In most countries, small and medium-sized enterprises (SMEs) make up the majority of businesses and account for the highest proportion of employment. They produce about 25 percent of OECD exports and 35 percent of Asia’s exports (OECD, 1997). Those SMEs that are internationally competitive are better able to grow as well as to survive in their domestic markets. In order to become internationally competitive, SMEs must be market-oriented and offer products and services of international quality. These objectives can be particularly difficult to achieve for SMEs in developing countries, and governments and non-profit agencies often need to provide assistance. This chapter identifies principles and best practices from worldwide experience with SME development assistance in the field of non-financial services. In particular, the chapter focuses on the role of industrial clusters and on the ways that public and non-profit institutions can help to promote SMEs by fostering the development of such clusters.