Ontario film, TV production soar but risks remain

Thu Mar 4, 2010 5:57pm EST
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By Claire Sibonney

TORONTO (Reuters) - Toronto, long a movie stand-in for New York, has led Ontario to an impressive rebound in the cutthroat film and television sector, but a strong Canadian dollar could dull the region's competitive edge.

The industry spent nearly C$1 billion ($970 million) in Ontario last year, up 41 percent from 2008 and the highest level since 2002, according to the Ontario Media Development Corp, an agency of the provincial government.

The rise reflected a hefty new provincial credit that gives foreign moviemakers a 25 percent tax break on a range of production costs, up from 25 percent on only eligible labor costs previously.

But filmmakers say a stronger Canadian dollar could offset some of the gains, as the currency climbs toward parity with its U.S. counterpart.

"The Canadian dollar almost being at par historically has been pretty tough on the film business," Canadian producer Miles Dale told Reuters. "I think it needs to stay south of par for the business not to be affected."

The Canadian dollar is currently worth around C$1.03 to the U.S. dollar, or 97 U.S. cents, down from a peak in November 2007, when it took $1.10 to buy a Canadian dollar.

A decade ago, the Canadian dollar was worth as little as 64 U.S. cents, and the Ontario industry thrived because of its cheap costs in U.S. dollar terms.

Dale is currently in pre-production of "The Thing", a prequel to director John Carpenter's classic 1980s sci-fi horror film, for Universal Pictures, a unit of General Electric Co. In it, Ontario is a stand-in for Antarctica. "The Thing" will also film for a couple of days in British Columbia.   Continued...

<p>Actress Penelope Cruz talks to television crews on the red carpet as she arrives for the gala screening of her new film 'Volver' during the 31st Toronto International Film Festival in Toronto, September 8, 2006 file photo. REUTERS/J.P. Moczulski</p>