Still considered of lesser importance in terms of economy and employment barely ten years ago, the Cultural and Creative Industries are today the subject of numerous European, national and regional policies that recognise their positive impact on economic revival and the regions’ identity and attractiveness.
The digital revolution has, of course, affected this sector bringing with it its new creative fields, new uses and new economic models. Creativity serving the creation of value outside cultural sectors: design, fashion, digital services, etc. and more broadly in the entire economy.
The Europe 2020 strategy road map is clear: development of an economy based on knowledge and innovation, in which culture will be the lever, thanks in particular to its capacity to nurture and regenerate traditional industries and create new goods and services.
ESSnet Culture (2012) defines the cultural and creative industries as “all sectors whose activities are based on cultural and/or artistic values and other artistic creations, whether these activities are commercial or non-commercial, regardless of the type of structure and whatever their mode of funding. These activities include the development, creation, production, dissemination and preservation of goods and services that embody cultural, artistic or creative expressions, as well as associated functions such as education or management. The cultural and creative sectors cover, among other areas, architecture, archives, libraries and museums, artisanal crafts, cinema, television, video games, multimedia, tangible and intangible cultural heritage, design, festivals, music, literature, the performing arts, publishing, radio and visual arts.”
However, the field of CCIs continues to evolve. Activities are becoming increasingly multidisciplinary and hybrid, and are continually connecting with other sectors of the economy.
Since the end of 2014, Wallonia and Brussels have had access to the invaluable results of a study on the economic weight of cultural and creative industries in their region. Undertaken by the Walloon Institute of Assessment, Forecasting and Statistics (IWEPS), which commissioned the Free University of Brussels (ULB), this new study is a request by the governments of the Wallonia-Brussels Federation and Wallonia with a view to orienting future policies. (Download the study)
Access to CCI funding
In Europe, 80% of CCIs are small or medium-sized businesses comprising fewer than 10 people who together generate barely 18% of the sector’s annual turnover. Large companies are very much the minority (less than 1%) but generate over 40% of the annual turnover. The “missing middle” phenomenon demonstrates the difficulty CCIs have in growing. Small and medium-sized businesses must demonstrate dynamism, strategy, flexibility and risk-taking in respect of the opportunities presented by a market which, in CCIs, is typically volatile and in unpredictable.
The culture and creativity sectors tend to have recourse to short-term funding, which means expensive financial products. The desire to retain creative independence often gives rise to a reluctance to open their capital to investors.
In Belgium, over 75% of CCIs rely mainly on equity and only 46% have access to external sources of funding, which up to 88% consider difficult to access. Of course, funding patterns differ between “cultural” sectors (largely supported by the public) and “creative” sectors (which tend to be more commercial).
In 2010, the Green Paper entitled Unlocking the Potential of Cultural and Creative Industries set the basis for one of the great challenges of European strategy: facilitating access to funding for small and medium-sized businesses in the CCIs. Europe called on politicians to adopt an integrated and strategic approach to favour the development of CCIs.
Mechanisms to encourage private investment are numerous, and include fiscal levers and the extension of guarantee systems to the CCI sector, which are identified as the most effective. They are also central to the Creative Europe programme (2014-2020). Better knowledge of the market and methods of evaluating intangible assets are other approaches that would enhance the attractiveness of CCIs in investors’ eyes. Finally, appropriate support of creative entities in managing their business and seeking funding is essential for a successful meeting between creative entities and financial backers.
The ST’ART fund was created in French-speaking Belgium at the end of 2009 to provide entities with a direct funding solution and also, more broadly, to work in collaboration with other partners on the consideration and implementation of new funding solutions requiring public and private investment.