Saudi Arabia Plows Ahead With Film Plans Amid Strong Human-Rights Criticism

In this photo released by the state-run Saudi Press Agency, Saudi Crown Prince Mohammed bin Salman speaks at a meeting of the Islamic Military Counterterrorism Alliance in Riyadh, Saudi Arabia, . Saudi Arabia's assertive crown prince on Sunday opened the first high-level meeting of a kingdom-led alliance of Muslim nations against terrorism, vowing that extremists will no longer "tarnish our beautiful religionRiyadh, Saudi Arabia - 26 Nov 2017

Saudi Arabia once had grand ambitions to become the movie capital of the Middle East, but the murder of journalist Jamal Khashoggi has cast a dark cloud over those dreams. Amid reports that appeared to implicate Crown Prince Mohammed bin Salman in the assassination, media companies that had rushed to embrace the Saudi leader as a reformer and had touted the potential of his country clammed up.

That dramatic shift in attitude is evident at this year’s Cannes Film Festival. A year ago, Saudi Arabia used the festival to court studios and film financiers. It set up its first national pavilion and trumpeted local rebates to lure Hollywood productions. But there is no Saudi tent on the Croisette this year, the promised incentives have not materialized, and the Khashoggi killing and various Saudi government policies continue to cause widespread revulsion.

“Everybody slowed down when the events around Khashoggi happened,” Imax CEO Rich Gelfond acknowledged Wednesday at an event in Cannes, adding: “But I think people are starting to move forward again.”

For some companies, Khashoggi’s brutal murder, by Saudi security agents whom the kingdom insists acted on their own, made it impossible to do business in a country rigidly controlled by the royal family and, in particular, the crown prince. Endeavor returned a $400 million investment from the Saudi sovereign wealth fund, and companies such as Viacom and Uber dropped out of a Saudi conference dubbed “Davos in the Desert” that had been intended to highlight bin Salman’s modernization efforts. (SRMG, a Saudi Arabian publishing and media company which is publicly traded, remains a minority investor in PMC, Variety’s parent company.)

But other Hollywood players ultimately decided to plow ahead with plans to enter a market that boasts a young population of wealthy consumers.

“You have to go in with your eyes open about the political situation and not be naive about it, but it’s potentially a very lucrative opportunity,” said Eric Handler, an analyst with MKM Partners.

Movie theaters, banned prior to 2018, are opening at a rapid pace in the kingdom, with Middle East-based Vox Cinemas on track to have more than 100 screens in operation by year’s end. AMC, the world’s largest exhibitor, expects to open as many as 50 theaters in the next five years. Imax has two theaters in operation through licensing deals. Major studios continue to release their films such as “Avengers: Endgame.”

“There’s no doubt there are a lot of complicated moral issues in Saudi Arabia,” said Gelfond. “On the one hand, you have the government who has clearly done a number of things that violate the world’s norms and moral code. But on the other hand, you have a population that it would be good for their people to modernize. The way we look at it is we could be completely idealistic and we can stand on the sideline, but I don’t know that would be the right thing for the population of the country.”

Some critics of the regime aren’t buying that logic. Besides its alleged involvement in the Khashoggi killing, the Saudi government has pursued policies that they say should make Western companies hesitate to do business with the country. A Saudi-led military intervention in Yemen has been accused of sparking a humanitarian catastrophe; the country has repressive laws regarding women, only recently allowing them to drive but imprisoning activists who lobbied for that right; and last month it beheaded 37 men in a mass execution.

“The Saudis’ cultural activities and the film industry it is trying to build are an attempt to put a pretty face on an incredibly repressive government,” said Medea Benjamin, co-director of Codepink, which has called on U.S. businesses to boycott the country. “This is one of the most misogynistic, intolerant regimes in the world. I don’t see why U.S. companies would tolerate that beyond the fact that Saudi Arabia has a lot of money.”

In Cannes, the Saudi contingent is keeping a lower profile this year, but it includes former Dubai Film Festival exec Shivani Pandya, who has been named general manager of Jeddah’s ambitious new Red Sea International Film Festival, Variety has learned. The festival is set to kick off next year.

“The road might be bumpy in its initial stage, and we may be witnessing some setbacks,” said Dubai-based producer Fadi Ismail. “But for sure things are moving forward.” Ismail, the former general manager of Saudi-controlled Dubai-based broadcaster MBC’s production arm, is now launching his own company with a slate full of projects based on Saudi intellectual property.

In Cannes, Abu Dhabi-based production powerhouse Image Nation, MBC, and Vox Cinemas on Wednesday announced a partnership to jointly produce and distribute Arabic film and TV projects in which “Saudi Arabia factors in enormously,” said Image Nation chief Michael Garin.

But outside the region, the killing of Khashoggi is impacting Saudi Arabia’s ability to forge international ties to make movies and attract top talent. It probably won’t be easy to get movie stars to attend the Red Sea fest. “It was tough enough to bring stars to Dubai,” said a prominent Middle East film exec who asked to not be identified, adding that “the current perception of Saudi is going to make it even tougher.” Nor have any major Hollywood productions announced plans to shoot in the kingdom – something that seemed possible when the country teased a generous round of film incentives.

“When we talk about the Saudi film industry…it’s sort of starting from zero, and it’s going to be quite a long process to build up anything that’s meaningful,” said David Hancock of research firm IHS Markit.

The Red Sea fest, which will include a year-round incubator/film lab, was announced in March, along with other initiatives, by Prince Badr Bin Abdullah Bin Farhan, who was appointed Saudi Arabia’s first culture minister last June. The prince, who is in his early 30s, is believed to be determined to lay the groundwork for an entertainment industry in Saudi Arabia, as is Turki Al-Shabana, who was appointed Minister of Media in December. Al-Shabana is a former top exec at MBC and the Rotana Media Group.

The new culture ministry is overhauling the country’s existing film and TV related bodies, sources say, including the Saudi Film Council unveiled on the Croisette in 2018, which may be among the reasons why there is no pavilion this year.

But the council’s first supported project, Saudi director Haifaa Al-Mansour’s “The Perfect Candidate,” is now in post-production. The film, announced in Cannes last year, is a comedic drama about a young Saudi female physician who maneuvers through her conservative, male-dominated society to run in municipal elections.

Stewart Clarke contributed to this story.