Bio-Economy and the Knowledge-Based Economy 1 ELSADIG MUSA AHMED * Faculty of Business Multimedia University 75450, Melaka Malaysia E-mail: elsadig1965@gmail.com and elsadimusa@yahoo.com ABSTRACT Purpose: This paper aims to explain bio-economy as a new stream of knowledge-based economy that exists in the new era of the Information and Communications Technology (ICT). Design/Methodology/Approach: Bio-economy refers to the production of a wide range of goods and services from plant, animal and forest-based material. It is more than just grain-based bio-fuels or bio-diesel as extensively highlighted in Latin America. It is related to biotechnology and other bio-activities based on knowledge generated from the bio-activities and extension of the knowledge-based economy. Findings: The main concern of developing bio-economy is the environmental damage caused through the undesirable output produced by the bio-economy activities. Bio-economy is centred on Research and Development (R&D) collaborations across diferent sectors, including the public and private sectors, in order to breakthrough new products through invention and innovation. 1 WASD *Corresponding Author BIO-ECONOMY AND ITS CONNECTION TO THE KNOWLEDGE-BASED ECONOMY