Funding a major hurdle for Latin American animated filmmakers

The Latin American animated film industry has managed several successes by joining forces, but it still works hard to overcome hurdles, particularly insufficient financing, an animated film producer told Latin Business Daily recently.

“In the last three to four years, $20 million to $30 million in animated films, both 2D and 3D, were invested in Latin America," Milton Guerrero, who leads Lima, Peru-based Red Animation Studio, told Latin Business Daily. "In the U.S., a lot more than $1 billion a year is invested."

Guerrero, who produced the 3D animated film A Mouse Tale, said that obtaining funds is perhaps the biggest challenge in Latin America  since animated films are still a niche product there. 

Funds obtained in Latin America usually come from government-sponsored institutions. It is also common for animated film producers to make alliances. A Mouse Tale was a co-production done 77 percent by Peruvians and 23 percent by Argentines.

“It took us three years to produce that movie," Guerrero, 38, said. "Then it had a slow start in Latin America. We could not sell it until it was completed."

The English version of the film was completed by 2014, two years after the film was released initially in Peru and Bolivia. Other countries followed later.

Within Latin America, Peru possibly has the greatest number of 3D animation films, with eight full-length films, Guerrero said. Yet, 2D films produced in other Latin American countries outnumber those of Peru.

A Mouse Tale had a production cost of approximately $2 million. In Peru, it obtained approximately $500,000 in ticket sale revenue while worldwide revenue may have reached $3 million, Guerrero said. 

Because of the high costs of making animated films, as opposed to films with real actors, most producers across the region enter co-production arrangements usually between Latin American countries or with Spain.

Red Animation, which includes a 14-member animated filmmaking support team in Lima, plus smaller teams in Mexico and Brazil, will finish Quackerz, a Chinese-Russian animation film production, in October.

Guerrero and his team are also working the technical aspects of another yet-to-be-released 3D animated film from Peru named Mochica.

Latin American companies are well-established animation outsourcers, but they must compete with companies in India and China, which get bigger government support, Guerrero said.

Some regional governments, such as Brazil, have policies to help film producers by demanding foreign companies hire a percentage of their production crew locally. Others lower taxes in exchange for investments in filmmaking, but those are the exception.

In Peru, film producers can receive one-time cash infusions of $160,000, while in Argentina that could increase to $400,000.

"In Europe, funds can provide up to $5 million,” Guerrero said.