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This study intends to diagnose the sector of clay ceramics in the Brazilian Northeast. It tries to identfy possible gaps left by inefficient use to technological innovation tools or even by the inexistence of these tools. Part of the data came from a survey by the Northeast Bank in 1999, part from recent interviews with entrepeneurs of the sector. In addition to the diagnostic analysis this study aims to offer a contribution to the elaboration of management models, capable of stimulating local processes of innovation. Actually it is assumed that fiscal and credit incentives are the main factors attracting new investment to the Northeast. Considering that other Brazilian regions might offer such incentives, one feels the need to creat new competition forms which could come from the structuring of a local innovation system. Keywords: innovation, capacitation, clay ceramics.

<b>Capacitação, Inovação Local e Competitividade da Indústria de Cerâmica Vermelha no Nordeste</b>