An Emerging Pillar Industry

By LI ZHENYU

An Emerging Pillar Industry

By LI ZHENYU

China’s cultural industry is geared to grow from a new engine into a pillar of the national economy

The Fifth Beijing International Cultural and Creative Industry Exposition(ICCIE), held November 17-21 in Beijing, was a feast for the eyes and mind. It showcased the enormous glamour and commercial opportunities promised by the cultural and creative industry.

Started in 2006, the ICCIE is an annual cultural exhibition jointly hosted by the Ministry of Culture, the State Administration of Radio, Film and Television, the General Administration of Press and Publication and the Beijing Municipal People’s Government.

Every year’s ICCIE re fl ects the cultural industry’s growth and characteristics of the past 365 days. It also acts as a weathervane,forecasting the industry’s future growth.

The ICCIE displays the latest achievements in China’s cultural industry, promotes the commercialization of cultural and creative projects,boosts trade and expands international exchanges. ICCIE features exhibitions, trade promotion,forums and other related activities.

This year’s events focused on the industry’s internationalization, digitalization and integration with other industries.

Current status

The Fifth Plenary Session of the 17th Central Committee of the Communist Party of China (CPC), which concluded recently,resulted in a suggestion that the cultural industry should be developed into a pillar industry in the next fi ve years.

During this year’s ICCIE, a large amount of projects were put into the market and a large number of products were traded. The value of cooperative agreements signed this year totaled 47.8 billion yuan ($7.1 billion),up 30.3 percent from the previous year.

In addition to the total value of agreements signed, the fifth ICCIE was also noted for hi-tech and content-rich exhibits, broad international participation, and for marrying the capital market with cultural and creative industry.

Hi-tech cultural products are a highlight of this ICCIE. New generation digital TVs,mobile multimedia, Internet and mobile TVs and other new media were showcased.

This ICCIE also highlighted the boom in the content industry. Creative design, fi lm and television production, animation and online games research and development accounted for more than 50 percent of all contracts signed at this ICCIE.

This indicated China is gradually shifting from low-tech, low-value-added “made-in-China” products to hi-tech and high-valueadded “designed-in-China” products.

The ICCIE effectively increased the cultural industry’s access to financial capital. Capital deficiency and financing difficulty usually are major bottlenecks hindering the development of China’s cultural industry.

This ICCIE melded cultural industry with the capital market. Banks and cultural enterprises signed more than 4 billion yuan($615 million) of cooperative agreements,more than triple the previous year.

This year’s ICCIE was also the most widely participated in since its inception.Exhibitors took the opportunity to expand cultural trade and explore opportunities for in-depth cooperation.

More than 30 high-level leaders of international organizations, industry experts,scholars and entrepreneurs delivered speeches at ICCIE’s 11 summit forums.

Chu Xiangyin, Deputy Director of the Organizing Committee of ICCIE, said this ICCIE exhibited the bright prospects of China’s cultural and creative industry.

Moving forward

China’s cultural industry has entered a golden era, enjoying a favorable domestic and international environment.

In recent years, China’s cultural industry has been growing at an average annual rate of more than 17 percent, making greater contributions to the national economy. It has become a new economic growth engine.

The international fi nancial crisis has not dampened the growth of China’s cultural industry. The industry has played a special role in boosting domestic demand and adjusting the economic structure.

In 2009, the State Council released the Plan to Adjust and Reinvigorate the Cultural Industry, the fi rst national plan in China dedicated to the cultural industry development.

To ease the financing difficulty faced by the cultural industry, this year, nine government ministries jointly issued a guiding opinion on fi nancial support for the rejuvena-tion and prosperity of the cultural industry.

TRYING ON CLOTHES: A computerized clothes trial system exhibited on November 19 at the ICCIE is able to help shoppers see how clothes look on him or her from different angles

TECHNOLOGY FOR CREATIVE ART: Staff at the ICCIE demonstrate a vision controller used to shoot 3-D movies

China’s macroeconomic condition is also conducive to the development of the industry. Data from 17 major countries and regions demonstrate when a country’s per-capita GDP exceeded $3,000, cultural demand rises sharply, and consumption on cultural products will surpass $615 billion.

A NEW IMAGE: The virtual image of a singing star attracts visitors to the Fifth Beijing International Cultural and Creative Industry Exposition on November 20

China’s per-capita GDP reached $3,700 in 2009, and consumption on cultural products only totaled $125 billion.

China’s cultural industry currently accounts for 2.5 percent of the GDP. Regional cultural industry is also growing robustly. In places like Guangdong Province, Beijing and Shanghai, the cultural industry accounts for 5-7 percent of the local GDP.

Data from this ICCIE shows the cultural and creative industry created an added-value of 80.4 billion yuan ($12 billion) for Beijing in the fi rst half of 2010, growing 15.7 percent over the same period of last year. The cultural and creative industry accounted for 12.6 percent of the capital city’s GDP. Among Beijing’s tertiary industries, the cultural industry was second only to the fi nancial industry. Moreover, the current trend suggests that it is possible for the cultural industry to overtake the financial industry to become the largest tertiary industry in Beijing.

The prospect

Experts participating in the ICCIE agreed China’s cultural industry is poised to maintain high growth during the next five years.

While the industry’s past growth was more government-driven, in the next few years, its growth will be more market-driven,said industry experts.

Previously, China’s economy relied on investment and exports, and domestic consumption was not strong. In the next five to 10 years, as the economic structure is adjusted, the government will encourage consumption.

Analysis based on data released at this year’s ICCIE suggests the following trends for the industry.

First, the cultural industry will gradually become a pillar industry in the regional and national economy, given the favorable policy and economic environment the industry enjoys. It will also become a key investment area for the capital market. A batch of fl agship public-listed cultural enterprises will appear. The industry will become more and more concentrated.

Second, the cultural industry will be further commercialized. Strong demand for cultural products will bring unprecedented prosperity to the industry. Investment in the industry will gradually diversify as the share of private and foreign capital increases.

Third, China’s cultural brands and products will compete in the international cultural market. But, although China’s export of cultural content products will gradually expand,it is still dif fi cult to eliminate China’s de fi cit in cultural trade.

Fourth, the cultural industry will further integrate with other industries. Convergence between the cultural, manufacturing and service industries will spur the development of these industries.

Fifth, signi fi cant progress has been made in the integration of telecommunications networks, cable TV networks and the Internet.The cultural industry is also marked by rapid digitalization, which will be the core of the cultural industry.

The author is a columnist forPeople’s Dailyonline