Why you should care

Because getting Hollywood to come to you has ripple effects throughout the economy.

Crikey, mate. What’s that there in the outback? Is it a kangaroo? Or a barbie? No, it’s a Hollywood movie set! Los Angeles is shipping off to Australia this year.

Should you visit the 23-million-strong country that winters when America summers, you might find hunky Liam Hemsworth strapped into armor for Thor: Ragnorak. Or Tinseltown It Girl Brie Larson next to a giant ape in Kong: Skull Island. That’s just scratching the surface. In 2014–15, total foreign production expenditure reached a record $418 million in Australia, more than double the previous year’s amount, and this year, experts predict the Hollywood invasion will bring at least $300 million in offshore investment and more than 3,000 jobs. The stakes are high Down Under.

So why is Hollywood flying half a world away to make its movies? Promoters boast about experienced and driven crews and the antipodes diversity of landscapes (beaches, jungle, outback, cityscapes). But experts say it really comes down to one thing: those incentives, baby. Several years ago came a government-funded, $19.6 million program to boost Australia’s film industry and then, last year, the Turnbull government offered $47 million in grants just for the new Alien and Thor movies, filmed in Australia. Some figure that location offsets nearly double the total amount of the subsidy, to more like $90 million. Move that money over to special effects, and the film looks a whole lot better.

This isn’t the first time Australia’s been a major player, of course: It’s been in the game since the mid-’90s, hosting productions of sequels to The Matrix and prequels to Star Wars, and building up an infrastructure of visual-effects companies that can handle the demands of heavily manufactured films, like The Lego Movie. International film production brought an estimated $258 million to Australia in 2005, according to Screen Australia, but revenues subsequently plummeted because of a more competitive Australian dollar.

With the Australian dollar down again, business is back up. You may have noticed that at the Oscars this year, Mad Max: Fury Road picked up the most awards — and people with comically thick Australian accents kept accepting them. Bear in mind that there will likely be two more of those films. This could all spell a rise in Australian filmmakers: Furious 7’s director, James Wan, and Cannes favorite Justin Kurzel have already become international favorites.

Where a film is made is big business, of course, and locations are constantly fighting it out with incentives and perks: “There’s a worldwide attempt to win production all over the world,” says Richard Harris, of the government agency Screen Australia. Atlanta, with its generous incentives, claims to be the Hollywood of the South. England and Canada, especially Vancouver, rank highly too.

In each case, film production is at least a short-term boon to the local economy, employing everyone from extras to gaffers to caterers. After all, Hollywood generally won’t ship out its stunt crew 8,000 miles away, let alone all of its sound engineers. As a result, many of these remote locations have built up their own film ecosystems. Louisiana, for instance, has a stuntwoman’s association; Stunt Book Australia helps casting directors find their favorite doubles. In Australia, underlings to directors and special-effects makers can cut their teeth on big-time productions before working on their own local ones. It’s about creating “fertile ground for local, national and international productions,” Annabelle Sheehan, CEO of the South Australian Film Corporation, says.

Of course all taxpayer-funded incentives come with some contention. Some Aussie experts contend that Hollywood’s fly-in, fly-out model can cannibalize or otherwise set back the homegrown film industry. There’s a question of basic fairness — why treat international productions better than homegrown ones? — and then there are economic effects: U.S. productions often pay better than domestic ones, according to Australian stunt man Haydn Dalton. Some locations benefit from tourism money, but, let’s face it: Not every film is a Lord of the Rings blockbuster, and there’s only one New Zealand.

As Australia’s own recent history shows, the cinematic good times might not last forever. They often are linked to the economy — the weaker the Australian dollar, the more crews that come ashore. And developing countries might try to cut in as a new dance partner, with the chief impediments being a lack of film infrastructure and sometimes language barriers. But that might all change if these countries were to offer up enough money.

It’s a tricky balance to win, and keep, Hollywood’s oft-coveted investment, but perhaps Hollywood and Australia can keep being best mates.

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