WIXLIB

Sustaining Competitive Advantage:The Challenge for Belgium’sChocolate Clusterè DAVID CHANSABINE PRINZCARLOS RIVERAHELENE SOWHARVARD BUSINESS SCHOOLMICROECONOMICS OF COMPETITIVENESSPROFESSORS LAURA ALFARO, CHRISTIAN KETELS, AND JORGE RAMIREZ-VALLEJO

havingstrongdomesticrivals,aggressivehome- ofknowledge,theroleofthenationhasgrown.’- oreimportantly,giventhe1

ium’sChocolateClustercommodity- therthanconsideringadiversificationintootherby- proposition.2

twomajorlanguagegroups,theDutch- nch- ngpartsofRwandaandBurundi,andthemodern- oleinthepost- routeswhichhaveledtothe

years–GDPpercapitahasincreasednearly4.5timesfrom 10,491in1980to esasseeninthechartbelowv.In2015,NominalGDPwas orkforce.GDP0Per0Capita0(PPP,0 USD ) 50,000 45,000 40,000 35,000 osition@ by@ 019991998199719961995 20,0002004 25,000

919981997199619950!0.5Unemployment4 st

ernment’srecapitalizationofthebankingsectorpost- essuresduetoincreasedcounter- 99719961995!4!4.5

Belgium’s

sproductsat 54billion,followedbypharmaceuticalsat coaandcocoapreparationaccountsforapproximately uringaccountsfor euticals-( 62b)Jewelry,-Precious-Metals-( 21b)6%Food-Processing/Manufacturing--( 33b)4%Financial-Services-( 8.7b)2%Oil-and-Gas-( arket&Share&(%)Ranking)in)Exported)value) world)2014)(US tions3.540%2%4%6%

mondAnalysisContext for Firm Strategy and Rivalry: Integration with EU: Full adoption ofpolicies and standards ( ) No tariffs: open borders and opentrade promotes local competition andrivalry ( ) Preferentialinternationaltraderelations ( ) Favorable investment climate fordomestic and foreign investors ( ) Modernization of SOE through partEprivatization program ( ) Austerity measuresandfiscalconsolidation plans may inhibit growth(E) Lack of coherent national policy foreconomic competitiveness (E) Fragmented federal structure adds tocomplexityanddecreasesaccountability (E)Related and Supporting Industries Access to wide supplier basethroughout the EU Firms that hold products acrossmultiple clusters able to driveimprovements in performanceFactor Conditions: Multilingual population and opennessto foreign skilled labor ( ) Large FDI as a source of capital andexpertise ( ) Well developed physical infrastructureincluding ports, rail, roads, and airtransportation ( ) Highly skilled work force ( ) High quality of education ( ) High labor productivity per hour ( ) Limited natural resources (E) Strong influence of unions (E)Demand Conditions: Central location in Europe withaccess to local markets and 500million customers ( ) Affluent EU consumers with highquality standards ( ) Belgian consumers enjoy high GDPper capita and disposable income ( ) Closely linked to neighboring EMEAregion ( ) Domestic demand not a significantdriver of growth given country size t

rtantpointtonoteisthatBelgiumhasbeencontinuousre- ntalkstoinvestanother - ls-2042University l-system-

,whichhaveaffectedloanstonon- orconcernaboutlong- peanUnion–EUcompetitionpolicyencouragesopen- ansfersince2000,ithas

xtent of cluster policy * therlandsFranceGermanyG7 countriesEuro areaOECD TotalGDP per hour worked, lgiumhasthethird- taccesstocloseto500millionEUresidents,and

gsectorconstitutes 33billionoftotalexports,ofwhich epaper.Presence of demanding regulatory standards al availability of specialized research and training services Local supplier quality Local supplier quantity Availability of latest technologies State of cluster development Local availability of process machinery Extent of collaboration in clusters 19 *&200020151492049611101914212022 *&23 vationsystems.In2013,the

en,Finland,Germanyxxviii- ,

-15

lyimproveonthetransparencyofitsgovernmentpolicy- .IntheAmericas,Brazil,EcuadorandColumbia

cocoain2014xxxi.

rnsoverthelong- y,over- notingthattheconversio

Sustaining Competitive Advantage: The Challenge for Belgium’s Chocolate Cluster !!!! DAVID CHAN SABINE PRINZ CARLOS RIVERA HELENE SOW HARVARD BUSINESS SCHOOL MICROECONOMICS OF COMPETITIVENESS PROFESSORS LAURA