Boosted by world-class incentives, Spain’s Canary Islands has attracted the shoots of some of the higher-profile movies on earth from “In the Heart of the Sea” to “Wonder Woman 1984” and “Eternals.”
Now, however, a homegrown Canary Islands cinema is bursting onto the scene, a Canary Island New Wave cinema lifting off, hitting festivals and making ever more insistent production news.
If a date can be attributed to the event, it may be March’s Malaga Film Festival.
Already playing Berlin’s Forum, Macu Machín’s “Undergrowth” won ZonaZine, Málaga Festival’s edgier main sidebar.
Two Canary Islands projects were pitched at the Malaga Festival Fund & Co-Production Event (MAFF): Lucía Pérez’s Locarno hit “Ever & the Sharks” and Víctor Moreno’s anticipated fiction feature debut “The Outside.”
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Malaga’s Spanish Screenings featured Canary Island production “I’m Gonna Disappear,” Coré Ruiz’s tale of two estranged brothers.Another Spanish Screenings title, David Baute’s animated feature “Black Butterflies,” co-produced from his Tinglado Films at Santa Cruz de Tenerife, has gone on to be selected for the Annecy Animation Festival next month.
Why the Growth?
Why the Canary Islands cinema has suddenly seemingly exploded onto the scene is another matter.
The Canary Islands cinema hasn’t grown from a vacuum, Tinglado Films’ Baute observes. The Ríos brothers – Santiago, Teodoro, Roberto – made features from the ‘70s, most notably 1987’s “Guarapo.” Produced by Aurelio Carnero, Rolando Díaz’s “Si me comprendieras” (1999), played Berlin and Toronto. The Festival de Cine de Las Palmas de Gran Canaria launched in 2000, MiradasDoc in 2008. “These events were a breeding ground for many young filmmakers, showing that a different type of cinema was possible,” Baute recalls.
The launch of big foreign shoot incentives sparked a counter-reaction.
“One thing that I believe also influences many of our generation of filmmakers including Macu Machín, Victor Moreno, David Pantaleón, Nayra Sanz, Octavio Guerra, Marina Alberti, and so on is the idea that a tax incentive exists here,” El Viaje Films co-founder José Ayalón has toldPvNew.“It has made us feel the need to react and for us to tell our own stories.”
Parallel to this, the Canary Islands government saw the audiovisual sector as a factor for diversification for an economy over dependent on tourism, Canary Islands Prime Minister Fernando Clavijo Battle tellsPvNew.
“In a second phase of our strategy, jointly with the rest of partners of Canary Islands, we’re are trying to attract foreign companies to settle in the Canary Islands and local companies to grow, bringing local stories, international producers, creating a Canary Islands film hub,” says Pablo Hernández, president of the Consortium of the Canary Islands Special Zone (ZEC), which offers preferential tax provisions for an outermost region of the E.U.
That strategy cuts several ways. Having seen Spain’s federal government launch and increase big shoot incentives, set because of ZEC at about 80% higher in the Canary Islands, a service industry has rapidly grown in the Archipelago, now reaching full maturity.
From 2019, the Canary Islands government put its back behind the launch of direct subsidies for local film industry. Development grants have been given to 43 titles, 29 for production.
All told, including spend from international shoots, audiovisual now represents 3% of the Islands’ GDP, says Clavijo. €1,375,000 in 2019, total project subsidy funding has nearly doubled to €2.8 million in 2024.
Canary Islands Special Zone (ZEC) has also set out to encourage foreign companies and producers to create offices in the Islands. To do so, it offers just 4% corporate tax rate for companies setting up shop in the Islands, which enables not only to take advantages for shooting but also adds financial efficiency to managing the IP and performing marketing and distribution from the Islands. That compares to a normal 25%-30% rate. In addition, there’s no dividend, nor interest nor capital gain taxation, Hernández observes.
“The local administrations are very supportive if you decide to create your production company there,” says Carlota Amor at Garajonay, which set up shop in the Canary Islands last year.
Production incentives on foreign shoots are hugely attractive offering 50% of eligible local spend, which can be advanced before shooting at a very low interest rate.
Producers can come and already have that incentive in place before shooting not after, which is hugely advantageous,” says Anaga Media Productions’ Malena González. “We went to Berlin and people were like: ‘But does this really work?’”
Working a Two-Way Street
Yet the international shoot scene and local production sectors are hardly separate silos. Companies which have made the move to the Canaries are often looking to twin services and own production. Garajonay provides production services and produces its own films. Anaga Media Productions is looking to go the same way, developing “Black Lotus,” having provided production services on the Elizabeth Avellán-backed “Bruha” with Anaga partners Gisbert Bermúdez and Gonzalez wearing creative hats as the film’s director and star actress.
Twinning services and own production, together with the option of being a ZEC entity, “is a very attractive business model,” says Clavijo.
Lucrative production services can co-finance own production which creates company asset value, via IP ownership, notes Sebastián Álvarez at Volcano Films. Also, “Experience gained in giving production services, with their international connection helps our own independent production. Our own production makes us render services in a very different way,” he adds.
Delivering More Bang for Your Buck
Macro-economic concerns are on the Canary Islands’ side. One of the global industry’s biggest challenges is spiraling production costs. As costs spiral, “soft money allows us to make the films we want to produce, bigger films,” which are competitive in terms of talent and production costs, says Amor.
As platforms have pulled back in content investment, under Wall Street pressure, everybody everywhere is looking for larger pricing efficiency.
“Service providers who have a stable presence in the Canary Islands frequently call the same providers and artists, achieving larger pricing efficiency, Hernández observes. “We have one of the top rebates in the world. But if you do it from here they become even more efficient shortly with low taxation,” Hernández adds.
Future Growth
The large question is how to grow the Canary Island productionhub all the more.
“The future lies in the training of locals to generate local employment as well as the increase in budgetary allocations for cinema so that Canarian productions can compete in salaries with foreign productions.And what is very important is that script aid is maintained for local screenwriters,” says film director Omar Razzak Martínez at Tourmalet Films (“Killing Crabs”).
One solution is to explore in films the Canary Islands themselves. The Canary Islands are more than a backdrop, Machín toldPvNew. “There is a whole world in the Islands.”
At El Viaje Films, Ayalón has gone into production on “La Lucha,” a father-daughter relationship drama set against the background of lucha canaria wrestling, a contact sport dating back to ancient times.
Ayalón says that lucha canaria is “more than a sport, it is almost a rite, something that has been practiced in the Islands since the first Berber settlers. We believe that there is something that remains there, something root, a core, of our idiosyncrasy.”
Companies are working different growth axes at one and the same time. In development, Tourmalet has two animated features, two fiction movies and two documentaries, Razzak Martínez tellsPvNew.
Filmmakers aim to scale up. “We have to make our projects bigger, making the industry more attractive, precisely to attract international talent in our own productions,” says Garajonay’s Amor.
Companies are moving ever more into international co-production, tapping foreign state-sourced equity as movies cost more.
“The next step, which has begun in the last two or three years, is international co-production, says Tinglado Films’ David Baute.
As a sweetener the Canary Islands launched a minority co-production fund last year.
“We’re very interested in forming part of other international co-productions, tapping aid via the Canary Islands Government’s minority co-production fund,” say Calibrando founders Elisa Torres and Octavio Guerra.
ZEC aims to attract more foreign companies. That also means growing the Canary Islands ecosystem by further training.
The Islands already offer a slew of labs, such as script development workshop Islabentura, MiradasDoc’s Creadoc or training facilities related to Las Palais de Gran Canarias’ Mecas market and the CIIF market.
“There’s a small supply for a big demand,” says Gisberg Bermúdez at Tenerife’s Anaga Media Productions which plans to create its own training facility.
Currently Garajonay Canary Islands productions employ about 30% local crew. 50% of Anaga’s crew were Islands-based, 30% from the Spanish mainland, 20% from the Americas.
Garajonay’s Amor would like to raise that percentage, both to lower production costs, and to grow the Canaries industry.
That’s no pipe dream. In animation, the Canary Islands governmental push to attract companies started slightly earlier, in 2017, and production times are longer, allowing qualified foreign staff more opportunity to train local animators. In 2018, the local/foreign crew ratio was 30%/70%, now it’s reached around 50%/50%, says Hernández.
Challenges remain, however, Clavijo notes: Two he cites are training and “more agile in administrative procedures.”
Yet huge progress in a short time has been made in the creation of a Canary Islands Cinema.
“Little by little Canarian cinema is positioning itself on the front line. Awards, selections and international recognitions are increasingly common among our filmmakers. And that’s the line that must be followed: betting on an audiovisual policy that supports our talent,” Clavijo enthuses.
