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Creative economy rising, new global report shows
A digital artwork “If The Little Women Were Black” by Natasha Karungi aka Kashushu. PHOTO / FILE
What you need to know:
- The Creative Economy Outlook 2024 underscores the pivotal role creative industries play in trade and economic growth
The latest technical and statistical report on the global creative economy by the United Nations Conference on Trade and Development (UNCTAD), reveals the varied economic contributions of the sector across different countries, ranging from 0.5 percent to 7.3 percent of GDP and employing between 0.5 percent and 12.5 percent of the workforce.
The Creative Economy Outlook 2024 underscores the pivotal role creative industries play in trade and economic growth. It provides insight into the creative economy and international trade in creative goods and services. The report covers recent trends and developments in creative industries and international trade of creative products. This year’s report focuses on the impact of digitalisation and artificial intelligence on the creative economy, competition challenges, and sustainability efforts.
The global survey shows that growth was fastest in creative services exports that surged to $1.4 trillion in 2022, marking a 29 percent increase since 2017. Meanwhile, creative goods exports reached $713b, a 19 percent increase. Over the past decade, creative services’ share of all service exports rose from 12 percent to 19 percent, while creative goods’ share of all goods exports has remained steady around three percent since 2002.
Developing countries primarily export creative goods, while developed countries dominate creative services exports. However, developing countries have significantly increased their share from 10 percent in 2010 to 20 percent in 2022, the report adds.
The most exported creative services in 2022 were software services (41.3 percent) and research and development (30.7 percent), followed by advertising, market research, and architecture (15.5 percent), audiovisual services (7.9 percent), information services (4.0 percent), and cultural, recreational, and heritage services (0.6 percent).
Changing landscape
Key trends in the sector include the rise of digital platforms and streaming services; increasing cross-industry collaborations; and the growing popularity of video games across various sectors.
According to the report, digitalisation is transforming the creative economy. Streaming services, for one, expanded their share of the global music market by 10.4 percent year-on-year.
They now account for 67.3 percent of global music revenue streams. Artificial Intelligence (AI) is a key driver of this change, enhancing content creation, distribution and consumption.
AI is widely used in newsrooms, with 41 percent of news teams employing it to create illustrative art; 39 percent for social media content; and 38 percent for writing and generating articles.
Digital tools lower costs and expand revenue opportunities, making global markets more accessible for individual creators.
“However,” the report notes, “they also bring challenges such as quality control, copyright issues, privacy concerns, and market monopolisation. Robust regulatory frameworks are necessary to ensure these technologies benefit everyone and foster a competitive creative economy.”
Level playing field quest
Market concentration poses significant challenges to the creative economy. Dominant players can stifle innovation and limit opportunities for smaller firms. For instance, in the USA, the “Big Five” publishers hold about 80 percent of the book market, while six movie studios account for nearly 90 percent of box office ticket sales in recent years.
Effective policies in some countries have fostered thriving creative sectors by protecting intellectual property and ensuring competitive markets. The report emphasises the need for a level playing field to promote a diverse and vibrant creative economy. Inclusion and environmental sustainability are becoming a cornerstone of the creative economy.
Governments are integrating inclusion and environmental sustainability into policies targeting the creative economy. The report highlights sustainable business practices that not only shape creative industries but also contribute to a more sustainable and prosperous society.
Contributions
The creative economy is a significant driver of global and regional economic growth, despite being among the most negatively impacted by the Covid-19 pandemic and susceptible to the challenges of a quickly evolving environment. According to Unesco, cultural and creative industries generate annual revenues of almost $2.3 trillion globally, contributing 3.1 percent of the global gross domestic product (GDP).
Estimates by the International Labour Organisation (ILO) show the arts and entertainment sector accounts for 1.4 percent of global employment.
UNCTAD’s 2024 survey on the creative economy, covering 36 mainly developing economies, confirms significant differences across countries. In economies where data is available from the past 10 years, the creative economy contributes between 0.5 and 7.3 percent of GDP and employs between 0.5 and 12.5 percent of the workforce.
Many nations acknowledge the creative economy’s beneficial economic and societal effects, implementing specialised policies to bolster the sector.
The outlook also responds to mandates by UNCTAD’s Bridgetown Covenant and the General Assembly resolution 78/1332 on promoting the creative economy for sustainable development. These mandates tasked UNCTAD with providing analysis of the creative economy and international trade in creative goods and services.
Creative economy explained
According to the Creative Economy Outlook 2024 report, the creative economy encompasses creating, producing, and distributing goods and services that use creativity and intellectual capital as primary inputs. It includes diverse activities such as advertising, architecture, arts, design, music and movie production, publishing, and video games. The creative economy is rapidly growing, offering opportunities for economic development and diversification. It generates cultural and societal values and supports economic objectives like economic growth and job creation. This sector is vital for some developing countries, although a recent United Nations Conference on Trade and Development (UNCTAD) survey highlights significant differences across countries.
Digital creative content increasingly replaces physical goods like books, films, music, and video games. Digitalisation also supports emerging business models such as streaming and digital platforms and fosters cross-industry collaborations (for example, between video game companies, musicians, publishers, and film studios) and gamification across sectors. Additionally, demographic shifts in developing economies, with younger generations consuming more digital content, drive growth in creative industries, the report adds.
The report shows that the creative industries exhibit wide variability in operations, value chains and revenue models globally and regionally. This diversity presents challenges in accurately estimating market size. Studies utilise varied metrics like industry revenues and sales, leading to inconsistencies in methodology and data sources while complicating analysis. Given these disparities, the report offers a synopsis of recent research and data on market trends across different creative industries.
In the absence of detailed global industry data from international organisations for some creative sectors, the section uses recent reports from consulting and market research firms and associations. Data about creative industries in developing countries is scarce. However, the report presents such data whenever possible.
