Speech By Dr Balaji Sadasivan at the 2nd Joint Bluesky-Greenfield Event
Distinguished speakers and guests,
Ladies and Gentlemen,
1. It is my pleasure to join you this evening for the second BlueSky-GreenField event, which is part of GreenField 06. GreenField 06 is a key event launched by Creative Community Singapore , or CCS this month, to inspire creativity and promote entrepreneurship in the community.
2. It is apt that CCS is partnering the Action Community for Entrepreneurship, ACE, in this networking session to promote the exchange of ideas and business collaborations. This is because a critical pillar of entrepreneurship is creativity and innovation - in design, new business concepts and technology application. The entrepreneurs who are most likely to succeed will be those who have created unique value propositions based on such intellectual properties. As ACE seeks to foster entrepreneurship, the creative industries are critical players in this process; as catalysts working closely with the entrepreneurs to enhance creative contents in their businesses and as entrepreneurial businesses generating value added and employment for the economy.
GROWTH OF THE CREATIVE INDUSTRIES
3. The global market value of the Creative Cluster, in 2005, was estimated at more than US$1 trillion. The Creative Industries are estimated to account for more than 7% of the world's gross domestic product or GDP and the sector is forecast to grow by an average of 10% annually.
4. Similarly, the prospect of the Creative Industries in Singapore is bright. Between 1995 and 2003, the value added for this sector grew at 7% compared to 4% for the general economy and employment grew by 5.5% per annum compared to 2.3% for the whole economy.
5. In the digital media space, renowned international brands like AXN, BBC World, CNBC Asia, and Discovery Networks Asia are already anchored here. RGM Holdings, a leading talent management company, is the latest to set up its headquarters and a US$100 million media financing facility here.
6. We have also seen a rise in the number of global players such as Motorola, BMW DesignWorks and Hewlett-Packard locating their design activities in Singapore . BMW DesignWorks chose Singapore over Tokyo , Seoul and Shanghai , for its first design studio in Asia .
7. In the performing and visual arts arena, the Singapore Biennale 2006 (SB2006), our first international contemporary art event, featuring more than 95 artists and artworks from over 85 countries, was successfully launched in September this year. We will also continue to attract key players. IMG, a global arts management company, for example, has already set up a new Asia regional HQ in Singapore .
CHALLENGES IN FINANCING THE CREATIVE INDUSTRIES
8. Whilst we will continue to attract the large as well as niche players to Singapore , there is also a need to seed and grow local entrepreneurial talent in the Creative Industries. In doing so, a fundamental issue faced is financing.
9. The Creative Industries is dependent on the intellectual property of its ideas and creations. There are often no tangible assets to serve as collaterals for loans. The commercial value of artistic and aesthetic creations, although present, may not be as apparent as that of traditional products and services. As a result, investors and banks often see these enterprises as high risk ventures.
10. I understand that the ACE Finance Crucible under Mr. Inderjit Singh is hard at work exploring alternative financing instruments with the private sector, for such asset light businesses. It is also through platforms like this that we can raise awareness, amongst the finance community, of the attractiveness and viability of this industry.
11. The Government has initiated various schemes to plug this financing gap. One such programme is the Start-up Enterprise Development Scheme or SEEDS which matches each dollar invested by third party investors in a potential startup. Managed by EDB and SPRING Singapore , SEEDS has invested in companies like ComiAsia, an aggregator of online content, and Digipix, a 3D animation media company.
12. Another government agency, the Media Development Authority of Singapore or MDA has also put in place various development and funding schemes to help media professionals and enterprises do what they are good at – transforming their stories and ideas into reality.
CREATIVE INDUSTRIES FUND (CIF)
13. Going forward, we need to foster a deeper appreciation of the Creative Industries by financiers, so that pragmatic risk assessments can be made and more financing schemes tailored accordingly. Private sector organisations, being in close touch with the industries, are well placed to identify their needs, deliver assistance and enhance industry competitiveness. We will partner the private sector to provide support to the creative enterprises.
14. A n example of such a public-private sector collaboration initiative is the setting up of the Creative Industries Fund or CIF. The new investment fund will be launched by INC 3 , a private Creative industries incubator company supported by Creative Community Singapore , and CIF Management, a private venture capital company. CIF aims to help bridge the funding gap in the Creative Industries and Mr Tan Kim Seng, Managing Director of 3V SourceOne Capital, will later elaborate on his passion to support the setting up of this fund.
15. In conclusion, I would like to thank ACE for co-organising this networking platform with CCS. We greatly welcome such platforms and exchanges for creative professionals and the business community to network and create business synergies. It is through such exchanges that we can learn from one another and tap on each others' strengths.
16. I wish you a pleasant evening. Thank you