Russia Cuts Film Subsidies Amid Economic Crisis

Associated Press

The head of the Russian Cinema Fund says $36 million left after $2.8 million cut will be used "more efficiently."

Russia has cut its public film subsidies for the year by $2.8 million, or 7 percent, the country's Cinema Fund has announced.

Although 2016 has been declared the "Year of Cinema" in Russia, the Cinema Fund's budget for supporting film has dropped from 3 billion rubles ($38.8 million) to 2.8 billion ($36.0 million).

Fund head Anton Malyshev urged production companies that receive grants to use the money more efficiently.

"Our grants, which are distributed directly, have shrunk, but in terms of efficiency, I think [their impact] will be more," said Malyshev.

Most money, made in direct grants to production companies that are only returnable to state coffers if recipients make a profit on their movies, goes to a select group of leading production companies, including that of Oscar-winning director Nikita Mikhalkov.

Although few co-productions are shot in Russia, money is available to foreign producers who partner with Russians provided the projects meet cultural and other criteria.

This year, $23 million will go the top companies, with the rest being distributed throughout the industry.

Although Malyshev did not specify the reason for the reduction in the subsidies, Russia's economic crisis — sparked by falling oil prices and a collapse in the value of the ruble against the dollar and other foreign currencies in the past year — has been causing public sector cutbacks throughout many industries.

The film fund does have contingency reserves for special cases, Malyshev added, though new rules stipulating that production companies must open accounts with the state treasury to receive the grants will make distribution of money more complex this year.

Last year was the worst for Russian film at the domestic box office in a decade, with homegrown films' market share slipping to 15 percent, down from 19 percent in 2013. Box-office receipts more than halved from $258 million in 2013 for 59 releases to $116 million for around 125 releases in 2015. That partly reflected the damage wrought to producers' bottom line by the ruble's catastrophic drop in value. In 2014, a dollar was worth around 35 rubles. Today, a dollar is worth more than 75 rubles.

Meanwhile, Russia’s culture ministry denied that it had turned down director Konstantin Bronzit’s application for funding of his Oscar-nominated animated short We Can't Live Without the Cosmos.

“That’s a shame that Konstantin rejected our financial support and then he says something different,” the agency said on its Instagram account.

Last week, Bronzit told a news conference that the project didn’t receive “a single ruble of state support,” although his producers had applied for funding three times.

This is Bronzit’s second Oscar nomination. Back in 2009, his film Lavatory Lovestory was nominated in the same category.