Development of Small-scale Industries During the New Order Government in Indonesia by Tulus Tahi Hamonangan Tambunan

Author:Tulus Tahi Hamonangan Tambunan [Tambunan, Tulus Tahi Hamonangan]
Language: eng
Format: epub
Tags: Business & Economics, General, Social Science, Developing & Emerging Countries
ISBN: 9781351791069
Google: ZoVHDwAAQBAJ
Publisher: Routledge
Published: 2017-11-22T03:31:26+00:00

The importance of SSI clusters

In the upcoming era of free trade and economic globalization, where competition will become heavier, and two critical factors determining the global competitive edge are mastery of technology and high skill human resource, industries of all scales in Indonesia will face various kinds of problems. This is especially true for SSIs considering the weakness of this group of industries, particularly in the rural areas compared to MSIs or/and LSIs in almost all aspects related to business development, including limited funds, lack of experts, as well as poor technological mastery and business knowledge, particularly on global market.

In literature on cluster of SMEs based on empirical studies in a number of West European countries, it is stated that if the small and medium entrepreneurs cooperate in a cluster, their ability to increase the competitive edge and output growth and to develop their business will be much better than when they work individually. As Richard (1996) put it (p.4):

The European experience seems to suggest that SMEs might not be at a disadvantage at all compared to large firms, as long as they were able to benefit from the advantages of clustering.

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