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Film Industry Sector
Introduction
- Commonly known as the gateway to Africa, South Africa is currently
one the most sophisticated and promising players in the emerging
markets stable. Home to 6% of the continent's population, South
Africa produces approximately 18% of Africa's GDP and boasts 45%
of its mineral production and 50% of its purchasing power. All of
this has led to the domestic economy recording strong and consistent
performances in the post-apartheid era.
- The film industry, from pre-production to distribution, plays an
important role in the South African economy. It is estimated to
generate over R5.5 billion in economic activity annually and is an
important employment creator, directly affecting companies involved
in production, post-production, casting, crewing, equipment-hire,
set design and property supply. Current employment estimates stand
in the region of 30 000, though further jobs are stimulated in the
transport, catering and hospitality industries. Internationally, an
employment multiplier of 1.7 is the generally accepted norm for the
film sector. Moreover, film brings in valuable foreign exchange and
acts as an important means through which technology is transferred
and the South African skills base is upgraded.
- Given the significant potential of the film industry to contribute
to economic gains, the government's Accelerated and Shared Growth
Initiative for South Africa (AsgiSA) has identified this industry,
along with other creative industries, as a high priority sector,
signaling its intention to support long-term growth in this industry
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South African Film Production Landscape
- South Africa enjoys a number of advantages in the area of film
production and as such, has the potential to become more involved
in the international film market. The local industry retains both
a world-class skills base in the area of film production as well
as superior distribution and exhibition infrastructure. South Africa
is naturally endowed with an extensive variety of locations and 14
hours of sunlight during the summer months, the quality of which is
excellent for filming. These benefits are complemented by copyright
protection of international standards and the recognition of the
economic importance of film by various government departments.
- The industry is supported through a number of public bodies that
deal with or incorporate film-related programs. Of national
prominence is the National Film and Video Foundation (NFVF). Its
duties include helping the industry access funds, promoting incentive
schemes that create an environment attractive to international
film productions, promoting development of South African film
and television audiences, and facilitating the export of South
African film and video product talent. Regional industry support
bodies include the Cape Film Commission, the Durban Film Office
and the Gauteng Film Office.
- Research undertaken by the NFVF has highlighted the emergence
of several other positive trends in South Africa's post-apartheid
period. These include the emergence of a significant amount of
talent from previously marginalised groups increasing the skills
pool available locally, consolidation and alignment in what used
to be a rather fragmented industry as well as a move towards
coordinated film research and statistical collation.
- There have been recent increases in media donor funding for
the production of documentaries, coupled with an increase in
international demand for SA conservation and wildlife productions.
There has also been improved representation of South African
products on international markets and at international festivals.
The annual Cape Town World Cinema Festival (CTWCF) incorporating
Sithengi Film and Television Market. is also gaining recognition
as an event of importance for international production stakeholders.
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Targeted Support Mechanisms
- The Department of Trade and Industry (the dti) has introduced a
Large Budget Film and Television Rebate with the main objective
being to provide an additional financial incentive for the
production of both foreign and domestic large budget film and
television projects in South Africa. In establishing the rebate,
the Government recognises that large-budget film productions
contribute to South Africa's economic development and international
profile by providing valuable economic, employment and skill
development opportunities for the South African film production
industry. The rebate will ensure that South Africa remains
competitive in attracting large budget film productions from
abroad
- The Industrial Development Corporation (IDC), under the auspices
of the dti, has allocated approximately R250 million for the
film industry, which is managed by their newly created Media
and Motion Pictures Division. In the last four years, they have
invested R500 million in the development of South African film,
which was used to finance the production of 19 feature films
and 16 documentaries. Their assistance usually takes the form
of loan finance, by means of equity, quasi-equity, commercial
loans, wholesale finance, share warehousing, export/import
finance, short-term trade finance, and guarantees
- Tax policy is another key area of government facilitation.
Together with the film and television rebate scheme, the South
African Revenue Service (SARS) offers tax incentives under
Section 24F of the Income Tax Act. This is a useful tool that
allows deductions against production and post-production costs.
- Other funding support measures can be found through the industry
bodies previously mentioned.
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Recent Highlights
- 2006 saw South Africa play host to the first African Film
Summit. This event brought together a myriad of stakeholders
with the long-term goal of developing the African Audio-Visual
industry.
- A South African production, Tsotsi, won an Oscar in
the category Best Foreign Language Film for 2006.
- U-Carmen eKhayelitsha, another South African production,
won the Golden Bear award for best film at the prestigious Berlin
Film Festival in 2005.
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South African Film Investment Opportunities
- Film studio production
- Co-production ventures
- Distribution infrastructure
- Servicing of foreign productions
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Role of TISA Investment Promotion
- The Investment Promotion & Facilitation Unit of the dti -
This unit forms part of Trade and Investment South Africa
(TISA), a division of the dti primarily responsible for the
attraction of inward investment into South Africa.
- This is achieved by offering potential investors a point
of call where they can access a complete range of services:
These include the provision of information regarding the
macro-economic position of South Africa, the overall business
environment, and the process of investing in the country, as
well as detailed sector-specific information.
- Investment is further facilitated by the unit through the
provision of assistance in organising visits or participating
in events such as exhibitions in South Africa and in expediting
incentive applications, work permits and other documentation
required by investors. In addition to such services offered
to investors on an individual or collective basis, the unit
is also responsible for the packaging, promotion and implementation
of projects aimed at addressing identified investment opportunities
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Contact
| Contact Person |
Ms Ginny Verran
Deputy Director : Investment Promotion |
| Tel |
+27 (12) 394 1108 |
| Fax |
+27 (12) 394 2108 |
| Email |
GVerran@thedti.gov.za |
| |
| Contact Person |
Ms Elizabeth Mtshali
Assistant Director: Investment Information |
| Tel |
+27 (12) 394 1333 |
| Fax |
+27 (12) 394 2333 |
| Email |
Lizziem@thedti.gov.za |
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References
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