Al-Ahram Weekly   Al-Ahram Weekly
1 - 7 June 2000
Issue No. 484
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Cinema under siege

By Gamal Essam El-Din

One of the main objectives of the Investment Incentives and Guarantees Law passed three years ago was to reinvigorate the Egyptian cinema industry. As such, the law stipulates that cinema companies benefiting from these incentives engage in all aspects of film activity, including production, distribution, establishing studios and cinema houses. Last week, cinema industry magnates gathered at the People's Assembly's Culture and Information Committee to express their dissatisfaction with results of the three-year application of the law. They argued that companies established under this law prefer to conduct distribution activities at the expense of production and establishing studios. The industry representatives accused these companies of swamping the local market with American movies.

According to Farouk Sabri, chairman of the Cinema Industry Chamber, owners of the new cinema investment companies submitted a request to Minister of Culture Farouk Hosni, asking him to raise the maximum number of copies per imported foreign film from five to eight by the end of this year.

Sabry explained that the chamber's present regulations state that the number of foreign movies imported into Egypt should not exceed 300 films per year. If approved by the minister, however, the number will be increased to 360. "It is true that Egypt has lately been swamped with American films, but the approval of the request by the Ministry of Culture would lead in the end to the total destruction of Egyptian film industry," Sabry said.

Cinema Joining forces with Sabry, actor-director El-Sayed Radi argued that the People's Assembly's approval to give a 10-year tax break to a full array of cinema activities was geared towards supporting Egyptian films and not "turning Egypt into a market for Hollywood movies. It is a good thing that investors in this sector were able to build large and luxurious movie theatres" Radi said, "but this is not an end in itself. The incentives also aimed at encouraging them to produce high-quality Egyptian movies. "

Mohamed Kamel El-Qalyoubi, chairman of the National Centre for Cinema, explained that the approval for investment cinema companies to conduct distribution activities had originally been restricted by the stipulation that they produce a minimum number of two Egyptian movies annually. "This has not happened since these companies have ignored production and focused on distribution," El-Qalyoubi said.

In defence of Egyptian film producers, Hassan Ramzi contended that the soaring costs of film production might be responsible for scaring investors away from this activity. "This is mostly due to the promotion costs," Ramzi said. The prices of press advertisements and TV commercials shot up by 50 per cent in one year, for instance. Egyptian movies are also subject to a 15 per cent sales tax, which is not much lower than the 20 per cent tax imposed on foreign films.

Over the past few weeks the serpentine intricacies of fiscal policy have hit the public consciousness as never before. Headlines, television talk shows and even ordinary conversations have been dominated by a single issue -- the recession, or more precisely, what to do about it. Government measures to ease the liquidity squeeze and calm the anxious business community have sparked furious debate, not least the announcement that telecommunications and the power sector are up for privatisation. Hardly the first time such announcements have been made, though this time they have impacted on the public in an unprecedented manner, as has the government pledge to include the new mortgage law during parliament's current session.

Moreover, production patterns of Egyptian films are directed to the summer and Eid (feast) markets only, which restricts the duration of their showing in theatres, Ramzi said. He cited Se'idi Fil Gam'aa Al-Amrikiya (An Upper Egyptian at the American University), a film starring popular comedian Mohamed Heneidi, which generated a mere LE24 million.

Sherif Fanous, manager of Egypt Renaissance Company, claims that his company has actually contributed towards salvaging Egyptian cinema. "We have built an unprecedented number of cinema theatres in different parts of Egypt. The criticism pointed against us, that we made huge profits from distributing American movies, is unfounded," said Fanous, adding that his company had in fact shouldered a loss of LE7 million in 1999.

Fanous believes that it is not the job of cinema investment companies to carry out production activities. "Contrary to what many claim, the distribution of American movies is not a profitable business. It is Egyptian movies that attract the largest audiences and generate the highest profits. But because of the current scarcity of Egyptian movies, we have no choice but to screen American movies," he said.

In full agreement with Fanous, Ramzi said there is only one Egyptian movie, Gunoun Al-Hayat (The Madness of Life), currently showing in cinema theatres.

Doriya Sharafeddin, former head of censorship and now a consultant to parliament's Culture Committee, surprised the audience by defending the position of cinema investment companies. "They really have no choice but to screen American films. It is nonsense to make an issue out of importing 300 or 360 foreign movies per year, especially since three years from now, the General Agreement on Tariffs and Trade [GATT] will lead to the full liberalisation of the cinema industry." She urged the parties involved to follow a "more competitive strategy" that can face up to fierce competition from foreign films.

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