The Telegraph
Sunday , November 25 , 2012
Since 1st March, 1999
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NZ wants a Hollywood put on its map

Wellington, Nov. 24: Standing by his desk in New Zealand’s distinctive round parliament building, known locally as the Beehive, Prime Minister John Key proudly brandished an ornately engraved sword. It was used, he said, by Frodo Baggins, the protagonist of the Lord of the Rings trilogy, and in the films it possesses magical powers that cause it to glow blue in the presence of orcs.

“This was given to me by the president of the United States,” said Key, marvelling that President Obama’s official gift to New Zealand was, after all, a New Zealand product.

In Key’s spare blonde-wood office — with no orcs in sight — the sword looked decidedly unmagical. But it served as a reminder that in New Zealand, the business of running a country goes hand in hand with the business of making movies.

For better or worse, Key’s government has taken extreme measures that have linked its fortunes to some of Hollywood’s biggest pictures, making this country of 4.4 million people, slightly more than the city of Los Angeles, a grand experiment in the fusion of film and government.

That union has been on enthusiastic display here in recent weeks as The Hobbit: An Unexpected Journey, the first of three related movies by the director Peter Jackson, approached its world premiere on Wednesday in Wellington (and on December 14 in the US.

Anticipation in New Zealand has been building, and there are signs everywhere of the film’s integration into Kiwi life — from the giant replica of the movie’s Gollum creature suspended over the waiting area at Wellington Airport to the gift shops that are expanding to meet anticipated demand for Hobbit merchandise (elf ears, $14).

But the path to this moment has been filled with controversy. Two years ago, when a dispute with unions threatened to derail the Hobbit movies — endangering several thousand jobs and a commitment of some $500 million by Warner Brothers — Key persuaded the parliament to rewrite its national labour laws.

It was a breathtaking solution, even in a world accustomed to generous public support of movie projects, and a substantial incentive package was included: the government agreed to contribute $99 million in production costs and add $10 million to the studio’s marketing budget. And its tourism office will spend about $8 million in its current fiscal year.

For a tiny nation like New Zealand, where plans to cut $35 million from the education budget set off national outrage earlier this year (and a backtrack from the government), the Hobbit concessions were difficult for many to swallow, especially since the country had already provided some $150 million in support for the three Lord of the Rings movies.