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Developing cultural industries and building and perfecting a market of cultural services and products in Vietnam
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Art performance entitled "Echo of Huong River" with attractive sound effects and lighting. Photo: VNA

The process of renovating cultural institutions in association with the development of cultural industries in Vietnam

1. Acceptance of cultural market, renovation of mechanisms and socialization of cultural services and production.

The Resolution of the 5th Plenum of the 8th Party Congress "On building and developing an advanced culture deeply imbued with national identity of Vietnam" emphasized economic potential in cultural development, concluding that to build and develop an advanced culture deeply imbued with national identity, it is necessary to consolidate, develop and perfect cultural institutions. Since then to 2000, changes in cultural institutions became a "guarantee factor" for the development of cultural industries, although they were semi-industrial, a “measurement” of the State’s organization and management of the development of cultural production and created the basic premise for Vietnam to join the World Trade Organization (WTO). The Conclusion of the 10th Plenum of the 9th Party Congress in 2004 identified that linking economic with cultural development, and socialization of cultural activities with production and trade of cultural products in the context of transforming the nature and structure of the economy is the basis for building and perfecting economic, cultural and social development institutions. In June 2008, the Politburo issued Resolution No.23-NQ/TW on "Development of literature and arts in the new era," which affirmed the development of means, production forms, performance, use, distribution of literature and art products brought home to the public many works, contributing to meeting people’s increasingly diverse needs. This is a meaningful resolution accelerating the establishment of domestic market and at the same time bringing quality literary and art products abroad.

Beside specialized directives and resolutions for cultural development, there are other Party lines related to the development of cultural industry, such as the Conclusion of the Politburo of the 11th Congress in 2011 on "Renovation of operation mechanism of public non-business agencies, and socialization of some public non-business services.” This shows that cultural activities are also “business” in the context of market mechanism. In 2014, at the 9th Plenum of the 11th Congress, the Party adopted Resolution No.33-NQ/TW on "Building the Vietnamese culture and people to meet the requirements of sustainable development of the country," which set out the task of “renovating and perfecting institutions, creating a favorable legal environment for building and developing culture market and cultural industry." (1)

2- Building institutions and policies for cultural industries.

After the Resolution of the 5th Plenum of the Central Committee of the 8th Party Congress, Vietnam has enacted, amended and supplemented many laws to build a favorable and effective legal environment for cultural industry development. The policy on socialization of cultural and artistic activities was formulated and promulgated in order to attract resources, economic sectors and people of all walks of life to participate in cultural production and service activities. In addition to the Intellectual Property Law, and tax incentive policy, there are other laws and legal documents closely related to providing the legal framework appropriate for the development of cultural industries. These legal documents have been supplemented and modified to conform to actual situation, such as the Law on Cinematography, the Press Law, the Law on Publication, the Law on Advertisement, the Law on Cultural Heritage, among others. In addition, there are also decrees and regulations relating to cultural activities and public cultural service business. Localities have paid attention to institutionalize Party policies and State law on cultural development, issuing many legal documents relating to cultural industries.

3-Development and promulgation of the "National Strategy for the Development of Cultural Industries to 2020, with a vision to 2030."

Pursuant to Resolution No.31/ NQ-CP dated 13 May 2014, on Promulgation of the Government's Program of Action to implement the Politburo’s Resolution No.22-NQ/TW dated 10 April of the Vietnamese Communist Party Central Committee on "international integration," Vietnam developed the "National Strategy for the Development of Cultural Industries to 2020, with a vision to 2030." The Strategy approved by the Prime Minister in Decision No.1755/ QĐ-TTg on 8 September 2016 identifies that cultural industries are creative industries based on cultural resources, applying scientific, technical and technological advances to create cultural products and services through industrial production. The products and services are distributed, exchanged and consumed in the market. At present, cultural industries in Vietnam are only small-scale production establishments, or semi-industrial establishments at their initial stage. The creation, production, distribution and dissemination of cultural products are largely undertaken by the public sector. Private, non-public entities have mainly involved in the circulation of the market. This participation is fragmented, spontaneous, and non-professional. Building on research results and the state management functions of ministries and branches, the Strategy identifies that Vietnam's cultural industry structure with 12 branches including advertisement, architecture, software and games, handicrafts, design, cinematography, publishing, fashion, art performance, fine arts, photography and exhibitions, television and radio, and cultural tourism. The Strategy sets a target that by 2020, cultural industries will contribute 3% of GDP and create more jobs for society; and by 2030, turnover of cultural industries will contribute 7% of GDP.

The launch of the Strategy is the result of institutional reform in cultural industry development, and demonstrates efforts of policy makers to develop modern cultural industries in the process of international integration, and focus investment to bring about real effectiveness to society.

Impacts of institutional innovation on the development of cultural industries and markets of cultural services and products

1.Diversification of forms of ownership, expansion of markets, and encouragement to develop cultural industries.

The domestic market of more than 90 million people is one of the advantages of Vietnam's cultural industries when the country is socializing cultural production and services to ensure potentials of sub-sectors in cultural industries can be consumed. In addition, the expanding Asian market is also a great opportunity for Vietnam’s cultural industries. Thus, while diversifying forms of ownership and socializing cultural production and services, Vietnam has created favorable institutional frameworks for stakeholders to join in cultural production and services in the music, cinema, art performance, fashion, online games markets. (2)

In addition to transformation of the structure of ownership, Vietnam's annual expenditure on cultural activities accounts for 1.8% of total state budget expenditures. By 2015, the total investment for cultural development reached US$26.7 million and for the National Target Program on Cultural $12.7 million. The State’s permission for the private sector to establish private film studios and cinemas, organize art performances, and cooperate with dozens of printing facilities has created a favorable legal environment for individuals, enterprises, social organizations in and outside the country to invest in cultural activities and provide a variety of cultural services and products. With such a support in mechanisms and policies, by 2015, Viet Nam basically established a cultural market and infrastructure capable of promoting the 12 cultural industries. Institutional changes have helped Viet Nam gradually transform non-business cultural units into state-owned business cultural units such as film production and distribution units, and art troupes. Besides, licenses have been given to new culture business units with the participation of different stakeholders. This is a breakthrough that broke the single ownership system, has step by step "untied" production force, encouraging socialization and implementation of preferential policies to support cultural production and services heading toward a diverse ownership structure (public ownership, private ownership and mixed ownership), formation of new cultural industries, expansion of market and international integration of cultural industries.

2- Renovation of policies and mechanisms has given impetus to a number of cultural industries, diversifying services and products.

For cinematography: After 1986, Vietnam’s cinematography transformed from a subsidized mechanism into a self-accounting mechanism with partial state budget allocation. In this period, the number of movies produced with the state subsidy dropped sharply, video films (called "instant noodles" in Vietnam) were produced and quickly dominated the market. This type of film and video studios are considered the first subjects contributing to the formation of the Vietnamese film industry. This kind of movies and the record sales they brought about led to the Government’s adjustment of film development policy. Decree No.48/CP of the Government, issued in July 1995, opened the revitalization of cinematography through film consolidation and development programs. In 2002, clearer changes were made in the cinematographic sector when Decision No.38/2002/QD-BVHTT of the Ministry of Culture and Informations on “Regulations on conditions for setting up film production establishments and authority and procedure to review film" recognized the full legal status of private film studios. The decision created a favorable institutional environment for private film studios to enter the market. Private film studios have been established. In addition to the five major state-owned film studios, there are 25 studios affiliated to mass organizations, and localities and about 30 private film studios. In 2009, only eight feature films were produced, including four from private labels. Recently, the production of state-invested films has been commissioned to private film production studios which has made a breakthrough in the development of the film industry. According to statistics in 2015, eight feature films commissioned by the State were put to cinema houses, while 32 films were produced by private studios. By 2015, cinema revenues were estimated at $102 million, of which revenue of Vietnamese movies accounted for 30%. The “fever” in late 2015 to mid-2016 and recently for Vietnamese movies such as "I see the yellow flowers on the grass" produced in 2015, "I am your paternal grandmother" in 2016 , "Brilliant years" in 2018 has shown positive impacts of institutional reform on the development of the Vietnamese film market.

For performing arts: Institutional changes have facilitated the emergence of new types of entertaining performing arts in Vietnam, in which many new arts programs have shown the potential of cultural industries in arts performance and entertainment. A number of outstanding products and services have been formed, creating international brands, such as circus "My Village", and puppet show "Country Rhythm.” Recently, the impressive "Ionah" show, a variety show including dance, drama, new circus, hip hop, visual arts, music, effects, lighting has attracted audiences of different generations in Hanoi as well as foreign tourists. Besides, stable progress has been made in production, circulation and sales of audio and video recordings of songs, dance, music, and dramas. According to the Department of Performing Arts, in 2015 revenue of the industry was about $5.2 million, revenue growth was estimated at about 5% per year. (3) Initial statistics show that this is an industry which has made many positive changes due to cultural institutional change in recent years.

Deepened international integration has facilitated the access, transfer and application of modern scientific and technological advances to creating and producing cultural industrial products. Some industries have made certain progress in domestic and foreign markets. In 2014, the software and game industry had recorded a turnover of more than $1.407 billion, attracting over 60,000 employees, each earning over $19,000 per year; advertising revenue in the media in 2015 reached over $1 billion; the tourism industry in 2015 bagged a total revenue of VND337.830 billion, of which cultural tourism accounted for about 10%. According to incomplete statistics in 2015, the cultural industries of Vietnam contributed about $8.039 billion, accounting for nearly 2.68% of GDP. Thus, with positive changes in policy and institutions, especially economic policies in the culture sector, encouragement of stakeholders’ participation, domestic and foreign investment in cultural industries, Vietnam's cultural industry market has made progress and certain contribution the country’s GDP growth.

However, Vietnam’s cultural industries have not developed on par with its potentials and strength despite institutional reform in the field of cultural industries. The number of projects related to the cultural industries is few. At present, only small-scale production enterprises and businesses not big corporations for multi-functional groups have engaged in production and provision of cultural products in Vietnam State-owned enterprises are still inert and lack dynamism. Non-state enterprises lack mechanisms and resources for development. Basically, the production, distribution and dissemination of cultural products have still mainly carried out by state-owned units. Private businesses have mainly involved in the circulation of the market which is still scattered, spontaneous, and non professional.

In the market of cultural industry products, violations of copyright are rampant in all areas of the cultural industries, such as music, cinematography, games online, fashion, and design. Copyright infringement makes creators, producers and providers of services less likely profit from the production and distribution of their products, ruining business model and causing difficulties for the development of enterprises. Businesses are less confident in developing business models due to lack of understanding of legal regulations. Copyright violations are considered visible threat to the cultural industry market in Vietnam if no solutions to address the situation is taken in time.

In addition, the financial investment mechanism in the field of culture only relies on government investment and neglects capital mobilization. Therefore, in order to renovate the cultural investment mechanism and to make it commensurate with the socialist-oriented market economy, Vietnam must solve the problem of capital “bottleneck.” The renewal of the investment mechanism has greatly benefited the promotion of structural adjustment of ownership and cultural industry structure through increasing capital attraction for investment. This can activate the State inventory capital, prioritize the capital structure in state-owned cultural enterprises, facilitate the placement and arrangement of human resources through cultural resources, solve problems in the organic relationship between the two components of production, namely capital and human resources in cultural development, facilitate the training of stakeholders in using investment capital, step up exploiting cultural industries in the region, restructure and adjust capital resources, and help corporations and units become stronger.

Towards healthy and sustainable development of the cultural industry and market

After more than 30 years of innovation, institutional renewal in the field of culture with more cautious steps has taken place later than institutional renewal in the field of economy. However, changes in the legal framework for cultural management have had significant impacts on the development of culture in general and cultural industries in particular. From a heavily-subsidized sector, Vietnam’s culture transformed towards cultural industries which, although still very fragmented, have brought new vitality to the recovery and development of national culture values through creation and diffusion of these values in the form of cultural services and products. The development of Vietnam's cultural industries is entering a new stage with both favorable conditions and difficulties and challenges. Deepened international integration does not only give great opportunities for creating cultural products but also put great pressure on competition. In this context, the development of Vietnam's cultural industries in the future is partly influenced by the progress of the cultural reform of the Government. Therefore, Vietnam needs to develop the cultural industries in parallel with building and perfecting the market of cultural services and products by taking the following solutions:

First, promote communication to raise awareness and responsibility of all levels, branches, localities and the whole society on the position and role of cultural industries in socio-economic development; raise the awareness of businesses in investing in culture as a part of business strategy and responsibility to society and community; mobilize broad and effective participation of the mass media in communicating Party lines, State laws and policies on the development of cultural industries.

Second, build, supplement and perfect mechanisms and policies for cultural industry development in the new period in order to facilitate businesses of cultural products and services, and improve observance of Intellectual Property and related rights, promote fair competition in the market; issue preferential policies on capital, tax, land to encourage artists’ creativity and start-up businesses. Review, adjust and supplement the mechanism for effective coordination among ministries and branches, ensure synchronousness and avoid overlapping and duplication, enhance decentralization in the administrative system, at the same time step up monitoring, control, inspection, and supervision of public-duty performance, strengthen organizational model, and enhance capacity of copyright centers and copyright service organizations. Continue implementing strategies and plans on development of cultural industries already approved by competent authorities.

Third, develop a plan on human resource development, promote knowledge exchange, improve professional capacity, and train professional human resources for cultural industries. Renovate content and training programs to improve capacity and management and business skills in cultural industries; enhance connectivity and cooperation to facilitate higher education and research institutes to effectively participate in the development of human resources in particular and cultural industries in general. Train and retraining staff working on management and enforcement of copyright and related rights; Regularly organize professional training on copyright and royalty collection; and form a team of experts in cultural industries and copyright sector. Adopt appropriate incentive mechanism to attract high-quality, qualified, and experienced human resources from countries with high development level of cultural industry to work in Vietnam.

Fourth, boost the application of science and technology in the creation, production, dissemination and preservation of cultural products and improve cultural service quality; renovate contents and modes of operation of cultural industries while applying modern science and technology; heighten scientific and technological content in cultural industries’ product and service chain. Renovate and develop traditional cultural products and services, such as printing, publishing, distribution, arts performance, film production, entertainment, advertisement and exhibitions.

Fifth, formulate preferential policies, step up communication, increase investment to develop potential cultural industries of advantage, such as cinematography, arts performance, advertisement, handicrafts, software and games, television and radio, fashion, and cultural tourism. Encourage domestic and foreign enterprises to invest in cultural activities, and production of cultural products and services; develop a business network, in which a number of major corporations in cultural industries in the areas of communication, cinematography, radio and television, software and online games are established. The State creates a favorable legal environment, supports investment in human resources development, promotes and develops the cultural market, creates market linkages for branches, crafts and regions and builds national brands for cultural industries; diversifies investment models; encourages formation and development of investment funds in the field of culture while strengthening the role of professional associations in investment and supporting creative activities, production, distribution, dissemination and consumption of cultural products and services.

Sixth, gradually form a community of consumers of domestic cultural products and services through publicity, increase public access and use of cultural products and services; bring into play communication and education role of cultural units and organizations in order to heighten the public’s understanding and enjoyment of cultural products and services. Renovate production technologies, improve production capacity and create new cultural values as well as high-quality cultural products and services for national and international cultural markets; and build quality brands for cultural businesses, product and services.

Seventh, expand exchanges, international cooperation, organize annual international cultural and arts events in Vietnam and make them prestigious events in the region and the world attracting famous artists and cultural and arts organizations of public concern. Develop and implement programs to promote brand names of Vietnamese cultural products and services, and businesses, cultural talents of the country at international fairs, and festivals; incorporate programs to promote cultural industries in diplomatic events. Boost the export of cultural products and services, expand exchanges and cultural exchanges with other countries in the region and the world; build and develop a market for cultural products and services of Vietnam overseas; and issue policies to support businesses’ participation in and development of international markets.

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(1) See http://www.tapchicongsan.org.vn/Home/Tieu-diem/2014/27706/Xay-dung-van-hoa-con-nguoi-Viet-Nam-dap-ung-yeu-cau. aspx

(2) See http://www.tapchicongsan.org.vn/Home/Nghiencuu-Traodoi/2018/49765/Phat-trien-cac-nganh-cong-nghiep-van-hoa-Viet-Nam-thuc.aspx

(3) Report of the Ministry of Culture, Sports and Tourism in 2015

This article was published on the Communist Review, No. 910 (August 2018)

Nguyen Ngoc Thien, PhDMember of the Party Central Committee, Minister of Culture, Sports and Tourism