Competitive advantage of clusters within lesser developed countries of the South Pacific: An empirical case study extending the Porter diamond model (Fiji, Papua New Guinea, Tonga)

The main objective of this study was to add to the body of knowledge about the processes of cluster development in lesser developed countries. Porter's diamond framework was applied to three lesser developed South Pacific island nations; Fiji, Papua New Guinea, and Tonga. The goal of this study was to answer two research questions including: (a) how, if at all, has the competitive advantage on production in select South Pacific Island nations been impacted by the existence of clusters, using Porter's diamond theory, and (b) what are the possible effects of the regional trade agreement, SPARTECA, on clusters and trade between the developing nation of Fiji and its trading partners Australia and New Zealand? This research parted from Porter's case study to analyze the trade agreement between the South Pacific island of Fiji, with Australia and New Zealand and its possible influence on trade and clustering. This analysis indicated that the regional trade agreement has impacted clustering in Fiji, and that lesser developed countries are impacted by developing regional trade agreements with developed countries. Porter's (1990) viewing of international competitiveness of industries through the diamond framework seems to hold for the lesser developed nations in this study. A focus on the regional trade agreement was a complement to Porter's framework.