Investing in film industry –The benefits of film financing

Investing in film industry –The benefits of film financing

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By Calvin Manika

MICHAEL Jamu relives the days he worked in the streets of Harare selling pirated movie disks. With technology he has resorted to load flash disks with latest movies and local dramas. For the past 20 years Jamu earns living through pirating film products, a situation many filmmakers bemoan as a hindrance to their success in the industry resulting in many people quitting the profession.

Revenue generation and sustainability in Zimbabwe film industry have been a major drawback for the past years. Film industry has been equated to a space of passion and killing time without major investments in it.

“I acted many dramas during my school days and ended up in street theatre. I had talent and I love it but it did not pay me off. In fact, all of our crew and the producers we ended up seeking other opportunities,” Jamu said.

A cultural expert, renowned actor and four-time arts award winning journalist, Tinashe Muchuri said the film industry is not bad as perceived, many countries have made it a big industry and it can create many opportunities including employment.

“Zimbabweans needs to change their attitude in the way they perceive arts especially films. Film industry is a game changer of our economy if we change our attitude. I think it begins with the community, if the ordinary person can support, the corporate world will support too,” Muchuri said.

Muchuri thinks research is very important in the funding of the film industry as investors want to invest from an informed position.

“It is critical to do the background work through research. It makes the stakeholders in the industry to see the gaps, be it opportunities or challenges. But, at the end of the day we will work to model the industry so it attracts investment through banks, partnerships and scholarships. Currently, it is happening but in a slow pace,” Muchuri said.

Director and producer of the ZBC TV drama series – Village Secrets and a doctoral student doing a research on film financing, Leonard Chibamu noted that, Zimbabwe is naturally an industry that is young in terms of growth and not operating at full scale.

“Investing in the sector will bring financial leverage to unlock potential. Currently there are new stations set to roll out and demands connect to satisfy their audience. With the new demand for entrainment products comes with an attractive investment return. Film industry is a high cost and risky business therefore needs injection of patient capital,” said Chibamu.

In 2020, the United States was the largest filmed entertainment market, with revenue of more than 25.9 billion U.S. dollars. China and Japan followed with 12.7 billion and 4.1 billion dollars in revenue, respectively.

In South Africa the film industry is a major contributor to economic development with a total of one hundred and four (104) locally (SA) and internationally produced films were released in South Africa between January and September 2021, and this amounted to a total Box Office Gross of R126, 6 million.

The records seen by The Entrepreneurial Magazine shows that, there were only nine (9) SA produced films with a Box Office Gross of R1, 4 million. Of the nine (9), four (4) films were independently released; three (3) films were State Theatre productions, later released at selected Ster-Kinekor theatres, as a result of the strategic partnership between the South African State Theatre and Ster-Kinekor Theatres.

According to National Film and Video Foundation of South Africa, the direct contribution of the film industry to the economy of South Africa is projected at R3, 86 billion. An additional R3, 31 billion is projected to have been generated through indirect (R946.07m) and induced (R2, 36 billion) impacts, resulting in a total contribution to the local economy of R7, 18 billion.

“Film industry Multiplier Effect is evident with the employment multiplier which increased by a multiple of 5, 65 for every R1 invested in the 2019/20 fiscal. This means that for every R1 of expenditure an additional R2.82 of additional income was generated in the economy. In the case of employment for every R1 million of direct expenditure, around 5, 65 annual jobs were created/ sustained,” notes the foundation.

Zimbabwean filmmakers have been coming up with creative solutions regarding training, production and distribution for years, but challenges lie in funding. Players in the film industry say government policy has a key role in laying the groundwork for this. It serves as an important signal to both Zimbabweans and foreign stakeholders that the film industry is a fertile ground for investment.

Last year in Paris, Audrey Azoulay, the UNESCO Director-General, presented the report which aims to help the African film industry, and decision-makers, to take stock of the current landscape and plan strategically for future growth. Nigeria alone produces around 2,500 films a year.

“The film, arts and creative industries play a critical socio-economic role with the sector having a potential to create more than 20 million jobs in Africa and contributing US$20 billion to the continent’s Gross Domestic Product (GDP). We must raise our voice to reaffirm that films are indeed ‘public goods’ that require public support and investment to ensure equal access to creation, production, distribution, dissemination and consumption,” said Azoulay. 

Mirazvo Productions late last year signed a memorandum of understanding (MoU) with the Indian Economic Trade Organisation (IETO) that would see the Indian cinema industry investing in the local film industry.

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