ENHANCING THE COMPETITIVENESS OF PALESTINIAN SMES THROUGH CLUSTERING

The research aims to discuss the competitiveness of SMEs working in the food processing sector in Palestine through clustering. To benefit from the regional experiences, the Jordanian and Israeli food processing sectors where studied. A combination of quantitative and qualitative methods is used in the research. The analysis of data shows that the Palestinian experience in clustering is frail, where there are weak collaboration between businesses and the related and supporting industries such as universities, banks, research institutes, insurance companies and governmental institutes. The weakness in the ties between the businesses and related and supporting industries has a negative impact on the competitiveness of SMEs working in the food processing sector in Palestine. Thus, building and formalizing a dynamic cluster within this sector will lead to enhance the competitive advantage of these firms. On the other hand, the research encourages the regional cooperation between the food processing clusters. This cooperation will lead to create economies of scale and technology and research and development transfer.