Creative economy for sustainable development

The year 2021 is the UN International Year of Creative Economy for Sustainable Development. This was declared during the 74th session of the UN General Assembly. Indonesia was the main sponsor of the proposal, together with a group of countries including the Philippines. This declaration recognizes the value of creative industries to economic, social, and cultural development.

Creative industries include the Arts, Culture, Audiovisual Media, Digital Media, Advertising and Marketing, Design (architectural, fashion, communication, etc.), Software and Game Development, and Creative Services. What binds these industries together is that they depend on individual creative talent and skill and have the potential for wealth and job creation through the generation and exploitation of intellectual property.

Globally, creative industries had an estimated value of $2.25 trillion and employed about 30 million people per a 2015 study published by Ernst & Young. The United Nations Conference on Trade and Development also estimated the global trade in creative goods and services to be at $509 billion in 2015.

For many progressive countries, creative industries outpace the growth and value of traditional sectors. The creative industries of the United Kingdom, valued at GBP111.7 billion (or about $153 billion) is bigger than its automotive, life sciences, aerospace, and oil and gas sectors combined. South Korea’s content exports were valued at $12.3 billion in 2019, and grew 22.4 percent versus 2018 due to the global craze for Korean music, movies, and TV programs.

The Intellectual Property Office of the Philippines (IPOPHL) published a report in 2014 that estimated the value of Copyright-Based Creative Industries to be at P689 billion, contributing to 6.52 percent of GDP. This is a significant share, as the global average for creative industries contribution is only 4 percent of GDP. Furthermore, the IPOPHL report did not include Heritage Tourism and Gastronomy in its coverage. For Indonesia and Thailand, these two sectors are the biggest contributors to their creative economies.

Philippine creative exports, on the other hand, rank well behind our Asean neighbors. With only $4.1 billion in creative exports, the Philippines ranks fifth in Asean and only has a 2-percent share in the trade of creative goods and services in the Asia-Pacific. There are a few bright spots in creative services outsourcing, specifically in software development, animation, and game development. However, there is much more work that needs to be done for Filipino creativity to truly become globally competitive.

The COVID-19 pandemic has decimated live audience-based entertainment industries, tourism-based heritage and crafts businesses, and other creative products that are perceived to be dispensable or postponable. On the other hand, digital-based creative industries have seen a significant increase in work from both local and international clients.

This is the goal of the Creative Economy Council of the Philippines. As a non-stock, non-profit advocacy group, our goal is to work with both the private and public sectors to help our creative industries not just bounce back from the current crisis, but find growth opportunities in international markets as well.

Our advocacy is anchored on six pillars: 1) A Creative Economy Policy that recognizes the value of creative industries and clearly defines the government agencies responsible for supporting their growth; 2) Creative Industries Value Mapping and Incentives that define the scope of the sector and give incentives to encourage its development, especially for exports and outsourcing; 3) Establishment of Special Creative Zones that attract foreign investors to locate outsourcing service studios in the country; 4) Creative Cities—getting more LGUs to embrace locally based creative industries programs and gain recognition as a Unesco Creative City; 5) Creative Tourism, to help tourism bounce back by promoting creative products and experiences; 6) Creative Education that builds the pipeline of talent with up-to-date creative skills training and critical thinking at all levels.

While the sector is facing significant challenges today, there is great potential in supporting the growth of Filipino creative industries. We have many individual examples of world-class Filipino creative talent. What is needed is to build business models and incentive programs that help Filipino creative businesses, and not just individuals, succeed in the highly competitive global creative marketplace.

——————

Paolo Mercado is founder and president of the Creative Economy Council of the Philippines.

——————

Business Matters is a project of the Makati Business Club (makatibusinessclub@mbc.com.ph).