Gov't to inject W17 billion into virus-hit film industry

A movie theater foyer in Seoul is empty amid growing fears over the spread of COVID-19, April 20. / Yonhap

By Kwak Yeon-soo

The Ministry of Culture, Sports and Tourism announced Tuesday that it had formulated additional plans to give financial support to the virus-hit film industry.

The culture ministry said it will provide a 90 percent exemption from charges for a film development fund as the industry suffers cinema closures and all-time box office lows amid the COVID-19 pandemic. The exemption will be applied from February to December this year.

Conventionally, Korea levies a 3 percent tax on ticket sales that goes into the film development fund. With the latest measure, however, movie theaters are required to pay 0.3 percent of monthly ticket sales to the fund.

The number of moviegoers dropped to a record low of 1.83 million in March, the lowest for the month since local box-office data was first compiled in 2004. Total revenue nose-dived 88 percent year-on-year to 15.2 billion won ($12.5 million) in March. Multiplex chain CGV temporarily closed 35 branches across the country in a financial belt-tightening move.

The government's plan includes providing a total of 17 billion won to the entire film industry. Of the total, about 2.1 billion won will be used to support opening marketing for some 20 films that have had postponed premieres. An additional 2.1 billion won will be used to help movie studios resume productions that have been on put on hold indefinitely.

It will also set aside 800 million won to conduct training sessions and give financial compensation to 700 film industry officials who have lost their jobs as a result of the coronavirus shutdown.

The ministry will set aside 3 billion won to encourage movie theaters to hold special screening sessions and 9 billion won to offer 1.3 million coupons for 6,000 won off tickets to moviegoers.

“We hope this set of support measures can help film industry workers, including importers, distributors and producers,” a culture ministry official said.

Despite such measures, film industry-related groups including the Producers Guild of Korea, the Directors Guild of Korea and the Korean Film Marketers Association said they were not enough to help theaters, film distributors and studios stay afloat.

According to them, the government measures do not cover liquidity support for local theaters that have fallen into a cash crisis due to a sharp drop in ticket sales.

The 17 billion won, which is intended to be used to support the film industry, was already part of a 101.5 billion won film development fund allocated in the government budget this year, they argued.