The following was a Facebook post from my friend Paul Spurrier, an advisor to the Thai Film Board.
In 2019, Thailand was booming as a location for international film and television production. The incentives, launched in 2017, were paying out.. (ed.). The production services industry had managed to expand capacity without either reducing quality or raising costs. The result was that the revenue produced by incoming production increased by 55% in 2019 to a record US$152m. With an ever-increasing number of international enquiries received by the Thailand Film Office, and the popularity of Thailand with OTT platforms such as Netflix, Amazon, etc., everyone was confident that 2020 was going to set a new record.
And then came COVID-19.
Thailand will not achieve the record-breaking results in 2020 that it was expecting at the beginning of 2020. But with a smart set of protective, practical rules, and well-trained, responsible crew, the Thailand Film Office has created a safe environment with which to welcome back international production.
Mr. Spurrier’s Facebook post lays out the current predicament facing Thailand’s film production service industry, the Thailand Film Office and its government counterparts; though it is not merely Covid that needs to be addressed during this time of reflection.
Thailand was very fortunate to have a record-breaking stretch, but this was a worldwide phenomenon – not exclusive to Thailand and not solely due to the newly instituted film incentive. The Thailand film service industry rode a wave of exponentially increased spending by Hollywood studios that grew at a similar rate worldwide.
To address Cod Satrusayang’s Sept 30th (read more here) there is a way for Thailand to build on this previous success in a covid world without calling on a greater financial commitment by the stretched Thai government.
The international film industry is a service industry, hence we need to listen to the clients (Netflix, Disney, Amazon Studios, Universal, Warner Brothers, Sony, Paramount etc.) and adjust to their needs.
The 2017-2019 period was a wonderful teething period for the film incentive and a rapidly expanding industry, as it revealed many strengths of the Thai industry, but also some of its weaknesses.
We as an industry need to tackle these elements head on.
The following are easy fixes that will cost nothing for the Thai government to implement and steps which will bring in more productions to the country.
1. FILM INCENTIVE (Tax Refund) – Clarity and written standards on qualifying expenses
2. FILM INCENTIVE (Tax Refund) – A clear auditing process so that the certified auditors can have an accurate estimate BEFORE the Ministry of Finance review.
3. FILM INCENTIVE (Tax Refund) – More timely payouts. Some of the refunds have not been paid out for 9+ months when they were estimated to pay out within 6 months. There needs to be a regular time frame for the payouts so that the clients know when they will receive their tax refund as cash flow is especially important in film production.
4. EXPIRED FOREIGN TALENT TAX EXEMPTION – this clear policy that the Thai government instituted expired in 2016. It needs to be renewed as there is now a gray area that film studios shy away from.
5. THAILAND’S FILM INDUSTRY AS AN EXPORT INDUSTRY – Currently the film industry is set up within the Ministry of Tourism and seen as a way to promote tourism.
This is a very valid function, but it would greatly benefit all for the Ministry of Finance to get involved and support this industry as an essential Thai manufacturing base (film studios, art department warehouse, costume manufacturers) and export product.
There are numerous Thai based companies and crew members who export their world class products and talent around the world. Thailand benefits from being the base within this region (Vietnam, Cambodia, Malaysia even Japan). Even international productions (such as those from the USA, Australia, UK, New Zealand) use numerous Thai crew, equipment and manufactured goods in their productions. Expanding the incentive to include use of Thai crew and equipment in Thai based multi-country shoots would be an active and easy method of supporting this aspects growth.
Thailand already is at the forefront of the post Covid film industry as it is the only Asian country with a clear government mandated protocol that supports film production, but it needs to address its weaknesses to be competitive in the mid term.
Addressing the 5 points at NO SUBSTANTIAL COST to THAILAND, would help rebuild and expand Thailand’s unsung and underappreciated world class industry.
Thailand needs to prepare to be competitive on the world stage, so it literally does not loose productions such as THIRTEEN LIVES, a story about the Thai cave rescue, to AUSTRALIA because Thailand is not competitive financially for such films.
(Read more on Thirteen Lives here)
Thailand will need a more substantial incentive policy with more active government support, but that can be at a later date. The current system needs to be fine tuned and amended so that it is actively attracting foreign productions.
Nicholas Simon is the founder of Indochina Productions. He has worked on film and cinema in the region for the past three decades and is a member of the Producers Guild of America.