Australia's decline as a globally competitive economy could signal that the "lucky country" should be doing more to commercialise its home grown discoveries.

Despite its reputation as a sophisticated modern economy, Australia's economic growth over the past two decades has been underwritten by export earnings from minerals, natural gas, agriculture and tourism. In crude terms, Australia is a quarry, a farm and popular holiday destination.

Although education has emerged as the nation's third biggest export earner behind coal and iron ore, the nation still lags in the commercialisation of new ideas and technologies that are powering growth in more competitive nations such as Denmark, Sweden, and Germany.

In his essay, 'Pain on the road to recovery', Prime Minister Kevin Rudd acknowledged that this is an unsustainable growth strategy. In his view, Australia needs to prepare for a future "beyond mining booms" by launching a new global competiveness strategy.

"Australia cannot sustain strong economic growth unless it lifts its productive capacity," says Mr Rudd. "It cannot sustain ongoing improvements in living standards unless productivity growth improves. And it cannot meet the challenges of raising our global competitiveness if we do not lift productivity growth."

In May this year it was revealed that Australia was ranked sixth on international competitiveness among 57 national economies, down from second in 2003 and third from 1999 - 2002.

The Australian Institute for Commercialisation has said Australia's falling ranking indicates that our economy needs greater efforts in innovation and commercialisation to maintain and boost its competitive ranking.

The AIC says sustaining high level GDP growth in Australia will require "genuine expansion of the economy, not just improving the efficiency of current practices. As a mature economy, this growth is best sought through our ability to translate new technologies and innovative ideas into commercial opportunities."

Australia's Minister for Innovation, Industry, Science and Research, Senator Kim Carr, echoed these remarks when he announced the release of government report on Australia's intellectual property (IP) scorecard. "Boosting local innovation is one sure way to create competitive advantage in a globalised economy - and Australia's innovation effort in recent years has been ordinary," he said.

Australian public research agencies such as the CSIRO, leading universities, cooperative research centres and medical research institutes are major sources of research-derived ideas and technologies. All our leading research agencies, including the Group of Eight (GO8) universities, have in-house technology transfer offices that provide advisory and commercialisation services to their researchers and inventors.

These technology transfer offices help bridge the gap between basic and applied research discoveries and their uptake as commercialised new products and services. Without them, many promising discoveries would never make it to market because few businesses would be aware of new discoveries or their commercial potential.

How should Australia respond to this challenge? And what roles should government, investors, and tech-transfer offices play in boosting the commercialisation of Australian inventiveness?

Dan Gaffney and Jim Henderson address these questions in the latest issue of Chemistry in Australia.

Read the article here.