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Trend 19 May May 2021 1220 19 May 2021

Here's how the creative economy can drive sustainable development

The United Nations has designated the sector as a driving force for building a future that respects the environment, workers and the essential pillars of democracy

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By formally announcing 2021 as the 'International Year of Creative Economy for Sustainable Development', the United Nations has acknowledged the creative economy's status as a driving force in building a future that respects the environment, workers and the basic principles of democracy.

The decision had already been taken on 19 December 2019, with the resolution then adopted in November the following year, at the height of the pandemic. But now more than ever, after a year marked by COVID-19, that resolution seems a particularly timely, necessary decision, at a time when creative solutions are needed for the challenges of the present: creative thinking must be a priority tool to give new impetus to innovation, to solve problems, to lead us out of the recession that has affected the whole world.

The creative economy is an evolving concept, based on the interaction between creativity and ideas, intellectual property, knowledge and technology. Since it was first defined in 2000, the term 'creative economy' has served to indicate the transformation of our society from an industrial to an idea-based economy.

In the 2001 essay, 'The Creative Economy: How People Make Money from Ideas', John Howkins pointed to the creative economy as a new way of thinking, capable of revitalising manufacturing, services, retail and of course entertainment.

The creative economy officially entered the UN global economic and development agenda in 2004 during the 11th session of the United Nations Conference on Trade and Development (UNCTAD XI) in São Paulo, Brazil: acknowledgement that the sector was becoming increasingly important. Not surprisingly, the UN's World Creativity and Innovation Day is observed every year on April 21st.

In short, the creative economy is a set of activities that support entrepreneurship, stimulate innovation and bring people together, starting with young people and women, while preserving and promoting cultural heritage and diversity. This is why it is considered a sector capable of creating equity and inclusion, and is even more important in a world where political and cultural debate is increasingly polarised, more extreme, more shouted about and less reasoned.

The creative industries are critical to the sustainable development agenda. They stimulate innovation and diversification, are an important factor in the burgeoning services sector, support entrepreneurship, and contribute to cultural diversity

Isabelle Durant, Deputy Secretary-General of UNCTAD

"The creative industries are critical to the sustainable development agenda. They stimulate innovation and diversification, are an important factor in the burgeoning services sector, support entrepreneurship, and contribute to cultural diversity", explained Isabelle Durant, deputy secretary-general of UNCTAD (United Nations Conference on Trade and Development).

The creative economy accounts for about 3% of global GDP and ranges from entertainment, publishing, advertising, architecture, design, fashion, film, photography, music, software, computer games, TV and radio.

The sector is expanding rapidly, growing by nearly 10% each year in developing countries. So much so that, according to recent forecasts, it will account for around 10% of global GDP in the coming years. Similarly, the value of the global market for creative goods has doubled from $208 billion in 2002 to $509 billion in 2015, with export growth rates increasing by more than 7% in 13 years.

And, of course, an expanding sector also brings new jobs, new earnings, new market segments: more than 30 million people work here worldwide, mostly young people.

But the growth of the industry has not made it immune to global crises. On the contrary, the creative industries have been badly battered by the pandemic over the past year: COVID-19 hit here harder than in many other markets, with the film industry alone losing around USD 7 billion in revenue in 2020.

But more than ever, we need creative thinking, innovation and problem-solving to imagine ourselves out of the challenges of inequality and vulnerability that we face daily.

Marisa Henderson, UNCTAD Creative Economy Programme Chief

"When the resolution was being negotiated and approved, no one could anticipate [a]pandemic", said Marisa Henderson, creative economy programme chief at UNCTAD. "But more than ever, we need creative thinking, innovation and problem-solving to imagine ourselves out of the challenges of inequality and vulnerability that we face daily."

It is precisely in this transitional phase, as we move towards a full reopening of all activities, that the creative industry has the opportunity to re-imagine itself, to redefine its parameters, leading the way for other sectors of the economy on the path towards a fairer, more sustainable and inclusive future.

So just how can a creative economy sector be shaped? An initial solution promoted by the UN is impact investing: a commitment that not only looks at the economic return, but also seeks to generate a positive and measurable social and environmental impact.

It means giving companies in the sector the opportunity to measure their standards in terms of safety, respect for the dignity of workers, diversity, fairness, care for the local community and the environment.

But that's not all. In his report 'Creativity, Culture & Capital', drafted to spotlight new ways to finance our creative economy, Global Steering Group for Impact Investment chief Sir Ronald Cohen writes that it is essential to "create an overview that values the investments flowing into the creative industry, which today often go unnoticed even though they have great impact: perhaps because they are classified as simple small business loans, or microfinance, or because they are quantitatively small investments".

The first step towards truly recognising the creative economy's status as a key sector for sustainable development is a commitment by all stakeholders, starting with national governments, to provide incentives for private and public funding that are not limited to reducing the negative effects on society, but whose primary objective is to generate direct and tangible change in society and the environment.

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