Produce Hollywood in Georgia
Fast & Furious 9on the streets of Tbilisi: a new chapter in the history of the Georgian film industry and the ‘Film in Georgia’ program.
“Scene one, take one” – the director’s words are followed by a stuntman picking up speed on Vazha-Pshavela Avenue. Reaching Rustaveli Avenue, he loses control of the car… The plot may be simple, but this is a complicated scene from the upcoming film ‘Fast & Furious 9’. Most parts of the plot are being kept secret; we start the story of Georgia’s encounter with Hollywood with excitement
Despite all the secrecy, the shooting locations – Vazha Pshavela Avenue, Rustaveli Avenue, parts of Old Tbilisi and Betania – were widely known. These locations will provide the setting for the opening sequence of the exciting final 10 minutes of Fast & Furious 9. And so, Tbilisi will join the likes of Tokyo, Los Angeles, London and Rio de Janeiro on the list of locations that are familiar to fans of the franchise.
‘Enterprise Georgia’ had to negotiate for a full year in order to convince the creators of Fast & Furious to expand into Georgia. This included a visit by influential Hollywood producers to Georgia to familiarize themselves with the local landscape, history and character, as well as to taste Georgian wine and cuisine.
Readers may ask why film producers do not get a car to explode on the streets of an American city, and there is no simple answer to this question. However, one of the factors that has led to the cooperation between Hollywood and this country is the ‘Film in Georgia’ program, which refunds companies 20-25% of the producer’s qualified expenses. There are also other factors that attracted ‘Universal Studios’ to the streets of Tbilisi, more of which we will touch upon later.
First, let’s look at the commercial details of the Fast & Furious franchise: the original movie was released in 2001. It was a huge commercial success, earning a total of $207 million at the box office with a $38 million budget. The eighth and most recent installment cost $250 million to produce, while revenues exceeded $1.238 billion. According to current data, ‘Universal Studios’ will spend $200 million on Fast & Furious 9, of which $31 million will be spent in Georgia.
The contract for the ‘Film in Georgia ’program was signed in 2015 for 28 projects, 15 of which have already been completed. The agency’s film industry component has thus far brought in investments totaling more than 99.8 million GEL, while qualified expenses have amounted to 94.8 million GEL.
Forbes Georgia spoke to Mikheil Khidureli, the head of ‘Enterprise Georgia’, about the details of Georgia’s cooperation with Hollywood:
On the back of the first cooperation with Hollywood, it can be said that 2019 is a breakthrough year for the film industry component of ‘Enterprise Georgia’. The Fast & Furious 9 team is already in Georgia. What did the agency do to secure this project?
The production company ‘Enkeny Films FF9’ began negotiating on this project a year ago. I would like to point out that we managed to bring high-ranking representatives to Georgia. It is one thing to travel elsewhere for negotiations, but to have people come here and see everything for themselves is something completely different.
We were frequently asked at international exhibitions whether a Hollywood movie had been filmed in Georgia. I used to reply: “no, but an American film was.” In this regard, the program’s greatest success is to have achieved a breakthrough. Attracting Fast & Furious 9 to Georgia required active involvement of the local production firm ‘Enkeny Films FF9’. Ultimately, this company played an equally important role in bringing the project to the country.
We were picked among 17 countries because we offered them a flexible system, quick solutions and a comfortable cash back program. Our readiness to help them quickly go through all the necessary procedures played a crucial role in the decision to award the project to Georgia.
We soon proved to ‘Universal Studios’ that they had made the right choice, as they went through all the processes within a few days. The government and local authorities acted quickly – at all levels – to issue the necessary decrees and secure permits. I must highlight the efforts of the program manager, Tatia Bidzinashvili, in achieving this great success. The ‘Universal Studios’ delegation that visited Georgia included its First Vice President and the CFO, who is the one who makes the decisions regarding filming locations. They could not believe how quickly the programme’s one-window principle worked.
Apart from your readiness to help with the procedures, what role did Tbilisi’s landscape play in the successful negotiations with ‘Universal Studios’?
Indeed, the movie plot played an important role in this regard. Filming locations for this franchise are generally diverse and includes places such as Brazil and Thailand. However, what is important is that Tbilisi and Georgia will be identified in this film, which is not always the case. For example, parts of the previous installments were filmed in Puerto Rico, but the location was marketed as Brazil; there was little interest towards Puerto Rico from a marketing point of view. Not only will Georgia see financial benefits, with more than 1 million GEL being spent here each day during filming, but the marketing-related benefits, which would otherwise have cost an enormous amount in monetary terms, are substantial.
What will be available to ‘Universal Studios’ in Georgia from technical point of view, and what will they have to bring with them?
In this case, most of the equipment will be brought by them, while the service will be provided by a Georgian company. They will bring the cars and the technology that they need for shooting the film. Unfortunately, we also do not have stuntmen. We have no specialist who can drive a Porsche at 350km per hour down Rustaveli Avenue, crash the car deliberately and survive. Naturally, we realize that we are not yet ready to provide all the necessary services, but we will witness the creation of demand for film production in the country. The film industry must become a leading contributor to Georgian GDP, as is the case in many other countries.
How long will the filming take place, and what can you tell us about the content of the scenes that will be shot in Tbilisi?
Filming will take place from the middle of August until the middle of September. Locations will include Rustaveli Avenue and Vazha Pshavela Avenue, while some scenes will also be filmed in Betania. Certain streets in the city will be closed off during filming, and the Georgians’ general lack of aggression towards the film industry plays a very important role here. For example, closing off parts of central Rome or Paris is very difficult, as filming takes place there quite often. This was another significant factor in awarding the project to Georgia.
As for the content, each installment of this franchise always has a hero and a villain. The plot centers on the clash between them and includes many car chases. The final 10 minutes of the movie will be filmed in Tbilisi. This is traditionally the most exciting part of any blockbuster film. Viewers pay most attention precisely to the final minutes, which provide the culmination and the ending of the plot. Therefore, I think that people also have a better chance to notice where these scenes were filmed.
I must also point out that this franchise has numerous fans who often visit the filming locations after the movie has been released. We can draw parallels to New Zealand and Croatia. Many tourists travel to Dubrovnik to visit the filming locations of ‘Game of Thrones’. The same is the case with the ‘Lord of the Rings’ filming locations in New Zealand, where the tourism revenues grew from $6 billion to $9 billion per year following the release of the popular movies. As for Dubrovnik, it actually suffers from excessive numbers of tourists.
Does the film crew, who will spend almost a full month in Georgia, have any special requests that are typical from movie stars?
Unfortunately, the stars did not travel to Georgia, although they may still appear in the scenes filmed in Tbilisi. This is a first step. On this occasion, we will be hosting highly qualified stuntmen, who will receive our full support. However, we are already negotiating about new film projects that will see big stars come to our country. They will certainly have complex and specific demands. We are currently working to ensure that we are prepared to host them both from the infrastructural and from a legal point of view.
It is good that we have already established friendly relations with these people. Even when someone spends one week in Georgia, they establish an emotional connection to our country. We are, therefore, already receiving specific recommendations and requests regarding new programs. Most importantly, ‘Universal Studios’ are telling us directly what they expect in order to bring new projects to Georgia in the future.
What do they expect?
For example, they want to choose new filming locations and to see their recommendations regarding the program being considered in order to make it more suitable for hosting top-class actors.
How many future projects are you negotiating with Hollywood? Would it be possible to get them interested in elements of Georgian history and culture? Do you plan to make any proposals to their producers in this regard?
Naturally, we are talking about new projects. First, I would point out that although Hollywood is financially an enormous industry, it is quite a closed little entity when it comes to human resources. Everyone knows and asks each other questions such as: when you filmed in Georgia, did it work? How quickly did you receive the cash back? How was the attitude from the government and the local population? What was the local production company like? We were often told that the professionalism displayed by us would be rewarded.
We are negotiating with ‘Universal Studios’ regarding several projects. There are also talks about filming a TV show. This would be a significant development, especially if Georgian themes can be incorporated.
Furthermore, we have begun talks regarding animated films, and have received specific tips about many cartoons being outsourced by studios to various countries, including the Eastern European region. We are, therefore, working hard to use this opportunity, create an animation studio and invite high-level specialists. We are being helped by the film center in this regard. Once the preparatory stage is finished, we plan to negotiate with Hollywood about working on animated films in Georgia.
One could say that ‘Universal Studios’ will become our ambassador in these segments. I am certain that we will soon meet with representatives from ‘Netflix’, while my team is due to visit Los Angeles in November to attend the annual American film market. We expect Universal and other studios to help us gain access to all the major players. However, we will be going with our heads held high, as Georgia will have a Hollywood film under its belt by then.
You mentioned Georgian themes. What did you mean specifically?
I personally have an idea involving The Knight in the Panther’s Skin, and I am trying to attract the Americans in Hollywood to it. There are many interesting episodes in Georgian history that can be used as themes for a TV show, and in my opinion, the Knight in the Panther’s Skin story is in no way inferior to that of Vikings. It has elements of love, heroism, politics, etcetera. If we are to visualize Kajeti Castle and various scenes from the poem, we can imagine how interesting and extensive such a project could become. All of this cannot be realized in one day. These people will have to visit Georgia and stay here for a while, attending traditional Georgian feasts, listening to toasts and various stories. This whole process will take place organically. I have already given them several books about The Knight in the Panther’s Skin as a gift, and now I am thinking about finding a script; if one already exists.
Apart from the Rustaveli epic, we also have battle art from Khevsureti and Mtiuleti that can be used to make a separate documentary. We have lots of material!
Presumably, Hollywood has its own language of communication, which is more than just speaking English and giving a good account of yourself. You need people who can work on developing these channels within the American film industry. Are your existing staff resources enough to realize your current ambitions and goals?
The only area where we do not have major problems is communication. Prior to travelling, we do our homework thoroughly. Our priority is to demonstrate the ease of filming in Georgia – the country’s approach, the existing procedures, locations, knowledge and mapping of infrastructure. Naturally, we are accompanied by production companies that specialize in these matters. We, therefore, start our presentation with the existing filming environment in Georgia, which is followed by the production company talking about other specific issues.
Georgians have also worked in Hollywood. For example, Themo Melikidze acted in Patriots Day. Are you in touch with them, and is it possible to use their resources?
To this end, we plan to implement a major project by organizing a homecoming event, where we will invite well-known and successful people who work outside Georgia. They will represent both the film industry as well as the business and investment sector. We will show them the country’s potential. They care about Georgia, and we can tell them about the specific areas where we require investment. We are continuously expanding our database, and we ask everyone, including your readers, to write to us with information about successful people. We will also be setting up a hotline.
The Armenians are successfully operating a similar model, and we must at least try to adopt this scheme. I am certain that this will be a successful undertaking. Even if a hundred people travel to the event, it will have a great impact. If nothing else, we will get to know all these individuals. We are actively planning this event and we wish to establish deeper roots in Hollywood.
Regarding the financial set-up of the ‘Film in Georgia’ program, you are currently refunding 20-25% of qualified expenses to those who produce films in Georgia. In some countries this figure is higher, while in others it is lower. Is this the best that we can currently offer investors in this field?
I do not believe that the existing figure requires revision. It is interesting from a marketing point of view, but we also have very low taxes and an effective system compared to places such as Dubai; where cash back has been raised to 40%. We must look at their high taxes, which have caused the need to raise the refund figure. We have very low taxes and a highly flexible system.
Which film exhibitions are you planning to attend soon?
We will be attending both the Berlinale and the Cannes Film Festival in the spring. There are also exhibitions taking place in Hong Kong and Shanghai, and we will definitely be attending one of them. We are usually present at European events such as the London Focus. The European film market is important. It may not be financially as lucrative, but in terms of quality it is an attractive market.
Let me ask you about the other ‘Enterprise Georgia’ projects. There are 12 banks involved in the credit guarantee scheme. From which sectors of the economy do you expect small and medium-scale businesses to express interest? When will the application process begin?
We are already accepting applications, and our expectations are quite high. The field is quite broad, and the credit guarantee scheme is more than just a subsidy mechanism. It includes the hospitality industry, education, hi-tech laboratories and so on. Partner banks are also ready to examine all applications.
Can we expect to see any changes in the existing programs, if so in which areas?
We are thinking of checking which sectors are saturated and then make changes accordingly. We have a high sense of accountability towards society and our entrepreneurs. There is a BDO study on this issue, but we also have more recent findings on hand: the 202 startups subsidized by our agency to the tune of 28 million GEL in total, have contributed 140 million GEL in taxes to the country’s budget. This means that for each Lari spent on subsidies, the country is recouping five times more in economic benefits. This does not even take into account the expansion of existing businesses.
As for the exports, we have spent 7 million GEL on exhibitions in various countries, which has encouraged 159 million GEL’s worth of exports. Thus, our earnings have far exceeded our expenses twentyfold.
Over the last two years, our team has spent quite a meager sum of 1.2 million on attracting investment and has managed to bring in a total of 119 million GEL during this period.
When will the Small Grants Project resume?
We will launch the communication campaign this autumn. Foremost of all, it is important to have more active communication to ensure that everyone has access to the necessary information and can participate. The funds will probably be issued in 2020, and we are thinking of increasing the amount to 30,000 GEL. We will also have special offers for the highland regions, where the required capital sharing will be 10% lower in order to stimulate development in said areas.
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