bell Laboratories. This provides the company – and our country – new prospects. Finland has so far been awarded two Nobel Prizes. Bell Labs has eight. That may not bring us to 10, but yet I believe this tradition only further strengthens Finnish commitment to world class innovation and research.

Why are technologies and innovations so important? The answer is self-evident: they are the key drivers of competitiveness and growth.

Finland has in the last four-five years suffered from a stubborn economic recession. By necessity, as the immediate challenge the current Government had to focus on restoring our cost competitiveness.  

Thanks to a Competiveness Contract negotiated by social partners, we will achieve a 4-percent improvement of unit labour costs, supported by zero wage increases this and next year, and by an evolution towards firm-level local agreement. This will enable us to close the competitiveness gap in unit labour costs vis-à-vis our main reference countries Sweden and Germany in a few years.

But at the same time, we must now turn our focus from cost competitiveness to structural competitiveness, which is based especially on enhancing productivity and innovation. This applies for the entire innovation chain. While the cost of labour does matter, the capacity to renew themselves through bold innovation and customer-based product development is increasingly important for Finnish enterprises, and for our socio-economic welfare.

My Ministry has commissioned from the OECD an evaluation and impact assessment to analyse self-critically how we can get more societal impact from our national innovation system.  We aim to get more information in order to better channel remarkable inventions and innovations into successful products and services for domestic and global markets.

There is a clear need to assess the resource balance between basic and applied research, as well as to further improve the collaboration between the universities, research institutes and enterprises. I trust the OECD impact study will useful in this regard. And to the puritans let me say that there is nothing unscientific in developing useful solutions that help human beings to improve the quality of life!

Real innovations are aimed at benefitting the world by addressing common global challenges, such as ageing, health problems, pollution or the inefficient use of energy.

While advancing such innovations, we aim at anchoring the position of Finland as a reliable provider of solutions to global challenges. With the Millennium Technology Prize, we wish to enhance the impact of our ambition by honoring world-changing innovations and innovators, like Frances Arnold, who will make a difference.

I wish you an enjoyable evening, and best of success to everyone and to all of us in promoting innovations and their contribution to better life.

Thank you!