08-05-2025
SA's film industry is grappling with govt shortcomings — and now Trump is in the picture
Inconsistent payouts from a government scheme to lure foreign film production to SA has damaged the industry.
That's according to industry players, who are now concerned about the effect of US tariffs on foreign-made films.
The government acknowledges the problem and says high demand for rebates led to budgetary constraints.
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Troubles getting payment from the incentive system meant to attract international film companies to South Africa have left the industry fragile, those in the industry say. Further pain now looms after US President Donald Trump announced movies are also in his sights as he continues down a tariff warpath.
South Africa has historically been a beloved destination for international film companies to shoot in, Unathi Malunga, executive officer at the South African Screen Federation (SASFED), told News24. The federation is the national representative of independent film, television and audiovisual industry organisations.
South Africa is relatively inexpensive to film in compared to other destinations. It has good weather, an abundance of talent, and a variety of shooting destinations.
This is especially true in the Western Cape and Cape Town. Wesgro, the official tourism, trade, and investment promotion agency for these provinces, and the City of Cape Town recognise this and run initiatives to support the industry.
Films such as Mad Max: Fury Road, Maze Runner: The Death Cure, Blood Diamond, and The Kissing Booth were either partly or primarily filmed in South Africa.
Delon Bakker, chairperson of the Independent Producers' Organisation — a body that represents independent South African film, television, and digital media producers — said the incentives were a key part of attracting companies to shoot in South Africa.
'Our film incentives are crucially important to holding up our industry,' he said.
However, inconsistent payments to companies that have applied to the fund have caused serious reputational damage to the South African film industry.
Accurate statistics on the size of the South African film industry are hard to come by.
However, pre-pandemic data presented by the National Film and Video Foundation suggests that film productions have a relatively high economic multiplier. This means that films shot locally have significant benefits for the local economy.
Because of this, many countries offer incentives to film companies to attract them to shoot there.
Countries such as Australia, Morocco, Canada, France, New Zealand, the UK, and Brazil offer such incentives.
South Africa also has a foreign film incentive administered by the Department of Trade, Industry, and Competition (dtic). The rebate allows qualifying companies to claim a minimum of 25% of their South African production expenditure back. This is contingent on the project meeting certain empowerment and local spending requirements.
The rebate can go higher than 25% but is capped at a maximum value of R25 million.
There is also an incentive for local film companies.
Payment troubles
News24 understands that inefficiencies, disputes, and delayed payments from the incentive date back to 2020 during the Covid-19 pandemic and have not been fully resolved.
At one point, several companies who had applied and been given pre-approval for the incentive, later had that approval repudiated, with the dtic citing new guidelines for the fund.
The repudiation was later overturned in many cases.
This has caused trust issues for companies considering working in South Africa.
Malunga said that trust is essential as the incentive is structured as a rebate, meaning companies first need to spend before claiming some of that expenditure back.
'There are two things that are necessary for an incentive. There has to be certainty, and there has to be reliability. Otherwise, there is no trust.'
She said that this has resulted in companies turning away from South Africa.
'We were a beloved destination to come to. We lost all that,' she said.
Bakker echoed this sentiment.
'Some companies are extremely sceptical of the South African rebate. I deal with this all the time,' he said.
In February this year, film workers protested outside the dtic offices in Tshwane to demand action to resolve the rebate system.
READ | SA film industry demands DTIC action to salvage collapsing rebate system
In response to questions from News24, dtic spokesperson Yamkela Fanisi acknowledged that the film rebate programme has had issues, which he attributed to budgetary constraints brought on by the incentive's popularity.
'Due to the success and popularity of the incentive, the programme has been oversubscribed, and the demand outstripped the budget available; therefore, the dtic is dealing with the budgetary constraint challenge while exploring different options in ensuring that approved productions are paid and the incentive continue to support the SA economy in a meaningful way,' he said.
Fanisi did not respond to questions about the current scale of the non-payment problem prior to publication.
And there's a sequel
Trump's recent threat to impose a 100% tariff on movies could cause further issues for the South African industry.
On Sunday evening, Trump made a post on Truth Social, ordering the introduction of a tariff on all movies coming into the US that are produced in 'foreign lands'.
Several commentators have pointed out that the proposed tariff does not make sense, and there are numerous practical uncertainties about how it will work.
Regardless, the threat signals Trump's intention to introduce an intervention so that more films will be made in the US rather than abroad.
Malunga, who said she was speaking about the tariffs in her personal capacity, said that in the short run, any further uncertainty caused by Trump's impromptu announcement could result in deal negotiations between South African and US companies being put on hold.
'The uncertainty alone can delay production and financing,' she said in a Facebook post that she sent to News24.
In the medium to long term, Malunga said that there could be a structural shift that results in less international films being shot in South Africa.
Nosipho Maketo-Van den Bragt, the CEO of Chocolate Tribe, a visual effects and animation studio with offices in Cape Town and Johannesburg, said there was 'palpable tension' as the South African film industry tries to digest what the tariff could mean for its businesses.
She said Chocolate Tribe, which has worked with companies like Netflix, Amazon, and the BBC, gets around 70% to 80% of its work from international film companies.
She said that Chocolate Tribe has been trying to increase the share of its work on local productions in South Africa or the continent, such that there is a fifty-fifty split between local and international projects.
Beyond the practical issues that the tariff could create, Maketo-Van den Bragt said that, in her view, the tariff does not align with the purpose of film.
'It's problematic because film itself is really about experiencing a global story. There is a strong push toward local stories that have global resonance.'
She said it would be difficult to collaborate with the US if it took an isolationist approach.
Wake-up call
Bakker said that fixing the foreign film incentive was the 'greatest weapon' the government could use to protect the local industry from the potential impact of a US tariff.
'This is a call to the government to resolve its incentive programme immediately to combat the adverse effects. Even with these tariffs, we could still be very economical. We are one of the most inexpensive places in the world to shoot a movie,' he said.
He said there was abundant talent in the South African industry, meaning we could be one of the few locations that 'still look good'.
'We could still be in the market if our incentive programme is working efficiently. Government needs to heed this call,' he said.
Fanisi said the dtic was committed to offering film incentives for international and local film companies and had told the industry that their claims would be honoured.
Wesgro told News24 that it was assessing the potential impact of the tariff and was committed to supporting businesses in the industry.
'Wesgro is in the process of assessing the potential impact, noting full details have yet to be announced. We remain committed to supporting businesses in the Western Cape navigate these challenges with confidence and support,' it said.
