Friday 12 February 2016

Creative economy policy in developing countries: The case of Indonesia 
Fikri Zul Fahmi, Philip McCann and Sierdjan Koster
University of Groningen
Economic growth policies based on the creative economy have arrived in Indonesia. Widely adopted in Anglo-Saxon and European countries, the Indonesian government has recently embraced the idea. A ministry was established to coordinate the creative economy sector especially. The goal is to inspire the growth of creative industries as a driver for local economic development. However, the national policy formulation and the local implementations and interpretations are importantly divorced. This can jeopardize the anticipated outcomes. Local forces and path dependence appear strong. Cities rich in traditional culture interpret the creative economy discourse in terms of traditional handicraft businesses and tourism. Meanwhile, in more advanced cities, the ‘real’ creative industries are already growing and the local government started to be aware of the difference between creative industries and long-established traditional businesses which focus on heritage, conservative values. Yet, it is visible that in both situations, local governments use the creative economy policy to reinforce what is already there.

This is what we found in Bandung, Surakarta and Yogyakarta, the first three cities to implement the creative economy policy in Indonesia. Bandung is the only city in which the interpretation aligns with the general understanding of a creative economy that emphasises innovation and new knowledge creation. Meanwhile, in Surakarta and Yogyakarta the term creative economy is used, while it refers to existing ‘traditional’ cultural economic activities – batik and traditional crafts - which have been in operation for years. These different interpretations are governed by several factors. Firstly, in Bandung there were ‘intermediaries’, especially The British Council, university actors and epistemic communities, who introduced the creative economy discourse and directed the local government’s interpretation towards the creative economy concept. Secondly, related to this, these intermediaries helped structure local assemblages and influenced local policies so that the creative economy not only became a development discourse, but also an important strategy embodied in local policies. In comparison, the creative economy was applied by the national government in Surakarta and Yogyakarta as ‘pilot projects’, but at the end of the day, the local governments in these cities decided to focus on traditional cultural industries as these industries are big and have been cultural attractions in these cities. Thirdly, there is a strong attachment to traditional culture in Surakarta and Yogyakarta, making it politically challenging to prioritize a ‘modern’, innovative creative economy like in Bandung.

The creative economy idea has become a temptation for many governments in Asian developing countries. However, often this means copy-pasting the word  ‘creative economy’ without considering whether the concept is suitable for local contexts. The Indonesian case thus provides insights for other developing countries. So, can stimulating a creative economy be the way forward for developing countries? It can, in some cities. There would be some cities that will be ready for this ‘creative turn’, while for others continuing the development of tradition-based economic activities might be more relevant. This, of course, depends on what the local government wants to do: developing the ‘innovative-style’ of creative economy, or rather protecting traditional values in cultural industries. Governments clearly can do both, but they need to acknowledge that the accompanying policy strategies as well as the expected economic gains importantly differ. For example, to support a ‘real’ creative economy, it is crucial to develop a climate  that allows creative industries or entrepreneurs to collaborate and build networks. Meanwhile, to support the traditional cultural economy, supply-side support seems important, as the small businesses involved in the sector are  vulnerable and have a limited capacity to highlight and economise cultural values. Given the weak articulation of the national policy and the different local interpretations, the creative economy policy in its current form is unlikely to become the silver bullet the Indonesian government wants it to be.

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