june 2005
Newspaper: Revista Negocios de Navarra, especial 15 años

"In the next few years we need to promote links between bussines and the university"

Providing formulas that manage to link the business and university worlds is something that appears vitally important to the Vice-President of the Government of Navarre and Regional Economics and Treasury Minister Francisco Iribarren, in order to tackle the transition from an economic profile where the industrial sector has great weight to one in which services will take on an increasingly more prominent role in the coming years.

Globalisation and communication technologies are changing the world, and my concern is that this transformation will make the bases upon which Navarre’s development has been founded obsolete. Has the current model run out of steam?

I don’t believe that the model that was set in motion 40 years ago has run out of steam. We should not forget that another one is emerging at the same time, the university milieu, which today is very much alive and has great prospects for the future. Therefore, we still need to be talking about industrial development and the knowledge community, because Navarre is going to continue its commitment to industry, to industry with added value. How? Obviously, by looking beyond our borders, integrating technology and offering differential value. For example, an industry that would appear to have a great future is the one deriving from the food sector in its evolution towards the world of gastronomy; here we have a roadmap and the tremendous possibilities offered by incorporating knowledge to industrial processes. It is obvious that we have to evolve, but the bases from which we set off are very solid.

And our companies are starting to see the European Union as their natural market…

I still think our natural market is Spain. And after Spain comes Europe, then South America, then the United States... well-known markets in which we operate very well. But first and foremost is Spain; we tend to forget our position as a region, we tend to read a lot in the national press saying how Spain’s problem is selling in the EU. That may be so, but it is not the problem in Navarre. The problem in Navarre is selling outside Navarre, in Spain. It is important to understand this from the point of view of attracting external demand, because demand from La Rioja is just as good as that from Aquitaine. This is not to deny the fact that it is very important in cultural terms to open up to the outside world. We are living in a globalised age and our young people and our company managers need to target other markets.

In that case, we have the home-grown elements to tackle this future.

Yes, I think so. We have an endogenous capacity, a knowledge community that we are not managing to exploit. For example, we have noted the presence in Navarre of entities associated with information technologies from the Basque Country and Catalonia that are not trying to sell technology to a German lander. They are selling it here. And they are doing so with our universities, these young people who we have trained and are subsequently recruited by these outside companies to sell their services in Navarre. So we’ve got a lot of ground to make up here to be able to give this knowledge community the opportunities for the ICT sector to develop in Navarre.

A sector that has quite a few weaknesses.

Indeed, we are not at all happy about the way it is evolving. We believe that there is a need to drive the demand for services, and to do that there is no other alternative than to support supply.

By following other European models in which the Administration has made a strong commitment and been the fundamental driving force behind the advance of these technologies?

The Government has already approved the 2nd Plan to Promote the ICT sector, which is aimed at making this a development sector in Navarre. So far, all the actions have been aimed at breaking the so-called “digital gap”, achieving greater social progress in terms of the information society, and now we are finally looking at making it a development model.

And the communication infrastructure network is also going to be completed.

There are three plans which all interconnect. We have the 2nd Information Society Plan, the Technology Infrastructures Plan and the ICT sector plan. We are aiming to get the whole of Navarre on broadband and facilitate the generation of a thousand jobs in three years.

Let’s go back to the beginning of this projection exercise. Are we going to be capable of continuing to sustain industry’s share in the GDP in the next few years?

No. The industrial sector is still going to be important in Navarre in the next few years, but we are undoubtedly evolving from an industrial economy towards a service economy. Forty years ago Navarre was an eminently agricultural region and we evolved towards a secondary sector, but today that sector is still very significant if we add the ten points of the industrial sector plus the primary sector to the four points of the primary sector. So we are not ‘divorcing’ ourselves from agriculture, it served as the basis for what we have today. In the same way, the current objective is that the industrial sector will help us to evolve towards the service sector.

Would you also say that in the industrial sector there is a culture, an important fount of knowledge, which can be transferred?

Yes, but the major challenge is to link up the university and business worlds. How to give university students an entrepreneurial spirit and how to make businesses capable of communicating with universities. In the next few years this is going to be the unification that we need to drive forward.

How much responsibility does each side have in this divide between the business and university worlds?

I don’t think it’s a matter of attributing responsibilities, what we need to do is for the Government to bear in mind, when it comes to the next models of university funding, that this interrelationship is essential, so maybe we need to look at how to finance companies so it is they who target universities as a way of forcing this interrelation.

What we are clear on is that one of our strengths is the knowledge community: two universities that should be at the service of development in Navarre.
Absolutely. They produce excellent professionals who, in many cases, unfortunately leave our region. We need to get a return on this. Every university graduate trained in Navarre costs us a certain amount of money and we need to get a payback on this by generating employment.

What role does the public sector play in this evolution?

The public sector has to be the driving force behind infrastructures, and in the first place we have to complete all the transport infrastructures, whether road, air or broadband communications. We are also going to drive forward the union between the world of knowledge and the world of management and create the conditions that improve the quality of life for the general public, because through this we can also attract value from outside. We have got to try to not undermine the competitiveness of companies through erratic tax policies or by creating strange regulations, nor should we get into massive debt, as some sectors are calling for, because we will just be transferring costs to enterprises. All in all, we need to continue with a balanced administration, without mortgaging our future wealth.

Will any kind of social consensus be needed to share these priorities?

Right now, I would love to have a consensus on the basic elements, but the fact is that not all parties who are called to govern are up to the task.

How do you reconcile this transformational policy with tax policies when the trend is to ask for more and more from the Administration while contributing less?

Civil society should send out a message calling for common sense.

Every four years, civil society gives its opinion and ratifies you if you have done well or kicks you out if you have done badly.

Yes, of course, but it’s not that. I was referring, for example, to the debate on education for the under-3s, which is no small thing because we are spending over 4,000 euros on each child’s education, which is what it costs to train an industrial engineer. So, I think someone else has to express an opinion apart from us. Not the educational community, or employers, or the universities, however … no-one is saying anything. And this is not just a debate between politicians, because if we are going to develop the 0-3 educational model in the next few years we certainly won’t be developing other educational areas, because there aren’t enough resources to give some to the 0-3s, more to the universities, and more to secondary schools. There are no further resources and there won’t be any. For this reason, somebody apart from us need to say “Well I prefer, or it seems to me…” and generate a debate, but the society of Navarre seems to be transfixed, as if we had the resources for everything, and there just isn’t enough money for everything.

This is a weakness.

I think that we are passive and that we would like everything to be handed to us on a plate, for the Regional Government to solve the problem. Even to the point that the Government has to turn itself into an entrepreneur, become a driving force behind enterprise, which is also a sign of this passivity.

What other weaknesses do we need to act on?

With a view to the next few years, everything relating to the information society, because we’re at the bottom of the league table in this respect.

A position that doesn’t correspond to our industrial capability.

Nor to our level of development, either at the level of households or SMEs. We have good infrastructures and equipment, because we have the purchasing power, but 40% of under-14s in Navarre know nothing about the information society and are not interested either. This is very serious.

And what are our strengths?

Without a doubt our scientific and knowledge capacity; the second strength is our business fabric, based on a large, highly diversified and solid business sector, and some of the highest levels of social welfare and quality of life.

Where do our threats come from?

I am concerned about this tendency of ours to navel-gaze, which means that instead of taking globalisation on board we are constantly adopting a passive attitude. There is a second threat in demographic terms: there are very few of us and we need to grow more. And I am also concerned about the risks we run in separating ourselves from the poles of Madrid and Barcelona in technological terms.

And what about great opportunities?

Navarre embodies quality of life, and so our opportunities lie in everything that is connected with that.