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Policy Brief - How they did it Vol. 1 Issue 1 - Building Effective Clusters and Industrial Parks
It is a daunting task to build institution and infrastructure over a short time period in developing countries. But in the absence of sound institutions and adequate infrastructure, it is difficult for economic transformation to take place. An alternative is to facilitate existing clusters or build industrial parks by creating an enabling environment in a limited place. This paper reviews the commonly used strategies to build effective clusters and industrial parks. Clusters and industrial parks are location-specific. Because local governments have an informational advantage, they are in a better position than the central government to identify and solve the bottlenecks that affect clusters and industrial parks. As clusters and industrial parks evolve, new bottlenecks emerge, thereby requiring new solutions. This in turns calls for continuous tinkering by local governments. It is important to place local governments and business communities in the driver’s seat of local economic growth so that they can watch out for and adjust to the bumps in the road ahead.
Keywords: Cluster, Industrial Park, Special Economic Zones, Quality Upgrades, Go-as-a-group.