Clusters can ignite national prosperity
cluster.
Third, there must be intense rivalry among these competing firms. Rivalry impels the local firms to upgrade and constantly innovate. Being close to each other is critical in order to fuel the rivalry. It is like a soccer derby — firms have no option but to be at their best in order to survive. Such competition forces rivals to keep pushing the envelope until their level of competitiveness surpasses every other global player. In clusters, companies must first win tough local battles before they can tackle international competitors.
Fourth, firms in the cluster must compete through sophistication, constantly innovating and upgrading.
Fifth, firms in the cluster depend on specialised skills, proprietary or exclusive or unique knowledge and topnotch technology. The aim is to bring down the total costs of production and innovate (not imitate) to create superior product features and performance. These skills and unique knowledge are produced within the cluster. Clusters rely on the quality of labour, not its quantity. In traditional economics, factors are inherited. In cluster thinking, factors are created and constantly advanced.
Sixth, firms in the cluster must be supported by internationally competitive suppliers in the cluster.
Seventh, the firms in the cluster must be supported by locally-based specialist research institutes.
A cluster lowers production costs to its players through its ability to turn information, knowledge and specialised skills into semi-public goods.
It should be clear by now why our national smugness about natural resources endowment creates false hope for achieving national prosperity. Digging soil, blasting rocks and shipping them abroad will not bring national prosperity. Planting crops and shipping harvests will not either.
Our hope for national prosperity is in the brains we are developing in our higher learning institutes. However, the knowledge we are giving them is ordinary and will not build competitive advantage in clusters. When we begin to unleash these brains in the context of clusters to create our own knowledge and technologies not found anywhere in the world, we will begin to achieve international competitiveness.
Through the lenses clusters one can see why land seizures saw national standards of living plummeting. When commercial farmers left, we lost tonnes of proprietary knowledge and semi-advanced skills that had been developed over decades — we lost factor creation.
There are two types of knowledge: tacit and explicit. Tacit knowledge is gained through practice — it cannot be transferred through teaching and libraries — you cannot tap it through research. Tacit knowledge is gained in the presence of the connoisseur and his/her example. We have irrecoverably lost that tacit knowledge. We also frittered away the rivalry that pushed farmers to embrace sophistication. Agriculture was an emerging cluster. Before land seizures, the closest we had to a cluster in Zimbabwe is the region in and around Harare: Beatrice, Chegutu, Norton, Banket, Chinhoyi, Mazoe, Mvurwi, Concession, Glendale, Bindura and Marondera. Rivalry among the farmers was fairly high. Who can forget the therapeutic artistry displayed in its full glory in the fields nestled between Kadoma and Harare that sated the wayfarer’s eye? Or the gently rolling moorlands connecting Gweru and Shangani on which a thousand top-pedigree steers roamed in magisterial abandon?
Specialised research institutes for tobacco and maize were an advanced component of this emerging cluster. Agro-based industries were also members of this evolving agricultural cluster.
Mazoe Orange Crush was both competitive in Zimbabwe and internationally. In a fully-fledged cluster, we would have tens or hundreds of such products fiercely competing locally and winning in international markets. Low farm wages in this economic region made it not a fully-fledged cluster — in a cluster the majority of workers must be high earners due to skill specialisation.
High-tech farming equipment employed on Zimbabwe’s yesteryear farms such as irrigation systems matched global best-practice. One must go beyond best-practice by creating proprietary technology and knowledge to become a real cluster. Some of the high-tech equipment must be manufactured within the cluster. This was and is still not the case.
Though seed varieties were produced and processed within this nearcluster, it does not represent the level of sophistication expected in a true cluster — it represents best-practice. High-tech exploits in Israel’s agricultural cluster such as soil-less agriculture, dew-harvesting, drip irrigation are proprietary and make it a true cluster.
At its peak, some of our near-clusters’ output was competitive in the region and beyond — think horticulture. Just imagine this near-cluster being fully upgraded to a true cluster. We would have internationally dominant high-wage exporters in agricultural equipment and components, agroproducts, agricultural consultancy, boutique marketing and advertising firms, internationally acclaimed research and training institutions, for instance. This would create massive employment.