Saudi Arabia To Launch $233m Film Financing Program Open To Local & Professional Entities in Q1 2023
Saudi Arabia’s Cultural Development Fund is poised to launch a new $233m ($879m Saudi Riyal) film industry financing program in the first quarter of 2023, which will be open to both local and international entities.
The new fund joins a raft of initiatives introduced by the Saudi Arabian government to support the building of a film and TV sector in the wake of the lifting of the country’s 35-cinema ban at the end of 2017.
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That move was part of a wider strategy to open up the country and move its economy away from a reliance on oil. Other key supports include a 40% rebate for production.
Bannered the Film Sector Financing Program, the aim of the new funding line is to stimulate the growth of a sustainable film industry and encourage private entities to get involved in the sector.
The monies will be meted out across various different financial packages targeting different parts of the production, distribution and exhibition chain.
There will be two key funding streams: a lending stream, under which companies can take out loans and keep ownership of their projects, and an investment stream, aimed at production and infrastructure projects.
The Culture Development Fund was launched in December 2021 as one of 16 development funds supporting different sectors of the economy, all of which are linked to Saudi Arabia’s National Development Fund.
The fund was among a number of Saudi organizations attending the Red Sea Souk market this week at the Red Sea International Film Festival, running in the port city of Jeddah from December 1 to 10.
The body’s role is to support the strategies put in place by the Ministry of Culture and its 11 different commissions covering the different cultural sectors, from film to fashion and dance.
“As a cultural development fund, we are a financial enabler for the national cultural strategy,” explained Chief Strategy and Business Development Officer Najla AlNomair.
“We look at the national cultural strategy, we look at the targets and objectives that it wants to achieve. And we think where financial intervention could make the biggest impact or accelerate the achievement of those targets.”
The fund’s services are not targeted directly at bodies like the film commission the culture centre Ithra or shooting hubs like Neom and UlUla but rather private entities that want to work within the country’s growing film and TV ecosystem.
“We provide financial services and non-financial services. The financial services could be loans, right, bank guarantees, or equity options. We also provide non-recoupable funds in the forms of subsidies or grants on an occasional basis that doesn’t come out of the government allocation,” said AlNomair.
The development fund’s end game, she said, was to create a film and TV industry eco-system that is not entirely reliant on government funding.
AlNomair is a Queensland University graduate who has held different roles in Saudi Arabia’s public cultural sector since 2012, including stints at Ithra, the General Entertainment Authority (GEA) and the Ministry of Culture.
She noted that the Cultural Development Fund can also help out with gap financing, citing as an example a company that had managed to tap into the country’s 40% rebate for production but needed help with cash flow while the monies came through.
“You start working, shooting but cash flow is a problem. That’s where we come right, we can give you a loan for you to be able to work on your film. And then once that’s done, and once you get your money paid to you, you can pay us back. The guarantee doesn’t have to be the rebate, it could other forms of income such as a sales contract or a streaming deal,” she said.
AlNomair said the body does not differentiate between local and international companies, although entities tapping into its financial support need to have an office or a partner based in the country.
“We require an address in Saudi Arabia for your application. That can be achieved by either opening your own office with a commercial registration to practice in Saudi Arabia, or working with a partner based here that has the right to apply,” she explained.
AlNomair emphasizes that the fund’s film support is not restricted to producers but to activities across the industry, from props to music libraries
“It’s for all the activities below the line, to support the industry overall, not just production,” she said.
The new Film Sector Financing Program was first announced at the global technology platform LEAP, hosted by Saudi Arabia last February.
AlNomair said the new program will be the best way for international industry professionals to tap into the Cultural Development Fund’s support.
“I would advise them to wait for the launch of the Film Sector Financing Program because it’s extremely focused on them. It will make it easier for them to get funding because it’s designed around their needs and everything that they want. There is a special team designed to review the applications.”
Professionals can register their interest via a form on the CDF website.
“We don’t have a launch date yet, but we’re aiming for as early as possible. January is our aim, but if not, it will definitely be the first quarter. The best thing is to sign up and as soon as it launches we will send out an email to everyone who has registered,” said AlNomair.
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