"Universities, Indigeneous Firms and Local Leadership
Key to Economic Success"

Wales should focus on promoting linkages between Universities and indigeneous firms in developing its economy. This is a major conclusion of an interim report on a two-year research project into World Best Practice in Regional Economic Development. Co-ordinated by the IWA, the project is sponsored by Barclays Bank, the Welsh Development Agency, and OneNorthEast, the development agency for the North East of England.

The research found that provision of advance factories and financial packages to attract inward investment - mainstream economic levers in UK development regions - are not prioritised by successful economic Regions elsewhere in the world. Instead, they focus on developing the research potential of their Universities, promoting indigeneous firms, and links between the two. The study examined the record and policy approaches of 15 successful regions around the world, including Atlanta, Georgia in the USA, Auckland in New Zealand, Singapore, Darmstadt (Germany), Oulu (Finland) and Overijissel (Netherlands) in Europe. Among the most important factors explaining their success were:

• Development of links between Universities and local companies
  
• Committment to support development of existing indigeneous businesses
  
• Networking between businesses
  
• Local autonomy and strong leadership for settling policy priorities
  
• An agreed 'vision' of common purpose among regional stakeholders
  

The study, carried out by the Cardiff-based ERES economic consultancy in association with consultants in the North East and USA, comments:

"The most interesting finding of this entire research is the prominent role Universities play in actively developing local businesses and economies in many prosperous Regions. There is a major opportunity for the economic development organisations of Wales and the North East to engage with their Universities to determine how such approaches could be introduced."

The next phase of the study, overseen by a Steering Group chaired by former WDA Chief Executive David Waterstone, comprises on-the-ground research in a small number of selected Regions. The objective is to come up with a series of policy innovations that can have immediate practical effect in Wales and the North East.