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          Policy and Regulation

          China's cultural industry to develop speedily

          By Li Zhenyu (Peopledaily.com.cn)
          Updated: 2011-05-12 17:10
          Large Medium Small

          China, with a history and ancient wisdom that stretches back across millennia, is a nation that abounds in cultural resources. Yet, when it comes to the commercialization of these resources, the Asian Giant is only at its infant stage. Over the next five years, China's cultural industry is geared to grow from a new engine into a pillar of the national economy.

          Oriental dawn

          With its economy expanding at an astounding rate and the central government's heavy support, China's cultural industry is to hail a new dawn.

          For years, China has been one of the world's fastest growing economies. According to statistics, from 1989 until 2010, China's quarterly Gross Domestic Product (GDP) growth rate averaged 9.31 percent. In the fourth quarter of 2010, its GDP expanded 9.80 percent and overtook Japan as the world's second largest economy.

          International common sense suggests that when a country's per-capita GDP exceeds $3,000, its citizens' demand for cultural consumption will rise sharply. China's per-capita GDP surpassed $ 4,000 in 2010, and in such metropolises as Beijing, Shanghai and Guangzhou, the number even exceeded $10,000.

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          In the meantime, the newly-released 12th Five-Year Plan of the Communist Party of China (CPC) made it clear that the cultural industry should be developed into a pillar industry in the next five years, meaning the cultural sector, as a pillar industry, should take up at least 5 percent of the total GDP by 2015, whereas it currently accounts for less than 2.5 percent.

          Stepping up

          China's cultural industry is ready to get on the fast track in its development and enjoy a favorable environment in both economic and political terms.

          In recent years, China's cultural industry has been growing at an average annual rate of more than 17 percent, surpassing that of the national economy by over 7 percent. It has emerged as a new engine in driving economy. Even the international financial crisis failed to dampen the growth of the sunrise industry, in which it has played a special role in boosting domestic demand and adjusting the economic structure.

          For that matter, the cultural industry was highly regarded by the Chinese Central Government.

          In 2009, the State Council, the highest executive organ of State administration, for the first time, issued a document designed to promote cultural industry in China. The release of the document, namely the Plan to Adjust and Reinvigorate the Cultural Industry, indicates that cultural industry in China was elevated to an unprecedented height of strategic position at national level, manifesting the Chinese Central Government's resolution to transform the budding industry.

          To ease the financing difficulty faced by the cultural industry, in 2010, nine government ministries jointly issued a guiding opinion on financial support for the rejuvenation and prosperity of the cultural industry.

          As of tomorrow, more favorable policies from the government are expected.

          Looking forward

          Experts predict that 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, its growth will be more market-driven in the next few years, industry experts say.

          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 statistics suggests the following trends for the sunrise 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 flagship 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. Although China's export of cultural content products will gradually expand, it is still difficult to eliminate China's deficit 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, while significant progress has been made in the integration of telecommunications networks, cable TV networks and the Internet, digitalization that marked the cultural industry will be the core of the sector.

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