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The Culture Industry in China Has Drawn Attention from Central Government Decision Makers

On Oct 28, 2009, Outlook Weekly magazine published a comprehensive review article titled “The Culture Industry in China Enters an Extremely Crucial Phase; Has Drawn Attention from Central Decision Makers.” [1] This article reviewed the major points from four articles that were published in Outlook Weekly at different times about China’s culture industry, as well as an Outlook Weekly interview of Han Yongjin, the director of the Department of Policy and Regulations, Ministry of Culture. From reading this article one can understand the two reasons that the CCP put forward the concept of a Culture Industry. The first reason is that “culture has an ideological foundation; it is a base, a mouthpiece, and a tool and instrument for education and propaganda.” It represents China’s soft power. The Second reason is the culture industry is “not only culture, but also an industry. This aspect is related to the market; so it is related to making money.” The article discusses going “from ‘culture market’ to ‘culture industry,’ and from ‘culture industry’ to ‘culture productivity’ and ‘culture soft power.’ This demonstrates our party’s more in-depth understanding of the laws of development of human society and the laws of socialist culture development.” Below is the translation of important excerpts from this article.

“On July 22, Premier Wen Jiabao hosted an executive meeting of the Standing Committee of the State Council. The ‘Culture Industry Revitalization Plan’ was discussed and approved in principle. Earlier, Gao Shusheng, the deputy director of the Office of Reform, Central Propaganda Department, revealed publicly that the Central Propaganda Department and several other departments are working hard on developing several important national plans, including the “Twelfth Five-Year Development Plan for the Culture Industry,” the “Backbone of the Culture Enterprises Training Plan,” the “Culture Enterprises Listing Plan,” and the “Culture Industry Base Construction Plan.” “(Gao said that these policies) symbolize the development of our nation’s culture industry, which is in transition from the ‘spontaneous stage’ to the ‘self-conscious stage.’” “The development of our nation’s culture industry is entering a very important and crucial phase. The year 2009 will be a turning point in China’s cultural history. The culture industry possesses its own unique advantages in development and it has demonstrated unique development potential in the financial crisis. All these are drawing more and more attention from the central decision-makers.”

“The culture industry is developing at a rapid pace, and will definitely impact China’s future. Ten years ago, it did not even have a ‘legal identity,’ but today it accounts for 2.6 percent of China’s GDP, and is growing by more than 17 percent every year. In the year 2008, it accounted for more than five percent of the GDP in Beijing, Shanghai, Guandong, Hunan, and Yunnan. However, if we observe and estimate its significance only from a pure economics point of view, then it would be too narrow and shallow.” “When visiting an Animation (Cartoon) Enterprise in Tianjin City’s at the beginning of this year, Premier Wen Jiabao raised the point that we need to make the culture industry a new growth point for dealing with the financial crisis, and we need to have Chinese culture reach out to the world and show the world China’s soft power.”

“The development of our nation’s culture industry is entering a very important and crucial phase. The year 2009 represents a turning point for China’s culture history. Currently the Central Authorities’ strategies and train of thought about speeding up the development of the culture industry are becoming clearer and clearer. Looking at all the actions taken so far, the culture industry is being pushed forward at a thunderous speed.” “There are several reasons that the higher authorities favor and pay so much attention to the culture industry. One is that our nation is facing many difficulties in the mid and late stages of industrialization, including resource shortages, the worsening of environmental pollution, extensive development of the economy, and so on. The global financial crisis is making China’s development face an even more severe ordeal.” “Despite this financial crisis, China’s culture industry is still growing well, and many culture industries are demonstrating a counter-cyclical direction. The party, the government, and all sectors of society have recognized its nature and advantages and have thus paid much attention to it. With this background, the central leaders have pointed out that we need to turn the culture industry into a new growth point for dealing with the financial crisis, make Chinese culture reach out to the world, show the world China’s soft power, quickly study and figure out how China’s culture industry can seize the opportunity offered by the global financial crisis, and maintain a good growth momentum.

“Zhang Xiaoming, deputy director of the Center for Culture Studies at the Chinese Academy of Social Sciences, told Outlook Weekly, ‘In the bigger picture, China’s economy has reached a phase where we must add culture to our nation’s strategy. This is a logical necessity for the development of the economy and the process of modernization.’… Since the end of 20th century and into the beginning of the 21st century, China has been quietly entering into a new period. Culture has begun to lose its traditional, simple concept of being ‘extrinsic.’ It is starting to be treated as an economic sector. We can say that this is an internal context for the development of the culture industry.” “Zhang Xiaoming also mentioned another even bigger basis for the development of the culture industry that is often easily ignored. From the end of the last century to the beginning of this century, developed countries have finished upgrading their national industries. They now are mainly relying on the knowledge economy and beginning to use the strategy of culture imperialism. At the same time, the western media groups changed in the mid-1990s through globalization. They were coveting the huge culture trade market in China, which was yet to open. Therefore in the final stage of the negotiation for China to join the WTO, western developed countries brought up requests to open the service trade markets in China, and this core request has a direct hit on our culture field. Zhang said, ‘Because China was an export-oriented economy at the time, it was crucial to China’s economic development that the developed countries open their traditional markets to China. Western countries have already entered the phase of developing a modern service trade in which the culture industry is their main industry. Thus the opening of a huge service trade market such as China became an urgent need for their economic development.’”

“In November 2001, China joined the WTO. Since then, our culture sphere has had no other option but to face the challenges from the culture of developed countries. However, China did not even have a formal concept of ‘culture industry’ until 2000. The Central Authorities obviously noticed this challenge, and thus in ‘Suggestions by the Central Committee of the CCP on Making the Tenth Five-Tear-Plan for the National Economy and Social Development’ that was passed in the Fifth Session of the Fifteenth Central Committee of the CCP, 2000, ‘culture industry’ was used the first time and it was the first time this term was put into one of the central authorities’ documents.” “People generally agree that this marked when the culture industry obtained a ‘legal status’ in China, and it became a milestone with high significance and value.”

“In the strategic intent and expectations of the central decision-makers, not only will the culture industry be the new engine for economic growth and the stepping-stone for economic restructuring; it will also be the important anchor for the development concept of experimental science and a break through point for achieving a change in methods of development. Since the establishment of the Department of Culture Industry, in the Ministry of Culture in 1998, China’s culture industry has gone through 10 years. Compared with nine years ago, now China has a clearer and a more accurate understanding of culture and the culture industry. The culture has more and more become the origin of national cohesion and creative power, as well as an important factor in the competition for overall national power. The Seventeenth Central Committee of the CCP raised the important strategic tasks of driving socialist culture to be vigorously developed and prospered and setting up a new upsurge in socialist culture development. These tasks required the nation to greatly develop the culture industry, prosper the culture market, distinctively increase the proportion of the culture industry in the national economy, and enhance the international competitiveness of China’s culture.”

"In a research report from the Ministry of Culture, it was said that the culture industry has a comparative advantage in many aspects that are unmatched by other industries. First, the culture industry does not consume a lot of resources and has little environmental pollution. … The culture industry mainly produces spiritual products. These products use creativity as the source, the content as the core, and as long as there is a steady stream of ideas, there will be a steady stream of output and profit. The development of the culture industry does not need a high expense for resources and does not pollute the environment. Secondly, the culture industry has high economic returns and long term benefits. Once consumers recognize and seek after the culture products, they will bring relatively high economic returns. Thirdly, the culture industry has a lower entry barrier, and can use lots of labor. The industry chain is longer and the employment is flexible. Not only is it suitable for large-scale, modern enterprises with high-tech equipment, but it can also accept individuals and small-scale traditional market players who rely on personal creativity and development of traditional skills. In addition, the culture industry and other industries of the national economy are having widespread penetration and integration with each other. They together are forming a huge industrial chain and industry clusters that use culture content as a link. They are becoming increasingly correlated with each other. At the high-end of the culture industry, service industries such as creative design are gradually combining with other industries. This way the culture connotation and product value of these traditional industries are upgraded and so the culture industry is playing an increasingly important role in promoting economic development. The culture elements can be blended together with other modes of economic production and operating styles to greatly drive other industries. The decision-makers hope the culture industry, in addition to giving full play to economic development, can also enhance the soft power of the national culture, and make a unique contribution to shaping a new international image for our nation."

On April 2, 2008, the BBC published an annual global public opinion poll. According to the results, in the evaluation of fourteen countries and areas, China ranked number seven. The positive feedback for China came mostly from the Middle East and Africa and the negative feedback came mostly from European countries and North America. On January 17, 2009, the China Academy of Sciences published the “China Modernization Report for 2009.” This report pointed out that even though the culture influence index for China ranked number seven globally, the value of the China index was only half of the value of the U.S. index, which was number one. “Facing the difficulties of global influence,” Zhang Xiaoming thought, “China must resolve the difficulties by developing a culture industry and having exchanges with the world. China needs to clearly express its position on international society’s widely respected practices and ethics concepts. Otherwise, China will ‘face difficulty everywhere and no matter what China does, others will have doubts.’” “In the current International environment, China’s culture urgently needs to ‘reach out.’ …China’s culture products that have Chinese elements and are very attractive, when disseminated in the world culture market…will bring China’s culture and spirit to the whole world through the world culture market platform. 

“The culture ‘reaching out’ strategy formally originated around the mid 1990s. It was earlier than the concept of the ‘culture industry.’ Although there are still many factors constraining culture from ‘reaching out,’ for this time in history, International society’s attention on China provides new opportunities to promote the culture industry’s ‘reaching out.’ The world is more and more acknowledging and paying attention to China’s culture, and to the unique better economic position that China has in this financial crisis. All these provide the opportunities for China’s culture ‘reaching out’ strategy.

In the China culture industry 30 people forum, the common understanding that the experts and scholars reached is that the next ten years will be the golden age of our culture industry. China Media University’s Culture Industry Institute director of the academic committee, Qi Yongfeng, thinks the “Twelfth Five-Year (Plan)” period will be considered the “growing up” period for the culture industry. The culture industry should be treated as a “National strategy industry” and employ important policies to accelerate its development. The “Thirteenth Five-Year” period (2016-2020) will be the period when the culture industry becomes internationalized. Our culture industry will enter the international market at a much faster pace and will set up its international competitive power as a culture giant.

According to a related bureau calculation, the culture industry represented 2.6% of the GDP in 2007. Using this ratio, the increase in the culture industry was around 641.2 billion which was an 18.4% increase over what it was in 2006. The ratio of the GDP increased 0.15% in 2008 which kept up the rapid growth momentum. The annual report on the national culture industry for 2008 has not yet been published. According to historical data, the increase in the culture industry will be close to 760 billion yuan and national family entertainment expenses will be around 639.1 billion yuan.

The China Culture Industry Report for 2009 pointed out that the growth of our domestic economic development decreased. However, the culture industry still sustained stable rapid growth and remained one of the few highlights in the domestic economy. “In 2008, Beijing, Hunan, Yunnan, Shanghai, and Guangdong became the five provinces where the culture industry ratio to GDP was larger than 5%. After these ‘five big clubs,’ other areas are catching up quickly. At a provincial conference, Xu Guangchun, who was the communist party committee secretary of Henan Province, issued a requirement for the Henan culture industry: ‘In Henan Province, because of the mindset, bureau organization, the arrangement of work, and other factors in general, economic development has dwarfed culture industry development. The culture industry’s scale, level, and performance are not comparable to its economy and culture resources, and could not meet the expectations and requirements of its people. It is highly desirable that we open up a new path in our culture revolution and strive to promote culture’s greater development. Thus, we will have a brand new image of both our hard and soft capacity in central China.’”

“Although all the data is promising, the development of the culture industry still has a lot of problems. The first one is that the culture industry’s revenue is small and makes a limited contribution to the GDP. The second one is that investments are insufficient and the infrastructure is out of date. The third problem is that marketability is poor and the industry is not centralized. The forth problem is the shortage of culture management professionals. The investment and financial support system lag far behind. The fifth problem is a lack of specific development planning; the related policies of the culture industry are not complete. The sixth problem is that the unfavorable balance of trade is still very significant. The ability of the culture industry to spread and to exert influence both need further improvement.”

“Experts think that science and technology, especially the rapid development and application of networking technology, digital technology, and new media technology, have deeply affected the development of the culture industry in four aspects. The first one is providing the advanced means and presentation forms for making the culture programs. Technology has made the presentation way more vivid, colorful, and attractive. The second one is giving birth to more new forms in the culture industry, such as electronic tickets, networking culture, cell phone culture, 4D movies, etc. The third one is the great expansion of channels to export and deliver the culture programs. The dominant broadcast channels for culture programs have been greatly challenged. More open, mutual channel layouts have been formed. The era when culture programs were based mainly on “broadcasting is king,” and dominated by television channels is gone. The era that evaluates programs based on quality and performance has become the main trend. The fourth one is that multiple high-speed, high-capacity channels have been built. The need for culture-rich programs has increased dramatically. This has provided a rapid development opportunity for the culture industry that centers on content creation and production. “The future for areas that have integrated science, technology and culture looks very bright for the next ten years. It would be a fatal mistake not to take it as a national strategy of development.” Zhang Xiaoming said, “The only chance for China to catch up with the culture industry of developed countries will be within a network. It is impossible in any other area.”

“In addition, Gao Shusheng, deputy director of the Reform Office of the Propaganda Ministry, found several noticeable trends in the development of China’s culture industry based on his recent years working on the coordination of policies and a grass-roots investigation: First, our culture resources have come to the period of big adjustments and big integration. Currently the administrative allocation system of culture resources is no longer suitable for the socialist market economic system. This not only causes a blockage in certain areas; it also leads to industrial monopoly. Ultimately it hurts the culture industry badly. This is exhibited in the fact that the present culture enterprises are very small and weak, and similar to each other. Therefore, the reform needs to break this old system and let the market system play a fundamental role in the allocation of culture resources. In this situation, someone’s will doesn’t determine the adjustment and integration of culture resources; instead they are determined by the market and capital. Second, the divisions among industries are blurred. There is a trend toward merging. Before, culture was categorized in three areas, “culture art, media, and publishing.” Because media technology and means are increasingly diverse, the trend toward merging blurs the lines of division between the industries. Third, the integration of the culture, travel and manufacturing industries has become more and more obvious. From now on, with further development of culture resources, the integration of culture and travel – that is deep travel – must appear in China. Fourth, culture industry development has transformed from spontaneous to conscious. The culture revolution is turning toward taking advantage of the market system’s direction. However, the market system also has its disadvantages. To fully employ the incubation and assembly functions of the culture industry’s base, and to strengthen planning, regulation and guidance are indispensable. Therefore, the top priority is to study and plan out the development strategy for the national culture industry.

“The Ministry of Culture Policy and Regulation Department Director, Han Yongjin, thought, based on the concept ‘culture market’ from the 1980s, to write ‘culture industry’ into the nation’s ‘Tenth Five-Year’ plan. The Chinese Communist Party Central Committee’s Fourth Plenary Session of the Sixteenth Congress first introduced the (name of) ‘culture productivity’ in the ‘Resolution of the CPC Central Committee on strengthening the Party’s governing ability’ in 2004, and introduced ‘culture soft power’ in 2006, all reflecting our Party’s understanding of the law of human society’s development, the law of the communist culture’s development, and the law that the communist party leads socialist advanced culture to become deeper and deeper, and more and more complete. These are the three milestones in China’s culture development history.

“Han Yongjin said the birth of the concept ‘culture industry’ indicates that culture also has the function of being industrialized. In addition to our traditional understanding that culture possesses the nature of ideology, being our battlefield, our tongue, and the tool of education and propaganda, culture also has a connection to the market, and can be used to make money. … This is not only a new name, and new concept; it is also a necessary requirement for the socialist market economic system of culture; it is the natural choice of China’s style of socialist culture development; it is the natural result of the culture industry’s self-practice and theory research.” 

“In November 2006, the CPC Central Committee General Secretary and State President Hu Jintao introduced ‘improve the nation’s soft power’ in his speech at the Eighth National Congress of the China Federation of Literature and Art and the Seventh National Congress of the Chinese Writer’s Association.” “From ‘culture market’ to ‘culture industry,’ then from ‘culture industry’ to ‘culture productivity,’ and ‘culture soft power,’ all these reflect that the Communist Party’s understanding of the development laws of human society and of socialist culture have become deeper and deeper.” “Science and technology will lead the renovation of China’s culture industry. …”

“In retrospect, we have found that our nation’s development concept has evolved from the initial stage of two parts one entity, that is ‘socialist material civilization and spiritual civilization,’ into the later three parts of ‘material civilization, political civilization, and spiritual civilization,’ to the current four parts one entity stage, which is ‘socialist economic development, political development, culture development and society’s development.’”

[1] Outlook Weekly,  October 28, 2009