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    Restrictions limit growth of cultural companies

    Updated: 2013-07-31 11:35
    By Wang Hongyi in Shanghai ( China Daily)

    Restrictions on private investment in the cultural sector have limited the growth of private enterprises, according to a report released on Tuesday.

    Restrictions limit growth of cultural companies

    The China Yiwu Cultural Products Trade Fair, which held its eighth annual event in April, aims to provide a trading platform for domestic cultural enterprises. Zhang Jiancheng / for China Daily

    The report, authored jointly by Shanghai Jiao Tong University's National Innovation and Development Base and the China Culture Index Research Center, found State-owned cultural companies remain the primary force in the industry.

    "In terms of investment structure, State-invested companies have dominated the cultural industry. The government has implemented strict limitations for market access," said professor Hu Huilin, director of Shanghai Jiao Tong University's National Innovation and Development Base, who led the research.

    The report noted financing channels are limited for private companies, causing a lack of financial momentum to seek better development.

    According to research by the Ministry of Culture in 2010 on the country's 300 private culture companies, 56.7 percent said they have difficulties raising money.

    Their financing methods were limited, and more than 80 percent of companies relied on their existing funds.

    Currently, the entry threshold in performing arts, advertising and entertainment industries is relatively low, offering ample room for private enterprises, while in the publishing, audio-video, media and television-film sectors, private capital faces more limitations.

    "There were only three cultural enterprises in the top 500 Chinese private companies in 2009 and they were in the paper, printing and stationery business," Hu said. "They are enterprises manufacturing cultural products but don't have much cultural connotation."

    The China Cultural Industry Development Index, intended as an indicator of the performance of the country's cultural sector, was part of the report.

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