Picture

Dwarfed by
Hollywood's
ominous shadows,
troubled by linguistic
barriers and faced
with regional
competition for
production sites,
; Israel's film industry
struggles for
(.), funding.

' D ALLISON KAPLAN SOMMER

LU

F-

74

SPECIAL TO THE JEWISH NEWS

Sho

n the surface, Israel's film
industry is a sleeping giant.
The continual exodus of tal-
ent to Hollywood certainly
suggests that Israel comes
up with talented actors, di-
rectors and technicians. And
the credits of numerous ma-
jor Hollywood movies include one or two
Hebrew names.
This involvement climbs all the way from
extras to producers such as Arnon Milchan,
Menahem Golan or Yoram Globus. "About
half of our film industry is sitting in Holly-
wood," says Marek Rosenbaum, the presi-
dent of the Producers Association, which
represents most of Israel's 200 independent
filmmakers. "Several of these are my friends,
and they are quite successful," he says.
But those who have remained in Israel
and tried to build a film industry that would
sustain itself are less successful.
No recent Israeli film can be called a
major commercial blockbuster.
Indeed, without substantial government
subsidies there would be no local filmmak-
ing. And the forecast for the future is gloomy.
Costs are going up, and private investment
money for Israeli films is growing ever more
scarce.
Commercial and cable television has
taken a huge bite out of the domestic audi-
ences who used to go see Israeli films. Major
producers who have gone out on a limb
financially for films they believed in have
racked up loss after loss. Rosenbaum him-
self has been involved in three money-
losing films over the past three years.
Does he ever think about joining his
friends abroad? "Only at least seven times
a day," he says with a sigh.
Israel is not alone in this cinematic qiisg-
mire.

Any small country has trouble producing
commercial films that can compete with im-
ported American blockbusters. In mid-size
countries such as Switzerland, Portugal,
Belgium, the Netherlands and even in
France, the film industry is highly govern-
ment dependent, and not particularly prof-
itable. In fact, frustration over Hollywood's
international domination led Paris to insist
— during the arduous negotiations over the
World Trade Agreement — on its right to
impose tariffs on American films, a stance
which nearly aborted the most important
multinational trade pact in history.
But these countries benefit from being
part of the European Union, which offers
additional funding and distribution advan-
tages in neighboring countries. In addition,
Francophile and Latin societies in far-flung
African and American domains offer film
producers in those countries a linguistic
depth which translates into expanded mar-
kets for their products. In other countries,
like Canada and Ireland, special laws make
investing in films extremely attractive as a
tax shelter.
Israel also offers a tax shelter; the law
says that 100 percent invested in a film in
a fiscal year can be written off the income
of the same investor or investment company
in that year. But this incentive has not made
up for the fact that the vast majority of
investors in Israeli features do not see a
profit.
"It is very difficult for a small country,
which speaks a very uncommon language,
to create films which are of interest to the
whole world," says Shlomo Sternfeld, deputy
director of the Israel Film Center, a division
of the Ministry of Industry and Trade, which
is supposed to assist private producers in
distributing their films abroad and encour-
age foreign productions to film in Israel.

"But there is potential," he says, consider-
ing Israel's historical depth, archaeological
diversity and religious melting pot.
What Israel really needs, according to
Sternfeld, is an Ingmar Bergman, Federico
Fellini, Akira Kurosawa or Pedro Almod-
ovar who will boost Israeli cinema into the
world's consciousness and attract investors.
And yes, maybe such a director could even
draw his fellow countrymen into the movie
theaters. But until a local genius appears,
the industry will continue to depend on gov-
ernment funds.
So, in the absence of a viable market base,
the primary source of financing for Israeli
features is the government's Fund for Qual-
ity Films, run jointly by the Arts Ministry
and the Ministry of Industry and Trade,
each of which kick in $2.5 million annual-
ly. The fund's largest grant was recently
raised to $400,000.
After submitting a script to the fund, a
producer's next step is usually in the direc-
tion of television — to the Israel Broad-
casting Authority or one of the companies
that broadcasts on Channel 2.
However, while TV is a major source of
funding in Europe, such is not the case in
Israel. Filmmakers can receive $50,000
(maybe $100,000, if they're lucky) in ex-
change for the broadcast rights, but this
amount is a tiny percentage of the total bud-
get, especially compared to what European
filmmakers receive.
Sometimes funding can be boosted by a
fund maintained by the cinema owners as-
sociation: If filmmakers sell more than
22,000 tickets for a particular movie, they
win a grant of $130,000, which can go to-
ward production costs. The rest of the bud-
get for the film is put up by the producers
themselves and any investors they can put
together, which usually brings Israeli films
to a budget of $600,000-$700,000.
The budgets are low, even compared with
those of European films, which usually cost
$3 $5 million. With such meager financing,
local producers are condemned to creating
smaller, artier films with a more limited ap-
peal, thus drawing limited audiences both
domestically and internationally. It is a
vicious Catch-22: less money, smaller bud-
gets; smaller audiences, less money.
If the cycle continues, Rosenbaum grim-
ly predicts, "the industry will die."
Several veteran film producers are threat-
ening to close down shop; others have de-
clared they will stop making films and turn
to more profitable pursuits, like producing
TV commercials. The only solution, says
Rosenbaum, at least for the short term, is
to step up government assistance.
Rosenbaum sees potential for salvation
in the creation of a special fund for co-
production, which the Ministry of Industry
and Trade has promised to try to set up.
In such a fund, the government would con-
tribute $25 million and raise $25 million
from private investors. Foreign-film pro-
ducers interested in shooting a film in Israel
would come to the fund and, if accepted,
would be reimbursed for 50 percent of their
expenditures in Israel.
In exchange, the fund would have a share
in the film's revenues.
But Sternfeld is skeptical about the
prospects of Israel ever offering enough fi-
nancial incentives to win foreign produc-
tions away from countries in which it is

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