Post on 21-Jan-2018
Cluster-based Development in China
Implications for Egypt
Xiaobo Zhang
IFPRI and Peking University
Workshop on Cluster-based development in Egypt
December 20 2017
1
Chinarsquos Industrialization
bull China has become rapidly industrialized in just four
decades which took many European countries two
centuries
bull One key feature of Chinarsquos industrialization industrial
development is largely cluster based
bull There are thousands of clusters all over China
2
Major Industrial Clusters in China
Huzhou just down the road from Zhili is noted for its bamboo products The city of Wenzhou is famous for manufacturing a large share of the worlds supply of cigarette lighters What they all have in common is a reliance on the low
The cluster-based model is labor-intensive The real question is whether it can survive in the new environment of
Huzhou just down the road from Zhili is noted for its bamboo products The city of Wenzhou is famous for manufacturing a large share of the worlds supply of cigarette lighters What they all have in common is a reliance on the low
The cluster-based model is labor-intensive The real question is whether it can survive in the new environment of
Advantages of clusters
bull Use the existing strengths (social trust embedded in
community and abundant labor) to overcome limiting
factors such as credit constraints and lack of formal
institutions
ndash A production process is divided into many incremental steps
lowering the capital entry barriers
ndash Merchants often put-out the production to different family
workshops Producers are paid based on piece rate and donrsquot
need much working capital
4
Advantages of clusters
bull Easy for each other to learn technologies
bull Better access to markets (both final goods and input
supply) Save the sales and purchasing costs
5
6
Outdoor furniture industry in Pingyu county Henan Set up by a return migrant from the coastal area
Mainly for export Main parts are manufactured in a factory in county seat
Assembled in 53 villages with kindergarten nearbyEmployed 2200 workers (1900 women)
7
Garment Cut the clothes in a factory in countryseat
Put out the production in village workshops
Factory owners have market orders
Major Experience
bull Having a market order is essential for the survival of the
above two rural clusters
bull The clusters take advantage of the abundant female
labor in villages
bull Rather good rural roads
bull Countyrsquos support for setting up factories in industry park
in the county seat where the centralized production
stages are located
8
Specialization
Anding Potato Cluster bull Anding of Gansu Province used to be one of the
poorest places in China (poverty rate 78 in 1980) and didnrsquot produce potato until 1960s
bull Now it has become one of the three largest potato production centers in China
bull Potato accounts for two-thirds of the cropping area Anding provides every Chinese with one kg potato per year Farmers generate about 60 of their income from potatoes
9
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Chinarsquos Industrialization
bull China has become rapidly industrialized in just four
decades which took many European countries two
centuries
bull One key feature of Chinarsquos industrialization industrial
development is largely cluster based
bull There are thousands of clusters all over China
2
Major Industrial Clusters in China
Huzhou just down the road from Zhili is noted for its bamboo products The city of Wenzhou is famous for manufacturing a large share of the worlds supply of cigarette lighters What they all have in common is a reliance on the low
The cluster-based model is labor-intensive The real question is whether it can survive in the new environment of
Huzhou just down the road from Zhili is noted for its bamboo products The city of Wenzhou is famous for manufacturing a large share of the worlds supply of cigarette lighters What they all have in common is a reliance on the low
The cluster-based model is labor-intensive The real question is whether it can survive in the new environment of
Advantages of clusters
bull Use the existing strengths (social trust embedded in
community and abundant labor) to overcome limiting
factors such as credit constraints and lack of formal
institutions
ndash A production process is divided into many incremental steps
lowering the capital entry barriers
ndash Merchants often put-out the production to different family
workshops Producers are paid based on piece rate and donrsquot
need much working capital
4
Advantages of clusters
bull Easy for each other to learn technologies
bull Better access to markets (both final goods and input
supply) Save the sales and purchasing costs
5
6
Outdoor furniture industry in Pingyu county Henan Set up by a return migrant from the coastal area
Mainly for export Main parts are manufactured in a factory in county seat
Assembled in 53 villages with kindergarten nearbyEmployed 2200 workers (1900 women)
7
Garment Cut the clothes in a factory in countryseat
Put out the production in village workshops
Factory owners have market orders
Major Experience
bull Having a market order is essential for the survival of the
above two rural clusters
bull The clusters take advantage of the abundant female
labor in villages
bull Rather good rural roads
bull Countyrsquos support for setting up factories in industry park
in the county seat where the centralized production
stages are located
8
Specialization
Anding Potato Cluster bull Anding of Gansu Province used to be one of the
poorest places in China (poverty rate 78 in 1980) and didnrsquot produce potato until 1960s
bull Now it has become one of the three largest potato production centers in China
bull Potato accounts for two-thirds of the cropping area Anding provides every Chinese with one kg potato per year Farmers generate about 60 of their income from potatoes
9
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Major Industrial Clusters in China
Huzhou just down the road from Zhili is noted for its bamboo products The city of Wenzhou is famous for manufacturing a large share of the worlds supply of cigarette lighters What they all have in common is a reliance on the low
The cluster-based model is labor-intensive The real question is whether it can survive in the new environment of
Huzhou just down the road from Zhili is noted for its bamboo products The city of Wenzhou is famous for manufacturing a large share of the worlds supply of cigarette lighters What they all have in common is a reliance on the low
The cluster-based model is labor-intensive The real question is whether it can survive in the new environment of
Advantages of clusters
bull Use the existing strengths (social trust embedded in
community and abundant labor) to overcome limiting
factors such as credit constraints and lack of formal
institutions
ndash A production process is divided into many incremental steps
lowering the capital entry barriers
ndash Merchants often put-out the production to different family
workshops Producers are paid based on piece rate and donrsquot
need much working capital
4
Advantages of clusters
bull Easy for each other to learn technologies
bull Better access to markets (both final goods and input
supply) Save the sales and purchasing costs
5
6
Outdoor furniture industry in Pingyu county Henan Set up by a return migrant from the coastal area
Mainly for export Main parts are manufactured in a factory in county seat
Assembled in 53 villages with kindergarten nearbyEmployed 2200 workers (1900 women)
7
Garment Cut the clothes in a factory in countryseat
Put out the production in village workshops
Factory owners have market orders
Major Experience
bull Having a market order is essential for the survival of the
above two rural clusters
bull The clusters take advantage of the abundant female
labor in villages
bull Rather good rural roads
bull Countyrsquos support for setting up factories in industry park
in the county seat where the centralized production
stages are located
8
Specialization
Anding Potato Cluster bull Anding of Gansu Province used to be one of the
poorest places in China (poverty rate 78 in 1980) and didnrsquot produce potato until 1960s
bull Now it has become one of the three largest potato production centers in China
bull Potato accounts for two-thirds of the cropping area Anding provides every Chinese with one kg potato per year Farmers generate about 60 of their income from potatoes
9
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Advantages of clusters
bull Use the existing strengths (social trust embedded in
community and abundant labor) to overcome limiting
factors such as credit constraints and lack of formal
institutions
ndash A production process is divided into many incremental steps
lowering the capital entry barriers
ndash Merchants often put-out the production to different family
workshops Producers are paid based on piece rate and donrsquot
need much working capital
4
Advantages of clusters
bull Easy for each other to learn technologies
bull Better access to markets (both final goods and input
supply) Save the sales and purchasing costs
5
6
Outdoor furniture industry in Pingyu county Henan Set up by a return migrant from the coastal area
Mainly for export Main parts are manufactured in a factory in county seat
Assembled in 53 villages with kindergarten nearbyEmployed 2200 workers (1900 women)
7
Garment Cut the clothes in a factory in countryseat
Put out the production in village workshops
Factory owners have market orders
Major Experience
bull Having a market order is essential for the survival of the
above two rural clusters
bull The clusters take advantage of the abundant female
labor in villages
bull Rather good rural roads
bull Countyrsquos support for setting up factories in industry park
in the county seat where the centralized production
stages are located
8
Specialization
Anding Potato Cluster bull Anding of Gansu Province used to be one of the
poorest places in China (poverty rate 78 in 1980) and didnrsquot produce potato until 1960s
bull Now it has become one of the three largest potato production centers in China
bull Potato accounts for two-thirds of the cropping area Anding provides every Chinese with one kg potato per year Farmers generate about 60 of their income from potatoes
9
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Advantages of clusters
bull Easy for each other to learn technologies
bull Better access to markets (both final goods and input
supply) Save the sales and purchasing costs
5
6
Outdoor furniture industry in Pingyu county Henan Set up by a return migrant from the coastal area
Mainly for export Main parts are manufactured in a factory in county seat
Assembled in 53 villages with kindergarten nearbyEmployed 2200 workers (1900 women)
7
Garment Cut the clothes in a factory in countryseat
Put out the production in village workshops
Factory owners have market orders
Major Experience
bull Having a market order is essential for the survival of the
above two rural clusters
bull The clusters take advantage of the abundant female
labor in villages
bull Rather good rural roads
bull Countyrsquos support for setting up factories in industry park
in the county seat where the centralized production
stages are located
8
Specialization
Anding Potato Cluster bull Anding of Gansu Province used to be one of the
poorest places in China (poverty rate 78 in 1980) and didnrsquot produce potato until 1960s
bull Now it has become one of the three largest potato production centers in China
bull Potato accounts for two-thirds of the cropping area Anding provides every Chinese with one kg potato per year Farmers generate about 60 of their income from potatoes
9
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
6
Outdoor furniture industry in Pingyu county Henan Set up by a return migrant from the coastal area
Mainly for export Main parts are manufactured in a factory in county seat
Assembled in 53 villages with kindergarten nearbyEmployed 2200 workers (1900 women)
7
Garment Cut the clothes in a factory in countryseat
Put out the production in village workshops
Factory owners have market orders
Major Experience
bull Having a market order is essential for the survival of the
above two rural clusters
bull The clusters take advantage of the abundant female
labor in villages
bull Rather good rural roads
bull Countyrsquos support for setting up factories in industry park
in the county seat where the centralized production
stages are located
8
Specialization
Anding Potato Cluster bull Anding of Gansu Province used to be one of the
poorest places in China (poverty rate 78 in 1980) and didnrsquot produce potato until 1960s
bull Now it has become one of the three largest potato production centers in China
bull Potato accounts for two-thirds of the cropping area Anding provides every Chinese with one kg potato per year Farmers generate about 60 of their income from potatoes
9
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
7
Garment Cut the clothes in a factory in countryseat
Put out the production in village workshops
Factory owners have market orders
Major Experience
bull Having a market order is essential for the survival of the
above two rural clusters
bull The clusters take advantage of the abundant female
labor in villages
bull Rather good rural roads
bull Countyrsquos support for setting up factories in industry park
in the county seat where the centralized production
stages are located
8
Specialization
Anding Potato Cluster bull Anding of Gansu Province used to be one of the
poorest places in China (poverty rate 78 in 1980) and didnrsquot produce potato until 1960s
bull Now it has become one of the three largest potato production centers in China
bull Potato accounts for two-thirds of the cropping area Anding provides every Chinese with one kg potato per year Farmers generate about 60 of their income from potatoes
9
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Major Experience
bull Having a market order is essential for the survival of the
above two rural clusters
bull The clusters take advantage of the abundant female
labor in villages
bull Rather good rural roads
bull Countyrsquos support for setting up factories in industry park
in the county seat where the centralized production
stages are located
8
Specialization
Anding Potato Cluster bull Anding of Gansu Province used to be one of the
poorest places in China (poverty rate 78 in 1980) and didnrsquot produce potato until 1960s
bull Now it has become one of the three largest potato production centers in China
bull Potato accounts for two-thirds of the cropping area Anding provides every Chinese with one kg potato per year Farmers generate about 60 of their income from potatoes
9
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Specialization
Anding Potato Cluster bull Anding of Gansu Province used to be one of the
poorest places in China (poverty rate 78 in 1980) and didnrsquot produce potato until 1960s
bull Now it has become one of the three largest potato production centers in China
bull Potato accounts for two-thirds of the cropping area Anding provides every Chinese with one kg potato per year Farmers generate about 60 of their income from potatoes
9
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Major Potato Production Centers in China
Anding potato cluster
Zhang and Hu 2015 World Development 10
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Expand the Market
bull Establish trader and producer associations
bull Update market information systems
bull Set up a new system of local wholesale markets
bull Apply for more freight car quotas
bull Subsidize farmers to build storages
11
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Acquire and Spread Market Information
bull The potato association sends informants to live in major wholesale markets nationwide to collect market information
bull The county broadcasts the information in local media (radio TV and newspapers) and on large monitors in major gathering places (central squares railway and bus stations)
bull Greater market transparency makes it harder for traders to cheat farmers
12
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
The Spatial Distribution of Markets Over Time
Wholesale market
Village collection point
Blue Built 1996-2000
Red Built 2001-2005
Yellow Built 2006-2010
13
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Overcome Transportation Bottleneck
bull Lobby for more freight car quotas (up from 1507
in 2003 to 3605 in 2004 and 6145 in 2009)
Transportation cost to Shanghai
By car 450 yuanton
By train 225 yuanton
Anding to Guangzhou
Anding China potato train
14
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Build More Storages (55 of annual output)
Farmerrsquos storage 036 million tons
More than 2 storages per
household
Small natural ventilation storages
0185 million tons
Centrally air conditioned 10000 ton each Natural ventilation storages Medium size
200 Yuan
Subsidystorage
15
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Develop the Processing Sector
bull Local government intensified their effort to
attract investors
ndash Provide free land
ndash Help secure subsidized bank loans
ndash Guarantee stable potato supply
bull The number of processing plants increased from
0 in 2003 2 in 2004 to 12 in 2009 Now it can
process about 13 of total output
16
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Develop the Processing Sector
bull In 2004 the first two plants produced only starch
bull Quickly the product lines have become more diversified
ndash Modified starch for industry use
ndash Frozen French fries for fast food chains
ndash Potato chips
ndash Potato flour
ndash Even export to the Middle East and Southeast Asia
17
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Summary
bull The size of potato cluster is determined by
market size
bull So one has to keep figuring out ways to
expand the potato market
18
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Summary
bull As shown in the potato case clusters are at the
local level Therefore it is essentially to have
locally tailored industry policy
bull In China local governments have played a key
role in facilitating cluster formation thanks to
their informational advantage
19
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
How to Incentivize Local Governments
bull In China local governments have strong
embedded interests in promoting cluster-based
development
ndash Fiscal competition among local governments
ndash Career competition among local officials
bull More research is needed to understand the
incentive structures of local governments in
other developing countries such as Egypt
20
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
How to Measure a Cluster
bull An industrial cluster is a locality with a high
concentration of firms in related
businesses
bull Large number of firms + relatedness
21
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
22
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Performance of the Clustering Measure
bull It outperforms all other clustering measures in
terms of predicting the actual clusters
bull Similarly using economic census data we can
compute the clustering measure at the district
level in Egypt Next we consult informants on
about the major industries in the regions with
high degree of clustering
23
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
24
My presentation is mainly based on the following publications
ldquoOvercoming Successive Bottlenecks The Evolution of a Potato Cluster in Chinardquo
(Xiaobo Zhang and Dinghuan Hu)
World Development 63 102-112 2014
ldquoA Proximity-Based Measure of Industrial Clusteringrdquo (Jianqing Ruan and
Xiaobo Zhang) IFPRI Discussion Paper 1468
httpspapersssrncomsol3paperscfmabstract_id=2688022
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
IFPRI ndash ECES Cluster-based Development
Research Project
25
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Cluster-based development as an
opportunity for job creation and poverty
reduction in Egypt
bull The CBD model is consistent with Egyptrsquos
current stage of development
bull Labour intensive
ndash Large population
ndash High unemployment
bull Based on community strength
bull Overcomes credit constraints
26
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Research Project Goal
bull Ensure that the existing potential is unleashed
bull Provide concrete solutions for how CBD can be scaled up for job creation and poverty reduction in Egypt
ndash USAID ARDII project area and other development projects
27
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Research Stages
Stage 1 Identify the promising industrial clusters in Egypt
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
28
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Stage 1
Stage 1 Identify the promising industrial clusters in Egypt
ndash Clustering index amp cluster mapping activity
ndash Expert structured interviews
Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnation
Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
29
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Stage 1 Cluster Mapping Activity
Stage 1 Identify what are the promising industrial clusters in Egypt
ndash Clustering index amp maps
ndash Expert structured interviews
Stage 2 What are the bottlenecks that are leading to their stagnation
Stage 3 Identify how the GoE can help and further promote the growth of these industrial clusters
30
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Stage 1 Structured Expert Interviews
bull What defines an industrial cluster
ldquointerconnected businesses that are geographically concentratedrdquo
ndash Common Goal amp Identity
ndash Interdependent
ndash Degree of collective efficiency
31
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Stage 1 Structured Expert Interviews
bull Criteria to narrow down the choice of
cluster
bull Geographical focus Upper Egypt
32
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Stage 1 Structured Expert Interviews
bull Promising sectors
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
bull Common bottlenecks
bull Suggested government intervention
33
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Stage 2
bull Stage 1 Identify the promising industrial clusters in Egypt
bull Stage 2 Understand the bottlenecks that are leading to the clustersrsquo stagnationndash In depth case studies 2 ndash 3 clusters
bull Stakeholdersrsquo workshop
bull Field work
bull Stage 3 Determine how the GoE can help and further promote the growth of these industrial clusters
34
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Stage 2 Stakeholder Workshop
bull Having an industry focus
ndash Furniture and wood manufacturing
ndash Agroindustry
ndash Handicrafts
35
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Next Steps
bull Stage 2 Field work
bull Stage 3 Determine how the GoE can help
and further promote the growth of these
industrial clusters
36
Thank you
37
Thank you
37