South African film biz bids for bailout

Is the local business really healthy?

The success of Sowet-shot “District 9” has focused attention on South African production, but local filmmakers say the business is nonetheless in dire straits.

South African filmmakers took their hats in hand to Parliament last month, asking for a lifeline to bail out the country’s production biz as the global economic slump continues to take a toll on the industry.

But some see strength in adversity. Calling 2009 “one of our busiest years,” Lance Samuels, of the production company Out of Africa Entertainment, says the global economic downturn has been a blessing in disguise for the South African service biz.

“From our point of view, (the financial crisis) is one of the best things that could have happened,” he says. “Because of the cost effectiveness of South Africa, a lot more work is coming our way. Next year is going to be one of our best years yet.”

Yet producer Tendeka Matatu (“Jerusalema”), speaking on behalf of the Independent Producers’ Organization, raised the alarm for an industry in peril.

“If there is not an intervention, we run the risk of sinking slowly away,” he told assembled MPs Oct. 16, painting a bleak portrait of shrinking investment in local productions, and a servicing slump as foreign production companies are lured toward countries with more attractive incentive packages.

“Our rebates have been very effective since they were introduced in 2004,” he says. “(But) there’s a stronger rand, and our rebate is not as competitive as it used to be.”

The department of trade and industry estimates it paid out R209 million ($28 million) in 2008 alone, and that its incentive program will bring $160 million in foreign currency into the country this year.

But critics say it’s not enough.

“What I’ve seen across the board is — a 50% reduction over last year’s volume from films which are foreign-financed,” says David Wicht of Film Afrika. “We are back to the level we were at three years ago, and that is a significant downturn.”

The call for more government intervention comes at a time when the global financial crisis has dried up advertising revenues and available capital for South African productions. Local filmmakers are struggling to adapt to the economic climate by lensing low-budget features and opting for straight-to-DVD distribution. But Wicht says that the resilience of local filmmakers doesn’t necessarily add up to a healthy climate.

“There’s always a few films that (succeed) that are extremely low budget,” he says, “but that doesn’t make an industry. Unless you can get decent returns, it gets very tough.”

But not everyone is convinced government intervention is the best thing for the film biz.

According to Samuels, the industry needs to get its own house in order.

“South African producers should look to the industry to sort out whatever problems we have, instead of turning to the government to bail us out,” he says.

Even Matatu, who sounded the alarm before Parliament, remains guardedly optimistic.

“I think the industry will bounce back,” he says. “There’s huge opportunity for growth here in South Africa, and I think the government recognizes that more than anyone.”

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