DOI: https://doi.org/10.62204/2336-498X-2023-4-16

SOCIAL  AND CULTURAL SCIENCES

CREATIVE INDUSTRIES AS A MEANS OF INCREASING

THE ECONOMIC POTENTIAL OF THE DNIPROPETROV REGION (UKRAINE)

Serhii Vytkalov,

Doctor of Cultural Studies, Professor,

Rivne State University for the Humanities, Ukraine

sergiy_vsv@ukr.net; ORCID: 0000-0001-5345-1364

Marina Shpakovska,

Master of specialty 028 «Management of socio-cultural activities»,

Rivne State University for the Humanities, Ukraine

shpakovskaya0504@gmail.com; ORCID: 0009-0000-7711-6499

Annotation. The material of the article examines the evolution of creative industries in Ukraine, highlighting their growing role in both the economic and cultural spheres. A comprehensive analysis is presented that reveals the multi-level economic impact of these industries, including direct, indirect and induced effects, as well as their role in facilitating innovation and technological progress. These industries, according to the definition of the Ukrainian Government, cover 34 different types of economic activity, which significantly affects such sectors as IT, advertising and publishing. In 2020, their contribution to the economy of Ukraine was noticeable: they accounted for 4.2% of the added value and employed hundreds of thousands of workers. The multifaceted impact of creative industries on the economy of Ukraine is emphasized, including direct contributions to production and employment, as well as indirect impacts through supply and consumption chains, as well as their social and economic consequences.

SWOT analysis and strategic recommendations provide insight into internal and external factors affecting these institutions, outline effective strategies for increasing competitiveness. The role of creative industries in the economic and cultural development of Ukraine is substantiated, their contribution to GDP, employment and exports, as well as their impact on society is emphasized.

Keywords: creative industries, economic influence, cultural development, transformation, Dnipropetrovsk region, innovations, regional practice.

Introduction. Statement of the problem and relevance of the research. The problem and relevance of the topic of creative industries in Ukraine lies in the recognition and optimization of their significant contribution to the country’s economy and culture. This sector, which includes traditional art forms: theatre, music, visual arts, as well as new forms brought about by digital technologies such as cinema, IT, mobile application development and video games, has historically been under-represented.

In 2018, the concept of creative industries was legally recognized in Ukraine, which gave impetus to their development and integration into the wider economic context. The creative industries have a significant impact on the economy, generating 4.2% of added value and employing 360,000 people. It is also important to support and develop this sector through various initiatives and organizations. The impact of these industries on the economy is multi-level, including direct, indirect and induced effects, as well as facilitating innovation and technological development. This highlights the need to develop comprehensive strategies to optimize the potential of creative industries in regions such as Dnipropetrovsk Oblast, with an emphasis on digital transformation, international cooperation, program expansion and public engagement. This is especially relevant during the war.

Recent research and publications. The phenomenon of Ukrainian culture is the subject of constant scientific study and interest in it does not wane, as evidenced by a multifaceted view of its history and economic potential. O. Vysotsky’s book “History of Ukrainian Culture” [1] offers a comprehensive overview of the history of Ukrainian culture. “Culturology” by P. Herchanivska [2] aims to investigate various cultural aspects of this issue and give them a theoretical understanding. Lectures by K. Kostyleva on the topic “History of Ukrainian culture” [3] and “History of Ukraine” by N. Levytska, V. Kolosyuk, S. Buravchenkova [4] provide a fairly broad idea of Ukrainian history and its culture. S. Kinal’s work [5] focuses on cultural development in communities, and D. Lull’s [8] exploration of media, communication and culture provides an international perspective on these influences. However, there is still a lack of works where the regional segments of the development of the outlined problem become the center of attention. Presenting main material. Creative industries in Ukraine have made a significant contribution to the country’s economic development, including traditional forms such as theatre, music and visual arts, as well as new forms emerging with digital technologies such as cinema, IT, mobile application development and video games. Historically, these industries have not received adequate attention, but over time, their integral role in various industries and professions has been recognized, especially in terms of impacting other areas of the economy through digital technologies. In Ukraine, the concept of creative industries was legally recognized in 2018. In particular, the Law of Ukraine “On Culture” defines creative industries as “types of economic activity aimed at creating added value and jobs through cultural (artistic) and/or creative self-expression.” This definition covers 34 economic activities, including visual arts, performing arts, literature, publishing, audio arts, audiovisual arts, design, fashion, new media and ICT, architecture and urban planning, advertising, marketing, PR, libraries, archives, museums and folk art. Creative industries in Ukraine make a significant contribution to the economy. In 2020, they generated 4.2% of the added value in the country (132 billion UAH), employed 360,000 people (4% of the total employment of the population) and had a significant impact on such sectors as IT, advertising, audiovisual arts, architecture and publishing. The export of creative services in 2019 amounted to $5.4 billion, which is 30% of the total export of services. Investments in the sectors of creative industries lead to a significant increase in the total GDP. For example, an investment of 1 hryvnia in programming sectors has a more significant multiplier effect compared to other industries. The contribution of creative industries to the economy of Ukraine can be compared with their influence in countries such as Germany. A number of initiatives and institutions operate in Ukraine to support creative industries. Among them are the Ukrainian Cultural Fund (UKF), Book Institute, State Cinema, Ukrainian Startup Fund, international and Ukrainian funds, such as House of Europe, Creative Europe Ukraine, Zagoriy Family Fund, Zenko Foundation, etc. [7].

The analysis of the main types of economic activity belonging to the creative industries in Ukraine, defined by the Cabinet of Ministers of Ukraine in Resolution No. 2019 of 05/26/2019, highlights the wide range and importance of these industries. Creative industries are defined as covering a range of 34 different types of economic activity that make a significant contribution to the economy and cultural development of a country. These activities cover different sectors, demonstrating the diverse nature of the creative economy. These industries include: fine arts, including activities such as painting, graphics, sculpture and photography. The performing arts include live music, theatre, dance, opera, circus and puppetry. Literature, publishing and mass media covers literary works, publishing and various forms of mass media. Audio Arts: This includes all forms of artistic expression based on sound. Audiovisual arts: involving film, television, video, animation and multimedia productions. Design encompasses various fields of design, including graphic and industrial design. Fashion: This sector includes the design, production, marketing and sale of clothing and accessories. New media and information and communication technologies, covering software development, video games and digital technologies in the arts such as 3D printing and virtual reality. Architecture and urban planning, which includes the design and planning of buildings and urban spaces. Advertising, marketing, PR and other creative services: These services are critical to the creative promotion of products and services. Libraries, archives and museum institutions that store and exhibit cultural and historical artifacts. Folk arts and crafts, in particular traditional arts and crafts practiced by communities. The regulation also recognizes the important role of related fields (such as communication, printing, tourism, etc.) that support, facilitate and enable the creation, production and distribution of creative industries products. However, there are also methodological differences in the definition of creative industries in different countries. Approaches range from specific categorization in the UK for creative, digital, cultural sectors, telecommunications, gambling, sports and tourism to more detailed classifications in Canada and the US. The report highlights that while there is general agreement on what constitutes creative industries, specific definitions and classifications may vary [6].

The influence of creative industries (CI) on the economy operates at different levels. First of all, the direct impact of CI on the economy is considered, which is the direct quantitative contribution of these industries to the total production, added value, income and employment. In addition, the indirect and induced effects of CIs are significant due to their positive multiplier effect on the economy as a whole and other sectors (production, income, employment). They are interconnected with CI through supply and consumption chains. Creative industries also have a wider impact on society and the economy by spreading concepts, ideas, skills, knowledge, facilitating innovation, technological progress and improving the quality of life. This includes CI externalities, such as spillovers or positive externalities, which can also affect cross-industry linkages and alter indirect and induced impacts. In particular, CIs are important drivers of economic and social innovations in the economy. They support innovation in many other sectors (e.g. industrial innovation) by providing creative ideas for new products (e.g. innovative content), creative goods and services used in production processes (e.g. software) and marketing support for innovative products (innovative design, etc.). They contribute to the development of flexible, mobile and multidisciplinary networks, project organization of work processes, development of human capital and creative problem-solving skills. Therefore, CIs contribute to the introduction of new ideas and technologies into other sectors, increasing their productivity and competitiveness. They are also significant users of innovative technologies and create demand for equipment manufacturers, particularly in information and communication technologies. It is worth noting the positive influence of CI on the development of the tourism industry, which is associated with an increase in the flow of tourists participating in artistic and cultural events (cultural tourism). External effects include the growth of brand value, improvement and popularization of the country’s international image, as well as contribution to the development of territories and communities [12].

The impact of creative industries on the economy can be understood through different levels of influence. First of all, the direct impact of CIs on the economy is considered, including their quantitative contribution to total production, added value, income and employment. In addition, the indirect and induced effects of CIs are recognized for their positive multiplier effects on the overall economy and other sectors (such as output, income and employment) through cross-industry linkages through supply and consumption chains. These consequences also affect government tax revenues. In addition, the wider impact of AI on society and the economy is recognized through the dissemination of concepts, ideas, skills and knowledge, which contributes to innovation, technological progress and improved quality of life [10]. These are known as CI externalities, including facilitating cross-industry linkages and changing indirect and induced effects. In the context of the Ukrainian economy, creative industries are important drivers of economic and social innovations. They support innovation in different sectors (e.g. industrial innovation) by providing creative ideas for new products (innovative content), creative goods and services used in production processes (e.g. software), and marketing support for innovative products (innovative design etc). In addition, CIs contribute to the development of flexible, mobile and multidisciplinary networks, the organization of project workflows, the development of human capital and creative problem-solving skills. Thus, CIs not only contribute to the introduction of new ideas and technologies in other sectors, increasing their productivity and competitiveness, but also act as significant users of innovative technologies, creating demand for equipment manufacturers, in particular in information and communication technologies. The positive influence of CI on the development of the tourism industry, due to the increase in the number of tourists participating in artistic and cultural events, deserves attention. In addition, external effects include increasing the value of the company’s brand, improving and popularizing the country’s international image, and developing territories and communities. This analysis highlights the multifaceted impact of CIs on Ukraine’s economy, highlighting their role in driving innovation, productivity and overall economic growth. The economic impact of creative industries (CI) can be assessed using various methodologies, including multiplicative analysis. This approach examines how investment and activity in CIs stimulate additional economic activity in other sectors. There are two main types of multipliers: Type I and Type II. Type I multipliers cover direct and indirect effects. The direct effect refers to the direct economic impact of CIs, such as jobs and output in the sector. Indirect effects include economic activity arising in other industries as a result of CI, such as supply chain impacts. Type II multipliers include both direct and indirect effects, as well as induced effects. Induced effects are the additional economic activity that occurs as a result of the income earned by workers in CI and related sectors being spent in the wider economy. An example of such an analysis can be found in the study “Do creative industries generate a multiplier effect? Evidence from UK Cities 1997-2018′ from the Creative Industries Policy and Evidence Centre. This study adapted Moretti’s system of local multipliers to estimate the long-term causal effects of CIs on the surrounding urban economy. The study found that each creative job generated at least 1.9 non-tradable jobs in the UK between 1998 and 2018, primarily due to local spending by creative business services workers. The overall impact of CI on the economic development of cities turned out to be positive, but partial, forming only a small part of non-tradable changes in urban employment. The study also found no causal evidence of spillovers from creative activities to other trade sectors. This suggests that although CI-led policies can have positive effects, they are not the only drivers of urban economic development [11].

On February 21-22, 2017, the first Creative Industries Forum was held in Dnipro, organized under the auspices of the “Bridges of Public Activity” project with the support of the EU. This ground-breaking event called “Creative Industries for Territorial Development” brought together a diverse range of participants, including representatives of the Ministry of Culture of Ukraine, local authorities, creative entrepreneurs, artists, territorial development experts and investors. The program of the forum was rich and multifaceted, focusing on topics of crucial importance for the development of creative industries and their role in social and territorial development. Key topics included “Partnership and innovation – the path to success”, “Cultural and creative industries for community development”, “Participatory budgeting mechanisms for cultural development in communities”, “Cultural integration and interaction for peace and development”, “Business development in creative industries”. One of the main entertainments of the forum was the presentation of various successful practices and new projects that are looking for funding and partnerships for their implementation. Among the presentations that deserve attention were O. Boyarynova’s report “Mapping citizens as a tool for city development” from the Ukrainian Library Association in Kyiv; V. Veres “Creating a cluster of culture and event tourism in Zaporizhzhia region” from the NGO “Kultprozhektor” in Zaporizhzhia; the project of S. Prokopenko “Audio books” from Kharkiv; R. Pomazan “TPP Center in Kherson”; “Mariupol on the border” by O. Ukraintseva from Mariupol, Donetsk region; and M. Pavlyuchenko “Evacuated collection. Embroidery: protection, resistance, weapons” from Zelenodolsk, Dnipropetrovsk region. The forum also facilitated the Open Mic session, a unique platform where participants whose presentations and talks were not included in the main agenda could share their experiences and ideas. This segment greatly enriched the discussion on the forum by bringing in a wider range of voices and perspectives. A distinctive feature of the Forum was the emphasis on live video broadcasts, which showcased a number of projects and products of the cultural industries of Ukraine, which further expanded the reach and impact of the event. The first forum of creative industries in Dnipro became an important milestone in the development of the creative sector of Ukraine. She not only highlighted the diverse and dynamic nature of the creative industries in the country, but also highlighted their critical role in promoting economic growth, cultural development and community engagement. The event became a platform for dialogue, cooperation and innovation, setting a precedent for initiatives in the field of creative industries [9]. Dnipropetrovsk region is distinguished by its unique cultural diversity and historical wealth, having played a key role in the development of the region. A variety of institutions, including museums, theaters and libraries, are important for regional cultural identity and promotion. Dnipropetrovsk National History Museum plays a key role in the preservation of historical heritage, the integration of digital technologies here can significantly improve interactivity and visitor engagement. The Dnipropetrovsk Art Museum has an impressive collection of Ukrainian art, and international cooperation can strengthen its global presence. The Dnipro Academic Ukrainian Music and Drama Theater can attract a wider audience by expanding its repertoire with modern and experimental performances. The Dnipropetrovsk Philharmonic can use new forms of funding and organize special events involving international musicians. Dnipropetrovsk Academic Youth Theater has great potential in educational work with young people through modern theater techniques and educational programs. Library of the Dnipro National University named after O. Honchara can become a center of digital learning and cultural exchange through the introduction of electronic systems. Menorah cultural and business center demonstrates the possibilities of public-private partnership in the cultural sphere.

Cultural institutions of the Dnipropetrovsk region have a unique potential due to the rich history and cultural heritage of the region. These features not only make local residents proud, but also attract cultural tourists. The region has a strong network of cultural institutions and a skilled workforce consisting of artists and managers. However, there are certain challenges, including limited funding, lag in the implementation of modern technologies and low international popularity. Therefore, the integration of digital technologies, such as virtual reality in museums, can radically change the interaction with cultural content and attract more visitors. Cooperation with international cultural institutions and the private sector opens up additional opportunities for funding and knowledge exchange. Investing in cultural management training can improve efficiency and optimize the use of resources. Competition with other cultural hubs and changes in consumer patterns, especially among young people, require adaptation and innovation. Economic fluctuations also create additional challenges for the financial sustainability of cultural institutions. To solve these problems, it is recommended to develop an integrated approach. It is necessary to focus on digitalization, provision of various sources of funding, strengthening of international presence, development of cultural tourism and diversification of program offers. The implementation of these strategies can not only solve existing challenges, but also significantly expand the influence and visibility of cultural institutions of Dnipropetrovsk region.

Table 1 Results of the SWOT analysis

The summary table of the SWOT analysis contains an overview of internal and external factors affecting cultural institutions. Strengths are outlined, including a rich cultural heritage and skilled workforce, as well as weaknesses, including limited funding and technological integration. The Opportunities segment highlights areas for growth, including digital transformation and cultural tourism, while the Threats highlights the challenges faced, such as competition and changing cultural consumption patterns. The “Strategic Recommendations” table shows effective strategies for increasing the competitiveness of these institutions. This includes implementing digital innovations, finding different sources of funding, strengthening marketing and international cooperation, engaging the community and diversifying program offerings. Each strategy is accompanied by specific action items, providing a clear road map for implementation.

Table 2

Strategic recommendations

Conclusions. Creative industries in Ukraine have demonstrated a significant impact on both the economy and the cultural landscape. This sector includes a wide range of activities, from traditional arts to modern digital forms such as IT and video games. Legally recognized in 2018, these industries make a significant contribution to Ukraine’s GDP, employment and export services. Investments in creative sectors demonstrate a multiplier effect for the economy. The growth and support of these industries is evident through a variety of initiatives and foundations, highlighting their integral role in facilitating economic and social innovation, technological progress and improving the quality of life. The influence of creative industries is multifaceted, it affects not only direct economic indicators, but also promotes cultural tourism and community development. And their active promotion in social practice will help Ukraine to quickly overcome apathy and social passivity, will stimulate the formation of a socially active personality that sees itself as a participant in social transformations.

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