Culture

Money, money, money: how hit movies help a struggling economy

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After the government debt crisis triggered by the financial collapse of 2007 – 2008, Greece has undergone a long period of austerity. Yanis Varoufakis, ex Greek finance minister called it, ‘a Greek tragedy.’ Varoufakis famously resigned from his position after disagreeing with the bailout measures proposed by the government in 2015. Who, or rather what, might lead Greece through the darkness to the break of a new day?

One means of economic boost in the past has been the filming of big budget Hollywood productions in Greece. Its unique landscape, classical architecture and azure seas make Greece a dream location for producers. Locals are often happy as well, as big budget productions can boost GDP, encouraging tourism and creating considerable job opportunities in the local economy. Several Hollywood movies filmed in Greece have had a direct positive effect on its economy. Luc Besson’s 1988 film, The Big Blue, filmed in Amorgos, the 1989 film Shirley Valentine filmed in Mykonos, Captain Corelli’s Mandolin filmed in Kefalonia in 2001 and Mamma Mia filmed in Skopelos in 2008 all boosted the local economy after release – from local jobs in the entertainment sector to hotels benefiting from maximum occupancy rates and restaurants booked months in advance. According to one study, the release of Mamma Mia increased tourism on the island of Skopelos by 12.5 percent. For the last 10 years however, Hollywood hasn’t been back and Greece has been blue ever since.

Was there a sense of expectation hanging in the Greek air when the producers announced the production of Mamma Mia 2? Did Hollywood hear their S.O.S.? This year’s newly released Mamma Mia 2, set in the same mythical island of Kalokairi was filmed instead, on the Croatian island of Vis. The Croatian economy will reap the benefits and the money, money, money will start to flow in, no doubt also boosted by the success of Croatia’s performance in this year’s World Cup.  Local mayor, Christos Vasiloudis, says ‘It was most disappointing for us that filming didn’t take place here…We were very sad. When the second part of a drama takes place it should surely be in the same place. But maybe it was much cheaper in Croatia.’ The 20% cash incentives offered by the Croatian government to production companies willing to spend at least one million euros in the country surely played a crucial role in the decision to film in Croatia – no winner takes it all scenario here – both Hollywood and the local economy benefiting from such tax breaks. Some have suggested that Vis island will make more four million euros from the movie.

However, the Greek economy is finally on the rise with the economy expected to grow by 1.9 – 2.0 per cent this year. Tourism has played its part in that growth, with record numbers expected to flock to Greece this summer – although perhaps not to the Bella Donna hotel in Kalokairi.  The Greek government, well aware of the benefits of local film production and the opportunities they have missed out on, is clearly in a position to start spending again. They have ear-marked 450 million euros to encourage foreign production companies to film in Greece over the next five years, through similar cash incentives offered in Croatia and elsewhere in Europe, hoping to raise Greece from the bottom of the European Union’s unemployment league table. The Greek government, however, hadn’t quite played all their cards – these incentives had already been in place but were limited to national and not foreign production companies.  With a current unemployment rate of almost 21%, Greece could surely benefit from added foreign investment.

Is Hollywood ready to take another chance on Greece?

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