Favorable Policies Take a Supporting Role

"Cultural industry relies on creativity and innovation, which call for tolerance and support of the government," says Xia Xunge, a researcher at the Center for Research of Private Enterprises. "Favorable policies and a positive attitude from the government unleash new energy in businesses. Without them, culture-related companies would become overcautious, dampening innovation and hampering the development of the entire industry."

In recent years, the Ministry of Culture has been focusing on facilitating investment and funding for cultural industry. In a bid to expand direct finance towards cultural businesses and carry out continuous and effective financial innovation, in 2010, the Ministry of Culture, the Bank of China and six other authorities jointly released a document outlining measures of financial support for the nation's cultural industry. The State Administration of Taxation has also promised to introduce more tax incentives to cultural industry, subscribing favorable rates for emerging cultural sectors such as animation and digital television.

More investment has been attracted to a diverse range of cultural businesses, which are growing in numbers. Though at the time only 24 culture-related businesses had been listed on the A-share market in China, at the end of August 2011, 42 such businesses were awaiting the results of the China Securities Regulatory Commission's evaluation of their applications for launch onto the stock market, while another 120 businesses were already in the process of IPO.

In the meantime, the central government has been planning the first legislation in Chinese history for one specific industry. The Film Industry Promotion Law, a draft of which was released in December 2011, will legislate on funding and taxation in order to stimulate the film industry.

The Ministry of Culture will also carry out region-specific measures to achieve a more efficient distribution of cultural industry resources across the country. In eastern regions animation, artistic creation, exhibition and online cultural products will be the focal points of local cultural industry growth, while in central and western provinces, efforts will be made to stimulate ethnic artistic performances, tourism, arts and crafts and folk holidays and festivals. Infrastructure to house influential cultural and creative industries will also be built in city clusters, creating local networks to support the growth of centers of specific industries.

With such attention from governments at various levels, cultural industry is finding itself in increasingly favorable conditions and has become one of the healthiest sectors in China's economy. According to Mei Song, director of Beijing Cultural and Creative Industry Promotion Center, the capital city alone now has more than 50,000 culture-oriented companies. With further policies and strong financial support, cultural industry is expected to find itself taking a more prominent place on China's economic stage.