BusinessDay Media recently hosted the inaugural ‘Africa Trade and Investment Summit’ in Lagosdrawing together key stakeholders and policy facilitators from the creative industry who spoke on impactful regulations and policies, particularly in the context of funding, to spur the growth of the creative industry in Nigeria and across Africa.
The panel, session tagged ‘Creative Economy and The African continent’ led by Nneka Okekearu of the Enterprise Development Center, LBS, saw the panelist Stella Okotete, Executive Director Business Development Nigeria Export Import (Nexim) Bank, Audu Maikori. CEO Chocolate City, Imal Silva Artist, Creative Economy Policy & Investment consultant and Kalilou Troure Ambassador of Côte d’Ivoire’s to Nigeria.
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Stella Okotete on the issue of funding said that the risks are so high that when taking a further look at these creative businesses, they end up reducing the loan amount or not giving them the loan at all.
“The creative sector is still at its ripe stage for funding. This is because a bank will only fund a bankable business. The creatives have ideas but they don’t put it into a business plan that is bankable,” Okotete said.
Okotete said that what is expected by the banks is for players to look at collaboration and capacity building and developing the right bankable business ideas to enable support.
“As a trade facilitation bank of the government what Nexum Bank is doing is to talk and work with other policy makers like the CBN to see how we can capture export of services into our own position as a country and it requires patriotism from the players in the creative sector,” Okotete said.
Given examples of movie producers who get funding from companies like Netflix to fund their films Okotete said that when receiving funds from international companies it’s observed that the people receiving the fund rather open domiciliary accounts to receive these funding rather than have export proceeds accounts.
“Whatever they do, because we are a wholesale bank with a defined mandate on export we can’t fund you because all your transactions have been informal as far as we are concerned. What formalises your export is the receipt of your export proceeds and if it’s not captured as a proceed but rather as an inflow, we can not do anything but get you to formalise it,” She said.
Its for this reason Nexim Bank is working with the CBN and trying to work with the private sector to see how they can have an E-commerce data platform which she called ‘Naija Baba’ which is almost like a replica of ‘Ali Baba’ platform where the creative sector revenue can be captured in a pool of funds as proceed.
Audu Maikori who was virtually present during the panel says that banks should be able to understand that the model of collaterals and funding has shifted and there is the need to shift to Intellectual Property and catalogue valuation using track record to benchmark a fair gamble in terms of investing in the said business.
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Maikori using his company as a personal example said Chocolate city had received funding from outside investors and there was no need for physical collateral but rather a proven track record of the companies IP which led to the firm being comfortable t investing in his company. He encouraged banks to join the trend of investing in online intellectual property creatively. Not following this trend may lead creatives to continue partnering with foreign companies, which would only benefit banks in other countries.
Maikori complained about a weak IP protection system as one of the main challenges. “For Africa to take its place and lead in the creative sector, there is a need for proper intellectual property protection and enforcement,”Maikori said.
He said even though the creative works are getting international audiences, he questions how well the intellectual properties are being monetized.
Imal Silva said a lot of ideas about the creative industry are still subjective in the minds of people which makes it difficult for a lot of investors to take chances or risk.
Silva said “People go to acquire technical skills in different areas of the creative sector like theatre, film, textile , art, and advertising, in the universities and they add their talents to it but hardly do we address the business knowledge around those technical skills.”
Silva said the most important innovative approaches to scaling the industry is to benchmark the industry with what happens in the UK and US as they are clearly ahead of Africa in terms of sustaining a mix economy approach where there is a clear collaboration between the government and the private sector in the industry.
On how collaborations can be more effective, Maikori said there is not enough lobbying to talk to representatives and key policy makers. He said the young people need to be engaged and there should be better training for people as well as the judiciary setting up specialised courts for matters affecting intellectual property efficiently and timely.
“With an influx of international companies coming into Nigeria, there needs to be a level of regulation to make sure there is no second recolonisation of our intellectual property which is worse than the physical one because intellectual property lasts forever,” Maikori said.
Okotete said supporting the creative industry fits into the Nexim’s core mandate. According to her, the creative industry falls under the category of ‘Services’ which is one of the four cardinal points for Nexim Bank’s investments. She said the bank is taxed with providing single digits funding lines to support players within the creative industry value chain.
According to her, funding has been given to a movie production company, as well as textile and leather refineries in Kano State. Another example she gave is the Women and Youth Export Development Facility which is also on single digit funding.
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Looking at measure Cote d’ivoire has embarked on to foster the creative economy in the country, Kalilou Troure Ambassador of Côte d’Ivoire’s to Nigeria said that the country does not export a lot of creative services at the moment though the country boast of high export numbers in other sectors like Agriculture, and digital economy.
Ambassador Troure said that for Côte d’Ivoire, there is to learn from Nigeria in music and movies and there are talks to develop a partnership with Nigeria. “In the general framework of facilitation of the cross border trade which is in the framework of ECOWAS one of the things that will benefit the creative industry is that we have free movement of people which will develop training and movement of talents.”
