AFRICA INVESTMENT-ACTION! - South Africa draws global film makers

JOHANNESBURG Wed Oct 16, 2013 3:00am EDT

JOHANNESBURG Oct 16 (Reuters) - South Africa is luring a rising number of Hollywood producers and directors keen to shoot in the country and may have its first home-grown box-office success in three decades this year with a film based on icon Nelson Mandela.

Aware of the industry's potential contribution to economic growth, the government offers rebates which, coupled with a weaker rand, make it cheaper for foreigners to shoot here than more established peer locations like Australia.

The last globally successful South African film was "The Gods Must Be Crazy", a comedy about a bushman from the Kalahari with no knowledge of the outside world, which wowed audiences in 1980.

Thanks to Mandela, the country may be about to emerge as more than just a hot location for others to make their films but as a producer in its own right.

Four years after the release of US film director Clint Eastwood's acclaimed "Invictus" in 2009, which chronicled how Mandela inspired the national rugby team to World Cup victory, the biographical "Mandela: Long Walk To Freedom" will hit movie screens in November.

The film chronicles Mandela's decades-long fight against oppressive white minority rule, for which he was jailed for 27 years, and was shot at the Cape Town Film Studios, the first custom-built Hollywood-style film complex of its kind in Africa.

Set in South Africa's tourism capital, the studio offers easy access to a wide array of locations including sandy beaches, modern cities, forest and plains, vineyards, savannah, waterfalls, safari and desert.

Since opening in 2010, it has been the location for high profile movies and TV series which have made hefty profits, including 20th Century Fox's "Chronicle" which is set in Seattle in the U.S. but was shot primarily in Cape Town.

The film cost slightly more than $10 million to make but grossed nearly $130 million in cinema ticket sales.

Figures from South Africa's trade and industry department show that in its first 2-1/2 years of existence, productions that used the studio employed 29,000 thousand people and directly invested 1.4 billion rand ($141 million).

This translated to an economic impact factor of 3, meaning for every rand spent on production, another 3 rand was spent in the economy.

"This industry is definitely a key driver to growth because the international films coming into the country working with our local crews and local production teams are injecting enormous amounts of money into the country," Cape Town Film Studios CEO Nico Dekker told Reuters.

JOINT PRODUCTIONS

Other products of the studio include the $208 million grossing U.S. thriller "Safe House" in 2012, which starred Hollywood A-listers Denzel Washington and Ryan Reynolds, and new TV drama series "Black Sails" which debuts next year.

This steady output has helped spur South Africa's film industry by 84 percent over the last six years, placing it 50 out of the 99 major sectors of Africa's biggest economy.

South Africa also churns out a steady stream of local films similar to the "Nollywood" productions out of Nigeria.

But while a handful of these have won global accolades, like the 2004 HIV/AIDS drama "Yesterday" and "Tsotsi", which won the 2005 Academy Award for best foreign language film, the majority have only enjoyed success with local niche audiences.

In its 2012/13 annual report, the National Film And Video Foundation (NFVF) says the industry grew 14 percent last year alone, contributing 3.5 billion rand to gross domestic product and creating more than 25,000 full time jobs.

At the launch of a new industrial policy framework earlier this year, Trade and Industry Minister Rob Davies singled out the film industry as a rising source of growth, particularly as the mainstream mining and manufacturing sectors struggle.

With that in mind, South Africa has set up eight co-production treaties with other countries, the latest being with Ireland and New Zealand last year.

"Joint productions between South Africa and other countries continue to be important vectors in boosting the status of South Africa as a filming destination and contributor of production skills and facilities," NFVF chairperson Mmabatho Ramagoshi said in this year's annual report.

Under the arrangements, 10 feature films and two television series were shot in South Africa over the past year at a budget of nearly 800 million rand, with foreign partners contributing more than half.

Outside the government backed deals, the trade and industry department is also luring more private sector investors with a 20 percent rebate on production costs for foreign film makers working with a budget of 12 million rand and more.

That, coupled with an 18 percent depreciation in the rand this year, has given South Africa the edge as a bargain priced location for film makers keen to keep costs contained.

"Other countries are offering even more (facilities) than we have, if you look at the States, South America, Europe, Australia. They all have big existing industries, but what attracts people to us is value for money," said Dekker.

"If they spend 10 rand, the value of the film on the screen is often double what they spend ... that's why they come all the way to us." ($1 = 9.9583 South African rand) (Editing by David Dolan and Ron Askew)