Welcome to the Clusters & Networks Development Programme

Clusters and networks are different yet linked phenomena. Clusters are agglomerations of interconnected companies and associated institutions. Firms in a cluster produce similar or related goods or services and are supported by a range of dedicated institutions located in spatial proximity, such as business associations or training and technical assistance providers. Vibrant clusters are home of innovation oriented firms that reap the benefits of an integrated support system and dynamic business networks. 

Networks are alliances of firms that work together towards an economic goal. They can be established between firms within clusters but also exist outside clusters. Networks can be horizontal and vertical.

• Horizontal networks are built between firms that compete for the same market, such as a group of producers establishing a joint retail shop

• Vertical networks, particularly supplier development schemes, are alliances between firms belonging to different levels of the same value chain, such as a buyer assisting its suppliers for upgrading.

Clusters and business networks have become keywords in the policy debate in industrialized and developing countries. They are regarded as tools to promote poverty reduction and the development of competitive industries. However, several bottlenecks may hamper their performance.
Focusing on the specific challenges faced by developing countries, UNIDO has formulated a six-step approach for the promotion of clusters and business networks.

For more information on our strategy and services, click here.

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