DEVELOPING CULTURAL AND CREATIVE INDUSTRIES IN ARMENIA Cristina Farinha The Programme is funded The Programme is implemented by a consortium led by the British Council, in partnership with the Soros Foundation by the European Union Moldova, the National Center for Culture of Poland and the Goethe-Institut The report is developed with the assistance of the EU-Eastern Partnership Culture and Creativity Programme. The content of this report does not reflect the official opinion of the European Union. Responsibility for the information and views expressed in the report lies entirely with the author. The report was published in January 2018. 2 CONTENTS 1. Executive Summary 4 Team and Acknowledgements 7 2. Creative Industries in the EU 8 3. Mandate and Methodology 11 4. Developing Cultural and Creative Industries – Regional Analysis and Detailed View on Armenia 13 4.1 Brief analysis of the national context 13 4.2 Recognising CCIs’ transversal character 14 4.3 Setting up participatory policies and platforms 20 4.4 Building on emerging creative hubs 22 4.5 Easing access to specific funding and support 25 4.6 Improving creative entrepreneurial education and skills 28 4.7 Developing audiences and markets 30 4.8 Encouraging internationalisation and cooperation 33 5. Recommendations on Developing Cultural and Creative Industries in Armenia 36 5.1 Policy-making, Participation and Platforms. 37 5.2 Infra-structure, Funding and Frameworks 39 5.3 Skills, Audiences and Markets 41 5.4 Internationalisation and Cooperation 42 Appendix A: Bibliography 45 Appendix B: List of Participants in Workshops, Interviews and Site Visits 48 3 1. EXECUTIVE SUMMARY The Cultural and Creative Industries (CCIs) have been recognised by the EU and integrated into its policy documents and programmes for more than a decade. This report provides a bird’s-eye view of the cultural and creative industries sector in the six countries of the EU-Eastern Partnership: Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine, but most importantly, it provides country-specific view on challenges and tailored recommendations for Armenia’s CCIs. Armenia’s main general opportunities include: Armenia’s main general challenges include: > Strong ICT community, software and > Armenia’s economy is highly dependent games development are among the on external sources, CCIs development fastest growing sectors. relies a great deal from international > From Armenian vast worldwide diaspora donors and investments from diaspora. some are actively engaged in investing > Lack of cooperation between academia, into Armenia's development, including R&D centres and industry hinders educational, social and cultural projects. innovation and business development. > Wide use of internet and enabling state > Deficient tourism infrastructure and policy for ICT provides supportive hospitality skills are hindering tourism environment for creative economy development. development. > Complex regional and cross-border > International tourism is steadily growing mobility due to enduring conflicts with and the strategic role of cultural heritage neighbours prevents potential synergies in and contemporary culture and creativity the CCIs and tourism fields. has been recognised. Specific Opportunities and Challenges 1. Recognising CCIs’ transversal character in Armenia > Opportunities > Challenges > Cultural policy is increasingly encouraging > CCIs are underexposed and not public-private management models and recognised in the government’s export- market orientation for cultural products and led industrial strategy. institutions. > Absence of a road map and inter- > Intention to promote businesses associated ministerial strategy towards the with cultural heritage and tourism (included development of creative industries and in the 2014 culture programme). management-orientated cultural system. > Developing UNESCO Culture for > Ministry of Culture endures a centralised Development Indicators in view of patronising role towards culture policy monitoring the sector’s impacts. and management. > Lack of accessibility and participation in the field of culture among general population. > Lack of synergies between ICT and wider creative communities. 4 2. Setting up participatory policies and platforms > Opportunities > Challenges > Openness for dialogue among the > Policy-making still lacks transparency government and the sector professionals. and a systematic participatory approach. > Rather weak civil society and lack of joint collective organisation within the CCIs. > Professional unions are not well adapted to new market rules and cultural management logics. 3. Building on emerging creative hubs > Opportunities > Challenges > Emergence of new venues for business > Lack of support for the creative development in Yerevan and in the regions. community to access and make use of new spaces. > Libraries are being renovated and re- equipped to become knowledge centres. > Cultural institutions require new management and business models, in order to serve as focal points for experimentation and showcasing. > Lack of availability of up-to-date technical equipment in cultural institutions, notably in schools and cinemas. 4. Easing access to specific funding and support > Opportunities > Challenges > Emerging interest of private funding to > State funding to arts and culture lacks CCIs, notably from international competitive procedure targeting the organisations and companies based in diversity of CCIs stakeholders. Armenia. > Absence of beneficial regulatory > Specific state funding to literature and framework to encourage sponsorship. publishing has recently become more > Lack of specialized support services and focused. alternative funding sources to creative enterprises. > Creative enterprises face complex and heavy tax framework and accountancy procedures. > Deficient copyright awareness and management. > Lack of specific up-to-date legal framework promoting cinema and audiovisual sector. > Media and broadcasting laws do not foster market pluralism. 5 5. Improving creative entrepreneurial education and skills > Opportunities > Challenges > State goals include the improvement of > Creativity and entrepreneurship are not cultural education system. promoted within overall education curricula. > Number of private sector initiatives pave the way to a more creative education system. > Artistic education and training lacks associated management and communication skills and it does not respond well to market changes and needs. 6. Developing audiences and markets > Opportunities > Challenges > Diverse private initiatives to connect CCIs > Lack of audience development and user- with wider audiences. engagement strategies. > Difficult access to cultural offer in the Marzes. 7. Encouraging internationalisation and cooperation > Opportunities > Challenges > Internationally well connected CCIs > Random and fragmented support to community. international mobility prevents long-term maintenance of international links and > Potential membership of the Creative partnerships. Europe Programme is being negotiated. > Irregularity in festivals operations prevent > Official recognition of the relevance of the unleashing of their full potential to act culture and cultural identity to brand as focal points for internationalisation. Armenia internationally. > Lack of a cultural diplomacy strategy > State policy to foster young talents and integrating a wide range of CCIs. support their education and presence at the international stage. > Commitment to increase international links and opportunities for Armenian cinema. > Festivals act as hubs for regional and wider international cooperation. Recommendations for developing CCIs in Armenia 1. Policy-making, Participation and Platforms. > Create an integrated CCIs policy > Set up collective platforms and engage stakeholders > Promote interactions between CCIs, tourism and IT sector 2. Infra-structure, Funding and Frameworks > Diversify funding sources > Create favourable supportive environment > Strengthen evidence-based management system 6 3. Skills, Audiences and Markets > Launch awareness-raising initiatives for CCIs > Foster creative skills and entrepreneurial mindset development > Develop new audiences and markets 4. Internationalisation and Cooperation > Promote Armenian talent and creativity worldwide > Provide opportunities for international cooperation and trade Team and Acknowledgements Cristina Farinha, Senior Expert (Portugal), author. Zviad Mchedlishvili, Junior Expert (Georgia), national adviser and contributor. We would like to thank all those that knowledgeably and kindly contributed to the realisation of the six cultural and creative industries reports in all of the Eastern Partnership countries. From the EU-EaP Culture and Creativity Programme: Ragnar Siil, that envisioned and guided the whole process through, and Tim Williams for relevant insights; and Norayr Yerznkyan the Programme’s Armenia country coordinator for organising the field trips as well as provision and checking of up-to- date information. In all six EaP countries: all various sector stakeholders, who have generously participated in meetings and workshops and guided our visits (see list in Appendix B). Finally, we would like to thank all colleagues and friends that enthusiastically have suggested inspirational links, cases and advice. 7 2. CREATIVE INDUSTRIES IN THE EU The cultural and creative industries (CCIs) have been recognised by the EU and integrated into its policy documents1 and programmes for more than a decade. The creative economy, a wider sector that goes beyond traditional arts and culture disciplines and comprises a larger number of interconnected activities and sub- sectors has a potential that is being acknowledged by other international organisations such as the Council of Europe, different United Nations organisations2 as well as by national, regional and local governments and institutions worldwide. Prior to this the sector’s capacity to generate non-market values had long been considered in terms of symbolic, non-material and educational input. More recently, there has been a growing understanding that the sector can impact the economy directly and indirectly by generating growth and jobs, stimulating innovation, and contributing to social and sustainable development. Research and data collected worldwide support this assumption. In the EU, the core creative industries generated 558 billion Euros in value added to GDP - approximately 4.4% of total European GDP, according to data from 2011.3 These industries represent approx. 8.3 million full time equivalent jobs or 3.8% of the total European workforce. Statistics also show that most CCIs have a higher percentage of youth employment than in the rest of the economy, and the sector has proven very resilient compared to others during the 2008 economic and financial downturn in Europe. Global economic data for 20134 shows Europe leads this sector and is becoming a catalyst for development. The CCIs generate 3% of world GDP (2,250 billion US Dollars in revenues) and provide 29.5 million jobs worldwide. Despite this growing recognition, their development has been slowed down by the fact that the CCIs overlap diverse policy areas such as culture, education, economic and urban/regional development. In recent years, the debate about the role of CCIs in the EU has focused on following key issues: > Mainstreaming CCIs into the EU strategic agenda to foster a holistic European wide ecosystem. CCIs remained largely absent and an untapped resource in the EU2020 strategy5. At a higher level, some EU institutions are recognising the role of culture in achieving the Sustainable Development Goals and efforts are being made to consider culture as a key driver in its response to the 2030 Agenda for Sustainable Development. The EU needs to further acknowledge and invest in CCIs and explore its potential to contribute to growth and employment; to become a catalyst for innovation; and a key element in global competition and soft power. Innovation, entrepreneurship and CCIs have been 1 Such as the Communication on promoting the cultural and creative sectors for growth and jobs in the EU (2012), the Communication on cultural heritage (2014) and the European Parliament Resolution on a coherent EU policy for cultural and creative industries (2016). 2 UNESCO – United Nation Organisation for Education, Science and Culture; UNCTAD - United Nations Conference on Trade and Development; UNDP-United Nations Development Programme. 3 Tera Consultants (2014) The Economic Contribution of the Creative Industries to the EU in terms of GDP and Jobs. 4 Ernst & Young (2015) Cultural Times: The first global map of cultural and creative industries, CISAC- International Confederation of Authors and Composers Societies. 5 https://ec.europa.eu/info/business-economy-euro/economic-and-fiscal-policy-coordination/eu-economic- governance-monitoring-prevention-correction/european-semester/framework/europe-2020-strategy_en 8 officially ear-marked as cross-cutting topics6 in EU programmes such as Horizon 2020 research and innovation, COSME for SMEs (including Erasmus for Young Entrepreneurs), Start-up Europe, Erasmus+, INTERREG-Territorial Cooperation and the EU structural and cohesion funds. > Integrating the competitive advantage of CCIs into regional development “smart specialisation” strategies for regional promotion, innovation and social-economic development. CCIs have the capacity to interact with other activities that often give rise to agglomeration and clustering effects that tend to contribute to a high proportion of added value locally. Several EU regions have been channelling structural and cohesion funds to CCIs, especially for mapping assets, resource mobilisation, strategic partnerships and clusters and improving the infrastructure and services. > Recognising CCIs strategic relevance for urban development policies, notably through the European Capitals of Culture (ECOCs) initiative. Cities have always been suitable locations for artists and creatives to thrive. Emerging creative hubs, new hotspots where professionals create, meet, collaborate and showcase their work are becoming drivers for city regeneration, giving new functions to abandoned industrial areas or disused buildings, which attract parallel services and businesses. ECOC, the EU long-standing flagship initiative, has evolved from an international artistic and cultural programme into a more structural initiative, which engages cities to include cultural development and CCIs into the strategy of their development policies. ECOCs bridge European cooperation and culture with innovation, tourism and urban planning stakeholders. > Incorporating CCIs into innovation and research and development (R&D) programmes. The capacity of CCIs to contribute to innovation processes has been only gradually recognised and supported. Since 2010 the Innovation Union (an EU2020 flagship initiative)7 has highlighted that innovation is increasingly driven by non-technological factors such as creativity, design, branding and new organisational processes. The initiative also noted that user-driven innovation processes and the role of CCIs in establishing meaningful relations and connecting with audiences and citizens are important. > Promoting spill-over effects in other industries and society. CCIs have a strategic position to bring about spill-over effects in other industries and fields, as they overlap art, science and technology. Cultural and creative skills can be valuable for other professional areas, CCIs can provide content for ICT, impact tourism and be integrated into several stages of value chains, notably manufacturing and high- end industries. This catalytic potential is also a resource for social innovation, health care and social challenges, such as environmental issues. Breaking down silos and fostering cooperation among diverse policy areas are required to facilitate this cross-sectorial fertilisation as well as promoting clusters where different stakeholders can collaborate. > Refining capacity to respond to new opportunities that digital technologies bring into CCIs value chains. The fast development of digital technologies is making the internet the main marketplace, thus contributing to the increasing 6 2015 Council conclusions on 'Cultural and creative crossovers to stimulate innovation, economic sustainability and social inclusion'. 7 European Commission (2010) Communication on Europe2020 flagship initiative Innovation Union. 9 complexity of creative industries value chains. This means CCIs need to constantly learn new skills and adapt their means of remuneration. ICT is also bringing new opportunities for CCIs regarding business models and more direct forms of interaction with audiences based on co-creation and further user-engagement. The EU is monitoring the digital change in creative value chains to address all consequent market imbalances, build capacity and foster diversity of contents and expressions. > Improving access to finance, notably through the EU’s new CCIs guarantee facility. Access to diverse funding sources is a crucial barrier for CCIs. The Creative Europe Programme (2014-20) earmarked €121 million to a financial mechanism acting as insurance to financial intermediaries (e.g. banks) offering loans to CCIs initiatives. The financial intermediaries will be also provided training programmes to better understand the needs of CCIs projects. > Promoting cross-border networking and alliances of creative hubs and creative entrepreneurs – The European Commission is supporting European Creative Hubs Network8 (ECHN) and Creative Tracks9. These pilots are building up communities by circulating information and promoting gatherings, peer-to-peer training programmes, mapping, matchmaking facilities and competitions, and offering a common stage for these support structures across the globe to share and learn from each other. > Developing a qualitative and quantitative understanding of CCIs impact – the Cultural and Creative Cities Monitor10. The European Commission together with Eurostat – the EU statistics office – and its Member-States, as well as international organisations such as UNESCO and OECD, have been working on the improvement and international harmonisation of data collection and analysis of the contribution of CCIs to economy and to overall society. There is a growing need to further invest in new ways of capturing CCIs qualitative effects. Other information- gathering methods such as storytelling and interviews are being considered. In 2017 the European Commission and the Joint Research Centre launched the Culture and Creative Cities Monitor. This platform maps and monitors CCIs assets in selected cities (currently 168) and measures their quantitative and qualitative value and impact in a systematic and comparable way. This tool is a step to support efforts to put culture at the heart of cities’ development agendas and to develop new ways of analysing and producing evidence for CCIs. > Highlighting the role of CCIs to EU external relations in opening up new markets and contributing to sustainable development and cultural diversity across the globe. The EU Council has recently adopted conclusions that endorse the European Commission communication11 on the new EU strategic approach to international cultural relations. Recognising the pioneering role of Europe in the CCIs sector, it will contribute to creating a conducive environment for CCIs to continue expanding creating growth and employment, support cultural production as driver for tourism and development, while opening up new channels of communication, intercultural dialogue and peace building. 8 http://creativehubs.eu 9 http://www.creativetracks.org 10 https://composite-indicators.jrc.ec.europa.eu/cultural-creative-cities-monitor/ 11 European Commission (2016) "Towards an EU Strategy for international cultural relations". 10