Iceland, a model to follow // Islandia, un modelo a seguir

Posted on March 5, 2013 by

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—————— Versión en Español abajo / Spanish version below ——————

I allow myself to repost an article from Wired Magazine (for the English article) and the Fundación Ampersand (Spanish version) on Iceland’s creative industries, a transformation process led by a minister of culture who gives speeches wearing Doc Martens, and an economic strategy based on gaming, music and the movies.

Frábær, indeed.

Moritz


Iceland is betting on its creative industries to rebuild its economy after the banking collapse of 2008.

A disused power plant sits in the suburbs of the Icelandic capital Reykjavik. Once, it was fed with coal to cope with spikes in the country’s electricity demand — usually as people get home from work in the early evening and turn their television, kettle and washing machine all on at once.

Today it lies dormant. Still operational, but dormant, as the country’s efficient exploitation of the natural energy bubbling up from the tectonic plates sliding apart beneath it has replaced dirty coal plants. Now, Iceland collects more energy than it uses.

So the building is being repurposed. It’s now known as Toppstöðin — pronounced, approximately, top-stir-thin — and it’s buzzing with activity. In one room, a team of students is building an electric race car out of basalt fibre, plentiful in a country comprised largely of basalt. In the next, a team of underwear designers are hand-making lingerie, and jigsaws and boardgames are being designed in the room beyond. Upstairs, in the hall where a vast pulley system used to haul coal up to the furnaces, a stack of colourful paper globes lie on the floor and a series of lightbulbs hang from the ceiling — an artwork half-way through completion.

Toppstöðin is the brainchild of Andri Snær Magnason, an author who wrote a book called Dreamland: A Self-Help Manual for a Frightened Nation in 2006. The book was a critique of the government at the time’s policies on exploiting the country’s natural environment to deliver power to huge aluminium smelters. Dreamland struck a chord with the population, sold in vast numbers, and it’s hard to argue that it hasn’t had an influence on the path Iceland has taken since the downfall of the country’s political leadership in the wake of the collapse of the country’s three commercial banks in 2008.

After the collapse
In 2009, Jóhanna Sigurðardóttir was elected prime minster of the country — making her Iceland’s first female prime minister, heading up the country’s first majority left-wing government. In the process, she also became the world’s first openly-lesbian head of state. She held a series of referenda on whether the banks should be bailed out in the same way they were in other countries, but the population overwhelmingly voted no. The results of this decision are well-known — the value of the Icelandic krona plummeted, salaries halved in real terms, Iceland’s stock market fell 90 percent and GDP dropped by 5.5 percent in the first six months of 2010.

But then something strange happened — something that few economists predicted. By late 2010, economic contraction and a rise in unemployment had slowed. By the middle of 2011, growth had returned. With the help of the IMF, government debt was stabilised and a domestic banking industry, divorced from its vast international forebears, began to operate profitably.

Today, the country’s unemployment rate is down to 5.7 percent — considerably below the United States, the United Kingdom and its old colonial master, Denmark. Many of the emergency loans that it took out to keep it afloat have been repaid, early. Economic growth in 2012 was forecast to be just shy of three percent. A startup ecosystem is flourishing in the country’s capital. “The last five years in Iceland have been very interesting — it’s changed how we talk about society”, says Iceland’s minister for culture, science and education, Katrin Jakobsdóttir, one of the few government ministers in the world who gives speeches wearing Doc Martens.

How did this happen? How did the country pull itself out of the financial swamp quite so quickly? To understand, we need to open the pages of Magnason’s book.

In Dreamlands, Magnason argues that Icelanders shouldn’t be relying on a handful of industries, but should instead diversify — spreading the country’s culture around the world. He talks of setting up “communities where engineers, architects, computer scientists, graphic designers, accountants and people like that could set up and work for companies in the great world outside”. He says “I want this country to have a rich assortment of prosperous and creative industries.”

Flourishing creative industries
Many in the country took this message to heart. In December 2009, a group of people from Iceland’s various centres for different art forms got together for two days outside Reykjavik and attempted to craft a strategy for their industry. They wanted to prove they could contribute as much, financially, to the country as another aluminium smelter would.

While the rest of the economy had cratered, creative industries were almost unaffected, and were bringing in 81 billion ISK — about £930 million — way outstripping agriculture (25 billion ISK) and approaching the country’s mighty fishing industry (worth 114 billion ISK). It was also employing 17,000 people. They formed a federation — the Samtök Skapandi Greina — to give themselves a greater political voice.

The federation quickly realised that while Icelandic culture was popular in Iceland, limiting their artists to a audience of just 320,000 was never going to yield significant growth. “The only people Googling Iceland were Icelandic,” says Magnason. So like their Viking forefathers who sailed from Scandinavia, they cast their eyes to the horizon and began to look for international markets to plunder.

Action
A number of projects began to take shape. Magnason wrestled permission from the head of the Icelandic power company he’d been feuding over hydroelectric dams with for years to found Toppstöðin in the disused power plant, and opened the space up to any creative businesses that needed a place to work.

The Icelandic Academy of the Arts began an initiative that pairs product engineers, food scientists and graphic designers up with farmers from around Iceland to create new products that could be sold on an international market. Products like chocolate-covered skyr, caramelised rhubarb and a heavy, meaty, black pudding cake.

In 2006, money was set aside for an organisation called Iceland Music Export, with the goal of promoting Icelandic music abroad. Iceland had already become known for its musical output thanks to the efforts of Björk and Sigur Rós, so it was an early success story. In 2010, Iceland Music Export took over the running of the Iceland Airwaves music festival, which has long had a reputation for uncovering new music.

“They started running the festival in a more professional and sustainable manner, which subsequently led to more organised efforts to map the impact of the festival on the local economy,” says Vasilis Panagiotopoulos, manager of the Icelandic band Rökkuró. “The growing interest in Iceland lead to established international festivals such as Sónar to run a Reykjavik incarnation for the first time in 2013.”

Other festivals that have sprung up in Iceland over recent years include Aldrei Fór Ég Suður, Eistnaflug, LungA and Extreme Chill, but there’s also been an increase in bands seeking out an international career, says Panagiotopoulos. To help, musicians can apply for grants from the government, the city of Reykjavik, and even the national airline, Icelandair. In fact, the government now offers a stipend called “Launasjóður listamanna” to any artist to help them cover their basic costs.

The movie industry is booming too, thanks to a government policy of reimbursing 20 percent of all film and television production costs in the country. Ridley Scott chose Iceland to film Prometheus, and so did Darren Aronofsky for Noah. Homegrown production studio Truenorth told Bloomberg that it has brought in close to three billion ISK through projects involving the likes of Ben Stiller and Tom Cruise. Meanwhile, the rest of the world is interested too — British VFX firm Framestore opened a Reykjavik office in 2008, doubled in size by 2011 and has worked on titles that include Harry Potter, Where The Wild Things Are and Sherlock Holmes.

Revenue from the videogames industry has risen 600 percent, and the ten companies that comprise the Icelandic Gaming Industry Association brought in £42 million in 2011. The country’s mobile games industry is starting to take off, but most revenue comes from established players — an Icelandic company called CCP is one of the few in the world that’s managed to build a stable, successful massively-multiplayer game: EVE Online. Like a vast, interstellar game of Risk, the universe of EVE is a maelstrom of politics, intrigue and diplomacy, set against a backdrop of planets, galaxies and supernovae. Despite having launched nearly ten years ago, its 400,000-strong userbase is still growing.

Intriguingly, the country’s games industry is linked to its fashion industry. Harpa Einarsdóttir, a young fashion designer and illustrator who won Reykjavik Runway in 2011, and spent four years working at CCP designing digital outfits for the game’s characters. Now she runs her own label — Ziska — and sells her work online.

Tourism
All this has repercussions on other sectors of the country’s economy too. Tourism has risen around cultural events like Airwaves and the annual EVE Online “fanfest”. With a new focus on the international market, more foreigners want to come and see Iceland’s culture in its natural habitat. Since 2011, the number of foreign visitors attending Airwaves has increased 66 percent, and revenue from those visitors has increased 46 percent, too.

The growth of these industries is expected to continue. In November 2012, Iceland’s minister for Finance and Economic Affairs confirmed a massive three-year programme of investment for the creative industries and tourism, with 250 million ISK set aside for “new creative endeavour”. Where does the money come from? The country’s vast fishing industry.

An annual conference called You Are In Control, running alongside the Airwaves music festival, has been held since 2008 with the aim of collecting and celebrating digital developments in the country’s creative industries. Speakers are invited from across the world, but the focus is firmly on homegrown achievements, with many prominent local success stories showcased.

Fantasy island
Back in Toppstöðin, Magnason warns guests not to press any buttons on the power plant’s myriad panels, telling a story of an overenthusiastic film crew who flipped a switch and accidentally flooded the basement with water from a nearby river.

It would be easy to claim that Iceland could be used as a model for other economies that were trashed by the global recession to follow — countries like Greece, Ireland and Spain. But Magnason cautions against this. “Iceland is a projection,” he says. “It often serves as a fantasy island for things people want to believe.” The country still faces challenges, including large household and government debt and a weak krona.

Nonetheless, there is something to be learnt here about the value of industries traditionally overlooked. With a renewed focus on culture, Iceland has recovered from its economic problems far faster than expected, and in February, Fitch Ratings raised the country’s status back to investment-grade. That’s something worth paying attention to. I wouldn’t be surprised if creative industries will become the largest contributor to Iceland’s gross domestic product within the next 15 to 20 years,” Agust Einarsson, an economics professor at Iceland’s Bifrost University, told Bloomberg.

Magnason says that if the finance industry returns, it will return to a happier nation: “I don’t think even bankers want to live in a place with no culture. When this all comes together, it brings a sense of hope.”

Repost from Wired.co.uk

—————— Versión en Español / Spanish version  ——————

Islandia se apoya en la industria cultural como camino para salir de la crisis

A diferencia del sur de Europa, concretamente en los llamados países PIGS, por su iniciales en inglés para Portugal (Portugal), Italia (Italy), Grecia (Greece) y España (Spain), donde los recortes y las subidas de impuestos se han cebado especialmente con la cultura (recordemos el Manifiesto en defensa de la cultura y las artes promovido desde el GGAC – Gremi de Galeries d’Art de Catalunya como respuesta a la reciente subida del IVA al 21 % aplicada a las artes plásticas, la música, el cine y las artes escénicas), Islandia, un país de 320.000 habitantes y el tamaño de Portugal, se ha volcado desde 2008 en el sector de las industrias creativas como principal fuente de ingresos para dar un giro a la situación de crisis.

El impacto económico de esa actividad (unos 1.000 millones de euros) dobla hoy al de la agricultura y está solo por debajo de la legendaria máquina de exportar bacalao (y otros productos del mar) al mundo continental, primera industria de la isla. Todo ello gracias, en parte, a su joven Ministra de Cultura Katrín Jakobsdóttir (Reikiavik, Islandia, 1976), que literalmente se dejó los cuernos durante cuatro años desde el Gobierno y no permitió que le dijeran eso de: “¿Para qué vamos a darle dinero a los artistas?”. Al contrario, les convirtió en protagonistas del éxito económico reciente como metáfora de lo que se traía entre manos: crear riqueza a través del fomento de las artes, hasta el punto en el que hoy en día el dinero que genera es el mismo que toda la industria del aluminio (algo que también se refleja en el empleo que genera el turismo cultural).

Por esta razón decidieron terminar la construcción de Harpa (Reikiavik, Islandia), el nuevo centro de conciertos y conferencias de la capital (el nombre Harpa además de representar al instrumento musical también coincide con el nombre del mes, en antiguo islandés, con el que en el viejo calendario Nórdico comenzaba el verano), todo un símbolo para la música en Islandia que se inauguró el 20 de agosto del 2011, y el 22 de octubre de 2011 acogió las primeras actuaciones con La flauta mágica de Wolfgang Amadeus Mozart (Salzburgo, Austria, 1756 – Viena, Austria, 1791), y, de forma simultánea en otra sala, Biophilia de Björk (Reikiavik, Islandia, 1965).

Además, el Gobierno recortó partidas de estructura, adelgazó ministerios y gastos fijos, pero aumentó las aportaciones a proyectos culturales independientes. Una mezcla de tejido público/privado muy ágil pero que, en ningún caso, supuso la renuncia del Estado a la gestión de la cultura y la educación.

En paralelo, la industria del software y los videojuegos creció exponencialmente: “está en los aledaños de la cultura y también da mucho trabajo a gente del sector, como ilustradores”, según palabras de la propia ministra.

Para el cine, una nueva ley reembolsaba el coste de cualquier película rodada en Islandia a sus productores. Ridley Scott (South Shields, Reino Unido, 1937) se fue ahí a rodar Prometheus, igual que Darren Aronofsky (Nueva York, EE. UU., 1969) hizo con Noah.

A la vez, la anteriormente nombrada Björk, junto con otras figuras clave de la isla, participó en la creación de grupos de trabajo en lo llamaron el “Ministerio de las Ideas”, ubicado en una antigua fábrica en las afueras de Reikiavik, un experimento de democracia participativa que resultó ser todo un éxito: se convocó al 0,5 % de la población islandesa (seleccionados al azar) a que se reunieran en el Ministerio para elaborar y proponer proyectos. Como resultado creció el número de teatros, el mercado literario floreció (60 escritores tienen apoyo durante un año entero), la producción cinematográfica aumentó, igual que la escena musical, repercutiendo todas estas iniciativas directamente en la economía.

Para finalizar, decir que para el gobierno islandés las artes no son un proyecto paralelo a la buena economía, son la base de su salud.

Repost de un articulo de la Fundación Ampersand

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