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Chinese cultural industry keeps growth via loans

(Xinhua)
Updated: 2009-08-05 14:30

A list of 15 cultural enterprises has been submitted to the Export-Import Bank of China (China Exim) via the Ministry of Culture for a huge amount of bank loans to support development of China's cultural industry.

The ministry Tuesday confirmed the submission of the applications for evaluation. China Exim, one of three banks affiliated to the State Council to support import and export projects, will grant loans of at least 20 billion yuan ($2.94 billion) during the next five years to help the industry mount various productions abroad.

The 15 enterprises' cultural programs are the first batch of loan applications, said Xu Rong, an official in the cultural industry department of the Ministry.

The programs include an acrobatic interpretation of the classic ballet "Swan Lake" by a Shanghai dancing company, a Shaolin martial arts drama by a film production group and a dance drama called "Dunhuang My Dreamland" by a troupe in northwestern Gansu Province's Lanzhou which will be staged in Europe.

The 15 enterprises are expected to receive China Exim's first batch of loans totaling more than 4 billion yuan ($588 million).

A panel of experts has evaluated the programs' potential for development before submitting the applications to China Exim, which will review the list, evaluate investment risks and decide which companies will receive loans.

Cultural industries in China include production and distribution of cultural products and services such as publishing, music, television and film production as well as crafts and design.

Among the 15 enterprises, the Hangzhou Songcheng Tourism Development Co Ltd in the capital of eastern Zhejiang province alone applied for 2.4 billion yuan, Xu said.

"These cultural companies, products and services all aim to promote traditional Chinese culture," Xu said, adding they were all export-oriented and had distinctive ethnic features, which was an important criteria for selecting applicants.

The selection and recommendation process will be conducted twice a year during the next five years for the bank to allocate the 20 billion yuan.

Xu said China's cultural industry was showing good momentum despite the influence of the global economic downturn.

"But financing remains difficult for the cultural industry, and it has curbed its development," Xu said. The government has actively adjusted industry strategies and helped to find partners for cultural enterprises worldwide in order to promote their international expansion.

China Exim president Li Ruogu said: "As long as key enterprises and projects recommended by the ministry are in line with lending policies and regulations, we will give them full credit support."

Xu said Chinese cultural enterprises were in most cases "small- to medium-sized and have difficulty financing their projects."

But she said the ministry could "act as an intermediary to help potential enterprises establish ties with financial institutions and get the capital they need."

Minister of Culture Cai Wu said he hoped cultural enterprises would seize this opportunity and make full use of the platform set up by the ministry-bank agreement to strengthen government, bank and enterprise cooperation and improve export competitiveness.

"Efforts should be made to build competitive international cultural brands and promote the influence of Chinese culture," Cai said.

On March 9, the first credit line under this framework was granted to Shenzhen Huaqiang Holding Ltd, which produces cartoons and develops entertainment technologies applied in theme parks.

The company said the fund would be used to promote exports of their products and other operations abroad.

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"Cooperation with China Exim will enhance our financial capability and promote exports. We hope to contribute more to the international standing of China's cultural products and services," the company's president Liang Guangwei said.

Kong Jianhua, a research fellow with the cultural industry research center of Beijing's Tsinghua University, said there was an increasing trend of financial institutions supporting the cultural industry as the industry was experiencing rapid growth and reaping big returns.

"A cultural consumption market has developed nationwide and a golden age is around the corner," he said.