Thursday, 31 July 2014

Malaysia's ever-growing entertainment industry

Box office hit: Local movie The Journey which earned a record RM17.16mil is seen as a positive step forward and a sign of better things to come.

Box office hit: Local movie The Journey which earned a record RM17.16mil is seen as a positive step forward and a sign of better things to come.

Film and TV productions contributed greatly to the national GDP last year.

Local movie The Journey recently broke the Malaysian box-office record after raking in a total RM17.16mil in the cinemas. It managed to draw audiences to see it on the big screen, and for repeat viewings, too. This significant development in our film industry is largely seen as a positive step forward and a sign of better things to come.

The release of the report, The Economic Contribution Of The Film And Television Industries In Malaysia, prepared by Oxford Economics, and its launch by the Motion Picture Association recently, can be seen as timely.

The report highlights that in 2013, the film and TV industries in Malaysia directly contributed an estimated RM2.9bil to the Malaysian economy in gross domestic product. This is about 0.3% of total national GDP.

The highest direct contribution came from TV programming and broadcasting at RM1.6bil, while film production was second highest at RM540mil.

These industries directly supported about 10,994 jobs while generating about RM366mil in tax revenues.

According to the statistics from the National Film Development Corporation (Finas), a total 71 films were produced in 2013 at a total production cost of RM139mil. Currently there are 124 cinemas around the country with 774 screens and 141,471 seats.

But according to the Oxford Economics report, film production alone made up 50% of the whole Malaysian film production, distribution and exhibition sector’s GDP and 44% of its jobs.

It says industry productivity is well above the national average. But even though Malaysia is a relatively small player in terms of film production due to its relatively small market and population, it has “developed niche skills in the animation market and the Malaysian government has set out a strategy to develop the country as a film hub.

“The recent introduction of tax breaks for foreign and domestic film productions and the opening of the US$120mil (RM387mil) Pinewood Iskandar Studios ... represent important steps in this direction.”

Communications And Multimedia Deputy Minister Datuk Jailani Johari said in his speech at the launch: “In the recently launched Economic Transformation Programme 2013 report, the Malaysian creative industry brought in over RM564.89mil in export revenue, with films such as War Of The Worlds: Goliath, Vikingdom and Life Of Pi making waves overseas.”

He also pointed out that there are several Malaysians and Malaysian companies doing commendable work for Hollywood.

“Malaysia’s expertise in digital innovation and creativity is best epitomised by the Oscar-winning movie Life Of Pi where 45 Malaysians were involved in the digital animation portion of the blockbuster directed by Ang Lee,” added Jailani.

Senior vice president and deputy managing director of the MPA Frank S. Rittman said the Malaysian industry is a vibrant and growing one, and that last year, cinema exhibition experienced double-digit growth.

“Certainly the opening of the Iskandar Studios in Johor Baru, and KRU Studios right here in KL, have provided tremendous opportunities for future growth,” he added.

The MPA also carried out studies and commissioned reports on the industries in India and Taiwan recently. Asked how Malaysia stacks up against the other countries, Rittman declined to make comparisons.

“It’s difficult to compare, because of the population in India, and also it’s the biggest movie industry in the world,” he said. “But in terms of GDP growth contributions, however, Malaysia is neither at the top nor at the bottom.

“We try not to put comparisons on our summary charts because people focus too much on that. But for example, when we looked at Japan’s economy two years, it was US$145bil (RM468bil) to their economy. China’s was estimated at about US$43bil (RM$139bil). It was just huge.”

The number of productions in Malaysia is so much smaller, so he thinks it is not a fair basis for comparison. While the most prolific film industry is India, the second most prolific, Rittman pointed out, is surprisingly Nigeria.

“In the US, we generally release 200 to 300 movies a year,” he said. “There are many more, of course, that are direct to video and for TV.”

He feels the film and TV industry is the business that Malaysia should be encouraging, as the average wages are 4% higher than the national average. And he also pointed out that there is a healthy competition going on now in the animation industry between Malaysia and Singapore.

Said Jailani: “This report is valuable. It not only gives us a picture of our industry’s growth, but it also gauges the industry’s potential. The government has put in place a lot of incentives, and one of its policies is to make Malaysia a production hub.

“I hope everyone will take advantage of the incentives and increase production and also skilled personnel so that our industry can be at par with others around the world.”

Tags / Keywords: Motion Pictures Association , The Economic Contributions Of The Film And Television Industries In Malaysia , Oxford Economics

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