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South Africa’s Economic Woes Spur Spate of Filming of Foreign Films, TV Shows

With a global slump in commodities prices and a raft of poor government policies pushing the economy into a tailspin, South Africa’s locations industry nevertheless has been able to find a silver lining in the growing demand from foreign producers to shoot in the country.

“The decline of the rand has been extraordinary, which is excellent for foreign films,” says David Wicht, CEO of Cape Town production house Film Afrika. “In an era of addiction to incentives, it turns out the biggest incentive to shoot in South Africa is a declining rand.”

In January, the currency slumped to an all-time low, a development that allowed one American series serviced by Film Afrika to spend 40% less than producers had budgeted as recently as October, when the rand was trading at 12 to the dollar, according to Wicht.

The economic slide has only spurred further interest in a country already known for its diverse locations, skilled English-speaking crews and competitive rebates. Recent shoots — including “The Avengers: Age of Ultron” and season four of “Homeland” — have solidified that reputation, with demand surging even before the rand began to tumble.

Among the foreign projects currently in production are the fourth season of the Starz original series “Black Sails,” and season two of ABC’s biblical drama “Of Kings and Prophets.”

According to Nico Dekker, CEO of Cape Town Film Studios, which is opening its fifth soundstage this month, demand is so great that he wished he originally had decided to “double or triple the size” of the space. The studio is already booked through the end of 2016, he adds, and estimates that he’s been forced to turn down close to 40 foreign shoots, including a number of “iconic and major productions” budgeted at about $150 million.

“People are angry that I haven’t built more,” he says.

Dekker maintains that the 2010 opening of CTFS — which he believes to be the first custom-built studio in sub-Saharan Africa — has helped to change perceptions of South Africa abroad. “The country was well known as a (place) for location-based filming … but the studio brought a new dimension to that,” he says, noting that it helped show filmmakers worldwide that shooting in South Africa is efficient and innovative.

Indeed, the film biz has provided the troubled South African economy with a much-needed shot in the arm. According to a 2012 study by the National Film and Video Foundation, the industry contributes more than $200 million to South Africa’s GDP.

The growth in the number of soundstages underscores the film industry’s ability to withstand the ups and downs of the global market, notes Dekker, pointing out that the studio was operating at full capacity in 2010 when the rand was trading at just over seven to the dollar.

“I’ve always felt we should not base our industry on a cheap rand … but rather on the ability to deliver value for money,” he says.

Yet a protracted downturn in the economy could certainly be a double-edged sword, Dekker allows, if imports — including costly film equipment — become more expensive, and interest rates begin to creep upward.

For now, though, he says the combination of a weak currency and a proven track record for servicing foreign shoots makes South Africa a “no-brainer” for producers.

As for how the country’s currency woes will play out in six months’ time, Film Afrika’s Wicht says simply that he’s expecting “a massive rise” in shows wanting to shoot in South Africa.

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