When Joko Widodo became Indonesian president, he made good on his campaign promise to offer greater support for the creative arts by setting up a special Creative Economy Agency (Badan Ekonomi Kreatif or Bekraf) with direct lines of responsibility to the president. The head of the new agency, Triawan Munaf, a former musician and advertising executive, has been given cabinet-level status.
The new agency, which is literally being built from the ground up, envisions a special role for the creative economy in Indonesia as a center for dynamism in areas like film, music, design and animation. By moving creative economy into its own agency after previously being housed under the tourism ministry, the president has said he hopes eventually to see the creative economy double its share of GDP from the present 7 percent.
Supporting and investing in the creative economy is a natural for American companies steeped in Hollywood, pop music and cutting edge technology. As a way to engage with Indonesia’s new creative push, AmCham Indonesia, the US Chamber of Commerce and several US companies including The Walt Disney Company, Universal Music and ESPN met March 16-17 with high-ranking Indonesian officials to discuss issues related to creative economy investment.
Indonesian artists joining the discussions were hip-hop musician JFlow, filmmaker Sheila Timothy Wanandi and IT entrepreneur Shinta Danuwardoyo. The US Chamber was represented by senior vice president for Asia Tami Overby, senior director for Southeast Asia John Goyer and senior manager, policy and programs, for Southeast Asia Natalie Obermann. AmCham Indonesia was represented by managing director A. Lin Neumann and communications director Mary R. Silaban.
On the two-day visit to Indonesia, the group met with Triawan, Trade Minister Rachmat Gobel, Deputy Chairman Himawan Hariyoga of the Indonesia Investment Coordinating Board (BKPM) and presidential chief of staff Luhut Panjaitan to discuss the investment climate and how American companies can contribute to creative growth.
“Indonesia is land of talent, no doubt about it,” said Sandy Monteiro, President of Universal Music SE Asia, noting a positive creative trend over the last few years.
“In the 1990s, Malaysian artists made the top of the charts in Indonesia, now almost all those topping the charts in Malaysia are Indonesian artists,” said Monteiro, adding that Indonesia is an important market for Universal Music.
Disney also acknowledged Indonesian talent, with popular singer Raisa recently linking up with Disney to sing the Indonesian version of the song “A Dream is a Wish Your Heart Makes” for the live-action version of the movie “Cinderella.”
The three companies that joined the meeting recognized the huge potential of the Indonesian creative economy, but also addressed obstacles to doing business here, especially in terms of IT infrastructure, noting that neighboring countries like Malaysia and the Philippines is are outpacing Indonesia.
Another challenge on the ground is securing licenses to do business. “We have to open different business entities to deal with artist management, video production and merchandising,” said Monteiro. He said it would be more convenient to allow one company to handle all aspects of the music business rather than insisting on separate entities.
The Indonesian counterparts joining the talks also recognized challenges in developing the creative economy.
“Talent is available, but there are very few senior people who lead the business process,” said Shinta, the chairwoman of bubu.com, a pioneering digital agency in Indonesia.
Filmmaker Sheila Wanandi, who also heads the Association of Indonesian Film Producers, added that in the movie industry it is a challenge to find partners and investors to assist in production and marketing.
JFlow said protecting intellectual property remains a major challenge for creative artists like himself. It is a constant struggle, he said, to keep pirates from stealing and selling his music.
The US companies said the hurdles can be overcome and that the Indonesian creative economy offers an enormous opportunity for companies willing to put in the time and effort.
“All the creative industry needs is a platform,” said Rob Gilby, Managing Director of Walt Disney SE Asia. “But US companies need to be here, we can’t do it remotely.”
Officials including trade minister Rachmat and presidential chief of staff Luhut said the government is eager to welcome US companies wanting to invest in what remains a fledgling sector of the economy.
“There are many branches of the creative economy. We need to focus on the first branches,” said Bekraf boss Triawan, urging growth in the local film industry through more vigorous investment and sound regulatory policy.
Triawan also said he favors removing restrictions on foreign investment in the film and theater business from the country’s Negative Investment List.
“Creative economy hasn’t been well taken care of by our office,” admitted BKPM’s Himawan, adding that his office is keen to work together with AmCham, the Chamber and US companies to implement plans to attract more investment in the creative sector.
