Thursday, April 26, 2012

Determinants of manufacturing competitiveness

Here is a nice chart that shows the determinants of manufacturing competitiveness. A combination of government action, manufacturing capabilities, market forces, and resources is needed for successful enhancement of manufacturing competitiveness. It is based largely on exports sophistication and complexity of products.

 Government forces

  • Education policies
  • Energy policies
  • Economic, trade, labor, financial and tax policies
  • Science and technology policies
  • Manufacturing and infrastructure policies


  • Innovation
  • Technology
  • Process
  • Infrastructure

Market forces

  • Demographic
  • Macroeconomic


  • Human
  • Materials
  • Energy
  • Financial

By the way, Nepal’s manufacturing sector is going downhill. If you look at the list of determinants of manufacturing competitiveness, almost all of them are either missing or inadequately supplied in Nepal. Here is an earlier discussion on the state of Nepali economy, industrial sector, and exports.