Cyprus tries to lure foreign filmmakers to ‘Olivewood’
… but structural issues remain, tax incentives still unclear
The island’s film industry may still be in its infancy, but a new scheme to lure foreign filmmakers and investors to Cyprus could, hopefully, pay off if the state finds the right balance between financial incentives and locally available services and infrastructure, delegates at a Nicosia conference heard this week.
The intention of the organisers of the first Cyprus Film Summit, hosted by the government’s investment promotion arm, InvestCyprus, was to announce a package of mostly tax measures to a group of professionals from the audiovisual sector, and at the same time to wine-and-dine them in order to show potential locations for film shoots.
A location often referred to at the conference was the mountainscapes and seascapes, many dotted with the characteristic olive trees, thus giving birth to the island’s new name, ‘Olivewood’.
“Cyprus has significant and unutilised potential as it tries to come into the spotlight of the global film industry,” Finance Minister Harris Georgiades said in his keynote speech, saying that the first step in launching the ‘Cyprus Film Scheme’ was a set of grants and tax breaks.
The minister said that the scheme is currently in parliament and should be approved by the end of the month. It includes a cash rebate as well as a tax credit of up to 35% on qualified capital expenditure, a VAT refund and tax allowance for individuals and the import or use of equipment.
“Cyprus is one of the fastest growing economies in the Eurozone, and our administration’s policy has shown that a balanced budget can be achieved through pro-growth policies, not austerity,” Georgiades said.
Angelos Loizou, Chairman of the co-host Cyprus Tourism Organisation, added that “we boast of having a natural film studio,” throughout the island, and that the record 4 million tourists expected for this year “can’t be wrong.”
The scenic locations, good connectivity and mild weather throughout the year were also promoted by other speakers as being key attractions to Cyprus, but once the panel discussion at the conference opened the floor to the professionals in the audience, it showed that the island still has a long way to go if it wants to imitate the successes of rival destinations such as Malta, let alone industry leaders Britain.
Despite the clear absence of many local professionals in the audience, veteran TV and film producer Chris Economides, broadcast guru Munro Forbes and film maker Andreas Pantzis tried to elaborate on doing business in Cyprus and how the cinema and broadcast industry has evolved in the past two decades, by highlighting their own experiences on overcoming obstacles.
Forbes, a consultant to Sigma TV, said that he is also involved with the Cyprus Media Academy, a training centre for aspiring broadcast professionals with short courses, mostly vocational, emphasising the need for more education in order to prepare the professionals needed by the industry.
This need was also highlighted by Peter Dunphy, a film producer, tax and funding expert, who brought the example of how the British Film Institute (BFI) cooperates directly with universities in the UK in order to cater to the industry’s needs.
Lefteris Eleftheriou, the head of the film unit at InvestCyprus, answered a barrage of questions that ranged from providing one-stop-shop solutions for film companies, tax write-offs, cash investments and liaising with state services on issues such as visa and customs clearance, crossborder co-operation and sharing or utilising European grants.
From his experience working in other countries, Dunphy added that beyond the tax incentives, the three most important features for the industry overseas were locations, available facilities and skilled local talent, and financial infrastructure, that includes access to financiers and investors.
Members of the audience were also keen to see if they would be eligible for tax breaks or could utilise the incentives immediately, with productions in the pipeline as early as in 2019, ranging from animation to TV series, and wanted to know if there could be cooperation with foreign crews, or using local crews in overseas assignments.
Eleftheriou concluded that InvestCyprus was quite flexible and that the incentives announced were not necessarily carved in stone, adding that he would like to hear of more suggestions on how to expand the scheme and make it more attractive to foreign professionals.
But some basic criteria were necessary, such as establishing a local company or a physical presence, as well as meeting the “culture test” to be determined by a panel of technocrats who would rule if the proposed project would have an impact on the Cyprus economy or would even promote Cyprus.