The Role of Creative Industries for the Competitiveness

The Role of Creative Industries for the Competitiveness of Europe Creative Industries on Stage, Vienna, December 4 th, 2007 dr. Žiga Turk, minister Government Office for Growth SLOVENIA ziga. turk@gmail. com

2008: Starting a new chapter in European history § end of period of EU looking inward § treaty signed, form defined, § expansion from EU 15 to EU 27 § success of Euro § time to look at the content, not form § time to look outward § time to shape, not respond to globalization

Lisbon Strategy is response to globalization which is driven by … § freedom in politics § fall of iron curtain and Berlin wall § freedom in trade § free trade agreements in WTO and GATT § advances in logistics § of goods: container ships, DHL, UPS … § of information: internet, mobile phones § Europe a follower, not driver of these processes

Context - Lisbon Strategy § Lisbon 1. 0 (2000) § most competitive economy in the world § Japan and USA § Lisbon 2. 0 (2005) § growth and jobs § looking inward § if it's not broken don't fix it … § Lisbon 2. 1 (2008)

SWOT § Strengths: cares for people, cares for nature, quality of life, social security, health system, culture of peace, human rights, tolerance, cooperation, tradition in science and art, humanism … § Opportunities: builds on strengths, attracts talents, innovates in all aspects of living, adapts and opens up to the world, projects its values to the world, dynamic economy § Weaknesses: no risk taking, little individualism, depending on government, highly regulated, low entrepreneurial drive, weak r&d - industry links, decreasing quality of education, weak capital markets, unreadiness to hard work, hard study … § Threats: does not address weaknesses, graying of population, unable to compete with Asia, closes itself from the world, Europe is satisfied, tired and lazy

In the wake of the Asian century § 1800 s … European Century § 1900 s … American Century § 2000 s … Asian Century § "they know it belongs to them" § again!

Asia § India + China GDP > West's GDP until 1820 § India + China GDP > West's GDP after 2050 or before? § other BRIC countries!

Innovation? § United States graduated roughly 70, 000 undergraduate engineers § China graduated 600, 000 and India 350, 000. § ½ of software developed in India § ½ of Fortune 500 outsource software work to India § new R&D centers of Microsoft, Cisco, Google, IBM … are in Asia, not Europe § by 2020 80% of scientific papers in sci&tech will be written by asians § out of top 10 universities 2 in Europe § Asia (Singapore) is setting education standards

Innovation is not enough!

The shift § Agriculture Age (farmers) § Industrial Age (factory workers) § Information Age (knowledge workers - innovators) § Conceptual Age (creators) Source: Dan Pink, A Whole New Mind

Theoretical basis § Schumpeter: § products fulfill needs § "profit is result of innovation" § Dan Pink (rephrased): § products fulfill passions § "profit is result of creativity"

Do you buy what you need?

Or do you buy what you think and feel you need?

Do you pay for function or do you pay for meaning?

Added value in function or in meaning ?

Price of function is droping, and price of meaning rising image design "home made" trade mark price of funcion “fair traded” trusted price of meaning marketing "healthy" environmental y friendly 1 EUR just function 30 EUR more who is willing to pay for it who can think of it who can sell it

Who makes meaning? What gives meaning? what is meaning? what gives meaning? what influences meaning? values, morals, virtues! MORALIZATION OF THE MARKETS!

Innovation vs. Creativity § Innovation: “The past few decades have belonged to a certain kind of person with a certain kind of mind— computer programmers who could crank code, lawyers who could craft contracts, MBAs who could crunch numbers. " § Creativity: "The future belongs to a very different kind of person with a very different kind of mind— creators and empathizers, pattern recognizers and meaning makers. These people—artists, inventors, designers, storytellers, caregivers, consolers, big picture thinkers—will now reap society’s richest rewards and share its greatest joys. ” Source: Dan Pink, A Whole New Mind

Left brain vs. right brain § “The era of ‘left brain’ dominance—is giving way to a new world in which ‘right brain’ qualities—inventiveness, empathy, meaning —will govern. ” § left brain - rational, methodical, mathematical … culturally independent § right brain - intuitive, artistic, spiritual … depends on cultural background Source: Dan Pink, A Whole New Mind

“Human creativity is the ultimate economic resource. ” Source: Richard Florida, The Rise of the Creative Class

War for talent! Educate talent Attract talent Retain talent

Florida's 3 "T"s for Creativity § Talent (educate, attract, retain) § ½ mil. top EU engineers and researchers abroad § Technology § attracts talent § Tolerance § makes talent stay

Focus § knowledge, innovation and creativity § § § § § support for JTI, technology platforms widening of ERA towards SE Europe knowledge as 5 th freedom ERA and ERA networked approach to concentration entrepreneurship, education, role models SMEs, early stage financing internal market (review) continued reduction of administration burden growth, competitiveness & entrepreneurship § jobs, human resources § energy and environment § sharing best practices on flexisecurity § improving education of youth and adults, weakness in knowledge triangle § perspectives of the young § environmental policies as key driver of innovation and consequently economic growth

Creativity as the horizontal issue in the four themes § innovation and creativity § not only engineers but designers, artists § competitiveness § how to make talents entrepreneurial § people § how to educate, attract and retain talent, § how to make talent entrepreneurial, § how to flexibly employ talents § environment § make it into a value, make it into a business opportunity

1. Pillar: Increasing the EU’s economic potential through R&D § Promote Creativity as a horizontal issue to make Europe the most creative place in the world § Innovation: generation and application of knowledge – establishment of the European Research Area (ERA), focus on the successful introduction of the European Institute of Technology (EIT) as a link between the public research sphere, the European higher educational environment and the economy. § Introduction of knowledge as 5 th freedom § Establishment of joint technology initiatives (JTI) § Opening the research infrastructure for researchers in SMEs, improving the competitiveness of the EU, Member States and regions; § Inclusion of neighboring regions (especially the West Balkans) in European research programs.

The Role of Europe in globalization § it is ultimately about values such as well designed, fair, environmentally friendly, nice, trustworthy … § Europe's role in the globalized world is to § shape values … dealing with conflict, addressing climate change, agreement among generations, social sensitivity, global empathy … valuing design, brand, intellectual property § project these values to the rest of the world § creating products fitting this world view, exporting products § century of European values!

Creativity is essential § creative industries powerful on its own § culture, media, advertising, branding, design, architecture … § even more powerful as creator of "meaning" and "value" for all other sectors § innovation should meet creativity

We have legacies and traditions to build on!

PS.

The Chinese invented cheap paper. In 15 th century Europe learned to use it. Democratic use of paper. It can be used for anything. So many more people can learn, create …

The first communication revolution

The Reneissance follows. Europe takes the lead. In ethics, arts, science, technology. World domination follows. Culminates in the early 20 th century.

In the 20 th Century Americans invent the Internet. Democratic use of digital technology. Anyone can be an author. Anyone can publish. Do movies. Europe learns to use it. Do music. Spread ideas. Values. His or her own.

The second communication revolution

Not in colonies. Not in steel production. In ideas. In values. Creativity 2. 0 Everyone gets involved Creative, media empowered society! What will we make of it? Or we get so poor manufacturing will come back to Europe. No room for complecancy

References § Dan Pink, A Whole New Mind § Richard Florida: The Raise of the Creative Class § Jeremy Rifkin: The European Dream