Book excerpt: The recent economic liberalization in developing countries is making many sectors succumb to new competitive pressures. Governments face the dilemma of how to help firms compete without falling back into failed dirigiste policies. Based on recent findings on the importance of inter-firm cooperation, public-private collaboration and local policies in boosting competitiveness, this book analyzes how much these elements explain the new dynamism of two agroindustrial sectors in Argentina and Chile, dairy and fresh fruit respectively.