ABSTRACT:

This paper draws on the knowledge management and absorptive capacity theoretical framework to argue that there is a significant knowledge gap between nationals and the expatriate managers, which are important in building local managerial capacity and enhancing organizational performance in the emerging markets. The relationship between expatriates knowledge and capacity building was explored with a moderating factor of willingness to share knowledge and to some degree problems of skills adaptability to local environment. The data show that expatriates population in the study using the 9- box performance-potential grid may not necessarily be superior to all nationals but those expatriate managers with superior technical and managerial competence are essential for local managerial capacity building and development in the emerging markets. The regulatory agencies ability to monitor and ensure that only competent expatriates are employed was discussed.