Culture Club: Opportunities in China’s Creative Industries

In 2011 the Chinese Government listed the creative sector as a pillar industry. A decade ago, the concept of the “creative industries” did not exist in China.

Although the creative industries currently contribute a small share to Chinese GDP (2.75 percent in 2010), the sector has been growing at more than 20 percent a year since 2004. Cai Wu, Minister of Culture, is confident the sector’s share will double to five percent by 2016.

The central government has recognised the sector’s huge potential to drive market demand, value, employment and growth. There are more than 50,000 cultural and creative enterprises in China, of which 8,000 are state-owned. The most profitable sectors have been advertising, IT services, tourism, indoor entertainment, cable TV services and publishing. Beijing is home to more than one million creative professionals, while other leading cities in the sector include Shanghai, Hangzhou and Shenzhen.

Driven by preferential policies, state-owned players are transforming their operation models and new companies are emerging, sector clusters are appearing and infrastructure is improving. However, there are still challenges and the government is yet to put in place a clear statistical system to monitor the economic status of the industry. But government at every level in China is still playing a key role in boosting creative industry development.

• In July 2009 the State Council passed the “Cultural Industry Revitalisation Plan” with
  the aim of enhancing the commercialisation of the cultural industries, focussing on the development of TV, film production, publishing and distribution, printing, advertising, entertainment, cultural exhibitions and digital content.
• In April 2010 key ministries issued the “Guidance for the Financial Industry to Support
  the Development of the Cultural Industry Revitalization”.
• The China Cultural Industry Investment Fund gives special support to sectors including
  entertainment, animation and digital games, TV, film production and distribution, publishing, cultural exhibition and internet media.
• Leading educational institutes have set up research centres and been engaged in developing policies and plans for industry cluster mapping on behalf of the government.
• Leading cities have each set up their own individual development plans.

Opportunities abound for overseas companies to help develop the industry. The UK in particular is in a great position to promote itself as the best possible creative partner for China. UK creativity is highly marketable, award-winning and sought after by global  business. Traditionally the UK has not been perceived in China as a byword for innovation and design excellence. This is changing. In 2010, the UK Pavilion at the Shanghai Expo made a huge impact. In a ceremony that was broadcast live on Chinese state television, Wen Jiabao, the Chinese Premier, praised the UK effort as “very creative” and gave it the gold award. The UK Pavilion not only won the top prize; it cost a fraction of other nations’ pavilions and was named one of the 50 best inventions of 2010 by Time magazine.

The timing of this very publicly recognised prize for creativity in China and the listing of the whole sector as a national pillar industry only adds to the opportunity for UK businesses, which they must seize.

Sir John Sorrell, a British Business Ambassador and founder of London Design Week, has also been putting Britain on the map as a key creative partner. In 2011, Beijing Design Week chose London to be its first “honoured guest city” and the UK was represented at the event by some of its finest designers, including Tom Dixon, Paul Cocksedge, Neville Brody and Ab Rogers.

The strength and depth of the UK’s creative industries is a huge advantage for Britain. Already, the UK has the largest creative sector in Europe, with seven percent of UK employment or 1.9 million people directly employed in 157,400 businesses. The sector is growing at twice the rate of the rest of the economy, with particular strength in advertising, architecture, art, design, fashion, film, video games, music, publishing, software, television and radio. Exports are worth £16 billion annually, or 4.3 percent of all UK goods and services exports. The strongest growth is from software, computer games and electronic publishing, which now account for 31 percent of the creative economy and are growing at 6.5 percent every year. The time is ripe for “creative Britain” to partner with China to promote growth.

Did you know?

• The UK is the global leader in TV formats, accounting for 53 percent of all exported format hours in the worldwide market, compared to 14 percent for the USA.
• Seventy percent of international advertising agencies have their European headquarters in London.
• UK fashion designers export 66 percent of the clothing they produce. The fashion industry contributes over £37 billion annually to the British economy and employs over a million people.
• London has the largest revenue-earning theatre cluster in the world and is Europe’s largest centre for live music.
• The UK is home to over 40 percent of Europe’s electronic design industry.
• In 2012, it is predicted that £1 in every £5 of all new commerce in the UK will be spent online.
• Samsung’s European design centre is located in London.
• In the animation sector more than 75 percent of employees are graduates and over a third have a postgraduate qualification, far higher than the average in the UK workforce.
• The UK’s advertising system sets the standard in successful self-regulation, being governed by codes of practice that are designed to protect consumers by ensuring that advertising is legal, decent and truthful.
• UK-made computer games account for 12 percent of the world games market. The UK boasts 26 of the world’s most profitable games studios. All major international studios have UK-based developers including Microsoft, Sony, Disney and Nintendo.
• London-based architects generate in excess of £700 million in revenue each year.

This article is taken from a special CBBC publication commemorating the 40th anniversary of UK-China diplomatic relations. View the full publication here.

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