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INDUSTRY / MARKET Estonia

The Estonian Film Institute announces a €1 million budget cut and a new state-of-the-art sound stage

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- As a result of recent talks with the government, the extra production support provided during the years of Estonia 100 will be kept but reduced by €1 million for 2022

The Estonian Film Institute announces a €1 million budget cut and a new state-of-the-art sound stage
CEO of the Estonian Film Institute Edith Sepp

The extra film production funding provided by the government on the occasion of Estonia 100, the initiative celebrating the 100th anniversary of the Republic of Estonia from 2017-2020, will be reduced by €1 million for 2022, the Estonian Film Institute (EFI) reports. During the period 2017-2020, the Estonian government invested an additional €3 million in film production each year (providing a total yearly budget of €9.2 million) and decided to keep the uplift for 2021 as well.

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“Unfortunately, with the recent change of government, it became apparent that the support of €3 million was a one-off uplift. In spring, the new government decided that the state needed to introduce cuts in light of the pandemic. Since this additional support for Estonian film turned out to be formulated as a one-year uplift, the €3 million in additional funding for film production was not to be continued for 2022. This represented a cut of almost one-third (32.6%) in the budget for the Estonian Film Institute, which would have had a seriously detrimental impact on our filmmakers, our audiences, our culture and our language. Estonian filmmakers and the institute made the case to the current government and to politicians across the aisle not to cut this additional support, but instead to make it permanent,” disclosed Edith Sepp, the CEO of the national film agency.

As a result of the negotiations, the government agreed to keep the extra support at €2 million, thus the body’s 2022 budget will be cut by €1 million in comparison to 2021. Meanwhile, the institute also invited the government to start negotiations on using Article 13 in the Audiovisual Media Services Directive (AVMSD) to broaden support for local filmmakers. “Before this proposal could be negotiated, the government had accepted the Ministry of Finance’s recommendation not to examine the possibilities that AVMSD offers for film. The Ministry of Finance’s rationale was the cost effectiveness of the new regulations. However, today, the counter-argument is that the pandemic has fundamentally changed the marketplace, and Estonia should look more closely at the opportunities provided by AVMSD for platforms to support local content production. Today, the government is listening to the film sector’s arguments,” Sepp added.

Besides the €1 million budget cut, the Estonian Parliament approved the construction of a new state-of-the-art sound stage, set to become the biggest complex of its kind in the Baltic region. Speaking about the operational costs and the benefits of this new facility, Sepp said: “The cost of the studio is approximately €17 million, and not all of the money will come from central government. For example, Tallinn City Council is one of the biggest partners. The complex is designed to be as environmentally friendly as possible, with energy production from solar panels, sustainable consumption and efficient waste management among its features. […] The key rationale for the state to invest in infrastructure is based on our high-tech, “digital first” mentality. We need a sound-stage complex that incorporates all of the available technological advances in the audiovisual industry. This sound stage will now be built in Estonia; this can’t be changed. It’s a massive breakthrough for our industry, which will deliver significant benefits to the local economy. For example, a study from Olsberg SPI published in 2020 calculated that 67% of below-the-line production costs are spent in business sectors outside of the film and TV production industry.”

Commenting on the institute’s future commitments, Sepp concluded: “The dialogue with the government continues, and the way in which the film industry is seen in Estonia has changed dramatically over the last few months. Time was just too short to secure all of the €3 million uplift, but film has a strong place in the Estonian economy and in society, to the benefit of both industry and audiences. The EFI, working in partnership with the entire film sector, will build on these recent achievements and continue to make the case for increasing governmental support.”

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