South African Cultural Observatory

Why innovation and creativity are interlinked

BY Unathi Lutshaba 28.06.23

EXCITING NEWS! Nelson Mandela University and partners bid to host the South African Cultural Observatory for a third time late last year. A few months ago we were selected as the winning bidder. This means another five year contract for Nelson Mandela University, and our partners new and old. We will share some more information on this in the next few weeks.

But at a very high level I am delighted to take the SACO forward. By trusting us with the project for the third time, the Department of Sport, Arts and Culture, continues to invest in a national cultural information system. By building upon the foundation we’ve established, we’ll advance our research capabilities on the creative economy – and expand our focus to include sport.

 SACO at World MSME Day in New York

This week I spoke at World MSME Day at the United Nations headquarters in New York. Since most cultural and creative enterprises are micro, small, or medium sized enterprises, and given the contribution they make to economies globally, it makes sense that CCI MSMEs are profiled and supported.

The theme for this year's celebration was: "Galvanizing MSMEs worldwide by supporting women and youth entrepreneurship and resilient supply chains." Read my remarks and watch the video below.  

World MSME Day speech at the United Nations

Honorable delegates, distinguished guests, ladies and gentlemen,

It is an immense honor to stand before you today as the Executive Director of the South African Cultural Observatory, representing the vibrant and diverse creative and cultural industries or the CCIs of my beloved country on the exciting – and very important – occasion of World MSME Day.

I would like to express my deepest gratitude to the United Nations for providing this platform to shed light on the pivotal role of MSMEs within the creative and cultural sectors of South Africa.

As we all know, the cultural and creative industries are the bedrock of nations and societies.

They provide us with the spice of life. From reading to watching films; to music and concerts; poetry and performance; or simply the way we move through and engage with cities, or enjoy festivals and events, these industries create meaning.

In South Africa, and across the world, they also create jobs.

The CCIs hold immense significance for our nation, serving as the cornerstone of our cultural heritage and diversity, artistic expression, and playing an emerging role in our economic growth.

MSMEs within creative sectors are also the driving force behind innovation, job creation, and the preservation of our diverse cultural identities in South Africa.

At the South African Cultural Observatory, our mission is to understand, analyze, and support the development of the CCIs; and by extension MSMEs, since most enterprises in the creative sector are single freelancers to smaller outfits.

Through our rigorous research and analysis, we strive to provide valuable insights into the economic and social impact of these industries, enabling evidence-based policymaking and strategic interventions.

Because of our work, we know that the South African cultural and creative industries contribute 3% to our national GDP, create close to one million jobs, and bring untold benefits around social cohesion, mental health, and community.

But our Mzansi Golden Economy can be bigger, be greater. Especially if we support MSMEs across the board.

Let me touch on how and why.

Firstly, MSMEs are business in South Africa.

  1. According to the Small Business Institute, MSMEs employ between 60-70% of South Africa’s workforce.
  2. The Small Enterprise Development Agency and Small Business Institute, respectively, reported that as in 2019, there were approximately 2.4 million MSMEs in South Africa, accounting for about 98.5% of formalized businesses in the country.
  3. The Department of Arts and Culture and SACO’s work shows that 60% of cultural and creative businesses in the country fall into the MSME category and employment opportunities within the cultural and creative sector are largely driven by MSMEs.
  4. And the Global Entrepreneurship Monitor South Africa Report 2020-2021 says our creative industries had the highest entrepreneurial activity rate compared to other sectors.

Knowing these facts, and secondly, we must consider how innovation and creativity are linked.

MSMEs are the site from which the innovation will emerge.

For this, innovation needs to be imbued with the creativity and problem-solving that’s already inherent in CCI related work.

Think of how an architect approaches an urban design challenge to integrate communities; or a designer a campaign to change minds about fossil fuels; or how an animator conceives of a powerful story that influences how children deal with bullying.

But innovation today is still mainly only associated with the fields of Science, Technology, Engineering, and Mathematics or STEM.

But if we include the arts and creativity in general – and take a STEAM approach – there will be greater recognition – and ideally funding an support for the remarkable creativity and innovation emanating from CCI related MSMEs.

To encourage this, we need to look at maps, as we have done at the SA Cultural Observatory.

What we have found is that CCIs tend to cluster in certain geographic areas is their inherent capacity for innovation.

These creative hubs are catalysts for exchange, collaboration, and inspiration, nurturing an environment where ideas flourish and artistic expressions thrive; and which spillover into other key areas and sectors.  

The cross-disciplinary nature of the creative sector MSMEs means that there is a constant exchange of ideas, thereby leading to a wider perspective on issues that drive innovation.

The Cultural Observatory has been instrumental in identifying and supporting these clusters and the many MSMEs that make them up through research and analysis.

But the positive innovation evidence also points to fault lines: artist rights, IP, copyright, finance, access, inequality, gender parity, and policy-support are all tenuous.

As the world changes and technology accelerates so rapidly – from AI to other frontier technologies – a wave of change is awash amid the creative sector.

The outcomes will be both positive and negative – especially for MSMEs.

New enterprises will emerge, freelancing will explode even further, and older established entities may fall away – all impacting MSME ecosystems and national economy engines.

We need to protect the intellectual property rights and copyright rights of creatives and artists, and indeed all innovators to spur wide innovation and problem-solving.

However, it is disheartening to note that women remain underrepresented in key cultural sectors such as film, architecture, and photography.

This lack of diversity and inclusivity hampers the growth and development of the CCIs, depriving us of the full spectrum of talent and perspectives – and innovative ideas.

We must support our creatives and indeed the most vulnerable among them: women, young people and people with disabilities.

In conclusion, as we celebrate World MSME Day, let us not underestimate the power of the creative and cultural industries to drive innovation, foster economic growth, and promote social cohesion.

Let’s work together to create an enabling environment that nurtures the talents of our artists, embraces diversity and inclusion, protects intellectual property, and empowers MSMEs within the CCIs.

I thank you.

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