High Canadian Dollar and Hollywood North
As we continue to hear about our strong Canadian dollar many of us are left wondering, what does this mean for investment from our neighbours south of the border? With the CDN dollar remaining fairly parallel with the American greenback we cannot tune out the constant debate as to whether this strength is positive or negative for the Canadian economy.
Although we don’t like to admit our dependence on U.S. investment, one of the largest industries with lots to lose is the film production industry, an industry so successful over the last decade that Canada is endearingly referred to as “Hollywood-North”.
Despite our strong dollar the past few years, Vancouver’s movie production revenue was up $237 million in 2010 compared year-on-year to 2009. However, in comparison to 2008, when the Canadian dollar was significantly weaker, the total revenue made in 2010, $485 million, is significantly less than that of 2008, $662 million. The majority of Vancouver’s recent success can be credited to larger film productions such as Twilight Saga: New Moon and The A-Team, as well as network TV series like Smallville and Supernatural.
Aside from Vancouver, other Canadian cities have found a struggle to maintain film investment. Toronto, which has experienced a constant decline in productions since the outbreak of SARS in 2003, has started to see a turn around in the industry. The newest studio to hit T.O., Pinewood Studios Toronto, has opened up the market and allowed larger projects to come in. Among the larger productions is Total Recall which has recently began productions and will be the largest film in the city’s history.
In an effort to keep filming in the country and avoid the strong dollar from running “business out of town”, many provinces have boosted tax incentives for foreign and local productions. The Canadian Media Production Association (CMPA) states that in order for Hollywood-North to keep its name, “Canada will have to ensure the tax credits are competitive, its crews are highly trained and its production facilities are state of the art.”
While Vancouver has taken over the majority of U.S. series’ like Fringe and Hellcats, Toronto and Ontario have gladly taken a lion’s share of Canadian TV productions, such as Being Erica and Degrassi: The Next Generation. They have also taken on co-production projects, Flashpoint, and last year’s hit series Rookie Blue, which air in both Canada and the U.S. meaning that both sides of the border split the cost of roughly $3 million an episode.
On top of the strong dollar, the epi-centre of Hollywood-North, has a lot to lose if BC’s HST is thrown out. With the existing HST system, BC is said to have a competitive advantage over rival film locations making Vancouver the third largest centre for motion picture production in North America. According to Peter Leitch, a guest writer for the Vancouver Sun, “going back to the 12-percent PST-GST double tax would drive up production costs – killing film production opportunities and sending jobs to Ontario and Hollywood.” It’s estimated that 20% of our film industry would be lost if the HST is voted down. Peter Leitch is the co-chairman of the Smart Tax Alliance, president of North Shore Studios and Mammoth Studios and chairman of the Motion Picture Production Industry Association of B.C.
Written by: Megan Rendell (@MeganRendell)
Image: Susan Gittins
Around Town More Vancouver Happenings
Christy Clark re-elected as B.C. Premier
Best patios in downtown Vancouver
B.C. Election Day: Where To Vote And What To Bring
The Weekender: Rent a cabin as easily as you’d book a hotel room
Dining in Darkness
The Importance of Voting
10 Best Ice Cream Spots in Vancouver: Menchie’s
Vancouver Cheap Eats: Kits Beach