East African fishing industry innovates its way out of economic disaster (continued)

The research project titled "The Relationship of Finance to Technological Innovation in Small and Medium Enterprises in Sub-Saharan Africa, A Case Study of Uganda," sought to analyse the conditions under which developing country firms innovate. It surveyed 57 food processing firms, 16 financial institutions and five development finance schemes. The results from the nine fish processing firms studied were particularly striking as they pointed to the beginnings of an organised process to find effective solutions to counter adverse external conditions (the series of EU export bans in the 1990s) and protect the country's share of fish exports.

While the analysis is still ongoing, Kiggundu comes to the tentative conclusion that the EU ban, in its severity, had the effect of rallying the industry stakeholders together. It was not only the fishing communities and fish processors that stood to lose their livelihoods from the ban but a broad spectrum of institutional support services. Kiggundu maps out the diverse process and organisational innovations that occurred, as a result. These include initiatives to bring stakeholders together to discuss how to react to the bans and the specific innovations made at firm and industry level - ranging from improvements to ensure hygienic handling and packaging of fish to marketing strategies and improvement of the delivery infrastructure. The study notes that the innovation process not only stimulated inside individual firms, but also triggered the emergence of an institutional support system for the fisheries sector.

The results of the study are currently being incorporated in a PhD dissertation and a number of discussion papers on this subject

For a broader analysis of innovation and trade issues for developing countries at the World Trade Organisation, including issues relating to Sanitary and Phtyo-Sanitary Standards (SPS) regulations, see "Creating Opportunities for Learning and Innovation through Trade and Technology Transfer" (PDF 28 Kb), a paper presented by Prof. Mytelka, UNU/INTECH director, to the WTO Working Group on Trade and Technology Transfer in 2002.