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SME DEVELOPMENT- CLUSTERS AND INITIATIVES
Background
Cluster development as an approach to industrial development has been successful in countries like China, India, South Korea, Malaysia
In at least 50 developed and developing economies clustering phenomenon is visible
It is acknowledged in our Industrial Development Policy 2012-2016
Can have direct impact on poverty reduction, generating employment
Can increase productivity and competitiveness of SMEs
What is a Cluster
Geographical proximity Same line of business or complementary
business active channels of business transactions,
communications and dialogue share specialized infrastructure, labour
market and services and they are faced with common
opportunities and threats.
Characteristics of Cluster
Geographical proximity Sectoral specialization Close inter-firm collaboration Common infrastructure Common opportunities Common threats
Benefits of Having Clusters
Common procurement of inputs Greater bargaining power with customers Greater presence in the market place- critical
mass to achieve economies of scale Enhanced possibility of securing or sharing big
contracts Easy provision of business development support
services therefore enhanced effectiveness and collective efficiency
Sharing of risks, and other critical resources e.g manpower, equipment, technology, training facilities
Common Sectors in Clusters in Zimbabwe
Leather work Furniture making Dairy farming Metal fabrication Clothing and textiles Agro-processing Retail- flea markets
Approach to cluster development
Methodology Selection of a cluster based on importance,
viability and sustainability Diagnostic study Trust building Action plan Implementation Monitoring and Evaluation
Challenges hindering cluster development in Zim
Lack of dedicated financial support Limited appropriate infrastructure and
work space Lack of knowledge of cluster concept and
benefits by SMEs- unwillingness to collaborate
Lack of technical support(technology, expertise)
Other Initiatives For SME development
• Formulating and implementing MSME development policies.
• Developing legal and regulatory framework for SMEs development
• Promoting, coordinating and monitoring innovative financing schemes for SMEs.
Cont’n
Providing technical skills and management training that support entrepreneurship and small business growth
Facilitating linkages between large scale enterprises and SMEs
Business consultancy services to SMEs Research into investment and marketing
opportunities for SMEs Facilitating provision of appropriate
infrastructure to SMEs
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