One million US dollars has been pledged by the Republic of Korea to develop an APEC SME Innovation Center, to develop and foster regional innovation in the small and medium enterprises sector. Recognizing innovation as the key driving-force of economic growth, and the need to interlink the activities of governments, researchers, entrepreneurs and investors to maximize the benefits of science, technology and innovation, the proponents of the APEC SME Innovation Center have set out an ambitious plan to provide education and training, develop innovation models and build a cooperative network for the benefit of regional SMEs.

In the rapidly changing world of globalization, where knowledge-based industrialization is moving at an unprecedented pace, SMEs face the very real challenge of needing to continue to innovate to survive and prosper. Acknowledging that SMEs require nurturing and development to meet their potential, the APEC SME Working Group gave its full support to Korea's proposal for an APEC SME Innovation Center at their recent meeting in Chinese Taipei. The meeting heard that one of the objectives of the new center is to create a lasting cooperative structure which links together governments, researchers, entrepreneurs and investors to ensure that SMEs, and ultimately the economies of the region, gain maximum benefit from innovation.
With the SMEs forming the apex of a pyramid, the APEC SME Innovation Center will link SMEs with support organizations including governments and public sector agencies, professional innovation development agencies such as universities and research centers, and investors of each member economy, to enhance the innovation capacity of innovation stakeholders. The center will develop an integrated program that provides consistent support to regional SMEs. The program aims to generate multiplier effects for innovation activities and create a positive environment for SMEs to build innovation capacity.
In order to realize the vision of the APEC SME Innovation Center to promote economic growth and prosperity in APEC through facilitating SME innovation capacity, the center will carry out three major functions. These are:
  1. Education and Training: This includes researching, developing and operating customized education and training courses to meet the specific demands of each innovation stakeholder such as policy makers, innovation professionals and SMEs.
  2. Innovation Model Development: This includes developing a framework of innovation models, based upon innovation policy surveys and comparison analyses, establishing innovation management practices as innovation models for SMEs and disseminating best practices.
  3. Cooperative Network Building: This comprises collecting information and building a database as well as developing cooperative networks with SMEs, innovation-related APEC fora and the European Union.

The APEC SME Innovation Center will be located in Seoul, Korea and most of its functions will be untaken from its base in Seoul. The center will be established in two phases: a preparatory stage in 2005 and an operational phase broken into three stages from 2006 - 2010.
For the rest of 2005, Korea will establish the center and finalize the project plan for 2006. The first stage of the operational phase (2006-2007) will include the completion of a comparison study on innovation promotional policies implemented by APEC member economies, and the conduct of an "APEC SME Innovation Conference". In addition, training materials and case studies will be developed and training courses will be run. Conferences and training workshops will be held every year. Also during this stage an SME innovation website will be developed and the "APEC Innovation Brief for SMEs" will be publicized.
The second stage (2008-2009) will involve a visitation program to successful innovation clusters. Initially, a visitation program to Korean innovation clusters will be launched along with education and training programs. Gradually, the program will be expanded to include successful clusters in the APEC region, in order for the program to facilitate innovation exchanges and cooperation between stakeholders within the APEC region.
The third stage (2010), will include an international conference to celebrate the fifth anniversary of the Innovation Center. Former and incumbent SME Ministers of member economies, experts, innovative SMEs and successful clusters will participate to review the past achievements and to discuss the future direction of the Innovation Center.