APPLYING PORTER'S COMPETITVENESS MODEL ON SMES: THE CASE OF OCCUPIED PALESTINIAN TERRITORY (OPT)

Palestinian industries are trying to move from totally depending on the Israeli economy to the gradual de-annexing stage, and hence building the independence stage and achieving a competitive advantage to the Palestinian industries that lead the economic process and sustain prosper and luxury to the people. The main objective of the research paper is to discuss the competiveness of small and medium sized enterprises (SMEs) working in the leather and shoe industry in the Occupied Palestinian Territory (OPT). The paper discusses the challenges facing the SMEs such as instability of economic and political environment, acquiring capital, bureaucratic rules and regulations, infrastructure availability, infrastructure cost, availability of technical qualifications and clustering in addition to the highly competition with the cheap Chinese products. The main recommendations are: simplifying rules and regulations related to the SMEs' growth, providing and developing the infrastructure facilities and utilities at reasonable prices and adequate quantities and qualities, building up the human capacities through training, maintenance and laboratory testing, developing lending institutions and making easy access to finance, encouraging the diffusion of ICT into the different business functions of the industry, and encouraging the strategic cooperation and clustering in the industry.