Generous state support and soaring private investment are spurring further growth in Colombia’s film industry.

In fact, the impact of a 2003 film law that established tax breaks for film financiers and the creation of a $3 million annual Film Development Fund continues to reverberate, playing a pivotal role in getting Cannes’ Un Certain Regard entry “Los viajes del viento” (The Wind Journeys) off the ground. Similarly affected was Camilo Matis’ 40-minute short “1989,” starring Vincent Gallo, which closes the fest’s Critics’ Week.

“By having ‘Los viajes del viento’ and ‘1989’ accepted by official sections in Cannes this year, we are reaping the benefits of years of government stimulus and promotion of national cinema,” says Claudia Triana, head of nonprofit Proimagenes en Movimiento, which manages the Film Development Fund among its myriad functions. She says the last Colombian film accepted in an official Cannes section was Victor Gaviria’s “The Rose Seller” in 1998.

Private investment in pics more than doubled last year to $7.6 million from $3 million in 2007, according to David Melo, head of the Culture Ministry’s film department. The number of projects receiving private coin skyrocketed to 16 last year from just two in 2004. More Colombian filmmakers are also forging co-production alliances with international entities.

Colombia has yet to reach the production levels of Brazil, Argentina and Mexico, each of which release up to 70 titles per year. But the average number of Colombian theatrical releases has risen from eight in 2006 to an expected 12 or so this year.

“Paraiso Travel” helped nudge local films’ audience share to 10.3% last year after peaking at 13.8% in 2006 thanks largely to blockbuster “Sonar no cuesta nada.”

“Our goal is to make Colombia a creative industry hub within the next five to 10 years,” says Colombian Vice President Francisco Santos. New tax incentives are in the works, he adds.

It was Santos who persuaded the filmmakers behind “Love in the Time of Cholera” to shoot in Cartagena instead of Brazil. The state has allotted

$1 million to set up a film commission, which debuted at the annual AFCI Locations confab in Santa Monica, Calif., last month.

Aside from improving security, Colombia has been formulating a policy that will provide resources, training, loans and the infrastructure for local and international audiovisual companies.

For example, Guatemalan-based animation/digital effects company Studio C, run by Hollywood vet Carlos Arguello, is setting up a branch as well as a state-backed training center in Bogota. Studio C touts the first two “Chronicles of Narnia” pics among its credits.

On the TV side, Fox Television Studios produced its first English-language series in Colombia, “Mental,” which will air on Fox TV in the U.S. and Fox Intl. Channel outlets in 35 countries this summer.

In January, Sony Pictures Television acquired 50% of Colombian indie production company Teleset to serve part of its panregional programming needs.

Among the locals, RCN Cine has boarded some of the most noteworthy pics to come out of Colombia in recent months, including “Los viajes del viento” and “La sangre y la lluvia” (Blood and Rain), among others.

The company also partnered with Vertigo Films, Andale Pictures and Screen Gems for the $15 million “Operation Checkmate,” based on the recent rescue of politician Ingrid Betancourt and other hostages held by Marxist rebel group Revolutionary Armed Forces of Columbia.

Cine Caracol, headed by Diana Bustamante, has been catching up with its rival and plans to invest in an average of five pics a year. “We want a diverse portfolio that will include mainstream as well as arthouse films aimed at the international marketplace,” says Bustamante.

Caracol also is in talks to board an international production with Salma Hayek reportedly attached, “Noticias de un secuestro,” an adaptation of the novel by Gabriel Garcia Marquez. Coproducers include Argentina’s Costa Films, Mexico’s Argos Cine and Spain’s Filmax.

Another private investor leading the charge is Dynamo Capital, a multimillion-dollar blind fund founded by a group of U.S./European-educated thirtysomethings. Since its launch last year, the fund has backed a slew of pics starting with Andi Baiz’s “Satanas.”

The group has clinched alliances with European sales agents for its latest pics — a growing trend as more Colombian pics enter the festival circuit.

“We have Wild Bunch handling the international sales of ‘Rabia’ and Memento Films managing ‘Contracorriente,'” says fund co-manager Cristian Conti.