The Mapping of Creative Economy for the Sustainable Development

Goals: A Case in Sukoharjo Regency, Central Java, Indonesia

Umrotun

, Priyono

, Choirul Amin

, Muhammad Sholahuddin

Faculty of Geography, Universitas Muhammadiyah Surakarta, Indonesia

Faculty of Economics and Business, Universitas Muhammadiyah Surakarta, Indonesia

Keywords: creative industries, sustainable development goals

Abstract: The issue of the creative industry remains an important issue for developing countries, as well as Indonesia.

The handling of industrial issues must be understood and considered as a world issue, thus it must be

addressed to a global context. Every creative industry handling program must be understood thoroughly and

interdependent with other activity programs. In SDGs, industry, innovation and infrastructure are at point 9 out

of 17 goals. It means that the world agrees to improve the economy around the world, including Indonesia.

Micro, Small and Medium Enterprises (MSME) creative industry is expected to compete in the global era, but

it indicates a weakness in synergizing the stakeholders. Therefore, it is necessary to make serious efforts by

starting the mapping of creative industry of MSME in Sukoharjo regency and analyzing the related strategy

and regulatory plan. The results showed that the development of the creative industry of MSME sector was

very important as it affected a country. This creative industry had become a part of the interest of economists,

statistician, cultural experts, and public policymakers. The creative economy sector based on creativity and

innovation is expected to contribute toward the growth of the national economy and become a new power of

the Indonesian economy. Indonesia is supported by a huge market and demographic advantages to be one of

the great powers of the creative economy in the world before 2030.

1 INTRODUCTION

Last year, at the United Nations General Assembly,

Indonesia (represented by Vice President HM Jusuf

Kalla) committed to join the global development

agenda on the framework to the Sustainable

Development Goals (SDGs). The framework is the

extension of the Millennium Development Goal

(MDG) program completed in 2015. Indonesia is 8-

10 years left in implementing MDG, thus Indonesia

has not been able to reach 19 indicators out of 67

MDG indicators. Many unachieved indicators are

reducing the number of poor people, the number of

maternal mortalities, and the number of

malnourished children under five. Failure to achieve

MDG targets is also due to the lack of involvement

of civil society and business communities. In line

with the formulation of SDGs at the global level,

Indonesia has also drafted the National

MediumTerm Development Plan (RPJMN) 2015-

2019, thus the substance in the SDGs has been

confirmed with the RPJMN (translation of

Nawacita) as the Vision and Mission of the

President.

Micro Small and Medium Enterprises (MSME)

has an important role in the Indonesian economy.

The number of entrepreneurs in the business sector

according to the Central Bureau of Statistics reaches

55.2 million business units or 99.99% of all business

units in Indonesia and employ 101.7 million workers

(97.2%). The MSME sector is the most likely to

survive because it depends on local content. They

use domestic resources in terms of human resources,

raw materials, equipment so that they do not depend

on the exports. In addition, the product of the

MSME sector aims to meet the domestic market

share, thus it does not depend on the economic

conditions of other countries. These micro and small

entrepreneurs are able to make great strides and

enter as the medium and larger category, thus they

are expected to accelerate the GDP growth,

employment, and even greater foreign exchange

contribution.

Umrotun, ., Priyono, ., Amin, C. and Sholahuddin, M.

The Mapping of Creative Economy for the Sustainable Development Goals: A Case in Sukoharjo Regency, Central Java, Indonesia.

DOI: 10.5220/0008787202930296

In Proceedings of the 2nd International Research Conference on Economics and Business (IRCEB 2018), pages 293-296

ISBN: 978-989-758-428-2

293

The study of entrepreneurship in the field of

economics (especially in the western) is relatively

small, particularly in Sukoharjo regency.

Meanwhile, the creative industry of MSME is

expected to compete in the global era, but it

indicates a weakness in synergizing the stakeholders.

Therefore, it is necessary to make serious efforts by

starting the mapping of creative industry of MSME

in Sukoharjo regency and analyzing the related

strategy and regulatory plan.

In general, the creative industry of MSME in

Sukoharjo is divided into three main stages: (1)

mapping of Sukoharjo creative industry on MSME

entrepreneurs, (2) analysis of creative industry on

MSME entrepreneurs’ competitiveness, and (3)

analysis of policy and alternative strategy on

competitiveness increase or its application.

Therefore, the aim of this paper is to examine the

mapping of potential creative industry in Sukoharjo

regency.

2 LITERATURE REVIEW

There are only a few studies in the country that

explain the entrepreneurs' position in the national

economy, in the relationship between finance and

growth, in the contribution, and in the potential to

the economy. However, we can see some research

conducted in other countries as the initial reference.

Research conducted by Global Entrepreneurship

Monitor (GEM) to 42 world countries (including

Indonesia) illustrates the interesting facts that

researcher can follow-up. The results showed that

the rate of entrepreneurship was inversely

proportional to GDP per capita, but the curve form

resembled the letter "U". Countries with a low rate

of GDP per capita (such as Indonesia, Philippines,

Peru, and Colombia) showed a high rate of

entrepreneurship. This condition was the opposite of

middle to high-income countries (such as Japan and

the EU) that showed the low rate of

entrepreneurship. However, the rate of

entrepreneurship countries with high GDP per capita

(such as the United States and Norway) increased

again.

There are several different results from

previously conducted research about

entrepreneurship. Audretsch and Thurik findings

prove that increasing the number of entrepreneurs

can reduce the number of unemployment. They call

this condition as 'Schumpeter effect' by referring to

Schumpeter's theory which states that

entrepreneurship provides a positive effect on

employment. Barringer's findings state that most

start-up companies face many obstacles to survive,

thus most of them experience failure less than 2

years after its establishment. Therefore, a study

related to the differences between those two research

results is necessary to conduct. For the domestic

researchers and policymakers, these differences are a

challenge as the actuality and locality for a domestic

case that needs to be confirmed.

Among the economists, there are two

mainstream views of entrepreneurship in its position,

namely the managed and the entrepreneurial

economy. The managed economy groups believe

that competitive advantage is achieved if the mass

production scale derived from the use of capital and

labor are fulfilled. Solow's theory is also often called

the old paradigm that is very popular during the

industrialization period. Indeed, the major

requirements of large capital and labor are only

found in large-scale and powerful industries, such as

Multinational Corporation (MNC). These groups

believe that the start-up companies and small and

medium-sized enterprises cannot improve the

economy as characterized by Charles Brown: (1)

The inefficiency of production compared to large-

scale companies; (2) Low wages for workers; (3)

Lack of innovation, research and development

(RandD) support in production; The insignificant

role in the economy.

In contrast to the first view, the entrepreneurial

economy groups consider that entrepreneurship

plays an important role in increasing the state

economic output today. Audretsch and Thurik

emphasize the rapid knowledge spillover process of

new and small-to-medium scale business caused by

the power of innovation and creativity. These are

several strong arguments for the second group: (1)

Technology has developed rapidly, thus it is

expected that the production scale required to

achieve economies in the lower scale than before;

(2) Specific market target (niche market) evaluated

stronger can be conducted by new companies or low

scale of companies.

Nevertheless, two arguments above are not

necessarily appropriate to be confronted in a local

context or in a developing country, including

Indonesia. This is due to the differences in the field

and economic structure.

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3 RESULTS AND DISCUSSION

Until the end of June 2009, there are 8 companies in

Sukoharjo Regency have Foreign Investment (PMA)

status with an investment value of US $ 163,065,735

and have employed 21,299 people and 14 companies

of Domestic Investment (PMDN) with value

investment of IDR 524,445,000,000 have employed

18,803 people. The creative industry classification

used in this study followed the creative industry

classification that had been mapped in Creative

Industry Studies 2007. The mapping of creative

industry has previously classified the creative

industry sectors into 14 creative industry sub-

sectors: 1. Advertising; 2. Architecture; 3. Markets

and Art Goods; 4. Handicrafts; 5. Design; 6.

Fashion; 7. The film, Video, Photography; 8.

Interactive Games; 9. Music; 10. Performing Arts;

11. Publishing and Printing; 12. Computer and

Software Services; 13. Television and Radio; 14.

Research and Development. This figure 1 below

describes the map of Small Medium Enterprises of

Creative Economy in Sukharjo Regency in 2018.

Figure 1. Map of Small Medium Enterprises of

Creative Economy in Sukoharjo Regency

The trade sector plays an important role in the

national economy. The number of workers that can

be accommodated by the trade sector ranks second

after the agricultural which consists of 22.21 million

people out of 107.41 million people working in

Indonesia. It means that 21 percent of the Indonesian

population is involved in the trade sector. The

capacity of this sector will increase as the increasing

trade carrying capacity by the government in terms

of accommodative infrastructure provision and

regulation. Having many working people, 20.46

million people try to work independently, and 21.92

million people work while being assisted by

temporary laborers. Overall, 42.38 million people or

40% have an entrepreneurial spirit. This is in

accordance with Wennekers statement, stated that

entrepreneurship can be defined as ownership that

also involves the business management so that the

entrepreneurs could be an owner-manager, small-

medium enterprise and self-employed. The

superiority of the trade sector is also supported by

the high growth of this sector. For example,

restaurants and hotels on the national GDP achieved

growth rates up to1.6 percent.

4 CONCLUSION

Economic growth is not only depending on capital

investment, but it is also affected by innovation and

new production method obtained from new

entrepreneurs. When it is observed in a more detail

way, most studies only focus on the industrial sector.

As a result, the other sectors that deals with the

study of entrepreneurship are less explored.

Furthermore, it must be associated with the local

economic configuration to create conformity of facts

and development needs. Furthermore, it must be

associated with the local economic configuration to

create conformity of facts and development needs.

The mapping of the creative economy in Sukoharjo

Regency explained that many home industries in

terms of the creative economy should be coached

and supported by the government in financial,

managerial, and marketing aspect. The implication

of this research is to make it easier in making

strategic planning to support the creative economy in

Sukoharjo Regency. In the next research, it is

needed to explore the informant of the creative

economy with SWOT analysis of Micro-Small

Medium Enterprises.

ACKNOWLEDGMENT

We would like to extend our gratitude to the Center

of Research and Community Service at Universitas

Muhammadiyah Surakarta (LPPM UMS) that

funded this research. We also offer our sincere

gratitude to our team (Iwan, Helmi, Ida, Ifka and

Agustin) for their assistance in accomplishing this

research.

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