creative industries: a new vehicle for trade and ... · creative industries: a new vehicle for...

UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT

Creative Industries: A new vehicle for trade and

development gains in CARIFORUM

Sudip Ranjan Basu, Ph.D.

[email protected]

International Trade Division

Regional Training Seminar:

Assessing the Economic Contribution and Performance

of Creative Industries to National Economies

29-31 March 2011

Castries, St Lucia


I.Post crisis global economy and opportunities

II.Concepts, defintions, classification & measurement

III.UNCTAD global creative economy database

IV. Global trends and CARIFORUM

V. Market access for creative industries

VI.Policymaking in CARIFORUM


Post crisis global economy and

opportunities


5

Impact of the global financial and economic crisis

• Worst economic and financial crisis since the 1930s

• Sharpest deceleration of economic growth worldwide in 60 years

• Global unemployment up 7.5% in 2009, 210 million people jobless

• Sharp drop in foreign direct investment worldwide -40 % in 2009

• World trade flows declined 12% in 2009

• Gloomy outlook due to instability and uncertainty

• Domino-effect into emerging markets, CARIFORUM and other developing countries

• Aggravation of global imbalances between rich and poor

• Economic crisis of unprecedented scale and magnitude

Paradigm shift : shortcomings of neo-liberal model

Undermined jobs, economic growth and social well-being

Stalled progress in MDGs


6

Creative responses to stimulate economic recovery

• The heart of the creative economy are the creative industries

• Every day everywhere in the world, individuals consume creative

products at home, work, leisure and entertainment

• We listen to music, watch TV, read newspapers, go to cinema, use

software in computers, play video-games, dress with fashion, etc.

• Demand for some creative products remain stable, particularly for

domestically consumed goods and services such as TV formats,

music, video-games, films, e-adds, e-news etc

More people are eager for culture and entertainment


UNCTAD’s work on creative economy

“Creative Economy Report – 2008: The challenge of assessing

the creative economy towards informed policy-making”

“Creative Economy Report – 2010: A feasible development option”

• UN perspective on this new topic. Initiative of the UNCTAD/UNDP

Partnership

• Conceptual, institutional and policy framework

• Analytical tools for informed policy-making and implications to

development/MDGs

• Shared vision based on evidence and comparative analysis

Sensitize governments about the potential of the creative

economy to foster socio-economic development


Concepts, defintions,

classification & measurement


9

Creative Economy

Knowledge-based activities based on creative assets and intellectual capital potentially generating socio-economic growth

It can foster income generation, job creation and export earnings while promoting social inclusion, cultural diversity and human development

It embraces economic, cultural and social aspects interacting withtechnology and tourism objectives

Interplay of creativity-led activities with a development dimension and cross-cutting linkages at macro and micro levels with the overall economy

It is a feasible development option calling for innovative concerted policy responses and multidisciplinary action

( UNCTAD)


10

Definition of the Creative Industries

• Is the cycle of creation, production and distribution of goods and services that uses criativity and intellectual capital as primary inputs

• Comprise tangible goods and intangible services, focused on but not limited to arts, with creative content, economic value and market objectives

• Produces creative products able to generate revenues through trade and intellectual property rights

• Are at the cross-road among the artisan, manufacturing and services

(UNCTAD)

Creative

Economy

Creative

Industries


UNCTAD classification of creative industries


Development impact

• Millennium Development Goals and poverty reduction

• Creative industries a key sector in national development

strategies

• Development linkages: beyond economics -cultural, social

and sustainable development aspects, interface with

tourism and technology

• Traditional knowledge, arts, education and the creative

economy

• Promotes job creation particularly for the youth and

women

• Obstacles to expansion of the creative economy: capital,

entrepreneurial skills, infrastructure and institutional tools


Creative nexus

Use our criativity, be bold, imaginative, transcend

Let’s shape a better, real and a more creative economy


UNCTAD global

creative economy database

http://unctadstat.unctad.org/ReportFolders/reportFolders.aspx?sRF_ActivePath=P,10&sRF_Expanded=,P,10


Creative goods data base

- Creative economy consists of two parts:

*Creative industries to include all creative goods and services

*Related industries to include all related goods, computer & information

services & royalties and license fees

- Uses the UN COMTRADE database using the Harmonised System (HS)

classification, version 2002

- Total codes of creative goods:

211 for all creative goods

60 codes for art crafts

2 codes for audiovisuals

102 codes for design

8 codes for new media

7 codes for performing arts

15 codes for publishing

17 codes for visual arts

170 for all related goods


Creative services data base

- Uses the IMF BOP using BPM5 and Extended Balance-of-Payments

(EBOPS) codes

- The level of disaggregation is not ideal but provides

an indication of the impact of creative-services activities

From the 11 principal BOP categories, 6 were selected :

- advertising, market research & public opinion services

- architectural, engineering & other technical services

- research and development services

- personal, cultural and recreational services

- audiovisual related services

- other personal, cultural and recreational services

Royalties and license fees are presented only as indicative since it covers more

than the creative industries (trademarks, patents, manufacturing rights etc)


Evidanced-based assessment:

Global trends and CARIFORUM


20

Global trends

World trade of creative products annual growth rate of 14% during 2002-2008,

and reached US$ 592 billion in 2008 plus gains from intellectual property rights

(no data)

South goods & services exports stood at US$176 billion in 2008

CARIFORUM goods & services exports stood at US$583 million in 2008

(about 0.10 % of world trade)

• Developed countries dominated trade but exports have risen faster in developing

countries due to China

• New opportunities for economies in South-South cooperation to leapfrog in high

growth sectors


Global goods trade snapshots


Creative industries, by group


Economic groups


Global rankings


Developing countries


South-South trade


Creative services, 2002-2008


Creative services, top 10


Evolution of goods exports in CARIFORUM

in millions of $

Source: UNCTAD


Benchmarking, by groups

in millions of $

Source: UNCTAD


CARIFORUM trends

Source: UNCTAD


Creating country profiles

http://unctadstat.unctad.org.

http://unctadstat.unctad.org/




Market access for creative

industries


Multilateral Trade Negotiations

• WTO Doha Round launched in 2001 remains inconclusive

• Several issues relevant for trade policy of creative/cultural goods

and services

• GATS : market access in cultural services including audiovisuals

Mode 4 -free circulation of artists and creative professionals -visas

• TRIPs: trade of copyrightable and non-copyrightable items such as

those originating from traditional knowledge, technology transfer

etc

• TRIMS, investments, competition policies, and trade efficiency

• As LDCs further explore special treatment for market access

(EBA)

• Other legal provisions such as free trade and regional trade

agreements, economic partnerships agreements (EPAs) , customs

unions


Market access opportunities

Significant differences still exist between MFN and bound tariff rates

Use of NTMs remain particularly important in the case of creative industries, especially related to labeling, marketing and packaging requirements under TBT, local content measures under TRIMs and IPRs to sectors such as design, new media and publishing

Average MFN applied tariffs are much lower among developed economies than among developing countries on all creative sectors

Lower South-South tariff rates could accelerate trade expansion and deepen liberalization process, which could help provide empirical evidence to speed up GSTP negotiations


Policymaking in CARIFORUM


Policymaking in CARIFORUM

• Facilitate interactions between the public and private sector,

universities, and relevant institutions including NGOs, to

facilitate a participatory approach

• Put in place cross-cutting mechanisms and institutions

involving relevant ministries /departments (education /tourism

/technology)

• Integrate local creative industries from the communities into

national strategies towards global markets

• Articulate policies to attract investment and business,

mechanisms for financing/micro-credit, promote training on

entrepreneurship, ICT tools and IPRs policies


41

Reconcile national policies and global processes

International policy framework : achievement of MDGs in 2015

UNESCO - implementation of the “Convention on the Protection and

Promotion of the Diversity of Cultural Expressions”

WIPO Development Agenda - debates on intellectual property rights

WTO Doha Round of multilateral trade negotiations : inconclusive

UNCTAD - policy-oriented analysis to assist in policy-making, providing

platform for advancing the policy and research agendas, implementing

technical cooperation projects on creative economy

UNDP – facilitating South-South cooperation


42

The role of the main actors in CAROFORUM

- Role of governments: to articulate a conducive climate and infrastructure to stimulate creative capacities, through policies such as creative clusters, financing, SME support

- Role of the creative community: to reinforce skills and continuous learning for strengthening the linkages between arts, creation and business

- Role of the civil society: forging strategic alliances to facilitate interactions and networking among stakeholders

- Role of the UNCTAD: policy-oriented analysis to assist in policy-making, providing platform for advancing the policy and research agendas, implementing technical cooperation projects on creative economy


43

• There is no one-fits-all recipe but flexible and strategic choices

to be made by national governments

• Creative economy calls for multi-disciplinary and concerted

inter-ministerial policy response

• Reconcile interests at public and private sectors for shaping a

national strategy to enhance creative capacities

• ICTs and IPRs are key drivers of the creative economy

• Technology offers opportunities for SMEs: new distribution

channels for creative content, new business models to reach

out global markets through internet (see ITC modules)

• The creative economy strengthens the links between creativity,

culture, technology and socio-economic development

Key policy messages for CAROFORUM


National Creative Industries Support

Pilot project on "Strengthening the Creative Industries in Five African, Caribbean and Pacific countries, including Mozambique, Zambia, Senegal, Trinidad and Tobago and Fiji, through employment and trade expansion (jointly with ACP Secretariat, the European Commission, ILO and UNESCO, 2008-2011)

Objectives:

-to assist the Governments in articulating a development strategy

that can optimize the economic potential of the creative sector for job

creation, trade expansion and social inclusion.

- to review current policy in these areas and to facilitate concerted

policy actions and inter-ministerial decisions

- to create a participatory methodology, the identification of key creative

sectors, and the development of institutional and productive capacity


Thank you for your attention

Reproduction autorized with acknowledgements UNCTAD (Sudip Ranjan Basu)

www.unctad.org/creative-programme

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