BRUSSELS — Plans to create a €210 million ($283 million) financial guarantee facility for Europe’s cultural and creative industries were revealed Wednesday by the European Commission. Move could unlock up to $1.35 billion in bank loans for small operators in the sector, it says, including for film and TV production.
Facility will be part of Creative Europe, a new program running from 2014 to 2020 that will absorb current European Union support for film and TV, including the Media Program.
The guarantee facility has been mooted because companies in the cultural and creative industries are poorly served by Europe’s lenders and do not fit well with existing mechanisms to help unlock credit.
Barriers include a reliance on intangible assets, such as intellectual property, and an output that is not susceptible to mass production. “Every film, book, opera, videogame can be seen as a unique prototype,” the Commission observed.
The Commission has already road-tested the guarantee idea in the film and TV industry with a $10.8 million Media Production Guarantee Fund. The EU contribution to date of $2.7 million has already generated loans to film producers worth $24.2 million, it said.
When it ends in 2013, this Media fund will be absorbed into the new, broader initiative, which will be open to the whole cultural and creative sector.
The Commission has been careful to emphasize Creative Europe’s continued support for the film and TV industry after reports of the Media Program’s imminent death caused an industry panic earlier this year.
Under Wednesday’s proposals, more than $1.2 billion will go to the cinema and audiovisual sector, out of a total budget of $2.4 billion. This represents a slight increase on the $1 billion plowed into Media and its international companion program Media Mundus from 2007-13.
However, the budget still needs to be examined by European governments and the European Parliament before these figures are set in stone.