Institute for Innovation and Public Purpose “UU DRAFT - FOR DISCUSSION 20 December 2022 A green industrial strategy in Colombia: Proposed collaboration Context ‘The Government of Colombia is seeking support over the next four years to bring a mission-oriented approach to the country’s industrial strategy, aligning its economic growth with sustainability and inclusion goals. There is a unique opportunity to position Colombia as a model for mission-oriented industrial strategy that other countries could follow. This support would take the form of a collaboration between the Government of Colombia, and Professor Mariana Mazzucato and the UCL Institute for Innovation and Public Purpose (IIPP) that'she founded and directs. It would build on a recent independent report written by Professor Mazzu the UN's Economic Commission for Latin America and the Caribbean (ECLAC in Latin America and the Caribbean: a Mission-Oriented, from economic p reforms to address lagging productivity, limit setting out clear coogi: for aligning social, economic» and_environment lems throu investment, i \n, and industrial Y. Proj vi could include three staged components: high-level strategic advice on industrial strategy oriented around sustainability and inclusion goals; cross-ministerial capacity building for policymakers and civil servants; and potential deeper work in specific areas where the challenges and opportunities are greatest, through policy design focused on a specific tool or institution, or customized executive education. These components could be pursued in sequence, with each building on the learnings and deliverables of the previous stage, or in parallel. 1omic growth trajectory with tackling new "mission-oriented” approach to This project aims to support the Colombian government in advancing a bold new approach to industrial strategy that fundamentally reimagines the role of the state as a market shaper and aligns economic growth with critical inclusion and sustainability goals, delivering value to the people of Colombia while at the same time positioning Colombia as a global leader in implementing a new, more inclusive and sustainable form of capitalism. To mobilise co-funding for this project, beyond a budget coming from the Colombian Government, we are working with the Open Society Foundations (OSF), which require funding proposals to come from the Craft prepared for UCL insti for novation and ne Pile Purpose (IPP wemuclac ape IPP @uPP_Uct.government partner. We are looking forwards to working closely with you in its development, and in exploring other avenues to fund this project. STAGE I-A new framing for mission-oriented industrial strategy ‘A mission-oriented industrial strategy can set a clear direction, aligning public and private sector investments and innovation across existing and new areas of economic strength, with a view to stimulate long-term green and inclusive growth and govern the energy transition in a coordinated way. As Minister Ocampo notes, the country faces three critical transitions: the energy transition (strengthening renewable energy sources, such as green hydrogen), the export transition (diversifying the country’s exports away from oil), and the fiscal transition (diversifying the country's tax collection). A new mission-oriented approach to industrial strategy can help bring greater cross-ministerial coordination within government, redesign the institutions required for these transitions, such as purpose-driven state-owned enterprises and a mission-oriented development bank, and leverage new tools such as strategic procurement and conditionalities to ensure that the public and private sectors govern these transitions in a more shared and ambitious way. Ultimately, a mission-oriented industrial strategy can set a clear direction to tackle the country’s social and environmental challenges, while crowding in and directing investment and innovation to increase productivity. could translate and apply the key insights from this rey support the government in charting a way f " a. ted in regy requires a shift from seeing the government role as one lures, STAGE I - Tr Ady ing es of me lur seeing its role as one of shaping markets that align with public policy Sri This shift requires creative, dynamic capabilities on the part of government — for example, to ticipate, adapt and lear within and across organizations; to design tools, institutions and Partnerships that are mission-oriented and maximize public value; to effectively engage citizens; and to build and govern digital infrastructure for the common good. Given the scale of the Government's ambition, it will be critical to build the confidence and capabilities required to implement its vision in the civil service. The UCL Institute for Innovation and Public Purpose (IIPP) offers a seven-week intensive Executive ‘Fducation programme designed to advance participants’ understanding of the role of the state in driving inclusive, sustainable, and sustained growth, The training that we provide is based on the IPP Masters of lic Administration (MP ime that teaches the dynamic skills required for public servants, policymakers, and purpose-driven public sector organisations to confront the grand challenges of the 21° century. Based on four pillars ~ rethinking public value, shaping innovation, transforming institutions, and redirecting finance ~ the programme offers a ground-breaking curriculum that rewrites modern approaches to economics and public administration, based on a fundamental shift away from market failure theory to a market-shaping approach. Specifically, the Executive Education programme is aimed at senior level policy makers directly involved in stimulating regional or national economic development. We have developed programmes for several different partners to-date, including the Peruvian and South Ere IPP.African governments, to deliver practical learning: civil servants, policymakers, and academics are brought together to build the foundation and practical tools for governments to act as market-shapers. STAGE Ill - Policy deep dive The first two stages of this collaboration will inform a shared understanding of where the greatest opportunities and challenges lie for advancing mission-oriented industrial strategy in Colombia, in line with the Government's priorities. A subsequent stage of work could involve working more closely with the Government of Colombia to design and implement a specific mission-oriented tool or institution. To advance this work, we could leverage IP's Policy Studio, which brings together bespoke multidisciplinary teams to work with governments on designing specific policies, tools, and institutions. We work in partnership with governments and institutions from across the world to co-design and test new policy frameworks and on-the-ground solutions. This stage of work could also / alternatively include more tailored executive education courses focused on specific areas where new capabilities are needed to successfully implement the Government's strategy. This work could, for example, focus on: innovation-led growth. However, to ensure that finance is inclusive and government requires institutions and instrumet ut nted. Mini 's le nt banks mi riented institution Ocampo expressed interest in IPP, (BANCOLDEX, FINDETER, FDN, and way. Similarly, the government can leverage specific tools, including. to ensure that access to public finance is conditional on contribution towards social and environmental goals. These institutions and instruments can help direct investment towards renewable technologies with a view to building up local production capacity. 1. Public finance: Mobilising and directing public finance is key to achieving innit = 11. Public procurement: Public procurement is 2 key policy tool to help direct public spending at social and environmental challenges. if leveraged strategically, it can play a powerful market-shaping role by mobilising public purchasing power to tilt economic activity in a desired direction. Recognising this potential and redesigning procurement contracts to ensure that Public funding is conditional on socially and environmentally mindful business decisions is crucial. Minister German Umafia Mendoza and Vice minister Maria Fernanda Valdés have requested support to work with IIPP on the Ministry of Commerce, Industry and Tourism’s Re-Industrialization Strategy. Working with them to embed a mission-oriented approach to thei industrial strategy as well as focusing on specific tools such as conditionalities or procurement could be a good option. 2. Public innovation lab: Developing digital capabilities within government, building digital platforms and other tools, and redesigning organisational structures can help strengthen inter-ministerial coordination and experimentation and the sharing of knowledge across government. We spoke about building a public innovation lab, ideally positioned within the Ere IPP. )presidency to ensure a clear, high-level mandate to embed a new approach to experimentation, learning, and policymaking within Colombia's government. This lab could be development with guidance and support from Chile's Laboratorio de Gobierno, which | visited whilst in Santiago. ECLAC also expressed interest in working with IIPP to convene public innovation labs from across Latin America to ensure knowledge sharing and learning between countries. a Ere IPP.Proposed activities Proposed project tim 10 2024-27 (Stage 3) Stage! 2-hour masterclass from Prof Mazzucato with key decision makers in the Colombian Government to collect insights into application of market-shaping and mission-oriented approach in Colombia's economic context : January 2023 ~ January 2024 (Stages 1 and 2), with the potential to extend High-level strategy Set of in-person workshops in Colombia to identify priorities and inform new framing for the government's economic policy. High-level five-page policy document that embeds the ideas of the ECLAC report in the Colombian context and translates it into tangible policy recommendations for the Colombian government. Stage It Intensive seven-week Executive Education programme designed to bring ws tive Multiple ministries and advance key decision makers’ understandings of the r f Education ‘tate in driving inclusive, sustainable, and sustained growth. This programme is e designed for up to 60 participants. IPP I z fa ‘open ~ Five 60-minute framingilecture access for up to 60 e inte semit rk’ staff which enable participants to engage in riences of other participants around the course material. Sv -minUte workshops that rely on co-design jodologies and peer-to-peer learning. - New research focused on a specific mission-oriented policy, tool or institution Policy deep that is critical to implement the recommendations from Stage |, focused on a dive priority area such as public finance, procurement or digital platforms. ~ Co-design workshops and stakeholder convening to inform recommendations ‘on policy, tool or institution design. = Development of an action-oriented final report. The specific nature of activities and deliverables pursued as part of this stage of work would be defined based on findings from Stage land I! IPP.Budget To mobilise co-funding for this project, beyond a budget coming from the Colombian Government, we are working with the Open Society Foundations (OSF), which require funding proposals to come from the government partner. We are looking forwards to working closely with you in its development, and in exploring other avenues to fund this project. Proposed project timeline: January 2023 — January 2024 (Stages 1 and 2), with the potential to extend into 2024-27 (Stage 3) STAGE | A new framing for mission-oriented industrial strategy Other IPP staff costs (part-time project manager, Professor Mazucato’s support team, IPP experts) Non-staff costs (e.g. for travel, communications, workshops, STAGE i—Talning rhe cobin goverment ac\? ££300,000.00 Policy deep dive * This stage could range in cost from about £75,000 to £500,000, depending on the nature of the deep dive, which will be determined in partnership based on Stage |. £235,000, “Note: For all budgets, VAT is not included and would apply IPP.Key IPP Experts The project will be supported by a core team, as well as @ wider array of IPP professors, post-docs, PhD students, and MPA students with relevant expertise. This list is a representative sample. Professor Mariana Mazzucato, Founding Director of the UCL Institute for Innovation & Public Purpose ‘Mariana Mazzucato (PhD) is Professor in the Economics of Innovation and Public Value at University College London (UCL), where she is Founding Director of the UCL Institute for Innovation & Public Purpose (NPP). She is the author of three highly-acclaimed books: The Entrepreneurial State: Debunking Public vs. Private Sector Myths (2013), The Val ervthing: Maki Taking in the Global (2018) and the newly released, i Chanaing Capitalism (2021). She advises policymakers around the world on innovation-led inclusive and sustainable growth. Her current roles include being Chair of the World Health Organization’s Economic Council on Health for All and a member of the South African President’s Economic Advisory Council, the Scottish Government's, Council of Economic Advisors, and the United Nations High-level Advisory Board (HLAB) on Economic and Social Affairs, among others. Jose Alejandro Coronado, Research Fellow at the UCL Institute for Innovation and Public Purpo: Jose is a Research Fellow at IIPP. His current research uses Bloomberg Né e mobiizespriate unde @ 0 i tit se a and how. eto Be jing PP Jose taught Microeconomics and Math for Economics at the New School's Eugene ing College, and Introductory Statistics at Fordham University. He is also a Research Associate at the ‘Schwartz Center for Economic Policy Analysis. Sarah Doyle, Director's Chief of Staff at UCL Institute for Innovation and Public Purpose - Sarah is Chief of Staff to Mariana Mazzucato, Professor in the Economics of f Innovation and Public Value at University College London and Founding Director of the UCL Institute for Innovation and Public Purpose. Previously, Sarah served the crestor ralcy«hennch the Srooktallietne fx erevdone Entrepreneurship, where she led development of the Institute's research agenda e * J and oversaw its policy team, and as Senior Manager at the Centre for Impact BD irvestng athe tans bscovery District Sarah ls worked in Cana’ Privy Council Office, developing advice for the Prime Minister on a range of social policy issues, and at Citizenship and immigration Canada. Sarah has served on several boards, including with The Neighbourhood Group. She holds a Master of Science in International Relations from the London Schoo! of Economics and Political Science, where she was a Commonwealth Scholar. IPP.David Eaves, Associate Professor in Innovation and Public Purpose (IPP) David specialises in digital era public administration, digital transformation and the governance of digital public infrastructure. Previously a lecturer at Harvard Kennedy School, David also co-founded Teaching Public Service in 0 Digital Age, which resulted in an open licensed curriculum for teaching the minimum needed digital competences for future public leaders, now used by dozens of faculty members in over 20 universities around the world. He has partnered with Public igital Government and Co-Director at the UCL Institute for Digital to co-host an annual convening of digital government leaders, and ran a successful Executive Education program on Digital Transformation. In addition, David co-founded and served as CEO of a civictech start up that successfully grew to serve over 400 governments across North America. He's also advised on governance and collaboration strategies for ‘open source communities such as OpenMRS, Drupal and Mozilla and provided training to almost every cohort of Code for America fellows, White House Presidential Innovation Fellows and Code for Canada fellows. David is also proud of his work as a negotiation adviser to numerous tech organizations, governments and environmental groups. a- e Observatory on Public ission-oriented innovation. He has also chaft fur Internationale zu arbeit (GIZ), Jopment corporation on fiscal policy and ti bilidgtion Has has a Masters of Public Administration (MPA) e UCL for Innovation and Public Purpose (UIP) and a Bachelors in nomics and History from McGill University. laldonado, Policy Designer of the IIPP Policy Studio at UCL Institute for Innovation and Public Luc a on Burger Det’ Policy Adis at UL nse fr Innovation a Pub urs Luca Kuhn von Burgsdorffs Professor Mazzucato's Policy Advisor and supports her in her variou attivties and rolesin shaping the economic policy nagative aroun pose Manuel Maldonado is a Policy Designer at the IIPP Policy Studio at the University College London (UCL). The IPP Policy Studio is the space where we work with policymakers, practitioners, and governments around the world to co-design new tools and frameworks for inclusive, healthy and sustainable growth. Before joining HPP, he has been a civil servant for over 10 years in Peru, working in different topics like public service improvement, modernization, innovation, civil service reform, country brand promotion, and others. He holds a Master of Public Administration (MPA) in Innovation, Public Policy, and Public Value from the UCL Institute for Innovation & Public Purpose and a BA in Public Management from the Pontificia Universidad Catolica del Peru References Transformational Change in Latin America and the Caribbean: a mission-oriented approach (link here! © Armission-oriented framework for a Scottish National Investment Bank (link here) 8 IPP.'* Mission-Oriented Research & Innovation in the European Union (link here) '* Governing Missions in the European Union (link here) '* Mission-oriented innovation policy and dynamic capabilities in the public sector (link here) ‘* The EIB and the new EU mission framework (link here) ‘© COVID-19 and the Need for Dynamic State Capabilities (link here) @ Mission-oriented procurement: international examples (link here) About UCL IIPP The UCL Institute for Innovation and Public Purpose (IIPP) aims to develop a new framework for creating, nurturing, and evaluating public value to achieve economic growth that is more innovation-led, inclusive and sustainable. We intend this framework to inform the debate about the direction of economic growth and the use of mission-oriented policies to confront social and technological problems. Our work will feed into innovation and industrial policy, financial reform, institutional change, and sustainable development. A key pillar of IIPP’s research is its understanding of markets as outcomes of the interactions between different actors. In thi context, public policy should not be seen as simply fixing market failures, but also as actively shaping and co-creating markets, Re-focusing and jing public e mission-led, public purpose aims will help tackle thé et nisatior ns Ast IPP.