CIsCIs and and developingdeveloping countries: countries:Local productive Local productive capacitiescapacities, , IPRsIPRs

and and profitingprofiting fromfrom creativitycreativity

BirkbeckBirkbeck College, June 20-21, 2008 College, June 20-21, 2008Creative industries and intellectual property conferenceCreative industries and intellectual property conference

Diana Barrowclough and Diana Barrowclough and ZeljkaZeljka KozulKozul-Wright-Wright

Presentation of personal views, not the official position of UNCTAD,Presentation of personal views, not the official position of UNCTAD,based on Barrowclough and based on Barrowclough and KozulKozul-Wright (2008), -Wright (2008), RoutledgeRoutledge..

22

WhyWhy‘‘creativecreativeindustriesindustries’’interestinterestdevelopmentdevelopmentagenciesagencies:: A)RecognitionA)Recognitionthatthatcultureandcultureanddevelopmentdevelopmentarearelinkedlinkedandinter-andinter-dependentdependent..

B)CultureandB)Cultureandcreativitycreativityhavehaveeconomiceconomicvalue.value.CreativeCreativeassetsassetsininDCsDCsareareunderunder--utilisedutilisedandandcouldcouldbringbringthemthemnewneweconomiceconomicopportunitiesopportunities……

C)C)IncreasingIncreasingfocusonfocusonknowledgeknowledgeandinnovationasandinnovationaskeykeytotodevelopmentdevelopment..

D)NewD)Newpossibilitiespossibilitiesareareopeningopeningup,up,throughthroughrapidrapidtechnologicaltechnologicalchangeandchangeandmarketmarketliberalisationliberalisationandglobalisation.andglobalisation.

------OptimismOptimismthatthatCIsCIscancanofferofferaroutetoaroutetobetterbetterintegrateintegrateintointothetheglobalglobaleconomyeconomy––leapleap--frogfrogintointohighhighgrowthgrowth,,highhigh-value-valuesectorssectors……

33

InternationalInternationalagenciesagenciesareareincreasinglyincreasinglyactiveintheactiveinthesectorsector UNCTADUNCTAD––tradetrade,financeand,financeanddevelopmentdevelopment 19971997JamaicaJamaicaSTIPSTIPReviewReview,2001,2001LDCsLDCsconferenceconference,2004,2004UNCTADXI,2008UNCTADXIIUNCTADXI,2008UNCTADXII

GlobalGlobalobservatoryobservatoryproposalproposal

WIPO(WIPO(IPRsIPRs,,traditionaltraditionalknowledgeknowledge)) UNESCO(culture),ILO(UNESCO(culture),ILO(employmentemployment)) ITC(ITC(tradetrademarketingmarketingetcetc,,enterpriseenterprisedevelopmentdevelopment)) UNDP(UNDP(southsouth--southsouthdevelopmentdevelopment))

2008jointinter-2008jointinter-agencyagencyCreativeCreativeEconomyEconomyReportReport HighlightsHighlightsneedneedforforsystematicsystematicdatacollection,datacollection,enterpriseenterprisedevelopmentdevelopment,,policiespoliciestotopromotepromoteproductionandproductionandtradetrade..

44

DefiningDefining‘‘CreativeCreativeIndustriesIndustries’’

SetofSetofinterlockinginterlockingsectorssectorsthatthatproduceproducesymbolicsymbolicgoodsgoodsandservicesandservicesthatthatrelyrelyheavilyheavilyononcreativitycreativity..

««  industriesindustriesthatthathavehavetheirtheiroriginoriginininindividualindividualcreativitycreativity,,skillskillandtalentandtalentwithwithaapotentialpotentialforforwealthwealthandjobandjobcreationcreationthroughthroughthethegenerationgenerationandandexploitationofexploitationofintellectualintellectualpropertyproperty » »(UK(UKCreativeCreativeIndustriesIndustriesTaskTaskForce).Force).

‘‘Voice,Voice,ChoiceChoiceetcetc’’focusesfocusesontheonthesubsub-setofA/Vs.-setofA/Vs.–– SimilarSimilareconomiceconomicfeaturesfeatures((industrialindustrialnotnotcraftcraftproductionproductiontechnologytechnology;E-O-Setc.);E-O-Setc.)–– ((CER2008CER2008usesusesmuchmuchbroaderbroaderdefinitiondefinition))

55

NewNewopportunitiesopportunitiesforforgrowthgrowth…….?.? ProfoundProfoundsupplysupply--sidesidechanges:changes:generalgeneralriseriseofservicesofservicestradetrade,,deregulationderegulation,synergies,synergieswithwithICTICTinvestmentinvestmentandinnovation,EOSandinnovation,EOSimperativeimperativetototradetrade..

LongvalueLongvaluechainchain––employmentemploymentpotentialpotential DemandDemand--sidesidechanges,changes,risingrisingmiddleclass,middleclass,diversitydiversityetc.etc.

RecogniseRecognisechallengesinthechallengesinthesectorsector,but,butsensesenseindustrialindustrialpolicypolicycancanhelphelpdeliverdeliverwhatwhatisisneededneededtotoboostboostproductiveproductivecapacitycapacity..

66

NewNewtechnologytechnologyoffersoffersnewnewmodelsmodelsforfordevelopingdevelopingcountrycountryproducersproducers……

A.A.TraditionalTraditionalproductionvision:productionvision: LowerLowerentryentrycostscosts&new&newfragmentedfragmentedmarketsmarkets;;reducesreducesthetheriskriskofofexperimentexperiment;break-;break-evenevenoveroversmallersmalleraudiences;audiences;fasterfasterproduction;production;flexibletechniquesflexibletechniques––ananopportunityopportunityforforsmallsmallandandnimblenimbleproducersproducers..

B.NewB.Newtechnologicaltechnologicalparadigmparadigm Dis-Dis-intermediatedintermediatedproductionproductionshortenedshortenedproductionproductionchainschains:: 1.Simplevalue1.Simplevaluechainchain:Production:Production––digitaldigitaldeliverydelivery––ConsumerConsumer

2.Newbusiness2.Newbusinessmodelsmodelsfordigitalfordigitalageage(.(.R.WallisR.Wallisetcetc).). CreatorCreator––marketsmarketsmusicmusicfreelyfreelythroughthroughthewebtheweb––findsfindsconsumersconsumers––paypayforfordownloadsdownloads,,paypayforconcertsofforconcertsofsignedsignedCDsCDs……..

Or,concertOr,concertpromoterspromoters––usewebtousewebtopromotepromoteconcertconcert––consumersconsumerstestviaP2PtestviaP2P––buybuyticketsalesticketsalesthroughthroughwebweb……

Metadatatechnology,ISANidentificationandtrackingetcMetadatatechnology,ISANidentificationandtrackingetc……..

77

EvidenceforEvidenceforoptimisticoptimisticscenario?scenario?1:A/Vexports1:A/Vexportsgrowthgrowthisisrapidrapid––especiallyespeciallyinindevelopingdevelopingcountriescountries

Routledge(2008)

88

Evidence for Evidence for optimismoptimism??2.Global 2.Global audio-visualsaudio-visuals tradetrade: new : new rolerolefor for developingdeveloping countries (1989-2004) countries (1989-2004)

99

EvidenceforEvidenceforoptimisimoptimisim?.3?.3

TradeinTradeinCIsCIsincreasesby8%increasesby8%p.ap.a2000-2000-2005.WorldexportsCIproducts$424bin2005.WorldexportsCIproducts$424bin‘‘05,05,cfcf$227.5bin$227.5bin‘‘96(UNCTAD2008).96(UNCTAD2008).

Developingcountryshareupfrom29%inDevelopingcountryshareupfrom29%in1996to41%in2005(verybroadlydefined1996to41%in2005(verybroadlydefined––dominanceAsiaandChina)dominanceAsiaandChina)

Ina/vormusicalone,developingcountryIna/vormusicalone,developingcountryshareofexportsrisingmorethan50%forshareofexportsrisingmorethan50%forsomesectors.somesectors.

Evidence contEvidence cont’’dd……Creative industriesCreative industriesexports goods and servicesexports goods and services

0

50

100

150

200

250

300

350

400

450

All creative

industries

Design Publishing Creative

services

0

5

10

15

20

25

30

Cultural

heritage

Visual Arts Audio-visual Performing

arts

New media

1996 2005

billion US$ billion US$

Source : UNCTAD (2008)

0

50

100

150

200

250

300

1996 2005

Developed

economies

Developing

economies

Economies in

transition

Source : UNCTAD (2008)

Evidence cond’t….Developingeconomies catch up but gap still

significant

Billion US $

1212

Case-Case-studiesstudies of of selectedselected developeddevelopedand and developingdeveloping countries countries…….1.1

DiverseDiverseexperiencesexperiencesreflectreflectdifferentdifferentlevelslevelsofindustrialisationofindustrialisation––

‘‘maturingmaturingindustrialisersindustrialisers’’,,newlynewlyindustrialisingindustrialising,de-,de-industrialisingindustrialising,not,notyetyetindustrialisingindustrialising..

AlsoAlsoreflectsreflectstraditionaltraditionalroleroleofculturalofculturalactivitiesactivities,Natureandsizeof,Natureandsizeofdomesticdomesticmarketmarket,,RoleRoleofStateofState

1.CIhas1.CIhashighhigh‘‘profileprofile’’butbutisisnotnotyetyetaasustainablesustainableactivityactivity::BurkinaFaso;BurkinaFaso;SenegalSenegal;;CaribbeanCaribbeanregionregion..

2.CIhave2.CIhavelowlowprofileandnotprofileandnotyetyetsustainablesustainable::ArabArabcountriescountries

3.CIhas3.CIhashighhighprofileandprofileandisisindustrialisedindustrialised::BrazilBrazil;;IndiaIndia;China;China

1313

Case-Case-studiesstudies of of selectedselected developeddevelopedand and developingdeveloping countries countries…….2.2

FocusonproductiveFocusonproductivecapacitiescapacitiesandandenablingenablingroleroleofthestate.ofthestate.DevelopedDevelopedcountrieshavecountrieshavewidewidevarietyvarietyofofpoliciespoliciestotoboostboostdomesticdomesticandinternationalandinternationalinvestmentinvestmentinincreativecreativeindustries.industries.

PoliciesPoliciestailoredtailoredtocountrytocountrycircumstancecircumstance.But.Butlikelylikelytotoincludeinclude::

1.1.freedomfreedomofspeech,mediaofspeech,mediapluralismpluralism,,socio-economicsocio-economicstatusstatusofofartistsartists..

2.2.GenericGenericpoliciespoliciestargettedtargettedtoto‘‘gapsgaps’’oror‘‘publicpublicgoodsgoods’’inthevalueinthevaluechainchain––technologicaltechnologicalupgradingupgrading,,digitisationdigitisation,ICT,ICTskillsskills,cultural,culturalclusters,clusters,citiescities……

3.3.SectorSectorspecificspecificpoliciespolicies––fundingfundingmechanismsmechanisms,contentquotas,,contentquotas,developingdevelopingaudiences,publicaudiences,publicbroadcastingbroadcasting,,co-productionco-productionpromotion,promotion,PPPsPPPs,,tradetradelawlaw..

1414

WhyWhy enablingenabling policiespolicies are are soso important important

The The decreasingdecreasing rolerole of the state of the state –– nownow mostmostDCsDCs have have littlelittle or no or no policiespolicies in in thisthis sectorsector..

SpecialSpecial characteristicscharacteristics of the of the sectorsector meanmeanthatthat marketsmarkets alonealone are are unlikelyunlikely to to bebeoptimal optimal –– especiallyespecially in in smallersmaller economieseconomies..

PoliciesPolicies mattermatter ( (experienceexperience of Ireland, New of Ireland, NewZealandZealand, Canada, , Canada, AustraliaAustralia and and SwedenSweden).).

1515

IP questionsIP questions

««  WhenWhenbankersbankersdinedinetogethertogethertheytheytalkaboutart;talkaboutart;whenwhenartistsartistsdinedinetogethertogethertheytheytalkaboutmoneytalkaboutmoney…….. » »(OscarWilde)(OscarWilde)

CountriesCountriesthatthatdesiredesiretoexploithome-toexploithome-growngrownculturalculturalproductsproductslocallylocallyandandgloballygloballyneedneedefficient,efficient,reliablereliablecopyrightcopyrightsocietiessocieties..

ButhowbalanceButhowbalancethisthiswithwithmaxpublicmaxpublicaccessaccessespeciallyespeciallyinDCs.inDCs. ManyManyactorsactorsandallareandallareimpactedimpacteddifferentlydifferently.Howto.Howtosharesharethejointthejointproductproduct??WhatWhatisisthetheappropriateappropriateriskrisk//rewardrewardforforcreatorscreators;;investorsinvestors;;governmentgovernmentsupporters;societysupporters;society……

HowHowdifferentdifferentisisCRCRcomparedcomparedtotootherotherIPIPdebatedebate??–– CreatersCreatersareareindividualsindividualsnotnotbigbiglabslabs,,bigbigcompaniescompanies..–– CreatorsCreatorsarearenon-salariednon-salaried,,oftenoftenself-self-employedemployed..–– GoodsGoodsareare‘‘experienceexperiencegoodsgoods’’,,risksrisksforforconsumersconsumers..–– NoveltyNoveltyisisintrinsicintrinsicforforeacheachconsumer,consumer,eacheachtransaction.transaction.

TheThesearchsearchfornewfornewmechanismsmechanismsthatthatmightmightworkworkbetterbetter..

1616

Relation to Relation to widerwider developmentdevelopment topicstopics

Copyright and Copyright and relatedrelated issues issues –– national, international national, international fairfair use. use.

EvenEven veryvery poorpoor countries countries cancan produceproduce thesethese goodsgoods and services and services ––itit maymay bebe a rare source of comparative a rare source of comparative advantageadvantage

DCsDCs as copyright as copyright producersproducers, not , not justjust consumersconsumers

There has been There has been lessless attention on attention on thisthis area, area, althoughalthough thisthis isis changingchanging..

ReformReform of IP to of IP to betterbetter balance balance returnsreturns to to actorsactors vs vs investorsinvestors; and; andprivateprivate vis public vis public accessaccess??

Or Or –– alternative alternative systemssystems of of renumerationrenumeration? ZKW to ? ZKW to addressaddress..

1717

OptimisticOptimisticscenarioscenarioreappraisedreappraised……....whywhyisisthethesectorsectornotmoreviable?notmoreviable?

GeneralimbalanceintermsoftradestillstronglyGeneralimbalanceintermsoftradestillstronglyfavoursfavoursdevelopedcountries(B&KW,2008,UNCTAD2008).developedcountries(B&KW,2008,UNCTAD2008).

Exportisonlypartoftotalrevenue.Exportisonlypartoftotalrevenue.

Whatisnotyetcaptured?Royalties,monies,copyrights,Whatisnotyetcaptured?Royalties,monies,copyrights,licenses,marketinganddistributionlicenses,marketinganddistribution……....

DataDataisisextremelyextremelylimitedlimited DevelopingDevelopingcountryimportsofroyaltiesandlicencecountryimportsofroyaltiesandlicencefeesfees$27,901m$27,901mcomparedcomparedtoexports$3,699m(UNCTAD2008)toexports$3,699m(UNCTAD2008)

RoyaltiesRoyaltiescollectedcollectedfromfromdevelopingdevelopingcountriescountriesshowedshowed‘‘spectacularspectaculargrowthgrowth’’(CISAC2004data)(CISAC2004data)––buthowbuthowmanymanydevelopingdevelopingcountrycountrycreatorscreatorsarearerightsrightsholdersholders??OnlyOnly0.5%0.5%shareshareoftotaloftotalcollectedcollectedininAfricaAfrica……....

1818

ContinuingContinuing researchresearch agenda agenda

–– ManyMany questions questions remainremain and and empiricalempirical evidenceevidenceand and researchresearch isis neededneeded.. How How cancan DCDC’’ss increaseincrease theirtheir ownershipownership of of IPRsIPRs?? How to How to renumeraterenumerate developingdeveloping country country creatorscreators WhatWhat are the are the appropriateappropriate financialfinancial incentivesincentives?? WhatWhat isis the the rolerole of of industrialindustrial policypolicy?? WhatWhat national IP national IP policiespolicies are are neededneeded WhatWhat international IP international IP policiespolicies.. WhatWhat balance balance isis neededneeded betweenbetween S, T and I. S, T and I.

1919

IndustrialIndustrial and IP and IP policypolicyhighlightshighlights

ManyMany developeddeveloped countries have countries have policiespolicies to to boostboost domesticdomesticand international and international investmentinvestment in in creativecreative industries. industries. VeryVeryfew few developingdeveloping countries have countries have suchsuch policiespolicies..

Policy on CI has Policy on CI has alsoalso to to bebe integratedintegrated intointo the the overalloverall policypolicyframeworkframework –– part of the part of the entireentire developmentdevelopment strategystrategy..

AchievingAchieving a a fairfair balance balance betweenbetween public and public and privateprivate interestsinterestsisis a major challenge, but not the a major challenge, but not the onlyonly challenge. challenge.

How do How do wewe resolveresolve the tension the tension betweenbetween the the creativecreative and the and thecommercial?commercial?

How do How do wewe rewardreward creativecreative artistsartists for for theirtheir workwork, and, andmaintainmaintain widewide accessaccess for for usersusers, , especiallyespecially in in developingdevelopingcountries.countries.

2020

Thank you for your attentionThank you for your attention

Diana.Barrowclough@unctad.orgDiana.Barrowclough@unctad.org,,Zeljka.Kozul-Wright@unctad.orgZeljka.Kozul-Wright@unctad.org..

Sources:Sources:RoutledgeRoutledge (2008), (2008), ‘‘Creative industries and developing countries: voice,Creative industries and developing countries: voice,

choice and economic growth.choice and economic growth.’’UNCTAD (2008), Creative Economy ReportUNCTAD (2008), Creative Economy Report