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Sunday, April 13, 2008

“Do I get to play golf before you cut me open, doc?”

The image of the stereotypical American tourist in this country is about to undergo a major makeover.

At least, that’s what the Philippines is counting on once its medical tourism program gets up to speed in about three years. Photos of dear old dad in a loud Hawaiian shirt toting the inevitable camera; of mom snapping up Philippine handicraft with her Visa and the kids pounding on their GameBoys might soon go the way of the buggy whip.

Replacing them will be images of dad in a floral hospital gown awaiting open-heart surgery; of mom staring at Photoshop images of her sexier figure after a tummy tuck and the kids searching Google for the coolest spas is the Philippines.

And whether they’re in Manila, Cebu or Mindanao, Mr. & Mrs. John Q. Public will get A-list medical care from skilled Filipino physicians (many U.S. trained) working at globally accredited medical facilities.

But best of all, they’ll save a ton of money in the process (up to 80%). Now, that’s good news for the heart.

Baby Boomers can look forward to this pleasant state-of-affairs when both the public and private sector finish polishing the many facets of the soon-to-gleam jewel called medical tourism.

Perks for investors is one of those facets. Accreditation of doctors and medical and wellness facilities are others.

Then there’s insurance portability, an advantage that should lure millions of foreigners covered by medical insurance such as Blue Shield and Blue Cross.

Grand visions
The government has grand visions for a medical tourism program that focuses on attracting Americans and North American “balikbayans” to these “Islands of Wellness”.

The health and wellness tourism industry posted worldwide revenues estimated at $40 billion in 2005 and is expected to grow 33% annually. Medical tourism, spas and alternative treatments and cosmetic tourism are service sectors comprising health and wellness tourism.

The government projects medical tourism as a billion dollar service sector by early the next decade. Medical tourism is also expected to put a brake on the massive exodus of nurses to other countries, and help reverse the sad trend of Filipino doctors becoming nurses just so they can find work in the USA and the UK.

It is widely defined as a health holiday that includes cost effective private medical care and tour packages (sightseeing, golf and shopping, for example). It also includes leisure and relaxation activities such as spa therapies to re-invigorate patients.

It’s a growing worldwide trend targeted mainly at citizens of wealthy nations such as the U.S. where soaring health insurance costs are making many medical procedures prohibitively expensive.

One in five tourists is an American and over 10% more Americans visited the Philippines in 2005 compared to 2004. Balikbayan arrivals were up almost 15% in the same period. The Department of Tourism (DoT) expects those growth rates to double this year.

Korea, Japan, Taiwan and Hong Kong are the four other top sources of foreign tourists who, as a whole, poured $2 billion into the Philippine economy last year.

The government initially expected to earn some $300 million from the first year of its much-hyped “Philippine Medical Tourism Program (PMTP)” and $1-2 billion a year for the next five years.

But these numbers have been scaled back a bit as the Philippines realizes it first needs to focus more attention on strategic measures such as getting foreigners to invest in world-class medical tourism infrastructure.

Dr. Paul Reganit, PMTP Project Manager for the Department of Health (DOH) and a Masters in Public Health from Harvard Medical School, said the government is now busy organizing its medical tourism effort and cutting the red tape affecting both medical tourists and medical tourism investors.

On stream is a four-phase plan to identify and accredit partner PMTP medical institutions throughout the Philippines. The first two phases (1A and 1B) will identify partners in Metro Manila while the remaining two phases will select partners outside Metro Manila and inspect partner facilities nationwide, including spas and retirement villages.

“After the full implementation of Phase 1, we should see some 125,000 medical tourists a year,” said Dr. Reganit.

He estimates these tourists could spend $125 million during their short (less than a week’s) stay in the Philippines. And that’s based on each tourist spending only $1,000 during his stay. He expects these numbers to jump with the completion of all four phases.

Investor perks
Dr. Reganit said the government is putting in place investor perks to help build the medical tourism sector. A Memorandum of Agreement between DOH and the Philippine Export Processing Zone Authority (PEZA) creating “Medical Tourism Special Economic Zones” is due to be signed this year.

The MOA offers incentives such as income tax holidays, special resident visas and incentives under the Build-Operate-Transfer Law.

Executive Order 226 or the Omnibus Investments Code also grants incentives to activities in the Investment Priorities Plan (IPP). The Board of Investments (BOI) has included health and wellness services in the IPP for 2005 and 2006 and is expected to extend these perks into 2007.

Ownership or management of hospitals is an investment area worth considering, said industry sources. Over half the Philippines’ healthcare expenditure comes from the private sector, a fact that illustrates the key importance of private hospitals in healthcare delivery.

While the Constitution does not allow foreigners full ownership of land, foreigners can enter into joint ventures or invest in existing medical facilities.

The former was the route taken by Cardiovascular Hospitals of America, LLC (CHA) and owner of a four-hospital system in the USA.

Bumrungrad Hospital, Thailand’s largest medical tourism facility, chose the latter alternative by taking control of the Asian Hospital and Medical Center in Alabang. Thailand is Asia’s leader in the medical and cosmetic tourism sectors. Singapore, Malaysia and India are among the frontrunners.

CHA advocates high quality patient health care by empowering physicians through governance, leadership and co-ownership of specialty hospitals.

It plans to build the American Specialty Hospital, a P1 billion medical facility, in Cebu City. The hospital will be accredited by Joint Commission International and will honor medical insurance from Blue Cross and other certified medical insurance companies.

Dr. Philip Chua, CHA vice president for Far East operations, said the hospital will cater to medical tourism. A Filipino, Dr. Chua is a Cardiac Surgeon Emeritus from Munster, Indiana.

He believes the prospects for Philippine medical tourism are quite bright since medical procedures are expensive in the USA. He noted that open-heart surgery can cost up to $70,000 in the US but only $8,000 in the Philippines.

CHA is also encouraging Filipino physicians to invest in the American Specialty Hospital. Dr. Chua said a growing number of physicians based in the Visayas are about to become investors.

Dr. Joel Beltran, Director for Business Development of the Asian Hospital and Medical Center, believes medical tourism should get up to speed after three years since partner hospitals need the time to improve their services and facilities.

“World class standards in hospital care entail huge investments in terms of physical plant, technology, human resource and clinical quality unlike spas and alternative therapies and cosmetic tourism,” Dr. Beltran pointed out.

He noted that Philippine hospitals have not seen that much investment for several decades except for Asian Hospital, The Medical City and St. Luke’s Medical Center, which are among the few hospitals accredited for medical tourism by the DOH.

In Asian Hospital’s case, the foreign investor is Bumrungrad Hospital. Bumrungrad handles close to a million patients a year (40% foreigners) and earned $150 million in 2005. Its experience is helping Asian Hospital prepare for the coming boom in Philippine medical tourism.

“While we have several international patients and clients at this point, the focus is on preparing our internal processes and support for the medical tourism project,” said Dr. Beltran.

UST Hospital (USTH) is accredited by DoT to service medical tourists. Located in Manila, USTH has transformed 70 of its rooms into international hotel-class rooms for medical tourists.

USTH has also partnered with the National Association of Independent Travel Agencies in the Philippines, the country’s largest association of independent travel agencies, to offer medical tour packages.

The services offered by USTH to medical tourists include plastic and reconstructive surgery, ophthalmology and laparoscopic surgery (a less painful surgical procedure since small incisions are used).

Eye operations, for example, cost $700 to $3,000 depending on the type. Medical and travel insurance, however, are not yet included in USTH medical packages.

“We have been doing medical tourism in USTH long before the term was coined . . . In terms of expertise and capability, USTH has a lot to offer international patients,” said France Manto, USTH Marketing Communications Consultant.

Healthy hospitals
Besides improving infrastructure and facilities, accrediting hospitals to international standards is vital to the growth of Philippine medical tourism, said Dr. Reganit.

He said accreditation of healthcare facilities will be managed in 2007 by the Philippine Council on Accreditation of Healthcare Organizations (PCAHO). The Philippine Health Insurance Corporation (PhilHealth) currently handles accreditation of hospitals and medical facilities.

The accreditation process now being developed will take into account standards set by the Joint Commission International and the PhilHealth Benchbook, a set of standards that measure the quality of healthcare provided by accredited healthcare providers. It will also consider standards in the international retirement industry and the DoT.

Filipino physicians will also be accredited and Dr. Reganit will take charge of this process.

Dr. Reganit said DOH is consulting with the Philippine Medical Association (PMA) about the problematic issue of American and foreign doctors practicing in the Philippines. He noted, however, that PMA does not encourage foreign doctors working here but will allow them in as consultants.

“If there is a reciprocating agreement, that will be OK,” said Dr. Reganit. “The Medical Act of 1956 is being revised (to allow foreigners to practice in the Philippines) and there is a pending bill in the Batasang Pambansa to this effect.”

PMA is expected to soon issue guidelines about foreigners practicing in the Philippines. Dr. Reganit pointed out that Thailand does not allow foreign doctors to practice locally. If a foreigner wants to do so, he must take the medical board exam—which is only written in Thai.

As regards medical malpractice, these cases will be coursed through PMA and its National Medical Grievance System. Consultation, mediation and arbitration will be the template used to resolve medical malpractice cases, said Dr. Reganit.

Fusing all the facets of medical tourism into an organized whole will be a “roadmap” the government expects to finish in September. This roadmap will be the game plan for Philippine medical tourism, said Dr. Reganit, and will set short-, medium- and long-term goals.

Philippine leadership is not the immediate goal; competitiveness in Asia is. Thailand, Singapore, Malaysia and India have too much of a head start to be quickly overtaken.

The Philippines’ great edge over its rivals is its “competent, compassionate and caring physicians.” It’s still the best prescription for a robust and competitive medical tourism sector.

Saturday, April 12, 2008

It’s Time for the Business of Creativity

You read and hear often enough about the Pinoy’s “world class” creativity: the jeepney, the Lunar Rover (or Moon Buggy), woodcarvings from Paete. And then there’s the truly world class creative furniture designs of Kenneth Cobonpue.

But “world class” creativity, while a feel good label, counts for next to nothing in a peso driven economy unless it earns money as a viable business. Banal or uncreative as this may sound, this reality leaves creative people and organizations with only two business models to choose from: the heroic but starving artist (unfortunately the dominant model)—or Kenneth Cobonpue.

Cobonpue of Cebu might be the icon of the successful creative person/entrepreneur the fledgling “Creative Industry in the Philippines” earnestly seeks to develop, and whose existence is a major force for growth in economies such as the United Kingdom, Hong Kong and Singapore.

The now world famous Cobonpue manages Interior Crafts of the Island, Inc., a family-owned furniture design and manufacturing company. Among Cobonpue’s more recent awards was the 2005 Design For Asia Award that he won in competition against 500 other entries.

His is a shining success story for Filipino creatives, and is the outstanding Filipino example of world-class design and creativity. “Brangelina” are two of his satisfied customers.

“Creativity or in economics/business terms the act of value-adding and, more importantly, value-creating provides a differentiating factor in the ability of the Philippines or a Philippine company to deliver a product or a service,” said Rhea Matute, Officer-in-Charge, Operations Group 1 for the Center for International Expositions and Missions (CITEM), and who is deeply involved in pushing creativity as a competitive weapon in the export market.

“Most especially, applied creativity de-commoditizes a product or service and elevates it where the creative input or content greatly determine its value. This enables Philippine companies to have a stronger hold on the market and reverses the relationship from a mere supplier to a business partner.”

She noted that for a creative country like the Philippines, there is tremendous potential for Philippine companies to use this creativity to carve out a niche in the global market instead of playing the game through somebody else’s rules.

“Creativity allows us to develop our own strategy, our own game in this globalized economy that maximizes the natural inclination of our human capital for creative expression. Especially in this fast changing world, it is ones ability to adapt, re-invent and capitalize on an opportunity that will spell success.”

Having the creative potential is only the beginning, however. The bigger challenge, she said, is developing the ability to harness creativity and use it in the operations of the company: be it developing products, services or a company’s competitive advantage, and managing creativity to truly reap its full economic benefits.

CITEM is one of the spearheads in advancing the Philippines’ “Creative Economy Agenda” through the Creative Industry Task Force. Its strategic partners in this push are the Cultural Center of the Philippines (CCP), the National Commission for Culture and the Arts (NCCA), the Department of Foreign Affairs (DFA) and The British Council.

Matute said the Creative Industry Task Force aims to harness the country’s creative talent and knowledge to fuel activity in the whole spectrum of the economy—from manufacturing to services.

“In doing so, the initiative brings the creativity of the Filipino to a new level, recognizing its value as an economic asset that enables differentiation of Philippine products and services in the global market. In the process, we enhance the country's international image and make our people even prouder of things Filipino.”

With the holding of the “1st Philippine Creative Industry Forum” in 2005, the government tacitly recognized the existence of the Creative Industry as an industry alongside others such as manufacturing and services. Held in September at the CCP, the forum was the first real effort to take a closer look at this nascent but vital industry. “Nurturing Creativity” was the conference theme.

The three-day event brought together representatives from countries that acknowledge the existence of, and benefit economically from, their creative industries with those from government and business. The speeches showed the wide gap between the Philippines and countries with recognized creative industries.

While foreign guests talked from experience and cited upbeat economic data to bolster their case for developing a creative industry, Filipinos outlined plans for nurturing a creative industry, and were in agreement that bold action must now be taken by the government to grow the vital industry.

Young or unborn?
CCP president Nestor Jardin said the creative industry “has been outpacing and outgrowing the rest of the industries in percentage growth” in the United Kingdom, the USA, Japan, Singapore, Hong Kong, Australia, Thailand, Malaysia and Vietnam. He cited Australia whose creative industry contributed “a staggering 13% to the GDP,” well above the Asian norm of about 5%.

He described the Philippines’ creative industry as “a young or perhaps an unborn sector of the Philippine economy.” He said the creative industry could be classified to include the Performing Arts; Visual Arts; Literature and Publishing; Architecture, Crafts and Design; Audiovisual and New Media; Cultural Heritage and Cultural Activities.

What defines the creative industry as a unique sector of the economy, he said, is that its collective outputs are products of human creativity “and because they are such, they are products with intellectual property rights.”

Jardin said an important challenge that must be surmounted is to formulate a workable national creative industry plan that will identify the gaps and propose policies, strategies and policy reforms and programs that would help develop and promote the creative industry.

He acknowledged, however, that the most important and most challenging problem is how to convince government leaders that the creative industry needs attention.

“In simple terms, we’re all ‘KSP’ or ‘Kulang sa pansin (unnoticed)’,” he said. “I’m tired of trying to convince them that arts and culture should be given more support because they are vital to the establishment of a national cultural consciousness that will define our cultural identity.

“Try explaining this to a DBM officer and halfway through your passionate dissertation, the official becomes fidgety and you begin to feel that you’re speaking to him in the Swahili language.”

Jardin, however, recognizes that economics is the language the government understands, and that the pioneering work of the United Kingdom in quantifying the economic impact of creativity has inspired creative industries everywhere to amass the economic data needed for investment and growth.

The UK: Creative Industry Leader
British Ambassador Peter Beckingham said that the United Kingdom today ‘boasts an economy based substantially on creativity.”

After four years of mapping or determining the extent of its creative industry, the UK found out this industry, surprisingly, had an economic value of P10.5 trillion (112 billion pounds sterling) and accounted for more than 5% of the UK’s GDP. Its exports were valued at P1.03 trillion.

“Perhaps the most significant figure of all,” said the Ambassador, “the rate of growth in these creative industries was more than twice that of the economy as a whole.”

He noted that one of the most interesting things about the creative industry is that they mostly tend to be small businesses. They also tend to want to come together “because they recognize they can feed off each other.”

The UK came to realize the immense value contributed by the creative industry because one man wanted to know what the creative sector was worth. In 1997, Chris Smith, then the new secretary of state for culture, wanted this information but was stymied because no statistics existed.

He went to work to answer this question, gathering government and business leaders and creating a task force to manage this complex undertaking. The data obtained by 2001 “surprised everybody,” said Beckingham.

Along the way, they crafted a definition of the creative industry that has come to be accepted almost universally: “Creative industries are those industries that have their origin in human creativity, skill and talent and that have a potential for wealth and job creation through the generation and exploitation of intellectual property.”

The data obtained two years later was more surprising because it showed creative industries accounting for 8.2% of gross value added in 2002, and had grown 8% from 1997 to 2000.

The UK had 122,000 creative businesses in 2002 that employed 1.9 million persons. Employment in creative industries grew by 3% annually compared to 1% for the entire British economy. And more telling was a report that creative industries are now more important to London’s economy than financial services, hardly surprising considering London’s eminent position as a center for culture and creativity.

The British define their creative industry as including advertising, architecture, art and antiques, markets, crafts, design, designer fashion, film and video, interactive leisure software, music, performing arts, publishing, software and computer services and radio.

The British realized, as the Philippines soon will, that the development of creative industries is a process that involves the government, government agencies, economists and the creative and cultural sector.

Mapping for success
They also discovered that “mapping” or providing the economic data that shows the current value of the creative economy, is absolutely vital to growing this industry. Although a complex task, mapping exposes the economic impact of creative industries and reveals the economic loss of not providing adequate protection for intellectual property rights.

Mapping has taken place throughout the UK for the past decade. It has given British cities and regions economic evidence of what the creative sector contributes and an understanding of its potential.

In 2001 also, the British decided to share their experience with creative industries with the rest of the world through a program called “Developing Creative Economies.” Six countries—including the Philippines as the final pilot—are involved in this program that also allows each country to develop its creative economy in a way that reflects its culture.
Each program is to run for five years.

The Philippines is now busy sourcing funds for the mapping project, said Matute. It is tapping the private industry to provide the bulk of this funding.

Hong Kong’s creative industry consists of 11 sectors and has been mapped, according to Prof. David Hui, director of the Center for Policy Research at the University of Hong Kong and a speaker at the forum.

Mapping showed that in 2001, Hong Kong’s creative industry contributed 3.8% of total GDP and had a value of P287.8 billion (HK$46 billion).

“We compared it to the other studies that were carried out by other countries and we found out that it’s actually close to our region like New Zealand, Australia and Singapore from the region of 2.8 to 5%,” he pointed out.

He said that, like the UK, Hong Kong discovered that creative industries grew faster than the general economy. Knowing the ups and downs of the industry, which mapping uncovers, allows Hong Kong to put in place policies that reduce the downs and enhance the ups.

Singapore’s creative strategies
Singapore in 2003 adopted the “Creative Industries Development Strategy” whose aim is to double the GDP contribution of creative industries from 3% to 6% by 2012. This three-pronged approach adopted the UK’s definition of a creative industry.

Baey Yam Keng, director, Creative Industries Singapore, said the first part of the strategy focuses on the arts, the second on design and the third on media.

The arts strategy seeks to integrate arts and culture development into Singapore’s economy, thereby unleashing the potential of Singapore’s creative cluster.

“We need to continue to invest in talent, content and infrastructure for the arts, and adopt a cluster development strategy,” he said.

The design strategy aims to develop excellence in design as a key driver in national competitiveness. The Design Singapore Council works very closely with schools and students “to cultivate the precision of design and include design as a creative learning tool in the curriculum in schools,” said Yam Keng.

Singapore’s media strategy hopes to develop Singapore into a global media city. One of the initiatives that advance this strategy is the “Asia Media Festival” that drew over 300,000 participants in 2004. This “Made by Singapore” approach also extends to producing content for new media and gaming

Most important, said Yam Keng, is that Singapore “must create the environment that allows such creativity to happen but also to uphold Asian values.”

Design – made in Holland
There are 46,100 designers in The Netherlands. Together they contribute P166.9 billion (2.6 billion Euros) to the Dutch economy – in other words, 0.7% percent of The Netherlands’ GNP. In fact, the design industry accounts for a larger share of the economy than the Dutch oil industry or traditional sectors such as shipbuilding.

The figures quoted above stem from two studies carried out by Statistics Netherlands (CBS) and the Netherlands Organization for Applied Scientific Research (TNO) for the Premsela Foundation (which represents the Dutch design sector) and the Dutch Ministry of Education, Culture and Science. The purpose of the studies was to investigate the economic significance of design.

Subsectors
Almost 60% of all Dutch designers work in visual communication, a subsector of the design industry. That 60% is made up of 27,400 commercial artists, window dressers, ornamental painters, graphic designers, illustrators, quick-draw artists and advertising designers.

One out of three designers (13,900 persons) works in product design. This category consists of industrial designers, fashion designers, goldsmiths and silversmiths. It also includes flower arrangers, because their design skills also add value to a product. The third subsector, environmental design, accounts for 10% of all Dutch designers.

It is represented by 4,800 interior architects, garden designers and landscape architects. In summary: 59.4% of Dutch design professionals are involved in communication design, 30.2% in product design and 10.4% in environmental design. All in all, the number of people working in design is comparable to the number working in the insurance and pension industry (53,000 persons).

Design specialists
Seventy-two percent of all designers work in the service sector, 20% in industry and 8% in the non-profit sector. TNO’s report also distinguishes between different corporate categories.

The first category consists of the “design specialists”, which employ 16,900 designers or well over a third of the total. The design specialist sector is made up of companies such as advertising agencies and interior and fashion design houses, whose core activity is design.

Advertising agencies employ 14,000 designers and represent the largest group in the design specialist sector. The sector accounts for 24.5% or EUR 635 million of the EUR 2.6 billion that the Dutch design world contributes to the nation’s economy.

The second category consists of companies that employ a considerable number of designers. The include publishers, furniture manufacturers, service engineers for consumer items, firms of architects, consulting engineers and technical design and drafting firms and consultancies.

These companies employ 21,600 designers. In other words, one out of every two designers works in this category, which represents 35.6% of the design world’s economic value, or EUR 922 million.

Design pays
TNO’s report also concludes that design plays a key role in innovation. Fifty-eight percent of the companies that combine technical and design innovation say that innovation has a major impact on their competitiveness, as compared to only 47% of companies that do not do so. Design is therefore a significant competitive factor.

This is the first major survey of the Dutch design industry. Never before has its economic significance been analyzed in such detail. A follow-up report is scheduled to appear in 2010. Industry representatives have stated that their contribution to the Dutch economy should have increased to EUR 5 billion by then.

Creativity’s value to the EU
Europe has also taken pains to study its creative industries. According to the European Commission, Europe’s cultural sector contributed a staggering P42 trillion (EUR 654 billion) or 2.6% of the EU's GDP in 2003. In 2004, it employed some 5.8 million persons, which increased to 7.2 million last year and is on the uptrend.

Trends in the last decade show digital culture set to develop vigorously, thanks to the virtuous circle between culture and technology (multimedia, e-commerce, telecommunications). While the sector will act as an important employment booster, challenges involving education and training still need to be faced.

The Philippine: leading with design
As for the Philippines, the bottom line in developing a creative industry “is the creation of jobs and livelihood as a poverty alleviation method,” said Zorayda Alonzo, undersecretary of the Department of Trade and Industry.

“We have to nurture key industries that make up the Philippine creative economy by directing investments, programs and policies towards the development of the infrastructure, both hard and soft, and the environment that can stimulate the growth and international competitiveness of the creative industries,” she said.

She said that a strongly enforced intellectual property rights would protect Filipino creatives and their works.

Alonzo cited the inroads made in Europe by “Movement 8,” a creative alliance and design collective formed in September 99 by the late Eli Pinto Mansor of CITEM , together with design great Budji Layug , featuring Tes Pasola, Milo Naval, Renato Vidal, Carlo Cordaro, Tony Gonzales, Luisa Robinson, Ann Pamintuan and Kenneth Cobonpue.

Movement 8 is a prime example of design leading the successful transition from mere commodity exports to value-creating exports.

By focusing on the design and designer aspect of furniture and home accessories, the market began to appreciate Philippine products, its originality, and elevated the Philippines from just a production center to a developer of original design and original content. The Philippines became integral partners in the business and not just an element in the global supply chain.

The economic value of creative industries lies in the intellectual property it produces. Protecting intellectual property has become extremely important in the “copy and paste” environment facilitated by computers and the Internet. Making sure creatives have proper copyright protection in a digital environment is, therefore, vital if the industry is to profit and grow.

Stricter enforcement of copyright protection laws will immensely benefit the animation industry, which for years has been hyped as a shining example of Filipino creativity and business success. Revenues generated by the animation industry in 2005 rose 25% to $52 million (from $40 million in 2004).

The Animation Council of the Philippines, Inc. (ACPI), a national association of animation industry players and stakeholders, counts 35 member organizations. ACPI is working with the government to increase in the number of animators from the present 6,500 to 25,000 by 2010 to take advantage of vast global opportunities and erase the problems posed by the small number of Filipino animators.

The Philippines is known as a provider of high quality animation in contrast to rivals India and China, which are low cost providers. India’s animation industry generated $285 million in revenues in 2005; China earned $604 million.

Matute described animation as a major creative sector of the Philippines. She noted the Philippines has been a major producer of animation for the North American, European and Japanese markets since the 1980s, with major projects completed for Hanna Barbera, Disney, Warner Bros, Nelvana, Toei Japan and many other internationally recognized producers of animated features worldwide.

She said a sustained, strong track record and a reputation for creativity in animation—and the benefits of English proficiency, a western sense of humor, and varied cultural exposure—make Filipinos the preferred choice for the world's animation requirements.

She also pointed out that an emerging sector of the IT and IT-enabled industry is game development for the X-box, Play Station and other hardware makers. Anino games recently won an international award in Barcelona, Spain for the technical superiority of a game they developed.

CITEM’s vast experience in exports serves to confirm the immense value of creativity as a competitive advantage, said Matute. She noted that over the past years, from their conversations with foreign investors, Filipino entrepreneurs, manufacturers and exporters, and most especially the SME’s, it became more and more apparent the value that Filipinos bring to the market—the element that differentiates us from our neighbors and other nations in this global environment—is creativity.

“Creativity and spirit of innovation inherent in Filipino workers and professionals are the elements why investors come to the Philippines; why international buyers buy Philippine-made products despite being more expensive than other Asian countries; why there are Philippine engineers, architects, designers and other creative professional being hired from the Philippines and sent abroad to work; why back room operations and other creative work such as animation, software design and development are being outsourced to the Philippines.”

CITEM always emphasizes that its clients nurture this creative potential and always keep in mind the content value, be it product development for home style and living to fashion to food to e-services/BPO/KPO.

Business must play a key role
The Creative Industry, however, belongs to the private sector where the need to generate revenues trumps other considerations such as employment generation. One of the interesting findings revealed by mapping is that most creative businesses are micro-enterprises or small businesses with minimal employment.

Business can foster a culture of creativity by ingraining the quest for innovation and creativity their corporate cultures. This is a must not just in private enterprises, but most especially in the education sector because this is what creativity all boils down to—education.

There also needs to be a major change in the mindset of business and about work. Government and business have to treasure creative industries, understand and appreciate design and be willing to invest into creative people/designers.

“The better one understands the creative worker or what Richard Florida, a recognized expert in the Creative Economy and author of the Rise of the Creative Class, calls the ‘Creative Class,’ then it is more likely that businesses can develop an environment that will value their input, challenge them, have mechanisms for mobilizing resources around ideas and are receptive to both small challenges and the occasional big idea, or what Florida calls the ongoing movement of capital toward more effective mechanisms for harnessing human creativity,” Matute explained.

The challenge for business, therefore, is how to keep stoking and tapping the creative core of each human being. And since the Creative Class blurs the line differentiating work, life and leisure, it even becomes a challenge for communities and cities to develop and nurture the kind of experiences that reflect and reinforce their identities as creative people.

For the creative economy to flourish, however, it must not just depend on technology but on talent and tolerance, as well. Tolerance being defined as openness, and the acceptance of a diverse population and diverse ideas.

Needed: a Creative Industries Coalition
These insights mean that it makes sound business sense to band together Filipino creatives under the premise that their strength lies in unity. Creating a “Creative Industries Coalition” of individuals and organizations, private and government, local and abroad, as proposed by Henry Schumacher would be a giant leap in furthering the growth of the Philippines’ Creative Industry, and supporting the Creative Economy Agenda.

As Schumacher contends, it is necessary to focus on the design sector initially. A design environment be created that would allow design to thrive as a service industry in the Philippines. Initiatives will have to be undertaken to develop the next generation of Filipino creatives.

In this Knowledge Society, it’s a smart move to arm Filipino creatives with the knowledge of what’s out there in the realms of ideas, technology, trends, fashion, materials, methods and financing.

Material ConneXion is a leading knowledge base for information about new and innovative materials. It has libraries of innovative materials and provides information for the packaging, architectural, interior design and the apparel industries, among others.

New technology gives designers and companies’ new tools with which to play the game. It expands the capabilities of manufacturers and service providers, and enhances the delivery of the products and services. Technology must be viewed as a partner of creativity and competitiveness.

A Material ConneXion-type library has to be established in the Philippines for the use of the creative industry, especially those involved in furniture, furnishings and interior design.

These businesses have long been a source of Philippine export strength, especially in Europe, and the many exhibitions built around them such as Manila FAME International continue to be cash cows for the country. The increasing Philippine participation in European trade fairs is another reason for upgrading Filipino creativity.

Over 80 countries and thousands of buyers and guests flocked to the World Trade Center in Pasay City for the October edition of Manila FAME International 2006, which generated revenues of $57.3 million. Among the guests was George Beylerian, President of Material ConneXion, whose seminar was one of the highlights of the trade show. The next FAME will take place this April.

Excellent Philippine design was also visible at the just concluded furniture fairs, the Cebu International Furniture and Furnishings Exhibition or Cebu X 2007, and the Philippine International Furniture Show (PIFS) both held in late February.

The Cebu International Furniture and Furnishings Exhibition or Cebu X 2007 was held for the 18th time this February. Its organizers describe Cebu X as the “Design Destination in Asia” for retailers and wholesalers.

The show introduced world-class products and excellent booth presentations from participating companies from all over the Philippines. Last year, Cebu X took part in Macef 2006 in Milan.

Macef is the world's leading trade show for those who work in the table, kitchen and silverware, home decoration and textile, celebrations, gift, ceremony and stationery, jewellery and fashion accessories sectors.

PIFS, which exhibited some of the Philippines’ finest furniture, had as its special guest, Gaetano Pesce, an architect-artist-designer based in New York City. In more than 40 years of practice, Pesce has created an extensive body of work recognized for its emotive and tactile qualities, unrestrained use of color and insistence upon innovative building materials developed through new technologies.

It would also make sense to invite international designers to develop a top rate School of Arts and Design in the Philippines funded by the private sector. Creative laboratories will also have to be established. The government of Singapore is heavily involved in advancing that country’s design sector.

Mapping the Philippines’ Creative Industry, of course, is one of the first priority and an absolute necessity. But it still has to happen since funding is practically non-existent.

Jardin said mapping is, clearly, the basic step. “We need to undertake a creative industry mapping that will tell us where we are now, what our strengths and weaknesses are, what success stories we have that we can all learn from, how much we contribute to the GDP and GNP and to national employment,” he said.

Taken together, these initiatives will take the Philippines along the same road traveled by the UK, Singapore and Hong Kong—and will hopefully yield similar positive results.

In this day and age, a country that does not keep building or investing in its creative capital will fall behind in the race to improve its quality of life, said Matute

“And for a country like the Philippines to not recognize and appreciate the great opportunity that we have before us, and to not appreciate the potential that lies inherent in the Filipino, it will be like again losing another opportunity to develop this country to its full potential”.



Components of the Creative Industry in the Philippines*

  • Performing Arts (Music, Theater, Dance, Performance Art and all their related products and services)
  • Visual Arts (Painting, Sculpture, Photography, Video Art, Graphic Design, Installation Art and all their related products and services)
  • Literature and Publishing (Books, Magazines, Newspapers, Periodicals, e-books, Print Advertising and other printed and electronic materials and services)
  • Architecture, Crafts and Design (Architectural and Landscape Design, Fashion, Accessories, Furniture, D├ęcor and other design products and services)
  • Audiovisual and New Media (Film, Television, Video, Radio, Entertainment, Software, Internet Activity Sites, Electronic Media Advertising and other products and services)

* As defined by the UNESCO Framework for Cultural Statistics