12 facts about the UK’s international trade in creative goods and services

27 March 2020

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Dr Salvatore Di Novo, 

Dr Salvatore Di Novo

Research Associate at Newcastle University

Dr Salvatore Di Novo is a Research Associate at Ne...

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Professor Giorgio Fazio, 

Professor Giorgio Fazio

Research Director of Creative PEC and Chair of Macroeconomics at Newcastle University Business School

Giorgio Fazio is an applied economist with experti...

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Dr Wessel Vermeulen

Dr Wessel Vermeulen

Lecturer in Macroeconomics at Newcastle University Business School

Dr Wessel Vermeulen is a Lecturer in Economics at ...

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Worldwide exports of creative goods exceeded 500 billion USD in 2015, with a 150% increase since 2002. In the UK, the creative industries have become an increasingly international sector in terms of the intensity of incoming and outgoing flows. As of 2017, exports of creative goods and services accounted for nearly 45% and imports accounted for 26% of the Gross Value Added (GVA) to the UK by the creative industries. This means that the UK’s creative industries make a strong positive net contribution to the UK’s balance of payments.

Ahead of upcoming trade negotiations between the UK and the US, understanding the forces behind these numbers is important. In this report, we draw on official data from the Department for Digital, Culture, Media and Sport (DCMS)and data supplied by other international sources to present facts about the international trade position of the UK’s creative industries. In doing so, we identify issues that need further empirical work.

In the report we assess the international trade and performance of the UK’s creative industries by focusing on 12 key facts:

  1. The fast rise in creative industries trade is driven by the expansion of trade in services.
  2. The rise in creative services trade is seen across sub-sectors.
  3. The Information and Communication Technology (ICT) related sector is the most important in the creative industries  in terms of the volume of exports.
  4. Sub-sectors with relatively fewer firms are also the ones with a greater share of international firms.
  5. The EU is the largest trading partner for UK creative goods and services, followed by North American Free Trade Agreement (NAFTA) countries and then Asia.
  6. The UK’s creative industries enjoy a large trade surplus in services and a moderate deficit in goods with the EU/European Economic Area (EEA)/Switzerland and a trade surplus with the rest of the world.
  7. The main trade partner varies by sub-sector.
  8. Trade-intensive creative industries are characterised by strong intra-industry trade. 
  9. 90% of the value of exports from the creative industries is created domestically.
  10. Domestic and international talent and skills are both important for the creative industries.
  11. Average (heads-based) labour productivity greatly varies across creative industries sub-sectors, party reflecting differences in human capital.
  12. Creative services trade are subject to various degrees of regulation across the world. The restrictiveness of these regulations varies greatly across sub-sector and geography. 

Please reference this paper as:

Di Novo, S; Fazio, G and Vermeulen, W. (2020) 12 facts about the UK’s international trade in creative goods and services. Various: Creative Industries Policy and Evidence Centre and Newcastle University. Available from: https://www.pec.ac.uk/research-reports/12-facts-about-the-uks-international-trade-in-creative-goods-and-services

Published 27th March 2020

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This research report is published by the Creative Industries Policy and Evidence Centre (PEC). All PEC research reports have been peer reviewed prior to publication. In keeping with normal academic practice, responsibility for the views expressed in this research, and the interpretation of any evidence presented, lies with the authors. These views and interpretations do not necessarily represent those of the PEC or its partner organisations.