Looking inward has hurt Kenya's creative industries

Monday February 1 2016

By BITANGE NDEMO
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One of the fastest-growing sectors of the world is the creative economy. 

The “creative economy” loosely refers to a range of economic activities concerned with the generation or exploitation of knowledge and information.

It includes entertainment, sometimes known as show business or showbiz, film, animation, gaming, publishing, fashion and several other sub-industries devoted to entertainment.

The 2015 Otis Report on California’s creative economy says that in 2013, the industry in that state was worth $293.8 billion, directly employing close to 700,000 people.

Put differently, one in ten jobs in California is in the creative economy.

If we dare to imagine that we in Kenya can attain at least one per cent of this sector’s achievements in California, it would translate to close to roughly $3 billion, the equivalent of what we borrowed from China to build the standard gauge railway.

We would have elevated the sector to one of the highest contributors to our GDP. This is not just imagination gone wild. It is attainable.

When I addressed some 300 young filmmakers at the Michael Joseph Centre last week, I saw the energy, the will and determination to achieve. I was left with no doubt that our young people are as capable as the best in the world.

Nigeria already is approaching the little amount we are daring to dream of. Our own Riverwood churns out billions of shillings but still remains an underground economy. 

We know the missing link. During the Kibaki administration, we attempted to change this sector and streamline it for growth.

CO-PRODUCING SHOWS

We noted the loose ends and started to tighten them, hoping that we could succeed and become a big player in the sector. Here is what we attempted to do.

About nine years ago, I proposed to the government that we should invest more in our creative economy sector, which I argued was a sleeping giant that would create massive employment and help reduce poverty. 

The proposal, a Cabinet memo, was accepted. I had the support of top leadership.

With the approval, I approached Sameer Business Park in Nairobi, intending to use the entire complex they had built off Mombasa Road. This was to become the first incubation centre for the creative economy as well as the first ever knowledge processing centre in Kenya. 

I secured a European telecommunications provider and an American back-office operations company as anchor tenants. On our part, we were to pay rent for the two organisations for one full year to cover their moving costs. 

In return, the European company was to recruit 1,000 local engineers and set up a local knowledge processing centre, largely taking care of European mobile networks. The Americans were to bring 8,000 knowledge processing outsourcing (KPO) jobs upon signing of the contract. 

This is what happens in other countries that have succeeded with business processing outsourcing work, like India and the Philippines.

I travelled to Hollywood and secured partnerships with American content providers to set up in Sameer Park and develop the capacity of our local artistes. They were to invest in modern equipment like editing suites for film, and co-produce a number of shows as part of knowledge transfer.

TREASURY GREW COLD FEET

Animation companies too joined the bandwagon. We held workshops in Nairobi with the creators of Avatar as well as staff from Walt Disney Studios.

In total, about 10,000 jobs were to be created. I needed about Sh300 million for one year’s rent paid by the government as an incentive or moving cost for these enterprises. I reasoned that within one year, the government would recover the money through Pay as You Earn (PAYE) taxes. 

However, before I could execute, great drama unfolded. Local companies came in their droves wanting also to enjoy free rent, but without contributing to knowledge transfer or experience. 

Negativity set in: “Bwana PS this is too ambitious. What if it fails? This will put you in jail.” I was given every reason to kill the project. Although I was ready to carry the risk, the Treasury wasn’t. 

In the end, the Treasury listened to the negative messaging, grew cold feet and refused to provide the funding. The risk was too much to bear, it was strongly and emotionally argued.

Up to this day, I keep on asking myself, how do we succeed if we can’t take risk? We had a chance to take our people from a hustler economy to a formal, digital economy, but instead we pushed them underground into what we refer to, not endearingly, as “Riverwood”. 

Well, Riverwood is now a vibrant Sh2 billion film industry that pays hardly any taxes because of its informality.

Technology is about to smoke them out of River Road, however, because modes of delivery have changed, especially with the entry of Netflix. If you are still in doubt, check what happened to Blockbuster in the United States.

MARKET GLOBALLY

If we do not act to help young people get incubated and formalised to acquire knowledge and technologies that will sustain them into the future, many of them will eventually end up in crime

Co-creation with those who have been there would lead to more competitive content that can be acceptable in new distribution platforms.

Nigeria, after going through a learning curve, entered into several partnerships with international filmmakers, and the government invested $200 million in the sector. After this commitment from the government, Nigeria is now beginning to attract new investments. 

Just this week, Africa’s equivalent of Netflix, iROKO TV, signed multiple deals totalling $19 million for content development and capital funding.

This week’s Screen Africa reports that CANAL+, the French Media giant, and Kinnevik AB, an existing investor, “are investing in addition to iROKO’s own cash flow to give the leading African tech and entertainment company the platform to scale its operations and expand aggressively across the continent”. 

We have spent many pages recently discussing Netflix, yet we have our own start-up, Buni TV, that has already moved local content to partner platforms in the UK, the US and the rest of Africa

We must change our narrative on this matter, from an inward-looking people to a more globalist community. The advent of the Internet changed market dynamics from local to global. 

We must at all times be looking at a market of 7 billion people, not 40 million, and as such promote, brand and market globally.

STRAITJACKET CURRICULUM

Let me repeat that in order for us to succeed, we must as a government, industry and research institutions, develop an enabling ecosystem in which this industry can thrive.

The government must invest in infrastructure for capacity building especially around mid-level colleges, and encourage expansion of university programs to include creative writing, music, dance, design, fine art, art history, theatre, animation, communication and rhetoric, amongst other disciplines that feed into the creative industries.

The arts degrees in most African countries follow a straitjacket curriculum that brooks no experimentation. This perhaps explains why we have too many people who are structurally unemployed.

Countries like the US are leading creative economies because of well-developed infrastructure that supports the industry and the scholarships that enable even the poor to access an education. 

Our future therefore depends on how we work together and how fast we can stimulate the sector.

Scott Adams, an American cartoonist, once said, “Creativity is allowing yourself to make mistakes. Art is knowing which ones to keep.”

Let’s learn to take risks, make mistakes and have the tenacity to keep our heads up and say we tried. There is no hope without taking risk. 

Next week, I will look into the contents of the American Growth Opportunities Act and delve into how we can exploit it as a strategy to deal with poverty and unemployment.

The writer is an associate professor at University of Nairobi’s Business School. Twitter: @bantigito